Szczecinbiznes.pl: Epa Wind was established at the beginning of the year as a daughter company of former Epa. What was the rationale behind that transformation?

Wojciech Głoćko: EPA was founded over 20 years ago by a group of people who decided to launch their own business because of the crisis that had erupted in the shipbuilding industry. At first the firm focused on electronics, seafaring communication and ship maintenance. The range of activities gradually extended, new people joined in and new departments were set up to deal with different challenges and projects. At the turn of the twentieth century EPA operated in the fields of maritime electronics, satellite communication, ship maintenance, wind power, etc. At some point the management board composed of the Company’s owners constituted the only link joining those departments. In consequence, individual departments were drifting apart and inevitably, they were bound to become independent daughter companies.

How did it affect the activities of the firm?

Epa still holds shares in the eight daughter companies, including Epa Wind.  The shareholders remain the same and we – within our companies – continue to do what we used to do, but now on our own account.

What is the Company’s structure like?

The management board of EPA Wind is composed of three persons. Our employees are divided into teams dedicated to natural environment issues, energy production, wind resource assessment, mast erecting and development-related matters. We employ 43 persons, mostly young people in their thirties.

How do you operate?

We develop wind farm projects, we construct the farms and we commission them. Our client base includes international concerns, such as: Dong Energy or GDF Suez as well as domestic corporations, for instance a listed company: Polish Energy Partners. First we receive information that a corporation intends to invest certain funds in renewable energy in Poland, because for example, it is a part of its business strategy.  Then a question must be answered whether we can offer that company such form of cooperation that will guarantee realisation of the planned investments. When the agreement is signed we search for the appropriate location and then manage the entire investment process. After securing the building permit and constructing the farm our client begins producing electric energy. As a rule, each project covers circa 50 megawatts.

Why that much?

A wind farm cannot be too small, because the costs associated with a project incorporating two air turbines are more or less the same as the costs of a project for fifteen turbines. On the other hand, wind farms cannot be too large either owing to community-related factors – if we were to erect too many turbines in one spot local residents could protest. Optimally, 15 – 20 air turbine complexes are constructed and they are separated from one another by a distance of ten to twenty kilometres. This corresponds to the above mentioned power of circa 50 megawatts.

How much does it cost to build a wind farm?

Erecting a wind power station that generates 2MW of power costs approximately PLN 12 million. The costs of the turbine itself account for 10 million, the remaining expenses are associated with the land and the required procedures.

Does it pay off to invest in wind farms and renewable energy?

We work on the assumption that an average investment in Poland should pay back within 8 to 10 years, which approximately corresponds to the profitability of 10 - 12 percent per annum. Our clients consider such indicators to be fairly attractive, hence the level of investments in Poland soars. It should be pointed out that the wind farms ensure long-term revenues from generating electric energy, in practice, even for 20 – 25 years. This is yet another advantage of our product. There are several determinants of the investment profitability, among others the volume of the energy obtained, the prices of electric energy and the so-called green certificates (RECs). The energy prices are established top-down, whereas the prices of green certificates depend on supply and demand, but they can be predicted.   Therefore, our main task is to find sites that will ensure maximum exploiting of the wind conditions and the largest possible volume of energy production.

How to find them?

In theory, some areas in Poland have never been used in any other ways than as agricultural land. However, a set of criteria need to be met in order to erect a wind farm. Primarily, the area must be more or less uninhabited and environmentally unattractive, it must be in the proximity of a power line, as constructing a power line over the distance of 40 kilometres is uneconomic, and the wind resource assessment should fulfil at least our minimum requirements. All five criteria must be satisfied in order for the project to be cost effective, otherwise, we altogether withdraw from the undertaking. In truth, the key to success is to find as many locations as possible where the above conditions are fulfilled.

Are there any regions in Poland that seem most eligible?

Obviously the strongest winds blow in the north, close to the sea, and this is where the first farms were set up. 10 years ago we established wind farms near Zalew Szczeciński (the lagoon opening into the Bay of Pomerania in the Baltic Sea) and the Bay of Puck. These are ideal wind power sites, but the development of this industry does not necessarily go hand in hand with the growth of the tourist trade and as a rule, seaside municipalities count on revenues from this sphere, it also seems not to agree with house building or areas of environmental protection under Natura 2000 program. For that reason today wind farms are not constructed along the belt of up to 50 km from the sea.

Do you have any serious competitors in the Polish market?

We have been first in Poland to focus on wind power and we continue to occupy the leading position in the industry, even though as far as capital resources are concerned, some other firms are sure to hold the lead. There are many small companies in the market which lease land from farmers, initiate the procedure and at a certain stage put the entire project on sale. We do not consider them as our rivals. When it comes to professional companies, we mainly compete against branches of international concerns. Wind energy is very popular in Spain, Denmark or the Netherlands and companies originating from those countries are very well-off. They usually act through their native specialists, but it does not necessarily ensure them success, as the business environment in Poland still differs slightly from those typical of well-developed Western European countries. It oftentimes happens that after some attempts, foreign corporations start recruiting local experts, and then they may become our competition. In order to secure the leading position we have gained, we strive to retain our best employees. So far, we have been successful. It is the specialists working for us that, apart from the good market reputation, constitute our best asset. Our employees are relatively young and we could say that we structure our lives around what we manage to accomplish here.

Is it really so hard to find experts in your industry?

Our business domain is rather narrow. We have spent many years putting together our team and now we set a certain standard in Poland. At the beginning there were just a few people on our team, now the number is close to 50. Our renown is confirmed by the fact that now financial institutions commission our company to audit other projects. At the same time, our engagements are highly appraised and they often serve as market standards.

Do you use the services of local companies when constructing wind farms?

As far as the construction itself is concerned it is not feasible to engage a local firm. Erecting 15 air turbines costs PLN 200 million and the contractor must be able to provide us with a guarantee for that amount. Local companies are rarely able to meet this requirement. We use the services of large international building contractors.

Is it possible for you to enter foreign markets?

Yes, if we were willing to do so. However, our major advantage is our knowledge and insight into the domestic market. If we chose to enter the Bulgarian, Romanian or Czech market, we would need to find a good local developer and practically set up a new EPA in the location. For now, it does not seem profitable, but as soon as there is not enough work for us in Poland we will consider this option.

Is there such a risk?

In my opinion we are sure to have enough to do over the next 5 to 10 years. Considering the environment, this is a long time. Compared to other European markets such as in Germany, the wind power industry in Poland is still in its early stages of development. However, we also take efforts to provide for the future, we conduct various projects and research programs. Maybe in a dozen years or so we will do something completely different?

What are your plans for the nearest future?

This year we intend to finalize four large projects – if we accomplish that goal, our financial results will be very high. We are also planning to launch new renewable energy products in the market. I believe that we will mange to keep up the pace of our development over the next few years and maintain our leading position.

Interviewed by Paulina Łątka