Poland’s development plans for transmission and distribution networks

November 20, 2024

Poland is undergoing an ambitious energy transition, aligning with broader European goals to reduce greenhouse gas emissions and substantially increase the share of renewable energy sources (RES) in its national energy mix. A main aspect of this shift involves modernising and expanding its electricity transmission and distribution networks. Over the coming five to ten years, Poland anticipates major advancements in this sector, driven by expected increasing energy demand due to sector coupling and the need to adapt to a rapidly evolving energy landscape.

Current status and outlook for distribution grids

The country's distribution grids face numerous challenges in the upcoming years. Much of the existing infrastructure, especially in rural and suburban areas, is outdated, resulting in frequent outages and high transmission losses. In 2023, data from the Energy Regulatory Office (URE) indicated that DSOs rejected 7,448 applications for new grid connections, representing a combined capacity of 83.6 GW - a substantial increase on the 7,023 rejections in 2022, which covered 51 GW of rejected capacity. Implementing smart grid technologies will be essential to improving energy management, reducing losses, and increasing network efficiency.

As renewable energy generation grows, flexible demand side management systems become inevitable. The Alternative Fuels Infrastructure Regulation (AFIR) mandates that EU member states, including Poland, must significantly boost charging station capacity. In Poland, charging capacity is expected to grow from 230 MW currently to over 342 MW by the end of 2025, and to 1,515 MW by 2030. Distribution networks must not only meet rising demand but also ensure a stable energy supply during peak charging periods.

The implementation of smart grid solutions will be a pivotal aspect of developing Poland's distribution networks from 2025 to 2030. Smart grids facilitate two-way communication between energy suppliers and consumers, enabling more flexible supply and demand management. Real-time monitoring will improve response capabilities to network disruptions, optimise energy flows, and increase RES utilization efficiency.

Energy storage technologies will play an integral role in the future of distribution networks. As the share of RES in the energy mix grows, storage systems will be essential to capturing surplus energy during peak production and distributing it during high demand periods (time shifting). Both large-scale and household-level storage solutions will be critical for maintaining grid stability. The digitisation of distribution networks, facilitated by real-time data monitoring, will further enable prompt issue detection, minimise failure risks, and improve overall energy management. Automated processes will enhance system security and reduce energy loss.

Projections for Renewable Energy system integration at transmission grid level

By 2030, the Ministry of Climate forecasts that up to 50 percent of Poland's electricity consumption could be derived from RES. This target aligns with the new draft National Energy and Climate Plan (NECP-PL), which suggests such baseline scenario is achievable without substantial policy adjustments. The Ministry's forecast is consistent with PSE's 10-year network development plan (10YNDP). A 64 billion PLN investment plan includes constructing over 4,850 kilometers of new 400 kV transmission lines, establishing 28 new transformer stations, upgrading 110 existing stations, and developing a direct current (DC) transmission line linking Northern Poland (Pomerania) with Silesia region.

Investment strategies

The modernisation of Poland's electricity distribution infrastructure during the next planning horizon from 2025 to 2029 requires significant financial resources with a majority funded by the EU, particularly through the Recovery Fund. In addition to EU contributions, Poland also plants to rely on private capital, including investment funds, to support the modernisation and expansion of the country's power distribution infrastructure. Poland's draft NECP-PL underscores the importance of developing both distribution network and decentralised generation infrastructure as part of its overarching national energy strategy. The bulk of financial allocations will focus on expanding and modernizing not only distribution grids, but also implementing smart grid technologies to increase flexibility, and boosting energy storage facilities. These investments aim to ensure reliable energy supply during decommissioning of coal power plants, enhance system stability, and improve the efficiency of energy distribution to end-users. Poland's five largest Distribution System Operators (DSOs) plan to invest a total of PLN 72.6 billion to 2028. Total expenditures for distribution network development may surpass PLN 500 billion, highlighting a substantial investment gap emphasised repeatedly by the Supreme Audit Office (NIK).

Furthermore, Poland's TSO PSE has earmarked PLN 64.3 billion for infrastructure modernisation in its 10-year network development plan spanning from 2025 to 2034 (10YNDP).
Investment efforts will need to target not only new infrastructure but also optimisation of existing grids. This approach includes advancing mechanisms for cable pooling, allowing varied renewable energy sources with supplementing production profiles to share network infrastructure. Hybrid RES projects are rapidly emerging in Poland.

Conclusion

The expansion and modernisation of Poland's transmission and distribution networks are crucial for advancing the country's energy transition while delivering notable benefits to consumers and businesses. By upgrading these networks, Poland can integrate more renewable energy sources, offering cleaner and more sustainable electricity options for both individuals and commercial entities. This enhanced connectivity facilitates distributed energy sources, such as residential solar panels or community wind projects, to contribute surplus power to the grid, empowering consumers as active participants in energy production. For businesses, particularly in cleantech and energy sectors, improved transmission infrastructure creates new investment and innovation opportunities. Enhanced networks enable cleantech firms to develop advanced solutions like battery storage, demand response technologies, and smart grid systems, all of which depend on reliable, adaptable infrastructure. This creates a virtuous cycle: better infrastructure attracts greater investment, driving further innovation in energy management. For end consumers, modernised infrastructure promises improved service reliability, competitive pricing, and quicker adoption of flexible rate options and smart technologies, helping them optimise energy usage and reduce costs. In essence, the development of Poland's distribution and transmission networks forms a resilient, customer-centric energy system that supports economic growth, environmental goals, and the seamless adoption of future energy solutions.