EBRD lends EUR 200 mln for construction of Baltica 2, Poland's second and largest OWF

"The European Bank for Reconstruction and Development (EBRD) is supporting Poland’s renewable energy development by extending a EUR 200 million loan to finance the construction and development of the Baltica 2 offshore wind farm," EBRD wrote.

The Bank pointed out that its financing is provided through a consortium of international and local commercial lenders, the European Investment Bank, Poland's state development bank BGK and the Export and Investment Fund of Denmark.

Baltica 2 is the second and the largest offshore wind project in the first phase of offshore rollout in Poland. It follows Baltic Power – Poland's first offshore wind farm, which the EBRD also supported in 2023.

"With concerns for energy security growing amidst geopolitical tensions, Poland has increased its climate ambitions, pledging to generate 58 percent of its electricity from renewable sources by 2030. The growth of offshore wind energy deployment is seen as key to reducing the country's coal-fired energy generation and meeting this target," EBRD stressed.

The Baltica 2 project is being carried out by the PGE group together with the Ørsted group in the formula of a joint venture in which each partner has an equal share. The first power in the project will be generated in the first half of 2027 and the commissioning of the entire project is planned for the second half of 2027.

On Thursday, representatives of the management boards of the listed power utility PGE and the Danish Ørsted signed an act to start the construction of the 1.5 GW Baltica 2 offshore wind farm, with an estimated cost of around PLN 30 billion (EUR 7.14 bln). The shareholders are responsible for providing this funding in equal proportions.

The part attributable to the PGE capital group will be financed with EU funds from the national recovery plan KPO under a loan provided by BGK and in the project finance formula provided by a consortium of 25 Polish and foreign financial institutions, including BGK, the European Investment Bank and the European Bank for Reconstruction and Development.

Once operational, Baltica 2 will be the largest wind farm in the Baltic Sea, with a capacity of up to 1.5 GW. It is expected to generate about 5,000 GWh of electricity annually, which equates to approximately 3 percent of Poland's current electricity generation. This will help to avoid over 3.5 million tonnes of CO2 emissions a year. Baltica 2 will benefit from the Polish Contract-for-difference (CfD) support scheme.

Energy security and the climate transition also remain key priorities for the Polish government under Poland's rotating presidency of the European Council.

jz/ ao/