26.1 Market risk

Market risk covers commodity risk, interest rate risk, currency risk.

The main objective of market risk management at PGE Group is to protect the financial result and maintain the level of risk resulting from commercial and financial activities at an acceptable level and to support the implementation of the business strategy and maximisation of the Group’s value for shareholders.

PGE Group’s procedures for managing specific market risk categories in trade and finance activities specify the following:

• objective, scope and rules for managing risk;
• scope of responsibility for managing risk;
• management and operational processes within risk management in trading on electricity markets and related product markets and as regards financing activities;
• ways of identifying sources of exposure to risk;
• permitted instruments for hedging exposure to risk;
• methods for measuring and monitoring exposures to risk;

The market risk management rules applicable at PGE Group also specify the method of determining the market risk appetite, limiting market risk exposures and the mechanisms for securing exposures when limits are exceeded.