“Efficient and effective management of renewable energy installations is impossible without advanced tools in data science,” says Paweł Czaus, CEO of Nomad Electric Services in an interview for wnp.pl.
What is Nomad Electric Services’ outlook on the future of the Polish PV farm market and the potential for its business in Operations and Maintenance (O&M) for large-scale photovoltaic farms?
The prospects for the development of the Polish renewable energy market, including large-scale photovoltaics, are very promising. In the coming years, we will see not only a larger scale of projects but also a convergence of technologies. In Poland, grid connection conditions have been issued for over 28 GWp of PV farms, of which about 5 GWp have been built and connected to the network so far. ‘Cable pooling’ allows for the connection of wind and photovoltaic farms at the same point, enabling technology hybridization. The potential for hybrid installations is another 20 GWp. Moreover, the liberalization of the 10H law has improved the conditions for onshore wind energy. Nomad Electric is implementing projects in the ‘turnkey’ formula (EPC – Engineering, Procurement, Construction) and providing services for wind and PV installations. Ultimately, a lot of the generation capacity will combine technologies, so it’s a natural development direction for us.
Are there any issues that could be an obstacle to the development of the PV sector in Poland or Europe?
Several challenges can negatively affect the pace of renewable energy development, including PV. I see two main obstacles. Firstly, inadequate or delayed investments in the expansion and modernization of energy networks in Poland and other EU countries. The National Recovery and Resilience Plan (NRRP) partially addresses this issue. Secondly, I would like to highlight the importance of regulation. The focus should not be on regulations that favor renewables, but rather on a strategic approach to the development of renewable energies, and the stability and predictability of regulations. In summary, I believe that these challenges are inherent in the transformation of any strategic economic sector. It is unrealistic to expect such a significant change in such an important sector to be smooth and without obstacles.
What will be the ultimate model for photovoltaic progress?
There is still a dynamic development ahead of us in the market for energy storage, which will initially be based on the foundation of auctions in the capacity market, and eventually through the so-called frequency market (in short: services for the grid). I believe that the ultimate model for photovoltaics involves installations supported by energy storage.
When did Nomad Electric Services start managing and servicing photovoltaic farms?
Nomad Electric Services began its O&M activities by servicing photovoltaic farms for the R.Power group, to which it belongs. The oldest farms we service were built in 2014-2015. However, the market for large PV farms began to develop intensively between 2018 and 2020. We were the first to gain experience in managing PV power plants and naturally filled this gap in the Polish market.
What portfolio of PV farms do you manage and for whom?
Currently, after four years of operation in the O&M services market, the PV farm portfolio we manage is about 1.4 GWp. Of this, about 900 MWp are operational farms. The remaining 500 MWp are installations under construction. Our clients are both Polish and foreign investors, including companies transitioning from traditional energy to renewable energy, infrastructure funds investing in renewable energy, and companies from non-energy sectors acquiring PV farms to ensure climate neutrality. Our current client base consists mainly of global infrastructure funds investing, among others, in energy infrastructure.
Will the company’s portfolio of PV farms increase by the end of 2023?
We expect an increase in 2024, as we are participating in various tenders, which are typically time-consuming in our industry.
Are foreign infrastructure funds currently investing in the Polish PV market?
Yes, and I believe their presence will continue to grow for several reasons. Firstly, the Polish market offers competitive returns. Secondly, although Poland is not yet at the level of leading countries such as Germany or Spain, it is not a small market and has considerable potential for further growth. We have established a strong network of professional companies in the PV industry, such as developers, law firms, technical advisors, banks, EPC and O&M firms, and component suppliers. Although the Polish PV market is relatively new, it already complies with European legal and technical standards. Poland has rapidly adopted a market-based model for the payment of renewable energy installations through long-term PPA contracts, which allow independent project financing on market terms without recourse to the auction system. However, regulatory stability and predictability will be key to the maintenance of foreign interest in the Polish market.
What business model do you want to operate in, and what are your long-term goals?
Our goal is clear: we aim to be a leader in managing and servicing large-scale photovoltaic, wind, energy storage facilities, and – to some extent – industrial renewable energy installations. The establishment of a pan-European presence has been our goal since the inception of our company. By the end of 2022, Europe had approximately 200 GWp of installed PV capacity, including 12 GWp in Poland. So international expansion is a natural direction for our development. We are currently present in Portugal and Romania, with plans to expand into Germany, Spain and Italy.
In addition, part of our strategy is to offer solutions that add value to PV installations through the combination of traditional engineering skills with new technologies. We use drones and electroluminescence to assess plant condition and provide renewable energy asset management software.
Are you becoming an IT company in some ways?
Yes, and new technologies are going to become more and more important in our business. Efficient and effective management of renewable energy assets is impossible without advanced data science tools that enable investors to achieve the economic outcomes they expect. With around 175 million data samples per 100MWp of managed capacity, our capabilities in big data analytics and cybersecurity are on par with those of IT infrastructure management companies. Our monitoring center in Lodz allows us to remotely manage the operation of PV power plants and control plant parameters, including negative-price shutdowns. We can do this thanks to our SCADA system Nomad NX.
Finally, could you tell us about the financial scale of Nomad Electric Services’ operations?
Scalability is crucial for the growth of PV O&M services, as they are only profitable on a large scale. Nomad Electric Services has already achieved this in Poland and is on track to manage a portfolio many times larger. The O&M market is based on long-term contracts, which makes it predictable. The longest contracts we service are 15-year agreements.