Executive Summary
As reported by Bloomberg, Poland, Europe’s coal heartland is now the hottest market for green power. Poland plans to increase its renewable power capacity by 65% between 2020 and 2024, with most advances gained through the development of offshore wind farms. The country is finalizing its 2040 energy policy and looks to partner with the world’s largest Renewable Energy companies to develop the market.
In 2008 all EU member states agreed to reach a minimum 15% share of renewable energy by 2020. At that time, Poland had not exceeded an RE balance of 8% and the country did not achieve the 2020 goal, only producing 12.2% from renewable energy sources (RES). Poland’s RES capacity amounted to 9,500 MW in June 2020, and it grew by 368 MW throughout the year. Sixty five percent of this capacity was generated from wind power, followed by biomass, hydro, photovoltaics and biogas. In 2020, photovoltaics exhibited the largest growth reaching 3,661.7 MW installed - an increase of 7 percent on a monthly basis. Renewable energy laws strongly support prosumer activities, and individual producers of u to 10KW power from newly installed RES system are guaranteed tariffs for 15 years. For larger producers, an auction system was introduced. Each year, Poland’s Ministry of Economy announces the consumption levels expected from renewable energy and provides reference prices for each group. According to the assumptions of the National Plan for Energy and Climate for 2021-2030, Poland’s share of energy from renewable sources is expected to increase from 17.6 percent in 2025 to 21 percent in 2030.
Photovoltaics
Photovoltaics (PV) is one of the fastest growing segments of the renewable energy sector in Poland. At the beginning of December 2020, installed PV capacity in the National Power System amounted to 3,661.7 MW – a monthly increase of 7 percent. The Institute for Renewable Energy estimated that at the end of 2020, the installed PV capacity in the system was approx. 2.5 GW, though this number was achieved in the middle of the year, confirming growth is faster than market forecasts. The success was attributed to a significant decreases in world prices for PV system modules and elements as well as, extensive Polish government programs supporting small investors (I.e., Thermo-modernization and My Electricity programs) and, RES auctions for large investors.
Energy industry representatives agree that the rapid development of prosumer photovoltaics cannot be stopped. A significant element of PV micro installations, more than 60% of Poland’s capacity, are systems implemented by individual prosumers. This trend has been driven by increasing energy prices, which resulted in numerous small installation companies being established to meet growing demand. Market experts predict that within next 10 years, Poles will install nearly 1 million individual PV roofs with a capacity of 50-100kW capacity. Large PV investors are supported by the government via RES auctions, which have been organized each year since 2016 by the Polish Energy System Regulator. This has resulted in more than 1000 projects with a total capacity of over 1.6GW that will be eligible for government premium payments over 15 years.
Read more: Poland Photovoltaics (trade.gov)
Wind - Onshore and Offshore
Poland’s wind generation capacity development was restricted in 2016, when President Duda signed a bill making it illegal to build turbines within 2km of other buildings or forests, ruling out 99% of Poland’s land area. Due to these changes, wind generation capacity only grew by 0.8%. Since then, the government has made plans to revise parts of the bill hindering wind energy development and that created several investment disputes between Poland and international investors.
There are more than 1,200 installations in Poland using wind as a renewable energy source with a capacity of more than 6 GW. These installations account for about 65% of Poland’s renewable energy capacity. Nearly 160 additional wind installations are under construction, with total installed capacity of approximately 2,500 MW. For comparison, in 2020, Poland’s entire power system capacity amounted to nearly 47,000 MW. The amount of energy produced from wind sources and introduced into the Polish power system is systematically increasing. In 2019, Poland produced 13,903 GWh of energy compared to 11,678 GWh in 2018. Wind energy accounted for 8.2% of the energy consumed in Poland in 2019. According to Poland’s Energy Regulatory Office, producers of wind and solar energy are the primary beneficiaries of the renewable energy auction support system. The 2016-2019 Energy Regulatory Office auction results created approximately 3.4 GW of new wind energy capacity and is an important mechanism to fulfill Poland’s renewable energy targets.
To meet Poland’s 2020 and 2030 RES obligations, the Polish government plans extensive development of its offshore wind farms. The Polish Energy Policy (PEP) Road Map 2040 provides for a visible participation of offshore wind in Poland’s 2027 energy mix, and the first mature projects should appear by 2024. In the 2040 prospectus, the strategic document sets the potential of 10.3 GW. A law promoting electricity generation by offshore wind farms was adopted by the Polish parliament and signed by President Duda on January 21, 2021, and companies controlled by the Polish State Treasury will have a dominant share in developing offshore wind farms. Investments in offshore wind farms will be carried out by companies such as the Polish Energy Group (PGE). By the year 2030, PGE and their Danish partner, Ørsted, intend to erect wind farms with 2.5 GW on the Baltic Sea. Another Polish state owned group, PKN Orlen, has concessions to construct a 1.2 GW offshore wind farm and is in the process of searching for a business partner to carry out the planned projects.
PEP 2040 predicts that 55.2 TWh of energy will be produced through wind power. The Polish Wind Energy Association (PSEW) http://www.psew.pl/en, estimates that the Polish energy system will require 1,000MW of newly installed wind energy capacity each year to comply with EU targets.
Read more: Poland Offshore Wind Technology (trade.gov)
Biogas Energy
With a population of 38 million, almost half of all land used for agriculture and being a net energy importer, Poland has the feedstock, workforce, growing economy, and commitment to environmentally sustainable growth needed to foster a thriving biogas sector. Agricultural biogas plants are supported by a new energy auction and are expected to drive biogas growth in Poland. There are currently over 30 digesters with a combined capacity of 245 MW operating in Poland. There is an even distribution of wastewater/sewage, agricultural (by)products/residues, and landfill gas plants running throughout the country. The average installed capacity is less than 1 MW, with agricultural plants tending to be larger than sewage and landfill-gas plants. Currently, there are no known plants that upgrade biogas to biomethane in Poland. Feedstock for agricultural digesters in Poland are constituted of: manure (25%), fruit and vegetable residue (20%), distillery waste (18%), maize silage (17%), and beet pulp (8%).
Current Market Needs
Further investments in offshore wind, photovoltaics, energy efficient buildings, grid expansion and energy storage projects will be necessary. Implementation of a new, smart energy infrastructure will also be needed to balance the fluctuating supply of renewable sources. Consequently, large, medium, and small-scale storage solutions and economically viable photovoltaic and wind systems, will be a significant driver for decentralized power generation in the future.
The growth rate of renewables is still important, though the systemic challenges will soon be revealed. Better solutions are needed to integrate variable renewable energy into the power system while maintaining economic and reliable operation of the grid.
Recent Market Trends
After World War II the renewable energy in Poland was solely provided by the hydropower sector and it did not exceed 2% of the country’s capacity. For more than a decade, other types of RES have been developed in Poland, including bioenergy, solar power and, most of all, wind power. The renewable energy sector in Poland has been increasing and developing dynamically. In 2016, renewable energy accounted for 13.3% of Poland’s total consumption and was mostly generated from biomass. In 2017, renewables accounted for 14% of Poland’s electricity generation, and was mostly generated by wind energy.
The National Renewable Energy Action Plan committed the generation of at least 15% of its utilized energy from renewables by 2020, and Poland had serious difficulties in reaching its goal. Throughout the past decade, renewables received a boost from changes in energy market legislation, such as domestic support schemes and the introduction of European competition rules. Quick development of onshore wind power plants ranked Poland as the 8th fastest developing country in the world. Since 2015, new government policies prioritized national energy security over competition practices. Investment in renewable energy sources has given way to a focus on maintaining the current power base. The few existing policies for renewable energy sources – a green certificates program and support for consumers that also generate power – have been dismantled. Subsidies for small installations have been substantially reduced. An auction system for renewables replaced the previous support scheme. The operating conditions for producers of onshore wind power have been changed to such an extent that new installations are virtually blocked, and many existing operators are bankrupt or at risk for bankruptcy. After 2015, the current ruling government introduced very stringent regulations restricting the construction of wind towers that dramatically slowed the development of this sector. During the last 5 years, only 1GW power from wind mills was installed. The government has recently announced it will revise the regulations to allow the onshore wind power to come back to the previous development pace.
Competitive Landscape
U.S. manufacturers will face a highly competitive market, as European manufacturers offer a broad spectrum of renewable energy technologies. Poland has become a leader of solar panel production and in the development of photovoltaic manufacturing projects. The most successful market entrants are those that offer innovative products featuring high quality and modern styling, though in many cases, price is the determining factor for the Polish buyers.
Further information can be found in the Country Commercial Guide Poland
Best Prospects for U.S. Exporters
U.S. companies will compete directly with Chinese and European companies in the renewable energy market. Chinese companies, due to low prices, continue to dominate, however, the local renewable energy power generation market offers significant opportunities to U.S. companies, particularly in following products:
- Energy storage
- Wind farm equipment (especially turbines)
- Inverters for PV installations
- Distribution Equipment
- Biogas equipment
- Technical consultancy
Market Entry Strategies
U.S. suppliers are encouraged to appoint a local representative or agent to develop and look after their interests in the Polish market (e.g., following up on project tender opportunities or secure product certification, licensing or accreditation when applicable). Technological support, marketing materials, and after sales service are critical elements necessary to ensure a mutually beneficial relationship with local partners.
U.S. firms seeking agents or distributors in Poland are encouraged to use the services of the U.S. Commercial Service Poland to find agent/distributors. More information is available at: Find Buyers and Partners (trade.gov).
Pricing is the most critical factor in positioning a product or service for sale in Poland. Access to capital is difficult for most Polish firms, and business transactions are typically self-financed. U.S. firms that can arrange financing will have a competitive edge. U.S. exporters should develop a creative strategy for financing exports. Carefully crafted terms of sale, including addressing currency fluctuations and product pricing, will help U.S. exporters gain a long-term advantage in the current Polish market.
Regulations/Registration Process
A company carrying out a commercial business operation must register in the public commercial register (Krajowy Rejestr Sadowy). The information is public and can be viewed by other companies. Small businesses, civil partnerships, freelancers and dependent branch offices do not have to be registered in the commercial register but should register with the Central Register & Information on the Commercial Activity
For more detailed information please visit: Doing business in Poland | Biznes.gov.pl - Information and services website for entrepreneurs
Technical Barriers & Tariffs
All business entities operating in Poland (including foreign companies) have equal access to international trade. However, this access is subject to trade policy measures introduced by the EU, which Poland is obliged to observe.
There are certain licensing requirements, not related to commercial policy, for trading in dual-use. Further information can be found in the Country Commercial Guide Poland: Poland - Trade Barriers
Procurement & Tenders
Public procurement accounts for a significant portion of the Polish and the European economies. While these contracts provide substantial revenue opportunities, they are subject to a unique set of laws and regulations. Government procurement in Europe is governed by both international obligations under the WTO Government Procurement Agreement (GPA) and EU-wide legislation under the EU Public Procurement Directives. U.S.-based companies can bid on public tenders covered by the GPA, while European subsidiaries of U.S. companies may bid on all public procurement contracts covered by the EU Directives in the European Union. However, U.S.-based companies and European subsidiaries of U.S. companies do not enjoy the same bidding rights. A comprehensive report provided by our U.S. Commercial Service colleagues in Brussels can be provided upon request.
Websites on EU public procurement legislation and the Government Procurement Agreement (GPA)
Public Procurement
Public Procurement | Internal Market, Industry, Entrepreneurship and SMEs (europa.eu)
The Government Procurement Agreement, on the website of the WTO:
WTO | Government procurement - The plurilateral Agreement on Government Procurement (GPA)
The Government Procurement Agreement, on the U.S. “Export.gov” portal:
TAC Program - Making Trade Agreements Work for You! (export.gov)
Public Procurement Poland
Biuletyn Zamówień Publicznych (uzp.gov.pl)
European Tenders Electronic Daily TED
TED home - TED Tenders Electronic Daily (europa.eu)
Getting Paid / Trade Finance
Import financing procedures in Poland take place under seller-buyer terms. Popular payment mechanisms include payment against documents and electronic funds transfers. The safest method of receiving payment for a U.S. export sale is through an irrevocable letter of credit (L/C). However, since most banks in Poland require the importer to deposit funds prior to issuance of a L/C, few buyers and sellers use this method due to its cost. The most popular payment mechanism is electronic funds transfer (SWIFT or wire transfers) as it is the fastest and cheapest way to transfer funds. Cash payment or down payments provide an extra measure of security for export sales. Leasing is a popular method of financing vehicles, heavy equipment, and other capital-intensive items. Both private and public insurance is available in Poland.
For more detailed information please visit: Poland - Trade Financing
Upcoming Trade Events
ENEX New Energy
April 28 – 29, 2021 in Kielce
ENEX / ENEX New Energy - 24th International Power Industry Fair 19th Fair of Renewable Sources of Energy ENEX
Warsaw Energy Expo
May 6 -7, 2021 in Warsaw
Targi Odnawialnych Źródeł Energii - Ogrzewnictwo
Energy Storage in Poland – International Congress
May 14 -15, 2021 in Warsaw
https://kme.org.pl
GreenPower
September 14 – 16, 2021 in Poznan
Greenpower (mtp.pl)
Eco Power Expo
November 24 – 25, 2021 in Warsaw
Eco Power Expo - Ptak Warsaw Expo
U.S. Commercial Service Information
For more information on the renewable energy sector in Poland, please contact:
Anna Janczewska
Commercial Specialist
U.S. Commercial Service Warsaw, Poland
Tel: + 48-22-625-4374
Anna.Janczewska@trade.gov
