The World's #1 Renewable Energy Network for News, Information, and Companies.
Untitled Document

Race to Beat Wind Power Subsidy Cuts Drives Poland Project Push

Poland, where 90 percent of power comes from coal, may be an unlikely clean-energy hub. Yet wind capacity that almost doubled in two years is set to grow further as developers rush to start projects before subsidies change.

“I’m sure that many companies will be trying to secure grid-connection agreements,” said Michael Mikulla, a developer whose EKO Energia Polska Sp. z o.o. clinched a deal with the grid operator to link Poland’s largest wind farm to the transmission network last month.

EKO Energia is among companies racing to get projects under way before Poland cuts subsidies -- potentially in 2015 -- and starts auctions for fixed-price contracts to drive down prices for renewable energy. Prime Minister Donald Tusk has pledged to stem increases in consumer power bills while meeting a European Union mandate to clean up emissions from electricity generation.

“We see much anxiety toward the new regulations,” said Lukasz Dziekonski, management-board member at energy investor the Marguerite Fund. “We expect developers will be trying to sell, or at least to connect projects to the grid until mid-2015. The wind-farm market is becoming a buyers’ market.”

By connecting projects before the cut-off date, developers can choose to receive the existing subsidies or wait for the new system. Some currently opt for tradable green certificates, which utilities buy to meet clean-energy targets. Certificates for new projects with no grid deal will be superseded by auctions next year, forcing developers to compete on price.

‘Best Time’

“Now is the best time for investing in renewables as developers can still choose if they want to remain in the old support regime or wait for the new one,” said Deputy Economy Minister Jerzy Pietrewicz. “The supply of renewable power won’t depress prices as we expect more demand from a recovering economy.”

EKO Energia expects to start generation at its planned 225- megawatt wind farm in Poland’s Silesia region in 2018. Securing a deal to connect the 400 million-euro ($544 million) project to the grid will help attract investors, according to Mikulla.

“The fact that we could get tradable certificates can markedly improve our business plan,” Mikulla said in a Jan. 31 interview in Poznan, Poland.

Helped by subsidies, the country’s installed wind capacity grew 34 percent last year after jumping 41 percent in 2012 and now totals 3,462 megawatts, according to grid operator PSE SA. Capacity is set to rise to 4,040 megawatts this year, amounting to more than a 10th of total generation.

Subsidy Changes

The Economy Ministry expects to cut subsidies by more than 2.4 billion zloty ($780 million) in 2015, reducing power prices for consumers by 26 percent to 20 zloty a megawatt-hour. The plans are laid out in draft regulations due for a cabinet vote in the coming weeks, according to minister Pietrewicz.

“Finalizing wind projects before new rules are implemented seems the most rational way to go,” Bogdan Pilch, the head of developer PGE Energia Odnawialna SA, said Jan. 29. The company has “several hundred megawatts of wind projects in the pipeline at different stages of development.”

Germany, France, Spain, Britain and Italy have all trimmed clean-energy subsidies after a boom in installations drove up power costs for consumers. Investments in renewables in Europe fell 41 percent to $57.8 billion last year, according to data compiled by Bloomberg.

Possible Delays

Investors in Polish renewables that fail to get projects off the ground before the new rules come into force may also face delays to the start of auctioning, according to the Marguerite Fund.

“We need some two years before the administration will be ready for tenders,” Marguerite’s Dziekonski said. “I can’t imagine that us, or any other fund, would finance a wind-farm project before it wins a tender.”

Regardless of delays, developers will struggle to bring wind ventures to fruition without state support, according to Mikulla, who cited the recent decline in European power prices.

Year-ahead power in Germany, the region’s largest electricity market, has slumped about 60 percent since peaking at 90.90 euros a megawatt-hour in July 2008. The share of renewables output in Germany more than doubled in the past seven years, according to data from researcher AG Energiebilanzen e.V.

“Recent power prices won’t allow for profitability of wind farms without state support,” Mikulla said. “But we have many German specialists involved in our wind-farm project. They all believe that Poland is the state which wants renewable energy and which will find the right solution.”

Copyright 2014 Bloomberg

Lead image: Wind turbines via Shutterstock

Untitled Document


States Already Seek To Delay Clean Power Plan

Andrew Harris, Bloomberg Fifteen states led by coal-rich West Virginia asked a federal court to stall Obama administration rules intended to c...

Stolen Solar Panels and Sabotage A Challenge for Powering India With Renewable Energy

Anindya Upadhyay, Bloomberg Disappointment spread across Tarun Singh’s face when he saw that parts of his solar power microgrid in eastern India’...

Global Renewable Energy Roundup: China, Kenya, Turkey, India Seeking More Renewables

Bloomberg News Editors China is being encouraged by three industry groups to double the nation’s solar-power goal for 2020 to make up for sh...

With Vast Amounts of Geothermal, Wind and Hydropower, Why No Solar In New Zealand?

James Ellsmoor, Contributor New Zealand has built an international brand on environmentalism and the great outdoors. So it is unsurprising that t...


Canadian Solar Announces Partnership in 200 MW Tranquility Solar Power Project

Recurrent Energy signed an agreement with Southern Power to partner on the Tranquility ...

AWS Truepower Announces Major Expansion of its Due Diligence Team in Response to Growing Market Demand

AWS Truepower, an international leader in wind and solar energy consulting and engineer...

20 days to GRC Annual Meeting & GEA Geothermal Energy Expo

The Geothermal Resources Council (GRC) has announced that it is only 20 days to go to t...

Array Technologies’ DuraTrack HZ v3 Continues to (R)evolutionize at SPI

Array Technologies, Inc. (ATI) prepares to showcase its recently launched tracking syst...


NATiVE Recognized for Excellence at 2015 Greater Austin Business Awards

NATiVE Recognized for Excellence at 2015 Greater Austin Business Awards NEWS RELEASE AUSTIN, Texas – Aug. 27...

Solar Energy Means Jobs, Savings, and a Low-Cost Future [infographic]

There are a lot of utility-sponsored legislative and regulatory attacks on solar energy lately, and we put together t...

How To Get People To Do Stuff

It’s no secret that psychology and sales go hand in hand. If you understand the principles of human psychology ...

Get In The Groove

When we talk about strategies for boosting productivity, we often overlook the fact certain projects lend themselves ...


Copyright 2015 Bloomberg


Volume 18, Issue 4


To register for our free
e-Newsletters, subscribe today:


Tweet the Editors! @jennrunyon



Doing Business in South Africa – in partnership with GWEC, the Glob...

Wind Energy in South Africa has been expanding dramatically, growing fro...

Wind Operator Congress Europe

The UK’s only business-focused O&M event for the European wind...

Distributed Wind Energy Workshop

Description: Distributed wind energy is electricity that is produced for...


Clean Energy Patents Maintain High Levels in First Quarter, Solar L...

U.S. patents for Clean Energy technologies from the first quarter of 201...

Koch Professor drops his Koch title, still makes same errors plus s...

The Koch Professor’s title isn’t the only thing that’s...

Fact Check: AWEA represents American wind power

The American Wind Energy Association (AWEA) is proud of its members for ...


Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now