The energy industry throughout Europe, including in Poland, is on the verge of a sweeping green transformation. However, in the last 30 years, very few investments have been made in this sector, and contractors responsible for constructing infrastructure are grappling with a lack of appropriately skilled personnel. Recruiting and training workers is made difficult by uncertainty about future orders.
– “Personnel are absolutely key to the energy transformation. In the energy sector, we need a workforce that is highly skilled, we are talking about technical knowledge and understanding of the legal environment,” said Błażej Madejski, CEO and board member of Victor Energy in Poland, to Newseria Biznes. – “This is a difficult engineering field, we have very strict restrictions relating to the working environment, often involving work in delegations, so the work environment is generally tough. For the past 30 years, there has been very little investment in energy, followed by an investment boom in the middle of the last century. So we have a significant lack of personnel. It is very difficult for us at this time to attract young people eager to work. We do not have workers aged 30+, who have enough experience. We must address this issue, and this is our biggest challenge at the moment.”
As noted by Spectis, a company that specializes in preparing reports for the construction sector, the energy-industrial construction market in Poland has been stagnant for several years, but this is beginning to change markedly. After reaching 20 billion PLN in 2019–2020, the value of energy-industrial contracts of 80 top companies reached 23 billion PLN in 2021. In 2022, this was close to 30 billion PLN. Based on the trend for the first three quarters of 2023, the value of this segment might have grown in real terms by about 30 percent last year, which in nominal terms could translate into a record value of 43 billion PLN. A significant problem in this construction sector, however, is low profitability. From 2017–2022, the average net profitability in a group of 80 contractors was 2 percent, in 2023 it improved to 2.8 percent, and on average, since 2010, it was only 1.6 percent, which was affected by the financial problems of several significant players.
– “Basically, we need a good working environment, a working environment where we can work consistently, year after year, we can provide people with jobs, organize training systems. But to do this, we need to have order certainty, we as the contractor industry, which operates as a service for the entire energy sector,” points out Błażej Madejski. – “This is a big challenge because right now this certainty does not exist. We do not have a steady flow of orders, we do not know what the orders will be in a year, we do not know what they will be in two years, we only know that they will be there. So we are on the edge of a precipice, and we need to know that we can invest in it now. We will need some time for this workforce to be trained.”
The Spectis report “Energy-industrial construction in Poland 2024–2029” states that the current value of 210 ongoing and planned largest energy-industrial investments in Poland is 532 billion PLN, with investments worth 79 billion PLN currently under construction, while the remaining 453 billion PLN is the cost of investments only in the tender, planning, or preliminary concept phase. A clear increase in the number and value of announced investments has been observed only since the beginning of 2022, i.e., since the outbreak of the war in Ukraine. The project updating the current Polish Energy Policy to 2040 program (PEP2040) indicates that investments in the development of new capacities planned by 2040 will exceed 700 billion PLN, over 80 percent of which will be spent on zero-emission capacities (renewable energy sources and nuclear).
In the coming months, funds from the KPO are expected to help finance investments. The plan is to spend the entire amount of non-repayable funds available to Poland, nearly 24 billion euros, on achieving the set goals. Additionally, Poland is applying to the European Commission for over 12 billion euros from the loan part. Out of the total planned expenditure of 35 billion euros, which Poland will have at its disposal, the majority – 14.3 billion euros – is to be spent on green energy. However, the problem is that this pool must be utilized by August 2026.
– “Regarding the use of KPO funds, we will have a number of very serious challenges. We have limited time to implement this investment program, and we will also need it for training and implementing personnel. I assume that in the initial phase, mistakes will be made, there will be organizational gaps, so gaining momentum is inevitable. We need to start this process as soon as possible,” assesses the CEO of Victor Energy in Poland.
Contractor challenges also include procedural issues, such as the heterogeneous structure of contract provisions applied by buyers. Introducing a uniform contract standard would allow contractors to better plan project implementation due to cost, as has happened in the railway and road industries.
– “Together with the General Directorate of National Roads and Highways, after several years of investment, we managed to work out a very reasonable contract template today, which allows the contractor to carry out investments, assess risks, and bill costs on an ongoing basis,” explains Błażej Madejski. – “The energy sector has to take advantage of the experiences of the road and rail industries. Here we need, from our point of view, some regulatory influence on the energy sector, understood in a broad sense. Unfortunately, we do not have one buyer, not two, but hundreds of purchasers, the majority of which are public entities, such as municipalities, local governments, network distributors, or entities with the participation of the State Treasury.”
Victor Energy, originating from Canada and present in Europe for several years, executes projects in the field of energy infrastructure. Its European branches are located in Sweden, Croatia, and Poland. The company plans to actively participate in the energy transformation that the Old Continent is going through.
