Nazar Holovchak

Yesterday, I had the pleasure of speaking at the "Aktualności Rynku Energii" conference organized by MMC Polska, where I discussed, among other topics, the new balancing market rules that came into force in Poland on 14 June 2024, known as the Terms, Conditions, and Methodologies of Electricity Balancing (Polish: Warunki Dotyczące Bilansowania).   These new rules bring significant changes to the market, including: 🔹A new structure of balancing market participants;  🔹A new structure of balancing market objects;  🔹A new catalogue of balancing services, including Frequency Containment Reserve (FCR);  🔹15-minute settlement periods for balancing energy and imbalances.   SSW experts have prepared a comprehensive overview of these changes, which we are pleased to present below ⬇️   Should you have any questions, please feel free to reach out to Dominik Strzałkowski, Grzegorz Mikos, Michał Ilasz, or me, Paweł Michałek.   #wdb #tcm #balancingmarket #balancing #reform #electricitymarket #power #electricity #energy #renewableenergy #RES #storage #BESS #FCR #TSO #transmissionsystem

36

🔋 This week I had a pleasure to take part in very insightful Energy Storage Summit Central Eastern Europe organized by NGEN and Polskie Stowarzyszenie Magazynowania Energii PSME//Polish Energy Storage Association PESA in Warsaw. ⚡ It was a great fun to moderate one of the panels "New Revenue Streams Unlocked: The Market Outlook" where together with Jakub Kupcu Daniel Świrydziuk Dariusz Perkowski Thomas Gilles we had discussed one the most important topics for the further #BESS technology development in Poland. Our agenda was: 1.       Capacity market auctions 2.       Wholesale arbitrage 3.       Ancillary services 4.       Bankability 5.       BESS working together with RES (wind, PV) on same grid connection 6.       Revenue stacking, and evolution of the revenue mix between the sources, and any additional / different sources we see abroad that may come in to Poland in the future 🎸 Plenty of representatives of top energy industry players from whole world showed up. ❓ I was multiple times asked what is going on today in Poland with #BESS market. 📒 I have provided more of less the below answer. ⚡ Given the current relatively high level of installed PV capacity compared to wind, and considering the limits of transmission and distribution networks, there is an essential need to stabilize the supply side and provide more flexibility on the demand side of the Polish electrical power system . The development of energy storage can largely meet this need. (as is in may other countries worldwide these days) 💵 This, in turn, makes the revenue forecasts and assumed IRRs from BESS technology potentially very attractive. 🛍 Investors are drawn to Poland, having recognized the potential attractiveness of investing in energy storage in the country, such as: 1)       existing capacity market auctions, 2)       the launch ancillary services market in June this year, 3)       increasing daily energy price volatility, 4)       the start of various government programs (preferential loans from the National Recovery Plan or subsidies from National Fund for Environmental Protection), 🥇 It is also worth noting that similarly to other market where BESS has already been deployed we are potentially dealing with a first-mover advantage, i.e., the first energy storage facilities to work in the system in (its near term shape) are expected to achieve the highest revenues in the first years of operations, which in turn could significantly improve the IRR on those investments. #BESS Polskie Stowarzyszenie Magazynowania Energii PSME//Polish Energy Storage Association PESA

48

I had the opportunity to briefly comment in the latest PB on what I think are the reasons for quite a solid representation of companies from the Baltic countries in the renewable energy industry in Poland. I invite everyone who is close to the renewable energy industry, works with or for these companies, to discuss whether you think this representation is actually above average or if you think there are any other reasons? This may be a bit off the core questions we are asking ourselves today regarding future of the energy market in Poland but sometimes such can lead to quite interesting observations and inspirations :) Deividas Varabauskas Darius Sagatauskas Enrique Gomez de Priego Fernandez Vytenis Susinskas, CFA Donatas Kundrotas Mantas Auruskevicius Kinga Kruczek Maciej Kowalski Jacek Wojerz Slawomir Sas Wojciech Chyłek, EMBA, Piotr Biernacki, CFA Kristjan Endrikson Łukasz Musiałkiewicz Ruslanas Sklepowicz https://lnkd.in/dHfeA7MX

22

Raen S.A. with its partner ExMetrix Sp. z o.o., AI algorytm based modeling platform, are happy to share some knowladge about the Energy Market in Poland. Will do regularly so stay tuned for more in upcoming weeks. The significant increase in energy prices in the balancing and wholesale market since the introduction of the auction system on June 14, 2024, can be attributed to a combination of factors that have affected the supply and demand dynamics of the energy market. Here's a detailed explanation of the reasons behind the high energy prices, particularly during the evening peak times: 1. **Introduction of the Auction System**: The shift to an auction-based system for the balancing market may have introduced new dynamics in price setting. Auction systems can lead to higher prices, especially if there is a scarcity of supply or an increase in demand, as participants bid competitively to secure the necessary energy resources. 2. **Shortage of Bids for Evening Peak Energy**: The evening peak is typically a period of high demand as residential and commercial activities peak. If there are not enough bids from energy providers to meet this demand, the basic economic principle of supply and demand kicks in—limited supply plus high demand equals higher prices. 3. **Lack of Infrastructure Preparedness**: Not all generators were able to prepare their infrastructure for the new regulations in time. This lack of preparedness means that there is less competition and fewer bids in the market, which can drive up prices due to the reduced supply. 4. **Renewable Energy Sources (RES) Units Registration Issues**: RES units, which can often provide cheaper energy, have faced challenges in registering as providers of balancing services (DUB). Without the participation of these units, the market loses a segment of potentially lower-cost energy, contributing to higher overall prices. 5. **PSE's Processing of DUB Registrations**: PSE (Polskie Sieci Elektroenergetyczne or Polish Electricity Networks) is currently focused on processing applications for DUB registration and conducting tests of technical and IT infrastructure. This administrative bottleneck means that new suppliers are waiting to enter the market, which temporarily reduces the supply of available energy for balancing purposes. 6. **Technical and IT Infrastructure Testing**: Ensuring that the technical and IT infrastructure is up to par is crucial for the smooth operation of the auction system. Delays or issues in this area can further contribute to the scarcity of supply as potential providers are unable to participate effectively in the market. In summary, the high energy prices in the balancing and wholesale market are a result of a confluence of factors related to the transition to an auction system, supply shortages during peak demand periods, infrastructure readiness issues, and administrative delays in processing new market participants. #RES #greenenergy #energyprice See below graph👇

33

3 komentarze

Existing requirements constitute a market entry barrier that keep the Polish gas market underdeveloped. Revising the way through which the strategic stock is established is the first step on the path to unlocking Polish gas hub’s full potential! You can find our detailed comments here 👇 https://lnkd.in/egF9K3BE #Poland #gas #storage

25

⚡️ Once again, we are advising on significant energy transition projects that will have a major impact on the decarbonisation of the Polish economy. This time we have advised GoldenPeaks Capital's acquisition of a portfolio of 30 photovoltaic farms projects.   The portfolio, acquired from Columbus Energy S.A., comprises ready-to-build projects.   The work of #CMSPoland’s multidisciplinary team was overseen by Piotr Ciolkowski and Wojtek Szopinski.   Read more ➡️ https://lnkd.in/dfeMS8ma   #CMSlaw #energy #photovoltaics #energytransition #acquisition #decarbonisation

90

1 komentarz

Tomorrow, I will have the pleasure of giving a presentation on the Polish PPA market at the Solarplaza Summit in Warsaw. Among others, I will cover the topics of: 🔸 Contractual risks and considerations 🔸 Meeting the offtaker’s needs 🔸 PPA pricing 🔸 Future trends The panel starts at 14:00, see you at Solarplaza Summit!  Let us meet there and have a fruitful discussion! #OurNewEnergy #SolarplazaSummitPoland #SolarplazaSummit #Poland #PPA #EnergyMarket #EnergyTransition #Networking

13

1 komentarz

🚨 Poland's Energy Market Update 🚨 In 2023, Poland saw its first RES curtailments and negative spot market prices. The situation evolved in 2024 with frequent curtailments in March-May, driven by new compensation rules in the Energy Law. Market-based redispatching compensates fairly, while non-market-based methods are used as a last resort. Find out more here: https://bit.ly/3UQXk9e #EnergyTransition #RenewableEnergy #PolandEnergyMarket #Redispatching #EnergyLaw #Sustainability

13

As promised another short energy report done together with ExMetrix. What is on German market we shall expect in Poland 🇵🇱 in the future. THE VOLATILITY OF ENERGY PRICES ON THE GERMAN MARKET IS SIGNIFICANTLY HIGHER THAN ON THE POLISH MARKET. Since 14 June 2024, with the introduction of the auction system in the balancing market, the volatility of energy prices in Poland has increased. However, this is a temporary situation. What's important to note is the resilience of the Polish market, where the average energy price is significantly higher than in Germany, but the volatility is much lower. The average energy price on the DAM in Poland for the last year is 93.66 [EUR/MWh]. On the other hand, the average energy price on the DAM in Germany for the last year was 79 [EUR/MWh]. Thus, the energy price of the DAM in Poland was 18.56% higher than in Germany. Meanwhile, the measure of volatility, or the variance of the price on the DAM, was 32.33% higher in Germany than in Poland. The futures price variance is even higher. For example, Base_M contracts (continuation price from contracts with the nearest expiry date) have a price variance 112% higher in Germany than in Poland. The much higher variability in Germany may be due to the fact that Poland's share of generation from RES sources is about 27%, while Germany's share was 55% in 2023 and 56% in the first quarter of 2024 (and generation from these sources, apart from hydro, is, as is well known, highly variable). The high volatility of energy prices in Germany also translates into volatility in trading. The different preferences of futures market participants in Germany and Poland further compound this. In Germany, the largest number of positions were opened on contracts with a relatively close expiry date (until the end of Q3 2024), with a volatility of more than that of Poland. Meanwhile, in Poland, most positions were opened on the more stable one-year contract expiring at the end of 2025. Energy price on the DAM - 🇵🇱 vs 🇩🇪

17

6 komentarzy

📅 At the beginning of August, Ivan Balytskyi, a partner at our law firm and the head of the legal committee of the Solar Energy Association of Ukraine, held an open session on the topic: "Tax Audits in 2024: How to Prepare for Renewable Energy Producers." 👤 Together with Nataliia Kurilenko, the head of the tax practice at "Sokolovskyi and Partners," they discussed how the "tax" environment for renewable energy producers has changed and how to protect their interests in disputes with tax authorities. The colleagues talked about the tax audit schedule, the necessary documents, and the steps to prepare for and during the audit. ❗️💬 According to Mr. Ivan: "Following the lifting of the moratorium on audits, we see increased activity from the tax authorities. Every day, more and more new court cases on tax disputes involving solar generation facilities emerge. Therefore, renewable energy producers should already be concerned about tax 'hygiene': checking the availability of all primary documents, ensuring their compliance with legal requirements, and verifying the accuracy of accounting and tax records by conducting an independent audit." Read more about the issues discussed during the session and the conclusions reached by the experts in the publication👇

5

As Maciej says, changes, changes, changes as we are transitioning to a fully renewable economy. These changes don't stop on our coast but are as important on our lakes, seas and oceans as they are on land. As the maritime transport sector, arguably one of the most important economic drivers in our internationally connected economy, has its unique challenges we need to be very aware of how we can change the sector in the most cost effective way possible. Enmaro can help you with that.

1

Chisinau is looking for options in case of interruptions in gas supplies due to Ukraine. The Ministry of Energy of Moldova has prepared a plan for the next heating season, which takes into account the option of stopping gas supplies via the Ukrainian GTS. Chisinau is trying to eliminate the risk of interruptions in blue fuel supplies to the republic during the winter period. The Ministry of Energy of Moldova has prepared a plan for this period, which includes energy security measures for the next heating season, a voluntary 15% reduction in gas consumption in accordance with EU recommendations, and an appeal to other energy resources. The measures will be discussed as part of public consultations. The republic plans to stock up on gas by November in the amount of 15% of annual demand, as well as fill coal and fuel oil storage facilities to the maximum. Moldova is considering two backup options if the transit of Russian gas through Ukrainian lands ceases in 2025. The first one assumes that the Russian Federation, which has obligations to the republic, will find another route. If Gazprom stops supplying gas, this will not be a fatal situation for Chisinau, and it will take mitigating measures. In this case, both banks of the Dniester will still have access to gas, but the left bank may not be able to pay at market value. In addition, if things go badly, Moldova will have to buy more electricity for the right bank from Europe and increase capacity on the Moldovan-Romanian border. https://lnkd.in/eMA-2wKc

2

Piotr Raczkowski, PPA Transaction Advisor at ONE, will be speaking at the Solarplaza Summit in Warsaw, Poland this Thursday. Piotr will speak about the outlook for the Polish PPA and energy trading markets, and touch upon the following topics: 🔸 Contractual risks and considerations 🔸 Meeting the offtaker’s needs 🔸 How to decide which type of PPA to use 🔸 Imbalance and profile risk of renewables and how to deal with that in different types of PPAs See the full program of the summit here: https://lnkd.in/giiSg-Ch Feel free to reach out to Piotr if you have questions or if you are also attending the event and would like to connect.   #OurNewEnergy #SolarplazaSummitPoland #SolarplazaSummit #Poland #PPA #EnergyMarket #EnergyTransition #Networking  

13

1 komentarz

Slovak tax policy makers analyze introduction of an adjusted FTT in Slovakia. Technical details are not dislosed yet, that is why it is too soon to make any judgments. The devil will be hidden in those details. Useful link on the German fate of this tax is in the commentary bellow.

8

1 komentarz

The opening of Orange Polska's deregulated fibre-optic access network is an important step, demonstrating the maturity of the Polish telco market. Historically unimaginable (we all remember how much T-Mobile had to pay upfront for the privilege of priority of access to a part of these resources...) has become a fact. Bravo Orange Polska for forward-looking approach! Less overlapped investments mean better health for the whole sector. https://lnkd.in/dyRbnYCs

15

Gain Real-World Perspectives at the Ukraine-Europe Energy Trading Forum ⚡️ We're thrilled to have Maksym Nemchynov, Vice President of Energy Club and former Deputy Minister of Energy of Ukraine, share his unique insights at our Budapest forum on June 4th, 2024. His practical experience offers valuable perspectives on: 🔹 Integrating Ukrainian Gas Storage: Explore opportunities and overcoming challenges for European markets. 🔹 Ukrainian Gas Transmission Trends: Discover the system's development potential. 🔹 Geopolitics and Gas Security: Understand how the current situation impacts Ukraine's crucial role in energy transit. Secure your spot: https://bit.ly/3vjYmlu #UkraineEuropeEnergy #EnergyForum #EnergyPolicy

5

💡 Andrii Nemyrovskyi at the Ukraine-Europe Energy Trading Forum Gain valuable insights into Ukraine's evolving energy landscape. On June 4th, 2024, in Budapest, Hungary, Energy Club presents the "Ukraine-Europe Energy Trading" business forum. Andrii Nemyrovskyi, Member of the Management Board at NPC Ukrenergo, will join the panel: "Ukraine-Europe Energy Partnership: Challenges, Recovery, and Opportunities." Key Topics: ✓ Exploring new electricity trading opportunities following Ukraine's integration into ENTSO-E. ✓ Necessary legal and regulatory adaptations to streamline cross-border electricity trade. ✓ Traditional generation: Prospects and challenges amidst the shift to green energy. ✓ Impact of new capacities on Ukraine's energy balance and export potential. ✓ The future of renewable energy development in Ukraine. ✓ Identifying Ukraine's most attractive energy sectors for investment, including risk assessment and mitigation. ✓ Opportunities and challenges related to completing units 3 and 4 of the Khmelnytskyi Nuclear Power Plant. 🤝 Engage with industry leaders, analysts, and energy traders from across Europe and Ukraine as they delve into the region's energy future. This is your chance to network and contribute to the conversation regarding Ukraine's crucial role in Europe's quest for energy security. Secure your spot now! ➡️ https://bit.ly/3vjYmlu #UkraineEnergy #EnergyTrading #RenewableEnergy #EnergyInvestment #ENTSOE #UkraineEuropePartnership

5

GREEN.. to Energy Transition

7

⚡ Unveiling the Power of Polish Power Exchange (TGE) ⚡ Founded in 1999, Towarowa Giełda Energii (TGE) stands as Poland's premier power exchange, fostering transparency and efficiency in the nation's energy market. TGE's extensive platform supports the trading of electricity, natural gas, and property rights, playing a crucial role in Poland’s energy landscape. ⚡ TGE's integration into the European energy market is marked by its active participation in the Single Day-Ahead Coupling (SDAC) and Single Intraday Coupling (SIDC) projects. These integrations have significantly enhanced cross-border trading, ensuring a seamless and efficient energy flow across Europe. 🌍 Over the years, TGE has continuously innovated to meet the dynamic needs of the energy market. From the launch of the Day-Ahead Market in 2000, TGE has consistently improved market liquidity and flexibility. By the end of 2023, TGE reported impressive trading volumes, underscoring its pivotal role in Poland's energy sector. 📈 Curious to learn more about the European energy market? Visit our website to stay updated with the latest developments in energy trading. 📊 #TGE #Poland #EnergyExchange #PowerTrading #EuropeanEnergyMarket #FORRS

33