Polish state-run bank BOS , which finances environmental projects, said on Wednesday it booked an impairment charge of almost 100 million zlotys ($25.24 million) in 2016 for loans it made for wind farm construction.
BOS said that the payments on the wind farm loans were not delayed as of the end of 2016, but it took the impairment due to an uncertain outlook for wind farms in Poland.
BOS’ shares fell sharply and were more than 8 percent lower by 0913 GMT.
The bank has one of the biggest wind farm loans portfolio among Polish lenders.
Most of Poland’s electricity comes from coal-fired generation but under European Union law more has to come from renewable energy sources by 2020.
Poland’s government wants to help its loss-making coal mines, but is also working on new regulations for a support scheme for renewables and plans to replace the current system of tradeable green certificates.
The green certificate system has become oversupplied causing a slump in prices, which has hit the cash flows of wind farms. Poland has around 5 gigawatt of wind farm installed capacity, which generates around 6 percent of electricity. According to a local wind farm lobby group PSEW, private investors invested around 34 billion zlotys ($8.58 billion) in the construction of wind farms in the country in the past few years.
Currently around 13 percent of power in Poland is generated in renewable sources, but the trend has significantly slowed down, Polish wind farm lobby group PSEW said.
State-run utilities – PGE, Tauron and Energa have also had to write down the value of their wind farm business. ($1 = 3.9625 zlotys)