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Denmark

Denmark

Dong sells Polish onshore assets for EUR 240 million

POLAND: Dong Energy has announced plans to sell three Polish wind farms with a combined capacity of 111MW to two of the country's utilities for EUR 240 million.

The deal, with Polish utilities Energa and PGE, includes Dong's Polish project pipeline of 700MW. The Danish power company said the sale will allow it to concentrate on developing its offshore capacity.

Dong CEO Henrik Poulsen said: "The divestment is a step towards realising Dong's previously announced plan to divest assets with an aggregate value of DKK 10 billion (EUR 1.3 billion) during 2013 and 2014."

The sale is expected to be completed by the end of the year. It includes the 30MW Karnice I project, which Dong built in 2008 at a cost of EUR 59.4 million. All three constructed wind farms are in West Pomerania, western Poland.

In a statement, Poulsen insisted the company's investment in Poland had been a profitable one. However, the deal also follows a new renewable energy law that was submitted to the Polish cabinet for approval in December, which is believed to more favourable towards offshore wind.

Commercial-scale wind farms will receive support under the green certificate (GC) system. But the economy ministry has cut the rate of green certificates per megawatt hour and has withdrawn the right to obtain GCs once a wind farm owner sells electricity for more than 105% of the medium price of electricity in Poland - currently EUR 49/MWh.

The Polish Wind Industry Association claims this effectively bans wind farms from the free market. Many wind farm operators sell electricity on the free market instead of under long-term contracts, earning more when selling during peak demand periods.



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