Poland Electric Power Investment
Polska Grupa Energetyczna (PGE) is Poland’s largest company in the electrical power sector. PGE is active in lignite mining, electricity generation from fossil fuels (lignite, hard coal, natural gas) and renewable energy sources RES (hydroelectric power plants, wind farms, biomass), heat generation, distribution and sale of electricity to end users. The new PGE Strategy, which was presented at the end of 2020, includes an ambitious transformation plan to achieve climate neutrality in 2050.
PGE’s plan to achieve climate neutrality by 2050 will include investments in low- and zero-emission energy sources and network infrastructure, a strategy defined by two time horizons. With a target date of 2030, PGE’s renewable energy portfolio will increase to 50 percent, and its carbon dioxide emissions will be reduced by 85 percent. By 2050, PGE intends to achieve climate neutrality, i.e. zero net CO2 emissions, and provide 100 percent green energy to its customers.
Decarbonization of PGE’s generation assets portfolio will be a complex process, requiring capital-intensive investments focused on generation using only low- and zero-emission technologies. The current PGE generation portfolio is based on hard coal and lignite in 80 percent. In the 2030 horizon, generation from RES will account for 25 percent of PGE’s output, and in heat generating coal production will be replaced by natural gas. Natural gas is a transitional fuel and will remain in use for approximately 20 years. Future investments in gas sources will depend on the pace of development of alternative technologies.
By 2030, PGE will focus on developing strong wind and photovoltaic sectors. Two PGE offshore wind farms, with a total capacity of 2.5 GW, will be built by 2030, and another 1 GW wind farm will be constructed after 2030. In 2040, the capacity of Poland’s offshore wind farms is expected to exceed 6.5 GW. At the same time, the onshore wind and photovoltaic capacity construction program will be continued, and the planned increase of new capacities is to exceed 1 GW and 3 GW , respectively, by 2030. These actions will be accompanied by the construction of natural gas capacities and a program to build 0.8GW of additional energy storage facilities. Energy storage facilities, complementary to RES, will ensure flexible operation of the power system and safe system integration of new RES.
Investments and development of the energy distribution grid will enable the integration of emerging renewable sources, as most of which will be connected to lines belonging to operators of the distribution grid. Investments will be made in distribution lines, transformers, digital communication systems, energy storage, smart metering and entire Advanced Metering Infrastructure (AMI) elements.
By 2030, PGE will allocate more than PLN 75 billion ($18.7 billion) for investments. Company will also be able to make use of EU energy transformation fund financing sources available for Poland. The share of acquired financing is expected to cover 25 percent of PGE’s investment needs. PGE’s investment plan will create many opportunities for U.S. providers of electrical power systems and services. U.S. companies interested in pursuing these opportunities should check tender announcements on PGE’s website and/or through the EU’s tender website.