Economic and market impact

Our core business and additional undertakings generate positive impulses in the Polish economy. We contribute significantly to the creation of added value, jobs, income for the population, and through the taxes we pay ─ we also contribute to the development of the region.

Economic and market impact

PSE's impact on Poland's economy in 2020

Key numbers

Economy and market

PLN 6.58 billion

of added value generated in the Polish economy

PLN 916.1 million

in wages and salaries generated in the Polish economy

PLN 996.13 million

total amount of taxes and contributions paid to the national budget and budgets of local government authorities

Workplaces

17 957

maintained jobs in the domestic market

PSE's priority is to ensure current and long-term operational security of the power system in Poland. The company's tasks include: maintenance and development of the transmission network, management of the national power system, including network balancing, as well as cooperation with other TSOs.

Ensuring the safe functioning of the system has a significant impact on Poland's economic growth, which is reflected in increased income and quality of life of Poles. Such an impact of PSE on economic growth is possible owing to the company's cooperation with numerous entrepreneurs.

As a payer of taxes and other fees, we have a positive impact on local, regional and national budgets, making it possible to fund many significant investments.

We are a strategic company, but also an important employer and a key customer and business partner for many businesses. Through its daily activities, PSE has a significant impact on the entire Polish economy and individual industries.

The scale and scope of our operations make our company also a significant payer of contributions, fees and taxes to the national and local governments. These funds go to both the central and local government budgets and are then used for investment and activities to improve the lives of Poles.

We exert a positive influence on all branches of the Polish economy: the power sector, trade, construction, professional and business services as well as agriculture, hotel and catering industries. We generate this impact through all elements of our value creation model, i.e.:

Managing the operation of the national power system;
Execution of investment, modernization and overhaul tasks with regard to network assets;;
Management of human resources and active cooperation with the company's environment.

The input-output model (Leontief model) was used to analyze the economic impact of PSE activities. It shows the impact of our activities in three categories:

Value added generated in the economy

Employees hired and new jobs created

Salaries paid

Thousands of miles of power network in three dimensions

We used three key areas for growth to show the broad economic and social impact of our business: value-added, jobs and wages.

Each of these impact metrics can be assigned three dimensions through which we support the development of the Polish economy and improve the quality of life of Poles:

Direct dimension – resulting from PSE's core business.
Indirect dimension – generated among contractors and entities in related industries.
Induced dimension – further growth generated by household income growth.

In this year's report, in addition to the impact of operations, the impact of capital expenditures (CAPEX)¹ was calculated. Investment demand is the component of final demand in the economy that provides the momentum for global output. Using Leontief's model, input-output multipliers were calculated to show how an increase in final demand translates into an increase in global output.

[1] 83.14 percent were included in the analysis. total investment expenditure incurred by PSE in 2020.

PSE's impact on the polish economy in 2020

PLN 2,78 bn
value added

2 627
jobs

more than PLN 234 m
wages

more than PLN 2,1 bn
value added

8 529
jobs

more than PLN 380 bn
wages

PLN 827 m
value added

4 265
jobs

more than PLN 159 m
wages

PLN 843 m
value added

2 536
jobs

more than PLN 142 m
wages

Fig. 1. Inter-branch flow model visualisation

Generated added value

Value added is the difference between global output and indirect consumption.

Global output is the sum of:

revenues from sales of products (goods and services) of own production,
change in inventories,
manufacturing cost of products for internal purposes,
trading margin on goods purchased for resale.

Indirect consumption includes the total of: the value of net materials used, raw materials, fuels, energy, industrial gases, third-party services, business travel expenses and other costs².

[2] For PSE, indirect consumption was calculated from income statement data by aggregating costs to the level of the industries included in the model. Next, the so-called stranded costs and the funds transferred by PSE to the Settlement Administrator under the RES fee were subtracted, as these costs are not an element of indirect consumption. This approach was also used in the 2017 and 2018 calculations.

Value added generated by PSE operations excluding capital expenditures:

PLN 6.58 billion – total added value generated in the Polish economy in 2020 thanks to the operations of PSE, including capital expenditures incurred for the construction, extension and modernization of substations and power lines.

Operational activity

Investment activities (capital expenditures incurred for construction, expansion and modernization of substations and power lines)

Value added generated by PSE operations excluding capital expenditures:

PLN 5.74 billion – total added value generated in the Polish economy in 2020 thanks to the PSE operations.
This is close to the PLN 6 billion that has been allocated to support all communes and counties in Poland in 2020 under the Government Local Investment Fund³.

PLN 2,78 billion - direct value added generated by PSE in the power sector (generation and transmission of electricity).
In the industries where PSE purchases equipment, materials and services, and in related industries, the company contributed a total of more than PLN 2.1 billion in added value.
Salaries paid to PSE employees, suppliers and subcontractors employees across the supply chain generated induced value in 2020 of PLN 827 million.

[3] https://www.gov.pl/web/premier/rzadowy-fundusz-inwestycji-lokalnych

Compared to 2019, the value added generated in the economy in 2020 due to PSE activities was higher by PLN 351 million.

Value added generated in individual industries by PSE operations excluding capital expenditures in 2020 (in PLN thousand)

Value added generated by PSE's investment activities⁴:

PLN 843.2 million – the total added value generated in the Polish economy in 2020 thanks to PSE's investment activities related to the construction, extension and modernization of substations and power lines.

Value added generated in individual industries thanks to PSE's investment activities in 2020 (in PLN thousand)

[4] 83.14 percent were included in the analysis. Total investment expenditure incurred by PSE in 2020.

Remuneration

Wages are one of the most important measures of the wealth of households, and at the same time - the guarantee of meeting the needs of their inhabitants. Through their operations and employment of their own employees and their indirect influence on contractors, suppliers, and subcontractors, PSE generates additional wages in many sectors of the national economy.

Wages and salaries generated by PSE operations including capital expenditures incurred:

PLN 916.1 million – the total value of wages generated in the Polish economy in 2020 thanks to the operations of PSE, including capital expenditures incurred.

Operational activity

Investment activities (capital expenditures incurred for construction, expansion and modernization of substations and power lines)

Wages and salaries generated by PSE operations excluding capital expenditures incurred:

PLN 773.5 million – total value of wages generated in the Polish economy in 2020 thanks to the PSE operations.
More than 234 million in net wages at PSE in 2020.
Thanks to purchases from suppliers and links in the economy between individual branches, suppliers and sub-suppliers were able to pay their employees wages of over 380 million PLN.
The national economy saw further wage growth driven by increases in income and household consumption. These are induced generated wages. Their value in 2020 amounted to over PLN 159 million.

3,3

Multiplier effect

Every 1 PLN spent on net wages at PSE is an additional more than 2 PLN generated for wages across the economy.

Compared to 2019, wages generated in 2020 in the economy due to PSE operations were higher by PLN 106,862 thousand. This amount would allow the payment of the "Good Start" benefit to 356 children⁵.

[5] The benefit amount per child is PLN 300.

Wages generated in each industry by PSE operations excluding capital expenditures in 2020 (PLN thousand)

Wages generated by PSE's investment activities

PLN 142.5 million – the total value of remuneration generated in the Polish economy in 2020 thanks to the investment activity of PSE in the scope of construction, extension and modernization of substations and power lines.

Wages generated by PSE investment activity by industry in 2020 (PLN thousands)

Employment

Employment is a significant area of both economic and social impact. PSE, through its operations, not only creates and maintains jobs within its organization, but also impacts employment at suppliers and related entities throughout the economy.

Number of jobs maintained through PSE operations including capital expenditures:

17,957 jobs – the total number of jobs maintained in the Polish economy in 2020 due to PSE's operations, including capital expenditures.

Operational activity

Investment activities (capital expenditures incurred for construction, expansion and modernization of substations and power lines)

Number of jobs maintained through PSE operations excluding capital expenditures incurred:

15,421 jobs – the total number of jobs maintained in the Polish economy in 2020 thanks to PSE operations.
In 2020, the average number of employees at PSE was 2,627.
Through daily operations, investments and other tasks where PSE cooperates with many companies in various industries, we maintain 8,529 jobs in various industries.
The induced effect of PSE operations is 4,265 jobs in the overall economy.

5,87

Multiplier effect

1 job at PSE equals almost 5 (4,87) additional jobs created in the overall economy.

Compared to 2019, the number of jobs maintained in 2020 in the economy due to PSE operations was higher by 1994.If all these people came from the county of Przasnysz - registered unemployment in this county would drop to zero⁶.

[6] 1994 - Registered unemployed in Przasnysz County, as at the end of 2020, https://bdl.stat.gov.pl/BDL/dane/podgrup/tablica

Jobs maintained by industry due to PSE operations excluding capital expenditures incurred in 2020 (number of jobs)

Number of jobs maintained through PSE's investment activities:

2,536 jobs – the total number of jobs maintained in the Polish economy in 2020 thanks to PSE's investment activities in the construction, expansion and modernization of substations and power lines.

Jobs maintained in specific industries due to PSE's investment activities in 2020 (number of jobs)

Taxes and charges

We conduct the investment scheme for the development of the power transmission infrastructure, which is one of the largest investment scheme in Europe. We make a significant contribution in taxes and other fees that constitute government revenue. Numerous public investments, made possible by tax and other revenues, allow for increased transportation accessibility, environmental protection, education and improved quality of life, among other things.

PLN 996.13 million – total amount of taxes, fees and social security contributions paid to the state budget, budgets of local government authorities and the Social Security Fund in 2020 by PSE. This amount is comparable to the amount provided in 2020 by the Voivodship Fund for Environmental Protection and Water Management in Katowice as part of the subsidies for activities related to environmental protection in the Silesian Voivodship⁷.

The total amount of taxes, fees and contributions was 50.89 million higher than in 2019.

PLN 230.35 million – the sum of payments for income taxes (PIT and CIT) in 2020.

[7] https://www.wfosigw.katowice.pl/9-aktualnosci/2665-rekordowy-wynik-miliard-zlotych-na-ochrone-srodowiska.html

This is the breakdown of all taxes paid by PSE to the state. The central budget receives 65 percent of the total amount of taxes, while local budgets receive 35 percent.

Nearly 65 percent of the taxes, fees, and premiums paid by PSE in 2020 are paid to the central budget. These were paid for taxes, a summary of which is shown in the chart below.

The remaining 35 percent percent are premiums made to local budgets, broken down as follows:

In-house indicator

The largest local tax beneficiaries

The total amount of taxes paid by PSE to the provincial budgets exceeded PLN 26.3 million.

In Łódź, in 2020 a similar amount was allocated to support unemployed people who wanted to start their own business activity⁸.

In 2020 PSE has contributed more than PLN 9 million to the county budgets.

[8] The total amount available for co-financing is PLN 25 million https://uml.lodz.pl/aktualnosci/artykul/25mlnzl-nazalozenie-wlasnej-firmy-wlodzi-id36490/2020/9/15/

In 2020, PSE paid more than PLN 317.7 million in taxes to municipal budgets.

For a similar amount, i.e. PLN 300 million, the local government of Stalowa Wola will build 1,250 council flats⁹.

[9] https://inwestycje.pl/nieruchomosci/samorzad-stalowej-woli-za-300-mln-zl-wybuduje-1-250-mieszkan/