PGE Gets Permits to Build First Polish Offshore Wind Farms

PGE SA (PGE), Poland’s largest power producer, received three government permits to build the first Polish offshore wind farms on the Baltic Sea.

The state-controlled utility applied to build wind farms with a combined capacity of 3,450 megawatts, Lukasz Witkowski, a PGE spokesman, said by phone today. The government has granted five offshore permits for a total capacity of 4,500 megawatts, Mikolaj Karpinski, a spokesman for the Transport, Construction and Maritime Economy Ministry, said in an e-mail today in response to Bloomberg questions.

Investors will have six years, with an option to extend by two, to build wind farms, Deputy Transport, Construction and Maritime Economy Minister Anna Wypych-Namiotko said on Feb. 22. Poland got about 50 applications from companies to build wind farms, each for 750 to 1,000 megawatts of power capacity.

The European Union’s biggest eastern state, which produces about 90 percent of its electricity from coal, needs to increase its renewable energy capacity to meet EU criteria for cutting carbon-dioxide emissions. Poland has the potential to build as much as 10,000 megawatts of offshore farms on the Baltic Sea, which will generate 30 terawatt-hours of electricity per year, or almost 20 percent of its current annual consumption, Bogdan Gutkowski, the head of Polish Offshore Wind Energy Society, said on Feb. 22.

Building one megawatt of offshore capacity is estimated to cost 3 million euros ($3.9 million), Gutkowski said. That’s more than double the price of a Feb. 15 deal PGE signed to build 1,800 megawatts in coal-fired units at its Opole plant.

Orlen, Kulczyk

Last year Poland changed the law, extending the validity of permits to build offshore wind farms to 30 from five years. The country’s onshore wind energy capacity installed will probably rise to 5,521 megawatts in three years from 1,933 megawatts, according to forecasts by the country’s power grid operator.

PKN Orlen SA, Poland’s largest oil refiner, is set to get permits to build offshore wind farms “within days,” while Kulczyk Investments, owned by Polish billionaire Jan Kulczyk, has already got government approval, Rzeczpospolita newspaper reported last week.

Spokespeople for Orlen and Kulczyk had no immediate comment on wind farm permits when contacted by phone today.

To contact the reporter on this story: Maciej Martewicz in Warsaw at mmartewicz@bloomberg.net

To contact the editor responsible for this story: James M. Gomez at jagomez@bloomberg.net

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