According to the data of SolarPower Europe (SPE), Poland's photovoltaic installed capacity at the end of 2019 was only 2GW, and by 2022, Poland's photovoltaic installed capacity has reached 4.9GW, becoming the third largest solar photovoltaic market in Europe.
This growth is primarily attributable to the booming residential rooftop market supported by net metering schemes and government schemes that provide financial support to households. However, changes in the law have hindered the development of this field. At the same time, large-scale photovoltaic power generation is rising at a certain speed, becoming the second strong growth point of solar energy deployment in Poland.
Rising energy prices and global scarcity of raw materials are helping boost solar development in Poland
By the end of 2022, about 8GW of Poland's 12GW cumulative installed capacity will come from professional consumers, residential households and small businesses supported by the government. The boom in large-scale PV was initially driven by a tendering system under Contracts for Difference (CfD), but is now largely by growing public support for PV, high electricity prices and the Polish industry’s desire to secure corporate power purchase agreements for solar (PPA) of interest .
Eyal Podhorzer, CEO of Econergy, said, "The Polish market needs renewable energy. 70% of Poland's electricity is coal power, and it is the largest coal market in Europe. Obviously, Poland hopes to achieve decarbonization as quickly as possible. "
Econergy is an Israel-based international developer with over 1.5GW of large-scale PV projects in Poland. Despite focusing initially on residential rooftops, Econergy has seen a huge increase in the development and construction of large-scale PV projects over the past 12-18 months, with about 4.3GW of such projects in Poland in 2022 alone. Install the project.
Monthly and cumulative installed capacity of photovoltaics in Poland, 2018-2022. Only grid integration is seen as an obstacle to continued rapid growth
"For a country like Poland, that's a pretty big number," Podhorzer said. Given Poland's northern location and poor irradiation conditions, the Eastern European country is not considered a prime location for PV development.
But since the government restricted the entry of new wind projects into Poland two years ago, investors have shifted their development efforts to photovoltaics . This is supported by the reduction of capital expenditure on equipment prices, which can realize grid parity of projects and realize sustainable investment.
High electricity price effect : a large amount of funds to find development project opportunities
According to SPE, the war in Ukraine, sharply rising global energy prices and a global scarcity of raw materials have prompted local governments and businesses to make renewable energy an energy security priority, which has helped boost solar development in Poland. As a result, corporate PPAs are particularly thriving.
Podhorzer said this was similar to the situation in other European markets driven by the process of decarbonization and energy independence. However, electricity prices in Poland have not risen as high as in other markets such as Romania, Spain and Italy. Due to its heavy dependence on coal, Poland is very important to Russia. Natural gas is less dependent.
Nonetheless, investors are increasingly interested in entering new PV markets as governments work to streamline the renewable energy development process. In addition, developers are currently selling developed and pipeline projects to investors at a much faster rate than in the previous two years.
" A lot of money is still in Europe looking for a portfolio of development projects, especially new money coming in, looking at big goals like energy independence in the next decade, plus people are willing to pay more because of electricity prices to get projects on grid as quickly as possible , try to enjoy short-term high prices ."
Installation map: a large number of photovoltaic power plants are under construction
According to developers interviewed by PV Tech Premium, there are no outstanding regions for solar development in Poland. For example, Econergy has photovoltaic power plants all over the country.
The situation is similar for Green Genius, the renewable energy division of the Lithuanian company Modus Group, which has 129 solar projects in Poland and nearly 700 projects in development.
Simonas Šileikis, director of solar energy business at Green Genius, said that by the end of the year, the company's cumulative installed capacity in Poland will reach 300MW, and there are 0.5GW of projects to be developed, in addition to the obvious benefit of higher efficiency in the southern region due to moderate irradiation , with few regional features worthy of special mention.
However, Southern Power Grid is more suitable for small and medium-sized (<100MW) power plants . Most developers are only targeting projects with available capacity in the five distribution networks across the country.
The northern region has capacity but is held back by upcoming offshore wind projects. Photovoltaic projects are stuck in the future development stage. Šileikis says Green Genius is therefore looking for more southern locations.
PV Tech recently reported on an industry panel discussion. The panel discussion stated that grid connection issues are the only obstacle to the continued significant expansion of solar PV in Poland, with grid operators uncertain when new capacity will be opened.
Likewise, an SPE report noted that the older grid needs a modern energy transition because "most of its components are more than 25 years old, and a significant portion of them are more than 40 years old. "
Contrasting the reports, Econergy said it had not encountered any grid connection problems in Poland and that it continued to build substations and invest heavily in ancillary services and infrastructure for grid connection projects.
"We do pricing in the business model, but I don't see a problem at the national level like in the UK," Podhorzer said. "In the UK, as a large developer, we have huge problems with other developers."
Econergy has 2.5GW of projects under development in the UK. While there have been grid application approvals from distribution network operators, these applications were recently rejected by National Grid, meaning grid connection projects approved for 2023/24 are now delayed until 2027 and beyond.
"We haven't seen that in Poland yet, so I don't see any particular grid connection problems," Podhorzer added.
On the other hand, Šileikis said that large-scale projects in Poland have started to succeed and that the Polish market is seen as "stable, secure, predictable" and approaching 12.5GW, despite the fact that new projects have been connected to the grid since last September Confirmation suddenly became next to impossible.
The grid as a resource has become very limited, which makes it difficult for a large number of development projects in Poland that have acquired land to obtain grid connection confirmation. Green Genius, which is developing projects of around 5-50MW in size, is also facing this grid issue itself.
Šileikis pointed out that, to some extent, the grid capacity that could be satisfied by large-scale solar in Poland is reserved for potential offshore wind projects expected to be built in 2026-2028.
Šileikis added: " Considering the installed capacity of solar power plants, which is the DC part of the power generation project, and the electricity that is connected to the grid, which is the AC part, it may be more efficient to use the current infrastructure. It will definitely be done in a more efficient way. Using the grid in a way that can easily add 20% or even 30% extra DC power without endangering the grid system itself."
Green Genius is confident that in the near future there will be a suitable dialogue in Poland on these issues, so it will continue to develop projects knowing that sooner or later Poland will have to face the reality of moving away from its heavy dependence on fossil fuels, There must be new electrical capacity.
"I'm quite optimistic about Poland," Šileikis added. "It's just a matter of time. It's a question of when people are ready to change. To a large extent it's a question of politics, but also of the general environment and the EU .So from this point of view, I can say again that Poland is a very important market for Green Genius."
How to enter the Polish market?
According to Dr. Dariusz Mańka, director of legal and regulatory affairs at Polskie Stowarzyszenie Fotowaltaiki, the Polish solar energy association, there are generally two ways to enter the PV market in Poland: The first and fastest way is to acquire one of the many projects on the market.
However, Mańka warned that projects that have not yet been acquired often have "more or less" problems with grid connection and construction permits after a booming market , making it difficult to secure high-quality projects as a result.
"After you buy this kind of item, there are several issues that need to be addressed, and it all costs money."
The second way is to develop greenfield projects. This may seem more difficult, but due to the growing demand for solar in the industry, developers can work with industry partners to develop projects directly linked to off-takers using a corporate PPA model.
Meanwhile, local governments will also look to cleaner and cheaper energy sources this year, offering another option for cooperation.
"Polish provinces will be given renewable energy capacity development tasks, and the provinces will have to take on this task themselves, so the push is decentralized."