- Monitoring of the implementation in Poland of the directives on renewable energy sources (RED II), EU regulations on the production of heat and electricity from RES and related directives (Electricity Market Directive, Energy Efficiency Directive).
- Monitoring the amendment to the Renewable Energy Sources Act
- legal updates, planned amendments and implementing regulations
- analyses, interpretations, expert opinions
- the impact of regulations on the profitability and formula of investment execution and the competitiveness of particular technologies
- specific arrangements for prosumers in the service and industrial sectors
- Legislative monitoring of the RES sector
- EU policy on the implementation of the EU climate and energy package, agreeing on and implementing the European Commission's "New European Green Deal", monitoring the implementation of the State's energy policy
- Monitoring of RES grant schemes for 2020-2021 from the point of view of the possibility to take advantage of competitions for RES investments, including ESCO schemes (self-producers and energy communities) and competitions for R&D projects
- Monitoring the development of investment projects and their implementation
- Current statistics on the development of the national RES market and monitoring of investment potential in wind and photovoltaic projects
- IEO's own analyses, forecasts and recommendations for the RES industry:
- RES auctions: including: list of companies that have won the auctions, selected auction projects,
- PPA - Corporate Power Purchase Agreement (contracts for direct sale of energy from RES installations),
- market for certificates of origin,
- electric energy prices,
- changes in the electricity and heat tariff system plus fixed and variable tariffs for companies (business perspective),
- electricity price forecasts,
- green investments in the heating market to adapt to EU directives, e.g. SDH - solar thermal systems for heating companies, gP2H - Green Power to Heat, which means unbalanced electricity from RES, in particular from wind power plants, whose generation profile is similar to that of heating,
- ready-made innovative RES solutions for implementation in energy systems.
- Current, independent political commentary
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Investors' interest in wind projects in Poland versus 10H Act
The latest IEO data indicate that the entry into force of the so-called 10h Act has essentially blocked the development of new wind energy projects in Poland. Since the Wind Power Investments Act, which requires the location of wind turbines at a distance of not less than 10 times their total height, went into effect in 2016 practically no completely new green field wind project has received a building permit. Projects only change their owner, sometimes insignificant changes are made to them, which only statistically confirm that the development activity is continued.
It can be noted that only those wind farm projects that obtained a building permit before the restrictive regulations came into force had a chance to be implemented (from the stage at which they had been in 2016). Only these investors have a chance to develop these projects using 15 years of support from winning RES auctions.
A common question asked by market participants is how many potential wind projects with a valid building permit can be submitted to this year's auction? Has the wind energy market been completely blocked?
Answers to these and other questions can be found in the latest August update of the Wind Projects in Poland database by the Institute of Renewable Energy (IEO).
According to the IEO, there are still 1.4 GW of wind projects on the Polish market with a valid building permit obtained before the entry into force of the 10H Act. This year's auctions are the last call for these projects to obtain financial support and to complete the investment process within the auctions. A large auction for wind and photovoltaic projects above 1 MW is planned for this year, in which 1.5 GW of wind and photovoltaic farm projects will get a chance to receive government support. So far, in two RES auctions (in 2018 and 2019) for large farms, wind projects with a total capacity of about 3365 MW have won, of which over 2 GW of projects are under construction.
The situation is slightly better when it comes to the successful application for connection conditions. In the Wind Projects in Poland database, wind projects with a total capacity of 7.68 GW have connection conditions issued.
Despite the stagnation in applying for new building permits, the projects are at various stages of progress. Some have already participated in auctions in 2018 and 2019, and those with "old" building permits are likely to participate in this year's auction. However, this is not the case for projects whose owners did not manage to obtain a building permit before 2016. On the Polish market, such projects, which have only grid connection conditions issued, are almost 3.2 GW. In the last three years, developers have been active in obtaining connection conditions. New connection conditions received both - projects with old building permits, as well as new projects. In 2020, 23 projects with a total capacity of 261 MW received connection conditions.
The largest capacity of wind projects is still present in the Pomorskie, Zachodniopomorskie and Wielkopolskie Voivodeships. In these voivodeships there are 57% of wind projects, while in eastern Poland the development activity has practically ceased.
A waste of the industry's potential and capital committed is the lack of developers' efforts to obtain a building permit for some projects with already issued grid connection conditions despite the 10h Act. In this group of projects with the capacity (according to the IEO database) of 1.8 GW you can certainly find those that will meet the 10H rule using the latest technologies. Smaller projects (several MW) consisting of new, efficient turbines, economically still win with photovoltaic projects in auctions. They can be implemented in the PPA formula, or in a self-producer's business model, where they could work better than photovoltaics. The under-use of this potential and the capital already committed is difficult to understand from an economic point of view, even if the industry is waiting for the 10H rule to be unblocked. The most regrettable thing is the time that is escaping, which is objectively the best for developed wind energy technology. - Grzegorz Wiśniewski, CEO of Institute for Renewable Energy.
We invite you to learn more about the IEO database "Wind projects and RES auction winners Database - August 2020".
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Maintaining the pace from the first half of the year 2020, the record may fall - more than 2 GW of photovoltaic projects should receive the grid connection conditions (Chart 2.). This is the same capacity as installed now in Photovoltaics.
Furthermore, more and more large photovoltaic projects are beginning to appear on the market. Currently, 29 PV projects with a capacity of over 10 MW have grid connection conditions and their total capacity exceeds 1 GW.
It can be noted (Chart 3.) that the largest number of photovoltaic projects is in Wielkopolska Voivodeship. There are less than 700 and their total capacity exceeds 1.2 GW. It is the voivodeship that definitely takes first place in the ranking of photovoltaic development in Poland. The second place is held by the Lubuskie Voivodeship with the number of projects exceeding 500, and with the capacity twice as low as in Wielkopolska. With similar project capacity (less than 600 MW), Warmińsko-mazurskie Voivodeship is on the third place. It can also be noted that in voivoderships like łódzkie, świętokrzyskie, śląskie, małopolskie, opolskie there are less than 200 MW in projects. The lowest number of projects developed is in opolskie voivodership. The localization of voivoderships can be chaced on the map on the bottom.
The government has prepared large volumes for RES 2020 auctions, as in 2019. 800 MW is expected for photovoltaic projects below 1 MW. In the previous year the auction basket below 1 MW was filled, and there was a high level of competition between bids. IEO analyses show that with the unfreezing of the economy and a typical jump in the number of administrative decisions, the competition of PV projects participating in auctions will be similar to last year.
We invite you to learn more about the IEO database "PV in Poland - August 2020".
PV Auctions Winners 2016-2019
Based on the database of photovoltaic companies " PV Auctions Winners 2016-2019"
So far, four rounds of RES auctions have been held, in which a total of more than 1700 photovoltaic projects, belonging to about 800 companies, have won. The contracted capacity of photovoltaic farms under the auction support system is 1.66 GW in total.
Further RES auctions are planned in 2020. In mid-January, the signed Regulation of the Council of Ministers on the maximum amount and value of electricity from renewable energy sources, which may be sold by auction in 2020, appeared. For projects below 1 MW in the PV power industry 800 MW is planned. According to the justification to the Ordinance, this year's auctions may enable the construction of 700 MW in photovoltaic power plants for projects above 1 MW. In total, the auction system may contribute to the creation of about 1.5 GW of new photovoltaic capacity in 2021-2024.
The IEO analysed information on owners of companies that have won RES auctions with photovoltaic projects. It turned out that a frequent phenomenon is the sale of companies that have won the auction. Transactions involving even several or more companies, sold simultaneously to a given investor, are observed. This means the entry into the Polish photovoltaic market of another large players who buy back PV projects at different stages of development, and preferably those with a winning auction. Undoubtedly, the auction support system is still the main driver of the PV market development in the area of photovoltaic farms, and as a result of the Convid-19 epidemic it will certainly remain the main element stabilizing the situation of developers and investors at least until the end of this year.
Analysing the updated IEO databases on projects and companies, one can see (pie charts) that the phenomenon of selling the winning companies is gaining momentum with each subsequent auction. For auctions I (2016), II (2017) and III (2018) it is 44%, 55% and 61% respectively. It is expected that for last year's IV auction this trend will be maintained, because as of today (less than 4 months after the auction's spread) 27 entities out of 260 winners have made transactions and changed ownership.
Based on the results of the auction, the Institute for Renewable Energy has prepared the latest update of the database of companies that won the auction in 2016-2019. The new database "Winners of the PV Auction 2016-2020" contains information about holding companies, addresses and contact details of the company owners. In addition, the database contains a summary of the last auction and a comparison of the results of all auctions and winning companies. Among the holding companies with the largest share in the auction system, the following companies can be distinguished: R.Power, Modus Energy, Sun Investment Group, Alseva Innowacje. These are usually companies that have participated in more than one auction. Taking into account the currently changing market of photovoltaic projects, where more and more investors decide to buy projects after winning the auction, the database of companies can be a source of information for investors who want to enlarge their investment portfolios with projects with guaranteed auction support.
Perspectives for 2020
Regulation of the Council of Ministers on the maximum amount and value of electricity from renewable energy sources that may be sold by auction in 2020 have been signed by The Prime minister at the end of January. This regulation includes plans to sell enough energy to enable building of 800 MW new wind farms and 700 MW of photovoltaic power plants in projects above 1 MW. For smaller installations it is planned total capacity of 800 MW. Summing up, auctions in 2020 should support 2,3 GW of new powers in 2021 – 2024 both from photovoltaics and wind.
In order to learn more about the winning companies from all auctions for photovoltaic sources, we encourage you to read the latest update of the "PV Auction Winners 2016-2019" company database.
You will find detailed information on the wind companies that have won the auction here.
Institute for Renewable Energy (IEO) was established in 2001. It’s an independent research group, and the first private research institute in Poland with a deep knowledge of the renewable energy issues: wind energy, solar energy, biogas, biomass, energy planning, ranging from politics energy and law, economic and financial analysis, and ending with the technical issues and design.
IEO also has an extensive experience in participating as an advisor (due-diligence, assumptions and concepts of technical solutions, functionality and utility programs, feasibility studies, business plans, terms of reference for a tender, supervision and construction monitoring) in the investment processes in the area of renewable energy implemented by the company and local governments. IEO actively participates and analysis the results of two first renewable energy auctions in Poland in 2016 and 2017.
IEO since 2009, conducts postgraduate studies "Investments in renewable energy sources", trainings and conferences in the field of technology, market economics and the law of renewable energy sources for national energy companies (eg. PGE, PKP Power Engineering), municipalities, financial companies (Alior Bank BGZ, ZBP) and foreign institutions (chambers of commerce in Germany and France, energy companies).
In addition, as part of its work, the IEO completed a number of expert opinions commissioned by the Ministry of Economy, Ministry of Environment, Ministry of Regional Development and other governmental and commercial projects for business customers.