Orsted joins up with Poland's biggest private power company for Baltic offshore wind

Danish utility Orsted and ZE PAK, Poland’s largest private power company, have agreed to form a joint venture (JV) to bid into the upcoming contact for difference auctions being held for seabed leases in the Eastern European country’s swath of the Baltic Sea.

The pair aim to participate in tenders planned by Warsaw for 2025 and 2027, seen as key to Poland’s stated intention of having 11GW of sea-based wind operating by 2040.

The planned CfD auctions for some 5GW of Baltic Sea wind capacity will be for a second wave of projects in the country's ambitious offshore wind programme. Poland had decided to grant direct CfD support to a first batch of 5.9GW in Baltic Sea offshore wind capacity that has been pre-developed and is slated to be operational by 2030.

“With offshore wind as the backbone, Poland has made the bold decision to transform its energy system to reduce carbon emissions and to make sure that sufficient and cost-competitive renewable power supply is available for Polish businesses and households in the coming decades as coal-fired power stations are being retired,” said Orsted chief commercial officer Martin Neubert.

“With very strong local know-how, leading global experience and joint ambitions, ZE PAK and Orsted can support Poland in making the transition from fossil-based to renewable energy sources happen while creating thousands of local jobs and re-skilling and up-skilling the workforce from the coal industry to renewables.”

Zygmunt Solorz, chairman of the supervisory board of ZE PAK, said: "Wind energy is one of the pillars of ZE PAK's strategy to switch to zero-emission energy production and I am glad that we have the opportunity to cooperate with Orsted.

“The potential, achievements and experience of Orsted in the production of clean energy are impressive and can undoubtedly support the energy transformation of both ZE PAK and the entire Polish energy sector."

ZE PAK, Poland’s fifth largest electricity producer, is phasing-out coal-fired “not later than” 2030 and has pledged to “join the bourgeoning market for renewable hydrogen to help decarbonise other sectors such as heavy transportation and heavy industry”.

The Polish government has set out plans to diversify the country’s energy mix through a renewables-led build-out, with an eye on reducing coal’s share of its power generation from 70% today to 11-28% by 2040. There are currently no offshore wind farms off Poland.

To support its ambitious offshore wind plan, Poland last month had closed an offshore wind sector deal between the wind industry and government, following a model rolled out by the UK in 2018.

Orsted’s head of region for continental Europe, Rasmus Errboe, said: “Poland is a strategically important market for Orsted, and we hope to further expand our presence and investments to help Poland harvest the clean energy resources that are abundantly available in the Baltic Sea.”

Globally, Orsted, which has total of 12GW of installed renewable capacity, has 7.6GW of offshore wind plant in operation, and is targeting 15GW by 2025 and 30GW by the end of the decade.

Together with Poland’s PGE, Orsted has already committed to build deliver 2.5GW of offshore wind via the Baltica project, which will be staged to ramp up to full power by 2027, to meet demand from nearly 4 million homes.