The nature of core activities of the Group is manufacture and rendering of services. The Company is the parent company of the Group. The Company generates and supplies heat to consumers (for the purposes of heating and hot water making) in the cities of Kaunas and Jurbarkas and in Kaunas district (Akademija town, Ežerėlis town, Domeikava village, Garliava town, Girionys village, Neveronys village, Raudondvaris village), (hereinafter referred to as Kaunas district).

Also, following provisions of the Law on Heat Sector, the Company supplies hot water (is engaged in hot domestic water supplier activities) from 1 May 2010 for consumers in the cities of Kaunas and Jurbarkas and Kaunas district (hereinafter the supplies of heat and hot domestic water without cold water are referred to as heat, with the exception of information provided in Tables 7 and 8 “Comparison of financial indicators of the Group and the Company of the year 2016 with the indicators of the years 2012–2015”), who chose the Company as a hot water supplier. As at 31 December 2016, the Company was a hot water supplier for 475 residential buildings in Kaunas and Kaunas district and 5 in Jurbarkas. Income from hot water supplies amounts to approximately 4.3 per cent of all of Company’s sales revenue.

In addition, the Company also maintains engineering structures (collectors – manifolds) and operates heat and electricity production facilities. The Group and the Company carries out a supervision of indoor heat and hot water supply systems, maintenance of heat unit equipment, repairs of heat units and other heating equipment, provides rental services premises under particular agreements. The Group and the Company are engaged in licensed activity in accordance with the licenses held. On 26 February 2004 the National Commission for Energy Control and Prices (hereinafter – NCC) issued a heat supplier licence to the Company. The licence is valid indefinitely. Maintenance of indoor heat and hot water supply systems is pursued following the provisions of Article 20 of The Law on Heat Sector of the Republic of Lithuania.

The vision of the Group and the Company is to be a modern, effective, competitive, and added value for shareholders creating group of companies engaged in heat and electric energy generation, supply of heat and hot water, maintenance of indoor heating and hot water supply systems and property lease.

Values of the Group and the Company:

• professionalism;
• reliability;
• transparency;
• being proactive;
• responsibility;
• cooperation.

Strategic goals of the Group and the Company:

• To implement strategic development plans formed by shareholders;
• To properly contribute to the implementation of goals of National Energetics Strategy;
• To reduce dependence from imported fuel, i.e. natural gas;
• To increase competition in heat generation sector;
• To expand current position of the Group companies in the market;
• Development by offering new products and services;
• To ensure implementation of Energy Efficiency Directive 2012/27/EU.

Principled guidelines of Company’s heat economy strategy are as follows:

• Increase and expansion of heat economy – Kaunas city needs at least one bigger than 100 MW capacity modern, up-to-date production facility – cogeneration power-plant, using renewable energy sources (hereinafter – RES) and / or waste, and / or natural gas. New power-plant should ensure tankage / use of reserved fuel, reservation of heat production facilities, stable hydraulic mode of centralized heat supply, flexible reaction to network peak demand changes, should have an emergency replenishment system and should be economically “balanced”;
• Increase of safety and reliability of heat supply – the Company intends to formulate an expert assessment of safety / vulnerability of heat supply system, to implement update and modernization of system of parameters data transfer, collection and evaluation, to implement optimization of the network hydraulic mode and increase of speed of parameters reaction / change, to reconstruct and optimize sections of thermofication pipelines and elements (average age of pipelines of district heating network (hereinafter – DHN) reaches approximately 30 years), to implement update and development of the system of DHN water reserve – emergency replenishment, to implement technical solutions and / or use a good practice increasing reliability and safety, ensuring stability of thermofication mode;
• to actively participate in formation of policy of Kaunas city supply with heat and in increase of Company’s desirability and in expansion of district heating market;
• formation of good practice and its publicizing.

Company’s total energy generation capacities installed as at 31 December 2016 were 596 MW, whereof:

• heat generation capacities – 587 MW,
• electricity generation capacities – 8,75 MW.

Energy is being generated in following facilities:

• Petrašiūnai power-plant,
• 4 boiler-houses functioning in Kaunas integrated network (Šilkas, Inkaras, Pergalė and the boiler-house at A.Juozapavičiaus av. 23),
• 7 district boiler-houses in Kaunas district,
• 1 boiler-house in Jurbarkas city,
• 13 boiler-houses of isolated networks,
• 27 local gas burned boiler-houses in Kaunas,
• 8 local water heating boiler-houses in Sargėnai catchment,
• 1 boiler-house of subsidiary UAB Petrašiūnų Katilinė, functioning in Kaunas integrated network (19,2 MW).

Fuel, used by the Company for heat and electricity production in the year 2016 was as follows:

• Solid biofuel – 81.31 per cent,
• Natural gas – 18.29 per cent,
• other fuels – 0.40 per cent.