The Orlen Group has reached the final investment decision (FID) to build the 1200MW Baltic Power offshore wind farm.
The project, set to come on stream in 2026, will be pursued in partnership with Canada’s Northland Power.
The FID means that with all the requisite construction permits in place, all key components contracted and financing secured, the project is primed for execution.
Moreover, as part of its ongoing efforts to facilitate offshore industry development, the Orlen has initiated the construction of an installation terminal in Świnoujście.
Daniel Obajtek, Orlen’s chief executive, said: “We stand at a pivotal point, both for the Orlen Group and the broader energy sector in Poland.
“Our commitment has led us to embark on the most significant project to develop renewable energy in our country and the entire region.
“Notably, the Baltic Power offshore wind farm represents one of just two such projects in Europe to progress to the implementation phase over the past three years.
“Despite the formidable challenges posed by the pandemic, supply chain disruptions, and military conflict across our eastern border, we have adhered to the ambitious timeline we set from the outset.
“Within three years, we will launch the first offshore wind farm in Poland, but our aspiration is to use our experience and newly established infrastructure to implement further projects.
“A case in point is the ongoing construction of an installation terminal for offshore wind farms in Świnoujście, which will serve not only the Baltic Power project but will also facilitate the pipeline of five more wind farms slated by the Orlen Group, with a combined capacity of 5.2GW.” The Baltic Power farm will generate 4,000 GWh of electricity, equivalent to approximately 3% of Poland’s current electricity output, helping to avoid an estimated 2.8 million tonnes of carbon emissions annually.
The foundation laying is scheduled to commence in 2024, with the farm expected to comprise 76 Vestas wind turbines with a unit capacity of 15MW, standing at a height of over 250 metres, by 2025.
An onshore substation project is already under way, designed to evacuate the power generated at sea.
Baltic Power has inked agreements with key contractors and suppliers to secure a supply chain spanning the manufacture, transport and installation of all critical farm components.
Notably, these partners include globally renowned experts in offshore wind, with a substantial local content, Orlen said.
The overall project budget is estimated at approximately €4.73bn, encompassing capital expenditures, including insurance (totalling approximately €4.05bn), as well as financing costs and an additional reserve.
The project will be financed under the Project Finance framework – in September, Baltic Power’s shareholders signed loan agreements for a total of about €4.4bn with 25 Polish and international financial institutions.
Mike Crawley, chief executive of Northland Power, said: “As Northland, in collaboration with our partner Orlen, we are delighted to commence the construction phase of the Baltic Power project.
“Upon completion, the wind farm will supply clean energy to over 1.5 million households, marking a substantial stride towards bolstering Poland’s energy transition goals. We look forward to achieving further construction milestones in the coming months.”