Energa to complete largest Polish battery storage project by end-2019

Polish state-controlled utility Energa said it plans to complete the country’s largest battery storage project, one of the biggest in the world, by the end of this year.

The Bystra storage project, which will house batteries in a 1,200 square meter warehouse with a target capacity of 6 MW (27 MWh), is currently in its final stages and the investment will be launched by the end of this year, the company said in a presentation of its second-quarter results.

The investment is the first hybrid battery storage project in Poland and it is being built in cooperation with Hitachi and the Polish transmission system operator, PSE, on a site close to Energa’s 24-MW Bystra wind farm in Pruszcz Gdansk, Pomerania, northern Poland.


Energa also said in its presentation the controversial 1-GW, Ostroleka C, hard-coal investment, slated to be the final large conventional coal unit to be built in Poland, is proceeding on schedule, although the project is not yet showing up in the company’s capital expenditure.

In July, Energa admitted that closing financing for the Zloty 6.023 billion ($1.58 billion) project at the company’s 647 MW Ostroleka B system plant in northeast Poland, was posing “a significant challenge.” Energa issued a Notice to Proceed order to the contractors GE Power and Alstom on December 29 despite the fact that external financing of Zloty 4 billion has not yet been obtained.

In April, Energa and its 50-50 joint venture partner in the project, another state-controlled utility, Enea, pledged to commit Zloty 819 million each to the project to meet impending investment schedule deadlines. Energa said that both companies assumed they would obtain financing under the project finance formula without recourse to their balance sheets to fund construction of the unit, although equity might be required.

In January, the partners opened talks with Poland’s largest utility, PGE, about its possible capital participation in the project but the discussions are yet to produce results. The contractual deadline for completion of the unit is August 28, 2023. Energa issued the NTP after the project won a 15-year contract for support in last December’s capacity market auction. Energa and Enea would incur financial penalties and lost revenue if the unit is not ready to deliver capacity in 2023.

In November last year, environmental protection group, ClientEarth, launched a legal challenge against Ostroleka C, saying the project posed an “indefensible” risk to shareholders. Energy ministry officials have said the unit is indispensable to Poland’s future energy security and is required to synchronize the Polish grid with the networks of the neighboring Baltic states.

Energa said turbines for its 31-MW onshore Przykona wind farm will start to be installed in early October. The company said it obtained connection permits in June for its planned 450-750 MW combined cycle gas turbine investment in Grudziadz, north Poland. Energa launched a tender, which is ongoing, for a contractor for the investment in March.

Source: S&P

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