Fitch: Opportunities in Polish energy market

Fitch Ratings said it said the Polish energy market's increasing liberalization and upcoming privatization offer growth and diversification opportunities for European utilities. It also presents less expected volatility and risk compared to other countries where energy sectors were recently opened for foreign investors such as Russia and Turkey.

Investment needs are considerable as most of Poland's 35GW generation assets are more than 30 years old and often written-off, Fitch said. The sector needs to add about 1GW-1.5GW of capacity annually to replace aging assets and to meet growing demand, the agency said.

Retail electricity prices, which are expected to be set on a cost-plus basis, will improve the feasibility of investments in generation assets, Fitch said. Other important contributory factors are strong Polish GDP growth prospects and the government's support for foreign investments in the energy sector, the agency added.

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