Poland's ZE PAK secures loan, PPA for 70-MW solar farm

Polish energy company ZE PAK SA (WSE:ZEP) has secured a PLN-175-million (USD 45.6m/EUR 38.1m) loan for the construction of a 70-MWp solar farm in central Poland and has also agreed an off-take contract for the project.

The financing has been provided to special purpose company PAK PCE Fotowoltaika by a bank consortium consisting of PKO BP SA, Bank Pekao SA and mBank SA, the energy group said recently. The special purpose vehicle has at the same time entered into a long-term power purchase agreement (PPA) with Polkomtel, under which the mobile operator will buy all the electricity produced by the solar farm over 15 years and potentially five more. The power sales over 15 years are expected to be worth PLN 300 million.

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Work on the solar farm located in Brudzew, Wielkopolskie Voivodeship, is in progress, with completion expected in the final quarter of 2021. It is expected to generate about 68 GWh in its first year of operation.

The solar farm is in line with ZE PAK's strategy to stop producing electricity from lignite by 2030.

The project is located in a former lignite mining area, where extraction ended in February 2021. ZE PAK said it will use the experience from building and financing the solar farm to implement more large-scale renewable energy projects in post-mining areas.

As part of measures to mitigate the socio-economic impact of ending lignite power production in eastern Wielkopolska, the company has created a training centre for solar installers, so people who were until recently engaged in lignite extraction and gained skills at the centre were able to get a job on the solar project.

(PLN 1 = USD 0.260/EUR 0.217)