Paweł Średniawa, Onde: I hope the market situation will stabilize soon enough

Climate Minister Anna Moskwa has indicated that with “increased ambitions” in Poland, it is possible to reach 50 GW of capacity in renewable energy sources by 2030. How far is this plan? he ambitious? – President Onde, when asked about it, told Interia that the plan, although quite ambitious, is still achievable.

– You have to pay attention to the fact that the problem that can stand in the way is not only the possibilities of entrepreneurs – because Onde is such a company – but various other problems that we also notice – he said. He also pointed out that you can build wind and photovoltaic installations, but you must also be able to feed the electricity produced from these installations into the grid.

– Investments in this area are also very important (…) We must not forget that the green transformation awaits Poland for sure and we must do everything to become independent of fossil fuels. Whether we do it in 2030, 2028 or 2032 doesn’t matter. It is important that we face a period of very hard work – he stressed.

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What to do to build more RES capacities? President Onde recalled that one of the reasons for the expected investment shortfall regarding the construction of wind farms is the binding law 10H. – For several months we have been hearing reports that these regulations will be liberalized. Current statements indicate that the law will be changed in the first half of 2022 – this is a very good signal. Other projects, mainly wind power projects, may appear on the market in the near future, which can be transferred to the construction process and we can increase the amount of installed capacity, explained Średniawa.

The basic, fundamental element that limits investments are – as the Interia interlocutor said – the legislative barriers. But there are also others: those related to costs, whose increase has recently been driven by the war in Ukraine.

– The prices of labor and construction materials, components used in the construction of wind or photovoltaic farms have increased. Some of the projects to be implemented in the near future are provided with revenue in the form of winning auctions for ERO; Investors are beginning to wonder whether such projects are feasible and whether they will tighten financially. Because we already have the revenue side – we know what revenue we can expect. CAPEX, on the other hand, has increased quite significantly recently. The second element that influences investment decisions is the price of financing – mentioned Sredniawa.

As he added: – Decisions to raise interest rates. significantly affect the interest rate of the loans necessary to carry out this type of investment.

– The interest rate on these loans has changed from the level of guaranteed long-term WIBOR about 3-4 months ago at the level of 0.7%; today we are talking about values ​​above 5%. With the TRI, which is estimated at a slightly lower level, one begins to doubt that it is really fair, he assessed.

President Onde draws attention to the importance of the activities of the associations, i.e. PWEA, which are asking for an extension of the period during which investors are required to supply electricity in the framework of the URE auctions winners. – Today we have a very unstable period: the prices of materials are an element – which, from my point of view, strongly affects the costs related to the implementation of the investment – today difficult to predict. The prices change from day to day. Predictability is important, so the next few months will be when we launch less investment projects so that investors have this time to adapt to the new situation – said Średniawa and added that there are also factors positively influencing investment decisions, such as price energy.

– We must find the right balance, this balance between the costs related to the realization of the project and the income that these projects will implement in the future – he concluded.

In 2020, Onde went public and the capital obtained through the issuance of shares was used to build its own portfolio of investment projects. It now exceeds 830 MW (as of April 26). But the company – which is singled out by the Średniawa – has a bigger appetite. – This is why we took the decision to prepare a bond issue program. The market situation does not motivate investors to embark on such a bond issue. Percentage rate therefore, we are dealing today with a high cost of money. However, it is important that as a company we want to prepare a bond issuance program and decide whether or not we want to use this program in the coming months. If market conditions are favorable, we will definitely decide to take this step to issue bonds – announced President Onde. – If the conditions are not favorable, I think that we will refrain from such decisions. It is important to prepare the program now, as this process is ongoing. This is not a process that we will be able to complete in one or two days, or even in a month, so we are already preparing all the documentation for the issuance program. We have started work. I hope we will make decisions soon. I hope the situation in the market will stabilize fairly quickly – he added.

Onde plans to issue the so-called green bonds, the object of which will be mainly investments in renewable energy.

In an interview with Interia Średniawa, he pointed out that the situation on the world market is difficult today. He noted, however, that “when running a business, you have to be resistant to all kinds of change.” – You have to be prepared for the “black swans”, which are talked about quite often lately. There are now more and more. But the history of our company shows that we can find ourselves in such situations, for example in 2016 after the introduction of the 10H law, when a significant part of the market – one could say – ceased to exist. In 2016, our company generated revenues of PLN 300 million; Five years later, in 2021, we finished with revenues of PLN 1.2 billion. I think it’s an argument that we can find ourselves in difficult conditions. Diversification is the key – said Średniawa.

When looking for new sources of income, the company plans to get involved in the implementation of projects outside Poland. – We started working on the acquisition of a company operating in Germany. We do not yet have a selected company that we would like to take over, but we have already started working in this area – said the interlocutor of Interia.

Why the German market in particular? – Firstly because the Erbud group, because we are part of it, has a long experience there and has been developing in this market for many years. Moreover, we see opportunities in this market for the development of the company we lead. The German market is a market where wind power plants have been built quite a long time ago and in the near future it will be time to dismantle the old plants, the so-called repowering ones and we hope to be able to show our experience in this – a he explained.

President Onde also stressed that “foreign development must start with one country and – if it succeeds – then think about the next”. – It would not be a good solution to suddenly start working in 3-4 countries. Remember that the law and building regulations are different. It is important to work in a different market, which is foreign to us today, but when we know this market, we can think of looking for new orders in other markets in other areas – he concluded .

Bartosz Bednarz interviewed

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