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Poland's PGNiG to create renewables unit, targeting 4B zloty spend beyond 2022

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Poland's PGNiG to create renewables unit, targeting 4B zloty spend beyond 2022

Polish state-controlled Polskie Górnictwo Naftowe i Gazownictwo SA revealed plans to create a renewable energy division by the end of 2020 as part of an overhaul of the company's strategy.

The oil and gas company, known as PGNiG, said June 9 that it may spend up to 4 billion Polish zlotys to create and develop the new segment over the next few years, beyond 2022.

This will help the company achieve up to 900 MW of generating capacity with the aim of ultimately making it one of the leading producers of renewable energy in Poland.

"Entering a new business line, namely [renewable energy sources], will allow us not only to build the value of the company, [and] to increase and stabilize its revenue, but also to engage more intensively in the transformation towards a low-carbon and zero-emission economy," said Jerzy Kwieciński, president of PGNiG's management board.

The company said renewable energy sources are not sensitive to movements in hydrocarbon prices, which have a strong effect on the performance of PGNiG's exploration and production and trade and storage segments.

PGNiG said its first decisions regarding investment in renewables may be made even before the company's strategy is updated. Meanwhile, it is doing investment simulations and will seek to establish cooperation with potential partners.

"We are most interested in wind power and [solar] photovoltaic projects. Considering our investment capabilities, the most attractive projects for us are those already existing or at a very advanced stage of development," said Arkadiusz Sekściński, vice president of development. "At the same time we also intend to build our own development competencies in this area by developing, for instance, photovoltaic projects on the sites and areas owned by the PGNiG group."

As of June 10, US$1 was equivalent to 3.93 Polish zlotys.