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Harmony Energy Poland bidding 500MW into upcoming capacity market auction

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The Poland arm of UK-based developer Harmony Energy is looking to bid in around 500MW of battery storage projects into the upcoming capacity market auction, executive director Michał Maćkowiak said.

Harmony Energy Limited has set up a local subsidiary in June this year, Harmony Energy Poland, in which it holds a majority stake with management holding a minority. The company has also set up local subsidiaries in France, Germany, New Zealand and Germany.

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The Poland subsidiary is headed up by executive director Michał Maćkowiak, who will be speaking at the Energy Storage Summit CEE, taking place next week on 26-27 September in Warsaw.

Maćkowiak told Energy-Storage.news the grid-scale energy storage market in Poland is at an inflection point thanks to the “enormous pace of renewable development” which now exceeds the UK’s and the transmission system operator’s (TSO) recognition that it will need energy storage.

He added that Harmony Energy will employ a similar model to in the UK to take projects from site identification to fully operational. There, Harmony Energy Limited develops battery storage projects to which the listed fund Harmony Energy Income Trust (HEIT) has first refusal to acquire, though the Trust can also acquire from third-parties.

The basis of the business case for large-scale storage in Poland will be the capacity market, which handed out 165MW of contracts to battery projects last year, deliverable five years out, so starting 2027. However, some tweaks to the capacity market still need to be made to be more favourable to energy storage, Maćkowiak said.

Harmony Energy Poland is seeking to bid in around 500MW of projects to this year’s auction, in December, a similar amount to that targeted by another developer Hynfra, though said it has a further 1GW pipeline of opportunities.

Alongside that, energy trading on the wholesale market and ancillary services will make up the rest of the business case, Maćkowiak said. “Though it’s still early days so everyone has to do their own analysis on exactly what they think the revenue stack will look like,” he added.

New ancillary services, right now a tiny market in Poland, will be brought in next year. Although the capacity market obligations for this year’s winning projects would only begin in 2028 Maćkowiak wants to have projects operational in around two years’ time. Like most other developers the firm is designing projects for two-hour durations.

Also like some other developers in burgeoning markets like Italy, Maćkowiak was sceptical of early-stage pipelines available for acquisition and said the company preferred to develop its projects “from scratch”.

Harmony Energy listed fund in the UK

As of H1 2023, Harmony Energy Income Trust’s portfolio comprised eight UK BESS projects totalling just under 400MW/800MWh, three operational and five under construction, with first refusal on another 505MW pipeline of projects. The bulk of its operational capacity is from Pillswood, currently Europe’s largest at 98MW/198MWh.

It recently sold its one ‘shovel-ready’ project, the 99MW Rye Common project, to Pulse Clean Energy, covered by our sister site Solar Power Portal in light of a “challenging capital environment”.

All three dedicated listed UK energy storage funds – Harmony’s, Gore Street’s and Gresham House’s – have seen their share prices decline over the past year as average BESS revenues in the UK have plummeted due to saturation of ancillary services like dynamic containment (DC) and firm frequency response (FFR).

Energy-Storage.news’ publisher Solar Media will host the inaugural Energy Storage Summit Central Eastern Europe on 26-27 September this year in Warsaw, Poland. This event will bring together the region’s leading investors, policymakers, developers, utilities, energy buyers and service providers all in one place, as the region readies itself for storage to take off. Visit the official site for more info.

24 September 2024
Warsaw, Poland
If your goal is to meet other industry professionals and create valuable business partnerships to better understand the region, then the Energy Storage Summit Central Eastern Europe 2024 is the right place for you. We provide the perfect platform to make high-level connections and fuel enriching and beneficial conversations in a relaxed yet professional environment. Our networking opportunities have been described as second to none by industry professionals.

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