PKN ORLEN BIOREFINERY & RDI

The project comprises the construction and operation of (i) a new R&D Centre to regroup RDI activities in the development of renewable chemical and biofuels technologies at the Promoter's site at Plock, (ii) an industrial demonstration facility for the production of 25 kt/ year of sustainable, second generation, bioethanol from cereal straw in the industrial sites in Jedlicze, and (iii) an innovative bio-propylene-glycol production unit with a capacity of 30 kt/ from biogenic glycerine in the industrial sites in Trzebinia.

The development of second generation (advanced) biofuel production technologies is identified as a key technological pathway towards the decarbonisation of transport under the Renewables Energy Directive II (2018/2001/EU). It is also one of the priorities of the European Strategic Energy Technology Plan (SET-Plan). Considering the above, the investment is considered to be highly aligned with EIB's public policy goals. The investments foreseen within the project programme will be predominantly carried out in Poland's cohesion areas. Due to the nature of the supported activities, the project is also expected to partially promote Rural Development in lesser developed regions of the EU. To a large extend the operation will also support climate change mitigation through the production and commercialisation of sustainable renewable energy carriers and materials for their use in transport and industry. Project, especially R&D Centre, will largely contribute and fulfils EU policy of enhancing private sector R&D activities and innovation in EU, especially in less developed countries.

After implementation, the project will deliver: a) a new RDI centre; b) a full scale industrial facility for second-generation bioethanol production based on advanced Manufacturing technologies; and c) an innovative bio-propylene-glycol production unit.

The project is strongly aligned with EU and EIB policy priorities, namely on the decarbonisation of transport, and consistent with the EU Green Deal and Paris agreements. The project is complementary to EU regional development policies in the promotion of renewable energy at local level. Moreover, it contributes significantly to the economic development of the three EU cohesion regions where it will be implemented. The project shows excellent prospects for growth and social benefits, as well as excellent employment indicators.

The project addresses the market failure climate externalities by providing low-carbon technologies to counter climate change from GHG emissions. The EIB, alongside the EU policy incentives, will support the promoter in re-orienting its business activities towards the development and implementation of more sustainable renewable energy and material solutions for transport and industry. The RDI component will create knowledge allowing the promoter to overcome limitations related to the access to and dissemination of new technologies, such as high transaction costs for obtaining information, negotiating and acquiring protected technologies.

The long-term EIB financing enhances the borrower's capital expenditure capacity and improves its credit risk profile, by extending its debt maturity profile, and strengthening funding diversification and stability. The EIB is able to provide financing on favourable terms, including a long availability period and flexible drawdown conditions.

Compliance with the environmental "acquis" (notably EIA directive 2014/52/EU amending the EIA Directive 2011/92/EU) will be assessed during appraisal, as well as well compliance with IED directive 2010/75/EU and other applicable environmental acquis. The EIA procedure followed as well as GHG savings/sequestration achieved on a life cycle assessment basis for the bioethanol & propylene-glycol production units will be assessed in detail during the due diligence procedure.

The promoter has been assessed by the EIB as being a private company not being subject to EU rules on public procurement or concessions. However, if after the project appraisal, the EIB were to conclude that the promoter is after all subject to EU public procurement legislation (Directive 2014/24/EU or 2004/18/EC, where applicable), then the Bank would require the promoter to ensure that contracts for the implementation of the project will be tendered in accordance with the relevant applicable EU procurement legislation (Directive 2014/24/EU or 2004/18/EC, where applicable), as well as Directive 89/665/EEC as interpreted by the Court of Justice of the EU, with publication of tender notices in the EU Official Journal, as and where required.