Report by the ORLEN Group and the agency S&P Global: More cost-effective and sustainable energy supply through closer energy cooperation between Poland and the Baltic Sea states – including hydrogen

Report by the ORLEN Group and the agency S&P Global: More cost-effective and sustainable energy supply through closer energy cooperation between Poland and the Baltic Sea states – including hydrogen

The ORLEN Group and the agency S&P Global have published a report highlighting the potential benefits of cooperation between the Baltic countries, including Germany. The report focuses on stable electricity supplies at affordable prices, complete independence of the Baltic Sea region from Russian supplies, and clean air thanks to joint projects for the development of new technologies, including hydrogen.

The report also includes a comprehensive analysis of the progress and challenges of the energy transition in eight European countries. The assessment not only shows the current state of decarbonization in Poland, Germany, Denmark, Sweden, Finland, Lithuania, Latvia and Estonia, but also potential for increased cooperation. It identifies specific areas in which cooperation makes sense to accelerate the energy transition and reduce CO2 emissions. _“

Ireneusz Fąfara, CEO and Chairman of the Management Board of the ORLEN Group, said:

We are actively shaping the future of the energy sector in the Baltic Sea Region, which is crucial for the energy security and economic future of Poland and for the European energy landscape as a whole.

“By 2035, we intend to invest up to PLN 380 billion (approximately EUR 91 billion), including in renewable energy projects, including offshore wind power, as well as in gas infrastructure and new technologies, in particular energy storage solutions. By working with regional partners, we can fully exploit the region’s potential and provide Poland and our neighbors with safer, more affordable and cleaner energy,”

The report, “Baltic Cooperation: Momentum for Energy Transition,” underscores the region’s strategic importance for Europe’s decarbonization, as it accounts for more than a third of total energy consumption and emissions in the EU. The combined potential for renewable energy generation, including offshore and onshore wind, solar, and hydropower, is immense, estimated at 4,400 TWh, equivalent to 4.5 times the total energy production of the Baltic countries in 2023.

Yet the region still faces the classic energy trilemma: how to reconcile security, sustainability, and affordability? One of the most effective solutions could be greater cooperation, particularly among the eight Baltic countries: Poland, Germany, Denmark, Sweden, Finland, Lithuania, Latvia, and Estonia, which could accelerate the energy transition and fully realize the region’s potential.

The report concludes that the expansion of energy interconnectors enabling cross-border transmission of electricity and gas could generate annual savings of EUR 9 billion (over PLN 30 billion) by 2040. This infrastructure could also improve the utilization of existing LNG terminals and pipelines and optimize the distribution of 52 billion cubic meters of imported LNG by 2030, according to S&P experts.

The region continues to face the challenge of reducing persistent emissions from scattered industrial sites. One promising solution is the storage of captured carbon beneath the Baltic Sea, a safe method already proven effective in the North Sea. This is in line with the ORLEN Group’s new strategy, which envisions building capacity for the capture, transport, and storage of up to four million tons of _CO2 .

The total offshore wind potential in the Baltic Sea amounts to 93 GW, but only about 3 GW is currently operational, compared to 32 GW in the North Sea. Experts emphasize that without increased cooperation in maritime spatial planning and harmonized permitting procedures, the Marienborg Declaration’s target of 19.6 GW of installed offshore wind capacity in the Baltic Sea by 2030 may be unattainable.

The report “Baltic Cooperation: Momentum for Energy Transition”, prepared on the initiative of ORLEN and S&P Global Commodity Insights, provides a comprehensive insight into energy sector developments in Poland, Germany, Denmark, Sweden, Finland, Estonia, Latvia and Lithuania.

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