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Orsted talks mean Poland’s offshore wind sector is ready to sail

Danish offshore wind champion enters the Polish sector just as the government is about to present an offshore wind act

Poland is finally ready to become the next big European offshore wind market.

The country has for a while looked like it was about to seriously start developing its offshore wind potential, but only now are all the key ingredients nearly in place. One is having strong foreign partners.

Danish offshore wind champion Orsted has just said it will enter talks to buy half of the 2.5GW Elektrownia Wiatrowa Baltica 2&3 arrays from state-owned utility Polska Grupa Energetyczna (PGE) that are among the furthest developed in Poland.

Scandinavian peer Equinor earlier had struck deals with privately-held local energy firm Polenergia to buy 50% of its 1.2GW Baltic 2&3 projects, which are the furthest developed in the Polish part of the Baltic Sea, and lead their construction and operation. Equinor also bought half of Polenergia’s up to 1.6GW Baltic 1 project, which is less far advanced.

“From the very beginning Polish companies were looking for very experienced partners in offshore wind. And the most experienced ones in the sector are among Scandinavian companies,” Janusz Gajowiecki, chief executive of Polish Wind Energy Association (PWEA), told Recharge.

“Orsted – among a few others – was said to be on PGE’s shortlist because of its know-how. That’s why the choice is not surprising and for sure it can help to speed up PGE’s projects and give them more quality.”

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First wind measurement campaigns by both Polenergia and PGE also indicate that wind conditions (around 10 metres per second) are on a par with, or better than those in the nearby German or Danish parts of the Baltic Sea, probably because waters between Sweden and Poland are more exposed than those close to the German or Danish coasts.

To de-risk developments further by adding more heavyweights to its developments, PGE and Polish oil refiner and petrol retailer PKN Orlen (in which the state owns an important minority stake) last month signed a letter of intent on cooperation in the development of their combined 3.7GW of offshore wind projects in the Polish Baltic Sea.

The cooperation aims at using synergy effects to push costs down, while at the same time maximising the share of Polish suppliers and contractors.

That again is music in the ears of the nationalist government from the Law and Justice Party (PiS) that has just been re-elected.

After years of slow development and improvisation, Warsaw seems to be finally getting its act together regarding wind at sea.

According to a draft for its long-term energy planning, the government counts on first power from Baltic Sea wind farms to feed into the Polish grid in 2025, and foresees 10.3GW of Polish offshore wind capacity to be built by 2040.

To flesh out the energy strategy, the government is looking at presenting a proposal for a dedicated offshore wind act in a public consultation in November, which will include a support scheme for installations and the offshore grid, PWEA told Recharge.

Poland is under pressure to do more to reach its climate targets, which will require far more renewables, and stepped-up efforts to replace part of its coal-fired generation fleet that currently supplies more than 80% of the country’s power needs.

While it was convenient to talk against any fast dismantling of its vast fossil fleet before national elections in October, as coal regions are among the PiS’s main constituencies, the government knows it needs to act now to avoid painful EU sanctions later.

"With coal power stations coming to the end of their life ... there is a massive responsibility to make Baltic wind farms happen."

Warsaw is impeding a bigger build-up of wind on land with a damaging distance rule, both to pacify the coal regions and because of not-in-my-backyard (NIMBY) groups. But the government still needs a much higher renewable energy volume, so turbines at sea that cannot be seen by angry citizens on land come in handy.

“With coal power stations coming to the end of their life, we know by 2035 it will be necessary to close down 20GW of aging coal power stations in Poland. As a result, there is a massive responsibility to make Baltic wind farms happen,” Wojciech Szczurek, the mayor of the port town of Gdynia, told the Maritime Economy Forum Gdynia this month.

Unlike in neighbouring Germany, the maritime industry in Poland is still a very large employer, giving jobs to more than 110,000 people and generating more than €9bn ($2.34bn) for the country’s economy, according to the forum.

Thanks to that, Poland already has a strong offshore wind supplier industry that currently is catering for wind projects in other European waters. Examples are jacket foundation maker ST3 and cable supplier Tele-Fonika Kable, while the Crist shipyard in Gdynia has supplied vessels installing foundations and turbines in the North Sea.

That will make government (and industry) expectations for a very high local content more realistic, despite Scandinavian heavy-weights buying half of the best offshore wind projects.

The industry sees the foreign involvement as a form of catalyst for the development of the sector.

“We should remember that Poland has learnt good practices in onshore wind also from Danish companies. Therefore, we are sure that the presence of Denmark’s Orsted and other Scandinavian companies [such as] Norway’s Equinor will help create such a code of good practice also for offshore wind in the Polish zone of the Baltic Sea,” Gajowiecki stressed.

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