The support model provided for in the act on promoting electric power generation in off-shore windfarms is based on the concept of the so-called bilateral contract for difference, already tried in the Polish economic reality. It is used in the case of the currently existing RSE support system. The electricity generators in offshore wind farms which are going to be allowed into the support system are going to be granted with the right to cover negative balance. In practical terms, that means covering the difference between the market price of energy, and the price allowing to cover the costs of offshore energy generation. The amount of granted support is going to be defined as the product of the planned output of the installed offshore wind farm and 100.000 hours. Such solution allows to optimally distribute support within the time it is granted for, i.e., the maximum of 25 years. The support system constitutes the investment incentive required to establish offshore wind farms with adequate power output.

During the first phase of the support system, by means of a decision taken by the President of the ERO, the right to cover the negative balance will be granted for projects with installed power of 5.9 GW. These are the most advanced projects with respect to implementation, which are going to generate energy for the first time before 2030. The second stage is going to involve at least two competitive auctions (in 2025 and 2027) for the total power of 5 GW.

Michał Kurtyka, Minister of Climate and Environment, has thanked the teams within the European Commission which were involved in the works related to pre-notification and notification of the support system.

I believe that this system is going to allow Poland to achieve the objectives which we have planned in the Energy Policy of Poland until 2040. It is another firm step in the process of Polish energy transition

- he said.

Ireneusz Zyska, Government Plenipotentiary for Renewable Energy Sources, Deputy Minister of Climate and Environment, stressed the great cooperation with the European Commission, which allowed to quickly accept the decision.

Offshore wind power is the key project for Poland’s energy transition. Positive decision on the support system for offshore wind is going to launch investments with a total value of at least PLN 130 billion. It constitutes another important step for establishing modern, zero emission economy. I am certain that such quick decision is going to allow energy generators for a timely implementation of the projects

– he assessed.

Margrethe Vestager, the Vice-President of the European Commission responsible for the competition policy, has stressed:

This Polish programme is a really good example of how competition policy may allow Member States to support projects related to renewable energy, such as offshore wind farms. It serves as an incentive for companies to invest in ecological projects, which they would not otherwise invest in, had they not obtained support. We hope that we are going to witness a number of initiatives which contribute to the EU Green Deal without excessively interfering with competition on the uniform market.

European Commission assessed the program on the basis of the EU state aid rules, in particular the Guidelines on State aid for environmental protection and energy 2014-2020. It has thus acknowledged that the support is required and that it causes an incentive effect, as projects related to offshore wind energy would not be implemented without public support. 

Link to the information on the European Commission website.