PGE Group is currently developing three offshore wind farm projects in the Baltic Sea. Two of these are the Baltica 2 and Baltica 3 offshore wind farms, which comprise the Baltica Offshore Wind Farm with a total capacity of 2.5 GW. PGE is implementing this project together with Danish partner Ørsted. Both phases of the Baltica offshore wind farm have location decisions, environmental decisions, transmission grid connection agreements with the operator, as well as the right to a contract for difference (CfD) and an approved level of individual support. Delivery of electricity to Polish households will begin later this decade. At the same time, PGE is preparing for the construction of a third project, Baltica 1. This offshore wind farm is scheduled to be commissioned after 2030 and will have a capacity of approx. 0.9 GW. PGE Baltica, the company responsible for PGE Group’s Offshore Program, started wind measurement and environmental studies for this project in 2022. Baltica 1 already has a location decision and a connection agreement. By implementing further offshore wind farm projects, PGE intends to fulfil the strategic goal of achieving – at least – 6.5 GW of offshore generation capacity in the Baltic Sea by 2040. In order to apply for new location permits (PSzW – permits to erect artificial islands) for a part of the areas released in the Baltic Sea for the construction of offshore wind farms, PGE has started cooperation with other energy groups in Poland such as ENEA and TAURON.
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PGE was the first company in the industry in Poland to announce a business strategy with a transition plan aiming at the Group's climate neutrality in 2050.
Implementing the goals and assumptions defined in the strategy adopted by the Management Board of PGE SA and published in October 2020, the Group is rebuilding its generation portfolio towards low- and zero-emission sources.
The effects related to emission reductions will become visible as more investments are put into operation.
PGE as the leader of sustainable energy transition in Poland, including in environmentally friendly energy, is committed to reducing its impact on the environment through:
- decarbonising generation through technology change, expanding the RES portfolio and enabling the Group’s customers to participate in the transition,
- increasing the use of renewable sources and decarbonising the portfolio,
- developing a circular economy,
- reaching climate neutrality by 2050.
Eco-friendly investments are at the core of PGE Group’s investment activities.
In 2022 alone, PGE Group companies incurred expenditures of approx. PLN 4.87 billion, of which:
- PLN 2.69 billion represented investments in new and development gas units (in locations of gas units in operation today),
- PLN 1.34 billion – investments in the development and modernisation of the distribution network together with the cabling of the overhead network,
- PLN 103 million – RES installation connections,
- over PLN 245 million – development tasks and strategic modernisation investments carried out by PGE Energia Odnawialna,
- 213 million – offshore energy segment tasks in 2022.
The remainder of the expenditures are investments related to the adaptation of generation assets to the requirements of the BAT Conclusions and modernisation and restoration investments related to increasing the efficiency of plant operation, reducing environmental nuisance and supporting the responsible use of natural resources.
Renewable assets
Renewable assets are a key element of the energy transition, aiding in the reduction of carbon dioxide emissions into the atmosphere and thus increasing the share of renewable energy sources in the National Power System.
PGE Group's path to climate neutrality
Fig. PGE Group’s path to climate neutrality
PGE Group's long-term strategic aspiration is to provide all energy from renewable sources to PGE's customers by 2050, which will be possible through implementation:
- offshore program,
- PV program,
- development of onshore wind portfolio,
- energy storage program.
The implementation of RES projects will contribute to the diversification of PGE Group’s fuel mix, an increase in installed capacity in renewable energy sources, and thus to the implementation of the EU climate policy.
PGE Group currently already has more than 1.3 GW of installed capacity in RES, including hydroelectric power plants, wind farms, photovoltaics and biomass, of which approx. 772 MW comes from wind farms. In addition, PGE is Poland’s largest operator of pumped storage power plants (1.25 GW of capacity without natural inflow) acting as energy storage facilities.
PGE Group is running the Group’s Photovoltaic Program, whose strategic goal is to achieve 3 GW of solar power capacity by 2030 and to ensure that PGE Group is the leader in the development of photovoltaic power plants in Poland. To date, PGE has secured land of 3,500 hectares, allowing for the construction of approx. 2.4 GW of photovoltaic capacity.
In 2022, PGE Energia Odnawialna continued its intensive activities in the area of the development of its own photovoltaic farms, with the Group obtaining planning permission decisions for around 251 MW of PV capacity in the last year. Two acquisitions of PV projects at various stages of development were also finalised. In February 2022, the acquisition of six projects with a total capacity of 25 MW with planning permission was completed. On the other hand, in December 2022, PGE completed the acquisition of 28 projects with a total capacity of 59 MW with technical connection conditions.
Facility work on 19 PV projects with a total capacity of approx. 18 MW was also completed at the end of 2022. The commissioning of these installations is planned for early 2023. In addition, in 2022, PGE Energia Odnawialna entered into agreements with contractors for the construction of PV installations with a total capacity of approx. 180 MW, including large farms such as 100 MW PV Jeziórko and 25 MW PV Augustynka. These assets will be built in 2023.
As part of the program to develop photovoltaics at PGE Group, preparations for the first stage of the construction of PV farms were continued at the Bełchatów power plant. These farms are to be erected in the areas of the Ashes Reservoir, Reservoir No. 5 and Szczerców Mountain, which requires, first of all, reclamation, changes to the Conditions Study and Local Development Plans, as well as obtaining a set of administrative decisions. Ultimately, by the end of 2025, PGE will have built installations with a total capacity of over 500 MW in the Bełchatów area.
PV development program in 2022 in numbers: Objective: > 3 GW of installed capacity by 2030
- 19 MW – built capacities;
- 179 MW – in progress (including 25 MW from an acquisition completed in the first quarter of 2022)
- approx. 250 MW – capacity covered by construction permits
- approx. 3500 ha with a capacity of approx. 2.4 GW – land secured:
- acquisition of a portfolio of 7 projects with a total capacity of 26 MW (including 1 project with 1 MW returned to the Vendor) in the first quarter 2022 and a portfolio of 28 projects with a total capacity of 59 MW (with valid technical connection conditions) in the fourth quarter of 2022.
PGE Group is the largest domestic generator of electricity from onshore wind farms with approx. 10% of installed capacity in wind farms in Poland. Its current investment portfolio includes projects with a total capacity of approx. 200 MW. These include FW Lotnisko II, FW Karnice III, FW Bukowo, FW Resko III and projects under development in the Bełchatów area. These new investments will be possible with the entry into force of the law liberalising the distance law, in particular the relaxation of the so-called ’10H’ condition.
Onshore wind farm development in 2022 in numbers. Objective: >1 GW in new capacities by 2030:
- 150 MW – capacity in progress under preparations
- 50 MW – analysis of the possibility of developing own projects in PGE Group locations
- acquisition of 3 wind farms, or 32 turbines, with a total capacity of 84.2 MW and an average annual production of 240,000 MWh. These are: WF Radzyń with a capacity of 36.9 MW (in the Kujawsko-Pomorskie voivodeship), WF Ścieki with a capacity of 22 MW (in the Łódzkie voivodeship) and WF Jóźwin with a capacity of 25.3 MW (in the Wielkopolskie voivodeship).
PGE Group is also carrying out analytical and preparatory work on energy storage development opportunities. The strategic aspiration is to build 800 MW of storage capacity by 2030. PGE Group currently sees potential for the development of electrochemical energy storage facilities, such as the over 200 MW energy storage facility operating at the Żarnowiec pumped storage power plant or approx. 50 smaller energy storage facilities cooperating with the main power supply points in the PGE Dystrybucja area, with a total capacity of over 250 MW. At the same time, the Group sees opportunities related to the development of new pumped storage power plants such as: ESP Młoty, which also perform an energy storage function in the National Power System. Technical and economic analyses are currently in progress to make an investment decision on the construction of the power plant in Młoty.
District heating sector transition
PGE Group’s business strategy adopted in 2020 sets a low- and zero-emission objective for the district heating area. The key actions taken by PGE that are conducive to the achievement of the set goals are primarily:
- investments in the area of new gas sources,
- thermal waste treatment facilities,
- use of renewable energy as a source of district heating.
PGE Energia Ciepła, being the leader of the heat market in Poland, aims to be a transition leader in the heating sector. In view of the growing expectations of customers and society and the development of the market for system heat consumers in large cities.
Solutions such as the long-term contract signed in May 2021 by PGE Energia Ciepła’s branch in Lublin for the supply of heat to the city’s inhabitants support the implementation of national and international climate policy objectives.
At the end of 2022, PGE Energie Ciepła’s investment application for the investment task: „PGE EC Decarbonisation Plan to 2050.” It contains detailed actions planned to be taken until 2030 concerning the conduct of in-depth analyses of the transition to low-carbon generation in the district heating segment.
The key investment projects in this area especially include:
- construction of new gas-fired cogeneration sources
Since 2021, new units are under construction in Siechnice (CHP Czechnica), while the preparation phase for similar projects is currently underway in Bydgoszcz, Kielce, Zgierz and Gdynia;
- construction of new reserve and peak load boiler plants
At the turn of 2021 and 2022, a new peak load boiler plant with a capacity of 130 MW was put into service in Gdańsk, which consists of oil and gas boilers and modern electrode boilers powered by electricity. The use of electrode boiler technology at the Gdańsk CHP is an innovative solution in Poland.
The construction of new peak load and reserve boiler plants started at the end of 2021 at six other locations, i.e. in Gorzów Wielkopolski, Lublin, Rzeszów, Kielce, Gdynia and Bydgoszcz, with a total capacity of approx. 743 MW, in order to replace the old coal-fired boilers.
In 2022, the projects entered the decisive phase of implementation – the main components (including gas boilers) were delivered and installed, and construction and assembly works were carried out. The work is expected to be completed by the end of 2023 at the latest, so that the newly built peak load boiler plants will be commissioned by 2024 at the latest.
PGE Energia Ciepła is also implementing projects with a longer time horizon as part of dedicated programs for the development of the existing generating assets in Kraków, Gdańsk and Wrocław. These are expected to be completed by 2030. The assumptions for these PGE Group projects are drafted on the basis of analysis of potential regulatory trends, also in cooperation with industry organisations on the national and EU level.
The development projects analysed also consider the use of hydrogen-ready technology, enabling the co-combustion of hydrogen, which in the long term offers an opportunity to significantly reduce CO2 emissions in cogeneration systems.
The document was created as an operationalisation of the objectives set out in PGE Group’s strategy in the area of generation portfolio transition towards a higher share of low-carbon units and renewable energy.
One of the key initiatives of the plan is the transition of generation assets, which includes in its scope the development and implementation of investment programs for individual PGE Energia Ciepła sites.
Rebuilding of generation capacity is envisaged with a view to 2030 (ending coal-based generation) and 2050 (achieving climate neutrality).
In view of the increasing expectations of customers, society and other stakeholders, as well as active support for the implementation of national as well as international climate policy goals, PGE Energia Ciepła is gradually replacing old coal-fired sources with new low-carbon sources fired by gas and oil.
With a view to further decarbonisation and relative limitations in the availability of natural gas, PGE’s intention is also to maximise the potential of large-scale heat pumps, biomass, waste heat, municipal waste and electrode boilers.
In the case of planned gas-fired units, the possibility of adapting to the future use of hydrogen is also being considered.
The new generating units are characterised by greater operational flexibility and reliability. In 2023-2029 most of PGE Energia Ciepła’s locations will feature installations that result in a total or considerable withdrawal from coal fuel.
The phase out of coal is first planned in Zgierz, Kielce, Lublin, Rzeszów and Gorzów Wielkopolski, followed by CHP plant in Bydgoszcz, Siechnice near Wrocław, Gdynia and Gdańsk.
Reducing greenhouse gas emissions from conventional energy generation
PGE Group is systematically working towards reducing greenhouse gas emissions also in its power plants, regardless of the expected implementation of the process of separating these assets from the Group’s structures.
Unit carbon dioxide emissions are being systematically reduced as generating assets are modernised and development investments are carried out.
Optimisation of generation efficiency, increased efficiency in the use of fuels and raw materials and a reduction in the energy intensity of generation processes and own needs are being carried out at the plants.
The Bełchatów plant is a major greenhouse gas emitter (CO2).
This is due to the fact that it is the largest unit in Poland and the world producing electricity from lignite, which causes emissions to accumulate in one place and reach significant absolute values.
It is noteworthy that Elektrownia Bełchatów in the period from 1989 to 2022 reduced the volume of CO2 emissions per unit of energy produced – from about 1.20 t CO2 /MWh to about 1.102 t CO2 /MWh. The decrease in unit CO2 /MWh emissions was as much as 8% over this period.
The scale of CO2 emissions per unit of energy produced at Elektrownia Bełchatów is comparable to or better than other European lignite-fired power plants.
The new units 5 and 6 at the Opole Power Plant contribute to the decarbonisation of the national electricity industry due to their significantly higher efficiency.
They are started-up first before older units with lower efficiency. In effect, at a given level of supply (capacity of installed units) and a stable level of demand in the country (demand for capacity), the „new” units with lower CO2 emissions displace the „old” higher emission units.
These actions contribute to the reduction of emissions from the national energy industry. In 2022, the emission factor for units 1-4 at the Opole plant was 0.902 Mg/MWh and for units 5-6 this was 0.749 Mg/MWh.
The reduction of carbon dioxide emissions at the Turów power station was achieved by increasing the electricity generation efficiency of units 1-3 and commissioning a high-efficiency unit 7 in 2021. A modern and high-efficiency power unit 7 was commissioned in May 2021.
At the Dolna Odra plant, there has been a gradual reduction in the amount of coal burned since 2013.
At the same time, biomass combustion was introduced in 2004, replacing part of the coal that would have to be burned in the absence of biomass combustion.
As part of the modernisation measures carried out at the units operated at the unit, efforts have been made to increase the efficiency of electricity generation and thus reduce CO2.
At the Dolna Odra power station, a project is currently in progress to build two gas-steam units of approx. 700 MW gross capacity each.
High-methane natural gas is the primary energy source for the selected generation technology. The overall progress of the project, including design work, equipment manufacture and supply, and site works, exceeded 80% at the end of December 2022.
PGE Gryfino 2050 sp. z o.o. is the company executing the project. According to the project implementation schedule, the works should be completed in December 2023, so that the gas and steam units will be put into operation in 2024.
The implementation of projects using gas as a transition fuel supports the transition towards climate neutrality. The construction of two new gas/steam units in the Dolna Odra Power Plant is a project of strategic importance for the Polish economy and at the same time important from the perspective of lowering the costs of the energy transition.
The average CO2 emission of the new units will be more than two times lower than the current average emission of energy generating assets in the National Power System (NPS). This means that energy generation using the new units will deliver a reduction in CO2 emissions in the NPS of approx. 2-3 million tonnes per year. The reduction in emissions is achieved not only by changing the fuel to gas, but also by using the latest generation of gas turbines.
Their energy generation efficiency exceeds 63%. For comparison, gas-and-steam plants with turbines from the previous generation have an efficiency of 59-60%, while most modern coal units – approx. 46%.
For the reduction of greenhouse gas emissions at the Rybnik power plant, the construction of the 882 MW gas-steam unit project at the site is of key importance.
The new gas unit in Rybnik will replace four coal-fired units with a total capacity of 900 MW that are being decommissioned. The unit is scheduled to be commissioned in December 2026 and will significantly contribute to the reduction of emissions in the National Power System, similar to the new units at the Dolna Odra plant.
The emission factor of the new unit is 320 g CO2 per kWh of electricity generated, which is three times lower than for coal-fired units of the 200 MW class. The new gas/steam unit will have the option of co-firing hydrogen in gas fuel.
Management of energy consumption
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Considering the management of energy consumption at PGE Group, the reduction of losses resulting from generation and transmission processes is of the most significant importance due to its operations.
As part of production activities, modernisation investments are being carried out in conventional generation units to improve generation efficiency by reducing own losses. The construction of gas/steam units at the current Dolna Odra and Rybnik coal-fired plants will also contribute to improving the efficiency of primary energy use.
In the case of electricity supply – a program to reduce network losses is in place, consistently reducing the amount of electricity lost.
Increase in connection capacity
The majority of investments in the area of electricity distribution in 2022 concerned the modernisation and development of the high-, medium- and low-voltage electricity grid and transformer stations. These investments will increase the connection capacity of the distribution grid, including for renewable energy sources, as well as improve electricity supply interruption rates and further reduce grid losses.
The energy efficiency of electricity equipment is increased by replacing transformers and procuring metering devices, including modern electricity meters. Renewable energy sources (RES) are an important element of sustainability, with measurable economic and environmental effects.
In 2022, PGE Dystrybucja connected 146,000 domestic photovoltaic installations with a total capacity of 1.18 GW to its grid.
In 2022, 323 RES sources with a unit power of more than 50 kW also appeared on the PGE Dystrybucja grid, sources that do not count as micro-installations, including:
- photovoltaic plants with a total capacity of 395.59 MW - 305 units
- wind farms with a total capacity of 235.8 MW - 9 units
- biogas plants with a total capacity of 3.58 MW - 6 units
- biomass with a total capacity of 0.66 MW - 2 units
- hydropower plants with a total capacity of 0.13 MW - 1 unit
The above measures are important in view of the planned reductions in energy production from conventional sources.
Reduction effect of management of by-products of combustion
Greenhouse gas emission reduction is not insignificant in production cycles that use combustion by-products. Examples include reducing the carbon footprint of cement production using fly ash, or gypsum boards using synthetic gypsum.
The use of high-calcium ash from energy generation reduces the CO2 emissions that accompany the cement and lime industries in the production of traditional binders (i.e. cement or lime). Therefore, the conventional energy industry contributes to part of the avoided CO2 emissions due to the use of combustion by-products supplied from the energy industry to the cement industry.
According to a report by the National Balancing and Emissions Management Centre, by producing binders from UPS that successfully replace cement and natural lime in selected geotechnical applications – mainly in road construction, the reduction of CO2 emissions over a 5-year period can be reduced by almost 568,000 tonnes.