Photon Energy N.V, has announced a significant achievement by its subsidiary Lerta JRM Sp. z o.o. within the Company’s New Energy Division. Lerta JRM Sp. z o.o. has secured 315 MW of Demand Side Response (DSR) capacity and 1.088 MW of renewable generation in the additional 2025 Polish capacity auction. This, combined with the previously contracted capacity of 10 MW for 2025, brings the Company’s total capacity obligation to 326.088 MW, ensuring revenues of PLN 56.1 million (EUR 13 million) from Capacity Market for 2025.
The Additional 2025 Capacity Auctions On 14th March 2024, PSE S.A. conducted additional auctions for each quarter of 2025. Photon Energy participated and secured 316 MW in capacity, with 315 MW designated for DSR units. The Group’s total maximum contracted capacity with PSE for Q1 2025 will be 326.088 MW and lower in subsequent quarters. Auctions for Q1 cleared in the second round, while those for Q2, Q3, and Q4 cleared in the eighth round, indicating lower demand for capacity in these periods. Preliminary results show the Group securing an average price of PLN 172,168 (EUR 39,892) per MW/year, leading to contracted revenues of PLN 56.1 million (EUR 13 million) for 2025.
While the contracted volume and revenues may appear lower than previous declarations, it reflects a deliberate strategy aimed at maximizing gross profit from the Virtual Power Plant business. Detailed analysis of auction parameters and potential price trends led the Photon Energy VPP team to conclude that the original volume would depress prices. Consequently, the Company opted for higher revenues from lower volumes and plans to pursue additional transactions in the secondary market. This strategic move resulted in securing revenues higher by PLN 18 million (EUR 4.2 million) compared to initial assumptions, while preserving potential for additional Capacity Market revenues from the secondary market. The Group aims to maintain its capacity growth and targets 430 MW in 2025, building upon the satisfying volume of 389 MW contracted for 2024.
Exploring New Opportunities The auction results precede the opening of a new market in Poland, scheduled for 14th June 2024, which will enable independent market participants to provide ancillary services. This market presents an opportunity for the Company to monetize assets managed for the Capacity Market by offering balancing capacity and energy during short-term needs. Unlike the Capacity Market, which is a long-term investment incentive, ancillary services, particularly frequency restoration reserves, offer close-to-real-time grid balancing tools. Photon Energy plans to leverage this market opening to generate additional revenues on top of Capacity Market revenues from aggregated energy resources across generators and consumption.
Borys Tomala, New Energy Director at Photon Energy Group, expressed confidence in the Company’s position as one of the leading Demand Response aggregators in Poland. He highlighted the strategic decision to decrease contracted volumes during auctions, emphasizing the potential for filling the gap in the secondary market later in 2024 or during deliveries in 2025.
Strategic Acquisition Driving Growth Photon Energy’s Virtual Power Plant business, including its participation in the Polish Capacity market and ancillary services, operates within the New Energy Division, established after the acquisition of Lerta in November 2022. This acquisition not only provided additional financial stability but also enhanced the Company’s capabilities in managing distributed energy resources.
Georg Hotar, CEO of Photon Energy Group, underscored the anticipation for Poland’s ancillary services market launch, marking a pivotal moment in the industry’s evolution. The strategic acquisition of Lerta positioned the Company to capitalize on emerging opportunities, such as flexibility markets, and drive sustainable success in the evolving energy landscape.
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