ORLEN’s Supervisory Board has made a conditional investment decision for the Baltic Power offshore wind farm in Poland, enabling the finalisation of the design phase.
The construction phase scheduled for later this year after the completion of the financing process and completion of construction permits.
The joint investment of ORLEN and Northland Power at this stage is the most advanced offshore wind project in Poland said the Polish developer.
By 2030, ORLEN Group will have made a leap in the development of renewable energy sources, reaching 9GW of installed capacity it added.
Offshore wind energy will be a key element of this development and the Baltic Power decision is a milestone that brings the company significantly closer to achieving its strategic objectives said president of the management board of ORLEN Daniel Obajtek.
The total finance plan for the Baltic Power project is estimated at €4.73bn and covers capital expenditures and contingency (in the amount of €4.05bn), as well as financing costs and additional reserve.
The shareholders of the investment assume that its financing will be carried out under the Project Finance formula, a model in which repayment of liabilities will be based on future financial surpluses generated by the development.
The is particularly favourable for investments that require significant expenditure and time to reach full capacity, such as the construction and operation of offshore wind farms. At the same time, it fits in with the financial assumptions of the updated ORLEN2030 strategy the developer added.
Baltic Power has secured all the permits for the onshore part of the project, as well as a permit for the construction of an offshore power connection to bring energy from the farm to land.
It also has secured contracts for all key components of the farm – including turbines, offshore and onshore substations, cables and foundations – along with their manufacture, transport and installation.
One of the conditions for reaching a final investment decision remains the acquisition of construction permits for the offshore part of the project.