The European Commission has approved, under EU state aid rules, a Polish scheme to support offshore wind technology.
The aid will be granted in the form of a two-way contract-for-difference premium, during 25 years, but only up to 100,000 full load hours per megawatt of installed capacity. Under this model, this variable premium is calculated as the difference between the reference price and the market price for electricity. When the market price is below the reference price, beneficiaries will be entitled to receive payments equal to the difference between the two prices.
However, when the market price is above the reference price, beneficiaries will have to pay the difference between the two prices to the state.
The scheme has a total maximum budget of €22.5bn ($27.5bn) and will run until 2030.
In January Poland’s Senate passed the Offshore Act regulating the development of offshore wind farms in the Polish Baltic Sea. Polish energy companies will divest themselves from most of their coal holdings and focus more on offshore wind following the act coming into law.
“The energy potential of the Baltic Sea is enormous and the conditions in the Polish part of the sea are among the best for this type of investment. We should take advantage of this. Ultimately, we can connect up to 28 GW of capacity in offshore wind farms to the Polish system and thus become the region’s leader,” commented Kamila Tarnacka, vice president of the Polish Wind Energy Association earlier this year.