The green shift of the Polish energy sector – POLITICO


Leading a rapid energy transition in Poland requires the full commitment of all interested parties. Polish power companies play a crucial role in this process as they are at the forefront of power and energy transition. The direction of climate and energy policy set by the European Union, the growing ambitions of EU climate targets and the impact of greenhouse gas (GHG) emissions on climate change, concern for human health, the need for sustainable development and the minimization of the impact of the energy sector on the environment are factors that motivate energy companies to carry out ambitious actions in favor of the energy transition.

From vision to transition strategies

PKEE-affiliated entities plan to continue their work with regard to the transformation of the Polish energy sector, which is reflected in the companies’ long-term strategies that will allow them to adapt their core business to the changing environment and regulatory requirements.

The PGE Group claims to reduce its environmental impact and achieve climate neutrality by 2050. This goal will be achieved through investments in low and zero carbon energy sources and network infrastructure. PGE’s strategy is based on three pillars: energy that respects the environment, modern energy services and an effective and efficient organization. Thus, PGE is implementing an ambitious program for the construction of offshore and onshore wind farms and the continuous development of photovoltaic (PV) potential. PGE is also looking for acquisition opportunities for other renewable projects. By 2030, the share of renewable energies in the group’s portfolio will be increased to 50% and carbon dioxide (CO2) emissions will be reduced by 85%, which means 120 million tonnes less CO2 emissions .

A six-fold increase in installed capacity in renewable energy sources (RES) and a reduction in emissions of almost 80% are the main objectives of the Tauron Group’s new strategy until 2030. The strategy also assumes the generation of PLN 4.5 billion (€955 million) in EBITDA (earnings before interest, tax, depreciation and amortization) in 2025 and PLN 6.5 billion (€1.4 billion) in 2030. It assumes a decarbonization of heating plants and an acceleration of the development of renewable energies. Tauron wants to have 1.6 GW of installed capacity in renewable sources by 2025: wind farms, photovoltaics and hydroelectric plants. In 2030, it will be 3.7 GW, which will constitute 78% of the production mix of this group. Tauron wants to have 1.1 GW of onshore wind and 1.4 GW of photovoltaic. In the early 2030s, it wants to launch offshore wind farms in the Baltic Sea with a capacity of around 1 GW. By 2030, approximately 50% of capex (capital expenditure) will be allocated to the development and modernization of the electricity distribution network. Tauron will also consider investments in pumped storage and virtual power plants. It intends to provide all customers with smart meters by 2030 and the customer will remain the focus of the group. In addition, Tauron also supports the further development of hydrogen technologies and assumes an involvement in developing skills and preparing for the implementation of modern nuclear technologies after 2030.

Enea aims to achieve climate neutrality by 2050 by investing in the development of renewable energy sources based on advanced technologies. The increase in installed RES capacity will be achieved through acquisitions, the development of own projects and in collaboration with commercial partners. By 2030, the Enea Group’s installed capacity in renewable energy sources will increase by around 1.5 GW, followed by an additional 2 GW by 2040.

Over the next 10 years, Energa, Orlen Group, plans to significantly increase its installed capacity of renewable energy sources, reaching by itself and by owning an interest in these assets, a total installed capacity of approximately 2, 4GW. Energa expects to achieve approximately 1.1 GW of installed capacity in onshore renewable energy sources, as well as a share in offshore wind farm projects with a capacity of approximately 1.3 GW. The company will also allocate around PLN 29.7 billion (€6.3 billion) by 2030 for the implementation of projects addressing the needs and challenges resulting from the ongoing energy transformation.

The largest Polish energy companies play a key role in this process by developing photovoltaic projects and initiating the implementation of large-scale offshore wind energy projects.

From vision to action investments

The largest Polish energy companies play a key role in this process by developing photovoltaic projects and initiating the implementation of large-scale offshore wind energy projects. Poland has one of the fastest growing solar energy markets in all of Europe. Today, in the Polish energy system, about 10 GW of PV capacity is installed, while four years ago it was less than 200 MW. Offshore wind power is also essential for the energy transition. Poland plans to build 5.9 GW of offshore wind power in the Baltic Sea by the end of 2030 and to reach 11 GW by the end of 2040, which, due to economic and technical conditions, offers the best development prospects for increasing electricity production from renewable energies. sources in Poland.

The entities operating within PKEE have carried out numerous projects that support the transformation of the sector in the areas of electricity and heat generation, as well as electrical networks. PKEE members plan to continue work on the transformation of the Polish energy sector, which is reflected in companies’ long-term strategies aimed at enabling them to adapt their core business to the changing environment and regulatory requirements. PGE is working on offshore wind farms with a total capacity of 2.5 GW until 2030 and on commercial hybrid electricity storage. Tauron plans the construction of the Mysłowice PV solar park with a capacity of 37 MW (phase one), as an example of the reuse of post-industrial areas and works on the distributed energy model 2.0 grid self-balancing zones. Enea will build the combined heat and power (CHP) production unit from biomass and will lead a program to build hybrid energy production sources. Energa’s plans involve activities such as the development of renewable sources with a capacity of more than 400 MW and the implementation of the group’s hydrogen strategy by 2030.

The Polish electricity system will follow the path of decarbonisation of the sector, in particular by gradually reducing the share of fossil fuels and increasing renewable energies, complemented by nuclear energy (large-scale, small and micro-modular nuclear reactors).

Costs and financing of the energy transition

CEO Wojciech Dabrowski | by PGE

As the history and experience of already developed countries show, the energy transition requires a lot of investment and generates significant costs. According to an EY study on the Polish energy transition, expenditure for the transformation of the energy sector in Poland by 2030 could amount to 135 billion euros, including related protective measures for the mining sector. to the electricity and heat sectors. The expenditure required far exceeds the investment possibilities of energy companies and potential investors. Support for energy transformation in Poland from the EU budget for 2021-2027, the European Union Emissions Trading Scheme (EU ETS) mechanism (until 2030) and the national energy transformation mechanism (until 2031) is estimated at around 70 billion euros. Nevertheless, even taking into account the existing and planned possibilities of obtaining aid funds from the EU and the state budget, there is still a huge gap. Furthermore, this gap could increase further as EU funds will be used in other sub-sectors, such as gas and transport, and as market conditions and spending investment may change.

One EU, several paths of energy transformation

Poland has been effectively implementing the energy transformation process for years. Nevertheless, due to a different starting point, resulting from objective, historical, geopolitical and economic reasons, the countries of Central and Eastern Europe need more time to achieve the increasingly ambitious climate objectives of the EU. A different starting point for the CEE region results in a different pace of the transformation process caused by a larger scale of challenges. The answer to these challenges lies in measurable actions by energy companies that bear the burden of energy transformation.

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