Ørsted and the state-owned Polish energy company PGE Polska Grupa Energetyczna S.A. (PGE) have signed an agreement to establish a 50/50 joint venture to develop, construct and operate two offshore wind projects in the Baltic Sea, which together have a potential capacity of up to 2.5 GW.
- We are very much looking forward to this journey together with PGE. Together we will invest significantly in exploiting the renewable energy resources of the Baltic Sea while creating economic activity, stimulating the local supply chain and establishing an industry in Poland, says Rasmus Errboe, Senior Vice President and Head of Region Continental Europe at Ørsted.
The agreement means that Ørsted will subscribe for new shares, representing 50 percent of the total of the total share capital in PGE's two offshore wind projects Baltica 3 and Baltica 2.
Baltica 3 has a capacity of just over 1 GW, and Baltica 2 has a capacity of just over 1.5 GW. The subscription price for the newly issued shares in Baltica 2 and 3 will amount to approximately DKK 1.1 billion.
Both projects are eligible to be included in Poland's 2021 offshore wind project allocation round, where a total of 5.9 GW of capacity is expected to be allocated.
An allocation round that was adopted via a historic agreement in the Polish Parliament, which was passed earlier this year. Baltica 3 is the more advanced of the two projects, and it could be commissioned in 2026.
Joint forces to ensure good position for the award round
As part of the agreement, Ørsted and PGE have agreed to establish a framework that enables both parties to effectively integrate and leverage each other's strengths and expertise.
The parties hope that the synergy through Ørsted's expertise in offshore wind and PGE's experience with the Polish electricity market will create a partnership that is well positioned to deliver the largest portfolio of offshore wind projects in the award round in 2021.
- We look forward to launching a joint project to construct the Baltica 2 and Baltica 3 offshore wind farms together with Ørsted. The two projects we will develop together are among the most advanced offshore wind projects in Poland, says Monika Morawiecka, CEO of PGE Baltica.
If the transaction is approved by relevant authorities, it is expected to go through during the first quarter of 2021. As part of the new collaboration with PG, Ørsted will significantly expand its physical presence in Poland.
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