Poland’s Energy Regulatory Office has awarded contracts for difference (CfD) for offshore wind capacity to two industry teams, led by Ørsted and PGE, and RWE, respectively
The Baltica offshore windfarm being developed by Ørsted and PGE – the largest offshore wind project in the Polish sector of the Baltic – has therefore moved an important step closer to realisation, as has a 350-MW project promoted by RWE Renewables.
The 350-MW FEW Baltic II windfarm is being developed by Baltic Trade and Invest, which is a subsidiary of RWE. In December 2020, RWE signed a grid connection agreement for the FEW Baltic II project, which is located north of the Słupsk bank in the Polish exclusive economic zone. Subject to a final investment decision, construction work will commence in 2024.
RWE Renewables COO offshore wind Sven Utermöhlen said the contract for difference is an important milestone on the way to realising RWE’s first Polish offshore windfarm. He described Poland as one of the most attractive emerging offshore markets in Europe.
In February 2021, Ørsted and PGE signed an agreement to form a 50/50 joint venture for the development, construction and operation of Baltica 3 and 2, which they will develop through special purpose vehicles. With a total capacity of up to 2.5 GW, Baltica 3 and 2 will generate enough green electricity to power 4M Polish households.
Subject to the closing of the joint venture transaction and Ørsted’s and PGE’s final investment decisions, the Baltica 3-phase of the project (up to 1 GW) will start generating power around 2026. Baltica 2 (up to 1.5 GW) is expected to be operational by 2030.
Ørsted senior vice president and head of continental Europe Rasmus Errboe described the contract award for Baltica 3 and 2 as “a big milestone” for Polish offshore wind and for Ørsted’s and PGE’s joint ambitions in Poland.
“We look forward to delivering these important infrastructure projects and to helping Poland harness the large green energy resources in the Baltic Sea,” he said, noting that offshore wind will be a cornerstone in Poland’s transition to green power and has the potential to create thousands of jobs.
PGE Capital Group chief executive Wojciech Dąbrowski said, “Offshore wind in Poland now has a solid foundation to be developed and is PGE Capital Group’s priority. In our application for the CfD we also presented how we intend to carry out our investments in offshore windfarms. We are committed to strengthening the local supply chain.”
The price set for the projects is PLN 319.60/MWh in accordance with the Decree of the Minister of Climate and Environment of Poland and the Offshore Wind Act.
The CfDs effectively confirm that the projects have been selected for the first phase of Poland’s ambitious offshore wind programme. The CfD awards are subject to final approval from the European Commission.
Poland’s energy policy to 2040 singles out offshore wind as a key technology to make Poland a low-emissions economy. The Offshore Wind Act specifies Poland’s ambitions for offshore wind: from zero offshore wind capacity today, it has committed to install 5.9 GW by 2030 and up to 11 GW by 2040.
Analyses suggest a potential of up to 28 GW in Polish waters by 2050. This will make Poland the biggest market for offshore wind in the Baltic region and contribute significantly to the European Commission’s target of 300 GW offshore wind capacity in European waters by 2050.