Poland Solar Photovoltaic (PV) Market Development Perspective and Opportunities in 2019
/19th February 2019, RENEWABLE MARKET WATCHTM/ Poland is a promising country among Central East European (CEE) countries for investors in solar photovoltaic (PV) generation facilities. According to the research department of Renewable Market Watch™, the Polish economy is safe for the business environment and long-term planning with a low risk of the financial crisis, offering excellent opportunities for renewable energy investments. In times of global economic crisis, Poland has strengthened its position in the region of Central and Eastern Europe and all over the continent. The country offers a wide range of investment incentives. Poland adopted the New Investment Support Act in June 2018. The new law is intended to expand the area offering tax incentives up to almost 100% of Poland’s investment space.
CURRENT POWER MARKET SITUATION
The use of coal strongly dominates energy consumption in Poland. Consuming 77 million tonnes of coal per year, Poland is the 10th largest coal consumer in the world and the 2nd largest in the EU, after Germany. 92% of electricity and 89% of heat in Poland is generated from coal (World Energy Council 2017). Coal has a share of 51% in gross inland consumption, followed by 25% of petroleum products, 14% of gas and 9% of renewable energies.
Prices on the Polish Power Exchange (TGE) spot market remained in 2017 at a relatively low level, which was the opposite trend compared to other European exchanges, where prices rather were increasing throughout the year. However, the growth of electricity prices by 25 % was observed on the market during 2018 compared to 2017, representing a risk for industry and households.
The Polish Energy Regulatory Office (ERO) reported in the first half of 2018 that energy generated by renewable energy sources (RES) in Poland is approximately 13.5% of the total production. The main share (c.a. 68%) of this production for wind energy, followed by 15.95% biomass, 11.5% hydro, 2.7% biogas, and 1.2% solar energy.
Poland's electricity grid is sub-divided into transmission grids (maximum voltage) and distribution grids (high, medium and low voltage). Polish transmission system operator (TSO) has over 100 high voltage substations. The number of electricity consumers in the country exceeds 17 million.
The Polish grid infrastructure needs serious amounts of investments to modernize transmission lines, some of which are in a poor condition. According to estimations of Energy Brainpool, the Polish market is facing big challenges considering the security of the power supply. If there will be no changes in the electricity system, the supply side will not cover the power demand shortly already.
CLIMATE AND ENERGY POLICIES
GHG emissions in Poland decreased strongly by 37% in the period 1990-2002, but after 2002 emissions grew by 3% to 2015. Poland has a growth target of 14% for the 2005-2020 period under the Effort Sharing Decision (ESD), and it is on track to reach this target because the actual emission increase is lower than expected in the ESD target.
Comparative indicators such as emission intensity indicate that Poland performs worse than most other Eastern European countries and the average EU-28 Member States in terms of emission reductions and decarbonisation in the energy sector due to its strong reliance on coal. Recent decisions and revised legislation in 2017 in the energy sector will lead to an increased role of coal in energy supply compared to past plans and a much slower expansion of renewable energies than in recent years, particularly for wind power.
Polish plans in the energy sector will not contribute to significant further emission reductions in the future. As Poland is the fifth largest EU emitter, this may slow down overall EU progress in emission reductions.
CURRENT SOLAR PHOTOVOLTAIC (PV) MARKET SITUATION
The maturing German, Spanish, Czech, Slovakian and Italian markets allowed investors to look for new opportunities in Central and Eastern European (CEE) nations. However, regarding renewable electricity generation, the Polish solar photovoltaic (PV) market loses greatly to wind energy in terms of installed capacity according to the research department of Renewable Market Watch™.
Wind is still the most popular clean energy source in Poland’s renewable sector, with 5,798 MW of installed capacity by the end of 2017. Coal and lignite-fired plants currently provide the majority of the electricity consumed in the country. Due to the lack of proper government support for solar photovoltaic (PV) energy in Poland between 2010 and 2016, the CEE region's biggest country trails far behind its neighbours.
SOLAR AUCTIONS IN POLAND
Cumulative installed solar PV capacity in the country is quickly growing since 2016 under the renewable energy sources (RES) auction model, and a net metering support scheme established by the Polish government reveals Renewable Market Watch™ in its recently published report Poland Solar Photovoltaic (PV) Power Market Outlook 2018÷2027.
At the latest round held by the Polish Energy Regulation Office (ERO) on 15th November 2018, a total number of 251 companies placed 554 bids for solar photovoltaic (PV) power plants in the country. The lowest auction price was PLN 288.99/MWh (€67.03/MWh), while the highest auction price was PLN 364.9/MWh (€84.63/MWh). New auctions for 700 MW solar PV projects are expected in 2019. According to information from the Polish transmission system operator (PSE) shared in 2018 the country’s electricity system shall need almost 2,000 MW (2 GW) of solar photovoltaic (PV) power capacity to manage the summer peak consumption.
MAJOR SOLAR PV PROJECT DEVELOPMENTS
Modus Energy finished the construction of 12 new solar PV power plants in Poland in 2018. These 12 solar PV power plant projects are the first of more than 50 projects implemented by Modus Energy in the country. Around 30 identical solar projects across various regions of the country are also planned. Approximately 56 MW is to be generated by the solar power plants installed in an area of around 130 ha. The total amount of investments is estimated at over EUR 50 million.
Polski Solar Holding has obtained EU funding to construct two renewable energy projects in the municipalities of Stara Kamienica and Prusice in Lower Silesia. Polski Solar also submitted twenty-two bids, totalling over 17 MW of solar photovoltaic projects, in the Polish Energy Auction on November 15, 2018.
ReneSola Ltd. announced at the end of November 2018 that it was awarded 26 solar utility projects in Poland with a capacity of 1 MW for each. These 26 projects are under Poland's Contract for Difference (CFD) regime and eligible for a 15-year guaranteed tariff of PLN 354.8-358.8/MWh, close to the highest auction price of PLN 364.9/MWh.
If you need more information for solar projects in Poland, please do not hesitate to download from here: Sample list with contact details of solar project owners in Poland
The full contact details and relevant information about the Polish solar PV market, you may receive with a 1-year subscription for Poland Solar Photovoltaic (PV) Power Market Outlook 2018÷2027. Furthermore, you will receive up to 4 quarterly updates.
For a better understanding of benefits from using our reports, you may read here: Benefit List - Reports of Renewable Market Watch - 2019
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