The year of 2022 was a very special year in many ways. It brought war to Ukraine, the end of pandemic restrictions, an energy crisis, sabotage of Nord Stream 1 and Nord Stream 2, inflation and a bleak prospect of a very serious economic crisis in 2023 and 2024.

Against the background of all these events that revised the energy policy of individual states and the whole EU, it is worth following how the Polish state ‘took care’ of the newly created power sector, the Offshore Wind Power Sector, in terms of legislation over the last years.
For more than 2 years, I have signalled in numerous publications serious legislative shortcomings, which became an essential obstacle to the origin of the Polish Offshore Wind Power Sector. It is worth noting that I am not alone in my concerns, because a large group of entrepreneurs, lawyers and even the National Audit Office (NIK) have been indicating such problems with growing resolution. Unfortunately, such relevant comments, suggestions and ideas do not find a fertile ground among policymakers, who miss an essential issue, namely the relentless lapse of time that may prove fatal for the plans of the Polish Offshore Wind Power Sector, contributing to the significant reduction of the power security of Poland. A good example of the incompetence of authorities in such critical projects is the nuclear power plant that has been constructed since 1982 and is still in the design phase.
On the other hand, the propaganda zone of the Offshore Wind Power Sector, as this has gone far beyond ordinary marketing, is highly successful. Focusing on the area of visions, unrealistic plans and forecasts, such as for example a recent very abstract claim of the Vice-Minister for Climate, Ireneusz Zyska, that first electricity will come from the Polish Offshore Wind Power Sector already in 2026, one may get an impression that we are on the eve of commissioning Polish Offshore Wind Farms. There is nothing more misleading.
In my opinion, we are in a much worse place today than 2 years ago, which is caused by the continued legislative negligence, the lack of pragmatic and uniform management of processes aimed at constructing this sector in Poland in isolation from political interests and the growing competition of other markets in the Offshore Wind Power Sector, which suffer, among other, from the deficit related to personnel, e.g. the US.

Security first

Events such as the sabotage of Nord Stream 1 and Nord Stream 2 have made many people in Poland aware that the infrastructure of this type may indeed become a target of similar or other attacks, which in turn may lead to its serious damage or even destruction. When such potential hazards have been signalled for years, Polish decision-makers have ignored them or even pretended that the problem does not exist. Despite all such worrying signals, no adequate or sufficient measures have been taken in Poland so far that would actually enhance the security of the critical infrastructure at and from sea. The lack of ideas and determined actions of the government in such areas leads to the deterioration of already poor security of Polish offshore infrastructure.
The war in Ukraine, energy crisis and the above-mentioned sabotage have changed the scene of potential hazards and risks related to the installation of Offshore Wind Farms in the Polish contiguous zone. What is more, the incapacity of our security system of the critical infrastructure and at least doubtful procedures have been revealed by the infamous and actually grotesque situation with ‘Spanish amber hunters’.
No adequate work has been undertaken and the following problems have not been solved:
1) Unifying maritime services that are highly fragmented;
2) Clearing competence issues of services whose competences overlap and do not cover certain events at all, which leads to chaos in decision taking and no adequate and fast reactions to hazard;
3) Establishing the Polish Coastal Guards, which simply do not exist, while the Navy is not responsible for this lack;
4) Sufficient training of personnel to protect offshore critical infrastructure;
5) No obligation to update studies of defence issues with regard to Offshore Wind Farms when issuing permits for farms.
It is worth noting that no adequate steps have been taken aimed at developing necessary procedures and processes aimed at the cyber security of infrastructure in the Offshore Wind Power Sector, which in some situations may pose a more serious hazard than a conventional attack or sabotage.
One may get an impression that the Government has no idea what to do or has no resources for resolving such issues, while substantial resources have been spent on an ineffective and totally absurd project of the Passage through the Vistula Pit.

Misfires and remnants of chemical weapons in Polish sea areas

The problem of chemical warfare agents that are remnants of the 2nd World War on the bed of the Baltic Sea is the issue that has a direct impact on the pace of work on Offshore Wind Farms and the final success of investments in their establishment on Polish sea areas.
In recent years, the issue has been signalled to Polish policymakers a number of times, but it has remained without a response, and certainly no specific or systemic measures have been taken in the legislative area.
It is worth noting that both the maritime administration (the minister competent for the issues of maritime economy and directors of maritime authorities) and the environmental protection administration (the minister for the environment and the Chief Environmental Protection Inspector) have not recognised, and consequently have not started to counteract effectively, hazards that results from the remnants of chemical weapons and conventional ammunition on the Baltic Sea bed.
What is missing in the first place are both effective and fast procedures for finding and removing misfires and remnants of weapons on the seabed of the Baltic Sea. Unfortunately, despite broadly advertised successes, which are to be achieved in the area of the Offshore Wind Farms, no legislative initiatives have been undertaken at all in governmental circles that would secure such processes and enable the effective performance of work by private contractors in these areas.
On the other hand, the Polish Government has guaranteed irrationally that the first Offshore Wind Farm will be opened already in 2026.
‘At the end of 2025, first wind farms will be connected to the domestic power system and will generate power in 2026, according to plans that have been approved and are being pursued’, said Zyska. ‘The years of 2027-2028 are the period when the Offshore Power Sector will come to being in full power on the Polish Baltic Sea’, said Ireneusz Zyska, Vice-Minister for Climate, for PAP in January 2023.
Such irresponsible declarations should be interpreted as clear demagogy, which is not supported with any facts or knowledge of what is happening in the legislative area or in any other areas that concern the Offshore Power Sector in Poland.

Polish phantom installation port

The subject matter of the Polish installation port for Offshore Wind Farms on Polish sea areas is the study of inertia of policymakers and chaos in decision-making, which is completely incomprehensible considering the power security of Poland. On the other hand, it has become quickly and cynically a pretext for the introduction of an unconstitutional pre-emptive right to real estate and shares or stocks by the State Treasury in port areas.
Unfortunately, time is passing and an installation port keeps coming back in discussions and various announcements that only cause unnecessary chaos and lapse of time. This situation will soon backfire, because the construction of the Offshore Power Sector on Polish sea areas will be finally served by German or Danish ports. Numerous potential sites of the installation port have been presented, including Gdynia, Gdańsk, and even Świnoujście, where the Orlen Group is planning to construct its own installation port. However, nothing is happening in terms of actual actions, while time is passing mercilessly. According to most assessments and forecasts, Poland has already ‘lost’ an installation port for such projects, which results from the long period of contracting and specific characteristics of processes involved in the construction of the Offshore Power Sector. It will soon turn out that plans related to the installation port will become another pretext for spending billions of zlotys from the Polish budget in a useless manner.
The timetable of the installation port for the Offshore Power Sector is worth following against the above background. One may get an impression that measures in this regard result from political bargaining and particular interests, rather than from a well-though-out plan of implementing processes aimed at creating Offshore Wind Farms on Polish sea areas, which are to enhance the energy security of Poland.
On 30 July 2021, the Government adopted a resolution that the installation port would be located in Gdynia.
Next, on 11 February 2022, the Minister of State Assets applied to the Minister of Infrastructure for changing the Resolution and indicating Gdańsk as a new site for the installation terminal. As a result, already on 1 March 2022, the Government carried a ‘resolution amending the resolution on the installation terminal for offshore wind farms’, indicating Gdańsk as the installation port for the Offshore Power Sector.
Surprisingly for people involved in the Offshore Power Sector, already on 13 October 2022, the CEO of PKN Orlen announced that he had agreed with the Port in Świnoujście that the installation terminal for the Offshore Power Sector would be opened there.
It is also worth describing what actually happened with regard to the installation, namely nothing.

Non-existent transmission network and OWFs

Another very important problem that concerns the Polish Offshore Power Sector is the missing transmission network in Poland, which could receive and transmit produced electricity. As a consequence, Offshore Wind Farms installed on the Polish sea area will not receive permits for connecting to the grid. This issue was inspected also by NIK, which issued a negative opinion on the ‘preparation’ of Poland to OWS.
It is worth noting that the Chairman of the Energy Regulatory Authority (URE), who is aware of the lack of economic and technical conditions required for connecting OWFs, has not presented or assessed conditions for undertaking and conducting a business activity within OWFs, which will involve the production, transmission and distribution of electricity from wind farms at sea. Neither the fulfilment of development plans of the power transmission system operator has been assessed; nor have been any proposals formulated for the change of regulations in this respect.
It is worth noting that OWFs are to be located in 11 areas in the Polish contiguous zone and are to finally produce 11 GW. As of today, it turns out that even if any OWFs are established on Polish sea areas by a miracle, due to the missing transmission network in Poland for receiving their production, any electricity would have to be received by other states, e.g. Sweden, which would probably not enhance Poland’s energy security.
Unfortunately, there is no action plan, decisions and, first and foremost, necessary resources in this regard, which are required for fast and modern investments and restructuring of existing networks.
The reason for this is, among other, the lack of money from the National Recovery Plan, which has been very effectively blocked by the Polish Government, as well as completely useless and uneconomical spending of resources on the Passage across the Vistula Pit, the project that finds no justification either in terms of vested interests of Poland or with regard to energy security of our state.
NO to the Polish local content
The Polish local content as regards to the Offshore Wind Sector has not been secured by law, but in fact has been sabotaged by the present policymakers. Amendments to the tax law, i.e. New Deal 1.0 and 2.0, have made Polish employees among the most expensive, if not most expensive, in Europe in the Polish offshore wind sector.
What is more, no regulations have been introduced that would secure even to the smallest extent the share of Polish firms in the supply chain in the construction of OWFs on Polish sea areas. Such solutions have been definitely possible in legislation, but apparently the Government has not been willing to think about Polish entrepreneurs. Unfortunately, the future of Polish OWFs on Polish sea areas is most concerning, as they will be constructed, operated and maintained by hardly any Polish businesses. This situation results from the incomprehensible indolence in the construction of the installation port that, ‘surrounded’ by Polish suppliers, would naturally and market-wise secure a Polish share in the supply chain at least to some extent.
On the other hand, it is worth highlighting what the Ministry of Infrastructure has done for the Polish local content. While amending the Regulation on training and qualifications of crew members of marine vessels, with no social or sectoral consultation, the Ministry introduced, in fact day by day, extremely unfavourable regulations for Polish businesses operating in the Polish offshore sector. Such actions of the Ministry are plainly ill-advised and have catastrophic effects for Polish offshore firms. One can in fact describe them as throwing a monkey wrench for Polish entrepreneurs who would like to participate in the present and future contracts in the offshore and wind offshore sectors.
Despite numerous initiatives and appeals of the business environment to revise the unfortunate Regulation, such amendments apply and the Ministry of Infrastructure sees no problem, which looks a bit like the old joke about a blind horse that saw no obstacles to running in the Great Pardubice Race.
The whole problem lies in the changed definition of ‘domestic navigation’ resulting from §2 (22) of the Regulation of the Minister of Marine Economy and Inland Navigation of 23 April 2018 on training and qualifications of crew members on sea-going vessels.
The Regulation was amended with § 1(1) of the Regulation of the Minister of Infrastructure of 20 April 2022 (Dz.U.2022.1018), which changed, among other, the Regulation as of 13 June 2022, without any prior warnings from the Ministry of Infrastructure, not to mention any public consultation.
In its previous wording, the regulation contained the following definition of domestic navigation: ‘domestic navigation’ is passage in sea areas of the Republic of Poland (including the economic and contiguous zones, where offshore wind farms will be installed).
The new definition of domestic navigation applicable since 13 June 2022 contains a very unfavourable narrowing of the definition. At present, domestic navigation is understood as ‘passages on internal waters and the territorial sea of the Republic of Poland;’ (§2(22) of the Regulation); hence, the economic and contiguous zones, where offshore wind farms are to be located, are excluded from the definition (sic!).
This is how the Polish local content has been ‘taken care of’ in the Polish offshore wind sector.

Shipyards have to cope alone

If the Polish Offshore Wind Sector were based on floating offshore wind farms to any extent, then Polish shipyards would certainly have to be cared for much more, in order to facilitate and in some situations even enable funding of such projects in Polish shipyards. Naturally, Polish shipyards will also have numerous business opportunities in case of offshore wind farms installed on foundations, but to make such chances real, they have to be simply competitive on the market, which is almost infeasible today.
Private shipyards in Poland have been neglected by policymakers for years. There are no reasonable legal regulations that would facilitate their operation on international markets. Neither can any aid programmes be traced that would support shipyards facing numerous post-pandemic problems, sudden increases of energy prices, price instability, inflation, abrupt raises of energy and gas prices as well as very strict procedures within financing projects implemented by shipyards.
One can in fact get an impression that only shipyards with a share of the State Treasury are treated preferentially, while other shipyards have to get by somehow, but in the present situation this ‘somehow’ is becoming a more and more arduous task.
In my opinion, the basic legislation tool that is supposedly, according to its original idea, the source of activating the Polish shipyard industry, namely the Act of 2016 on the activation of the shipyard industry and complementary industries, needs an urgent amendment.
In its present form, this legal act is in fact dead. This situation stems obviously from the market inadequacy and low legislative level, which has been signalled by the sector and lawyers for years.
Lapse of time and outflow of competences abroad
In this analysis it is worth noting the issue of training personnel for the offshore wind sector, which is gaining momentum in Poland. More and more interesting and valuable training programmes and post-graduate studies are being opened, aimed at training highly qualified personnel for the offshore wind sector. Such initiatives are commendable.
However, what is missed by most observers is that such personnel is trained in fact not for the Polish offshore wind sector, but mostly for foreign entities. After the introduction of draconian public and legal burdens on entrepreneurs in 2022, no foreign companies will find it profitable to employ Polish workers in the Polish contiguous zone, because employers would incur much higher public and legal costs than in case of employing personnel with a foreign fiscal residency, who will work in our sector for a period shorter than half a year per year.
On the other hand, Polish employees find it easy to get jobs in foreign projects, e.g. in the United States or Denmark, which will lead to the situation where the Polishness of Offshore Wind Farms will be expressed only by the site of their base.

Summary

Summing up, it has to be pointed out that the impotence of the Polish Offshore Wind Sector continues and, what is even worse, we are all taking party in it, hoping that something will change at last. I am becoming convinced that in fact not much will rather change. There have been some opinions recently that one cannot criticise the Government for certain mistakes, which are abundant, because it will slow down everything even more and will upset them unnecessarily (sic!). In my opinion, this is a path to nowhere and one should say clearly that nothing has been done for the Polish Offshore Wind Sector for the last 2 years. Explanations that this is a new sector and law-making always lags behind new sectors is a nonsense, because this subject matter has been debated on for several years in Poland and in fact it is well known what should be done. However, no one among policymakers bothers to adopt relevant regulations as quickly as those, for example, that secured the unconstitutional pre-emptive right in ports for the State Treasury. It is puzzling why we do not copy foreign examples, where the OWF sector has operated successfully, for instance the Danish model, which has undergone the whole legislative process related to the life of OWFs, because the first Danish Offshore Wind Farm is undergoing liquidation at present.
Everything that is happening around the offshore wind sector in Poland is interwoven with political interests and propaganda that are aimed at constructing an artificial image of success, which does not and will not exist, unless the attitude to such issues changes. Another problem is that those politicians who are giving their warranties now and making unrealistic plans will soon disappear from the political scene or will change their ministry, transferred for example to take care of agriculture. As a result, there will be no continuation of processes, if any have been started at all.
There is no long-term planning or apolitical processes in the Offshore Power Sector and maritime economy and other areas that concern energy security in Poland, which would enhance the security of Polish citizens in such areas. The list of sins of Polish policymakers, both former and present, is devastating, making one lose hope that anything will actually change.
I need to stress again that projects of this type should be handled by experts in their areas, rather than politicians who have neither knowledge nor skills to manage such processes or to implement them effectively and quickly.
We should not deceive ourselves – nobody in Poland has a realistic plan for implementing the ambitious projects in the Offshore Wind Sector. All this resembles a game of deception, oriented at gaining political capital, while the Polish energy security is in disrepair.
This leads to one more sad conclusion – we are losing a chance to participate in the new offshore wind power sector in Poland. Once again, because of the incompetence and negligence of policymakers, the business on Offshore Wind Farms based on our sea areas will be done by foreign companies, while Polish firms will be at the end of the ‘food chain’ in such projects, if they get any share in them at all.
I also get an overwhelming impression that the Polish offshore sector has never been so mentally and legislatively remote from the capital, Warsaw, as now, which is even more concerning, as despite its access to the sea, Poland has been totally neglected in terms of legislation and actual development of maritime issues for years.
            
Mateusz Romowicz Legal Consulting
Mateusz Romowicz – Legal Adviser