Bloomberg Announces that Sun Investment Group Takes the Biggest Piece of Polish Solar Energy Market

By Maciej Martewicz; Bloomberg

Poland’s solar power industry may be set for brisk growth as investors flock to the budding market as the coal-dependent country embraces clean energy to meet European.

Union emission standards and help clear up the bloc’s worst air pollution.

The EU’s largest eastern nation is shifting its energy policy away from coal as environmental concerns, including smog that blankets its biggest cities, become hot political issues.

After initially cutting green power subsidies, the two-and-a-half year old government in Warsaw made a turnaround to meet the bloc’s renewable targets. The move came after a heatwave hit the country in 2015, forcing coal-reliant power producers to slash electricity supplies to industrial users.

Lithuania’s Sun Investment Group is among investors betting that Poland’s return toward clean energy is long-term. It plans to spend around 40 million euros ($47 million) on 42 megawatts of the projects it purchased earlier this year and reach at least 250 megawatts by the end of 2020, according to Managing Director Deividas Varabauskas. “Poland is the last sizable country in the EU where the solar market is still in its infancy,” he said in an interview in Warsaw. “Currently, there is a gold rush. Everyone wants to jump on the Polish train.”

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Renewable industry group Instytut Energetyki Odnawialnej forecasts Poland’s solar capacity will rise to 1.2 gigawatts in 2020 from just 108 megawatts at the end of 2017. Sun Investment, along with E-Energija and Spain’s I+D Energias, bought 43 projects with total capacity of 42 megawatts, while another Lithuanian company, Modus Energy, plans to invest more than 50 million euros to build around 50 megawatts of photo-voltaic projects. Poland awarded subsidies for more than 300 megawatts at last year’s auction. The country will open bidding for another 750 megawatts in 2018, of which only 400 megawatts of additional capacity will be built as the fragmented market lacks eligible projects, according to Sun Investment. Even as the nation has potential to absorb 1 gigawatt of solar power every year, this may not happen mainly due to banks’ small experience in evaluating photo-voltaic projects and red tape, he said. On top of it, the “aggressive” pricing at last year’s auction was “quite a surprise” as Varabauskas had thought “the premium for entering the market would be bigger.” In the future, the Lithuanian developer may consider selling its assets in Poland once it has “a big portfolio or if a utility player, willing to make big acquisitions, comes in,” he said.