Brussels (Brussels Morning) Pressure from Brussels, rising carbon prices and a grassroots push for climate action have pushed the Polish government into backing investments in renewable energy projects despite its continuing political support from coal interests, Reuters reported on Wednesday.
Even though Poland currently relies on coal for more than 70% of its power generation, and is the only EU member not to commit to climate neutrality by 2050, it has backed significant investments in offshore wind and solar power in the past two years.
Baltic Sea wind farms
On Wednesday, the country’s largest power company PGE confirmed a deal with Denmark’s Ørsted to develop offshore wind farms. Despite its long coastline on the Baltic Sea, Poland has so far remained free of wind farms. Denmark, despite its smaller coastline, currently meets half its annual electricity demand from wind farms, and Orsted has become the world’s biggest developer of that technology.
Ørsted and PGE plan to construct a 2.5-gigawatt farm in the Baltic Sea in two developments, and other companies have also started looking at the Polish coast. German RWE Renewables plans to seek Polish government subsidies this year for another 350-megawatt offshore wind farm, while Spain’s Iberdrola recently bought a stake in the Sea Wind wind farm company, the goal being to develop Polish offshore projects.
New subsidies
“Poland is a very attractive, maybe one of the most attractive, emerging offshore markets in Europe,” according to RWE regional offshore head Holger Matthiesen.Many investors note that the tipping point came last month, when the Polish government adopted a long-awaited offshore wind law.
The new law offers a subsidy guaranteeing a steady revenue stream, in a so-called contract for difference (CfD). The Polish power market regulator can now approve up to 5.9 gigawatts of projects for the subsidy until end of June, with a second phase planned to allow for another 5 gigawatts of projects to receive such support through auctions.