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Ørsted and PGE form a joint venture for two offshore wind projects

Danish multinational power company Ørsted and Poland’s largest energy sector group PGE have signed an agreement to form a 50/50 joint venture for the development, construction and operation of two offshore wind projects in the Baltic Sea with a total potential capacity of up to 2.5 gigawatts (GW).

Ørsted will subscribe for new shares representing 50 per cent of the total share capital in PGE’s two offshore wind projects, Baltica 3 and Baltica 2. Both projects are eligible to be included in Poland’s 2021 offshore wind allocation round, where a total of 5.9 GW is expected to be awarded. Baltica 3 is the most advanced of the two projects and could become operational in 2026.

“Offshore wind energy is a great opportunity for the Polish economy and Polish entrepreneur,” said Wojciech Dąbrowski, President of the Management Board of PGE. “It is estimated that over 100 domestic entities can be successfully involved in the preparation, construction and operation of wind farms in the Polish part of the Baltic Sea. The potential offshore energy capacity in the Baltic Sea is estimated to be approximately 11 GW by 2040 and the total value of the investments is estimated to be up to 160 billion zlotys [35.5 billion euros]. The potential of the Baltic Sea for attracting offshore investments is enormous and that is why we are counting on leveraging the mutual experience and joint preparation for the operational phase of both projects, especially due to ambitious plans of PGE for offshore. We aim to install at least 6.5 GW of offshore capacity by 2040.”

As a part of the agreement, Ørsted and PGE have agreed to establish a framework that enables both parties to effectively integrate and leverage strengths and expertise from both sides. The combination of Ørsted’s world-class offshore wind expertise with PGE’s Polish power market expertise and experience will form a market-leading partnership well-positioned to deliver the largest portfolio of offshore wind projects in the 2021 allocation round.

“Poland is emerging as the front runner in offshore wind in the Baltic Sea and we are very excited to enter the Polish market with this joint venture with PGE,” commented Martin Neubert, Executive Vice President and CEO of Ørsted Offshore. “This transaction brings together Ørsted’s unparalleled track record in developing and constructing large-scale offshore wind farms with PGE’s extensive knowledge of and experience in the Polish energy market and its regulatory framework. Our new joint venture is strongly committed to delivering on the Polish Government’s ambitious plans for the deployment of offshore wind.”

As underlined by PGE, the two projects will provide green energy to 4 million households and will avoid over 8 million tons of carbon emissions per year.

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