Financial Aspects of Energy Investments in the Era of Shaping Stable Energy Development in Poland: A Case Study

Abstract

Investments in green energy are necessary due to, among other reasons, the growing expectations of stakeholders, climate change, limited natural resources, and improved quality of life. Unfortunately, the costs of implementing pro-environmental activities related to investing in technologies using alternative methods of obtaining energy are significant, which is why more and more entities are analyzing their profitability. The aim of this study, as part of a case study, is to assess the energy investment in PV panels in the logistics center (LC) being built in Central Pomerania. The analyzed investment fits into the activities of the development perspective of the renewable energy sources sector and is also very important from the perspective of shaping the conditions and stable development of the energy industry in Poland. The study proved that such a large investment, taking into account various forms of financing, will pay off within 15 years, which is a very good result from the point of view of its durability. The best variant of capital involvement is the option 20 (own capital)/80 (outsourced capital), which, among other things, confirms (in thousands of euros) NPV = 4.43, NPV (TGeBase) = 0.04, and NPV (CAPEX) = 4.32.

1. Introduction

Climate change and technological and industrial development are increasingly influencing the investment decisions of market stakeholders. The search for optimization solutions, especially in the use of electricity, that do not interfere with the natural environment is becoming necessary, but, on the other hand, expensive. Therefore, it is important for all market stakeholders to increase their environmental awareness and take actions aimed at protecting and restoring the natural environment [1,2] These actions should also aim to improve the quality of life for society, organizational development and sustainable development, including agglomeration, in line with environmental safety [3,4,5,6,7]. One of the directions for such actions is the use of renewable energy sources (RES) [8,9]. The subject of this study concerns selected financial aspects in the field of renewable energy [10], particularly photovoltaics. Renewable energy is obtained from natural processes, allowing for the natural replenishment of resources, ensuring the repeatability of cycles. From an economic point of view, this is crucial information because it serves as an alternative to traditional energy sources, such as fossil fuels, and becomes a complement and in some cases the primary source of energy [11,12]. Nevertheless, the financial assessment of investment projects in the field of renewable energy requires consideration of multiple factors [13], such as investment costs, potential savings, local energy regulations, investment returns, and the prospects for the development of the renewable energy sector.

2. Literature Review

The topic of renewable sources, particularly solar energy, and the practical implementation supported by various financial projects and forms of support [9], indicate that it is of great interest to scientists, governments, entrepreneurs, and individual customers (consumers) [8,14,15,16]. This is due to the fact that renewable energy (energy sources) is obtained naturally or can be renewed through human actions [17]. It is also inexhaustible and can be used to any extent. Understanding the necessity of changing the way we obtain energy is difficult for some market stakeholders to accept [18,19,20,21]. However, due to global environmental changes (rising temperatures, climate change, etc.), increased environmental pollution (CO₂, heavy metals, etc.), the depletion of other energy resources (coal, wood), and the elimination of natural air filters (deforestation, removal of green areas), it is necessary and irreversible [3,5,22,23]. The only question that remains is whether the source of renewable energy will be solar energy [24], wind energy, hydropower, geothermal energy, or biomass energy [25,26]. It is important that the implementation of energy production (

Table 1. Gross electricity in the EU-27 in GWh.

	2017	2018	2019	2020
Anthracite	4103.10	4013.00	680.00	715.00
Coking coal	11,163.79	8804.90	12.55	81.09
Other bituminous coal	316,143.34	286,534.62	205,613.47	154,217.95
Sub-bituminous coal	3170.10	2393.87	1553.70	572.09
Lignite	301,921.18	291,617.66	241,259.25	195,291.52
Brown coal briquettes	2328.99	2131.95	1799.37	1509.88
Coal tar	8.43	10.99	14.79	17.60
Coke oven gas	7769.53	7204.23	7166.19	6236.99
Gas works gas	1939.42	1803.19	1733.92	1250.37
Blast furnace gas	20,843.73	20,865.85	19,455.37	16,343.34
Other recovered gases	2182.73	1866.90	1910.07	1659.66
Peat	5243.05	5921.64	5160.73	3136.67
Oil shale and oil sands	9912.31	9380.00	4318.22	2247.21
Natural gas	525,178.48	490,689.43	569,312.00	560,997.12
Refinery gas	6549.87	7157.70	6955.08	6622.32
Liquefied petroleum gases	451.90	236.79	232.41	147.14
Other kerosene	13.21	12.51	4.11	2.30
Gas oil and diesel oil	10,517.66	9704.16	10,274.04	10,086.87
Fuel oil	28,736.81	25,614.23	24,893.74	21,345.29
Other oil products	10,126.94	10,219.02	8970.08	9118.46
Petroleum coke	2279.66	1577.38	621.46	516.88
Solid biofuels	74,261.19	76,252.05	80,559.93	82,959.23
Pure biodiesels	27.35	30.09	29.54	22.81
Other liquid biofuels	4962.80	4796.92	5103.35	5022.46
Biogases	55,648.16	55,095.79	54,990.80	55,765.97
Industrial waste (non-renewable)	2750.38	2925.27	2941.81	2638.57
Renewable municipal waste	18,739.42	19,335.12	19,010.73	18,872.89
Non-renewable municipal waste	18,217.70	18,838.38	18,583.93	18,334.13
Hydro	322,463.41	370,234.44	345,642.68	375,486.54
Pure hydro power	281,812.51	326,818.54	306,477.88	331,708.70
Run-of-river hydro power	77,013.64	81,374.04	82,454.45	86,873.06
Mixed hydro power	22,719.98	27,043.58	23,275.74	25,837.97
Mixed hydro power-pumping	10,186.52	9980.69	9494.13	10,366.53
Pumped hydro power	17,930.93	16,372.32	15,889.05	17,939.87
Geothermal	6715.04	6654.99	6725.81	6717.26
Wind	312,313.13	320,615.90	367,117.81	397,798.61
Solar thermal	5883.00	4867.00	5683.00	4992.00
Solar photovoltaic	102,051.94	108,199.62	118,201.58	140,124.76
Tide. wave. ocean	521.71	479.93	498.96	508.76
Nuclear fuels and other fuels n.e.c.	759,382.64	761,943.05	765,337.86	683,512.15
Other fuels n.e.c.—heat from chemical sources	1172.30	1099.28	1038.50	1088.76
Other fuels n.e.c.	5229.80	3922.38	3815.17	3716.90

Source: https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Energy_production_and_imports# Renewables and wastes (accessed on 30 October 2023).

) and utilization is ongoing (

Table 2. Supply, transformation, and consumption of electricity in the EU-27 in GWh.

	2017	2018	2019	2020
Imports	366,554.33	372,348.28	369,432.45	381,008.85
Exports	371,130.02	363,497.75	366,487.73	367,046.55
Inland demand	2,769,315.02	2,772,847.14	2,741,724.66	2,639,829.69
Transformation input—electricity and heat generation—electrically driven heat pumps	1734.73	1611.77	1602.57	1857.89
Transformation input—electricity and heat generation—electric boilers	611.26	560.18	687.34	1236.23
Transformation input—electricity and heat generation—electricity for pumped storage—pure hydro plants	24,409.02	22,150.56	21,597.65	24,195.83
Transformation input—electricity and heat generation—electricity for pumped storage—mixed plants	14,280.59	14,075.40	13,406.77	14,552.35
Energy sector—electricity and heat generation—energy use	145,997.70	140,656.71	131,149.33	121,967.32
Distribution losses	178,096.99	182,973.19	178,939.40	175,454.11
Available for final consumption	2,591,218.03	2,589,873.96	2,562,785.26	2,464,375.58
Gross electricity production	2,960,924.00	2,943,051.24	2,907,223.58	2,789,677.02
Net electricity production	2,814,926.30	2,802,394.52	2,776,074.25	2,667,709.69

Source: https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Energy_production_and_imports# Renewables and wastes (accessed on 30 October 2023).

), which limits and mitigates environmental degradation [27].

The analysis of data (Table 1 and Table 2) and information from Eurostat indicate that the energy sector in the European Union is developing in a sustainable way. On the one hand, in the analyzed years 2017–2020, there is a visible increase in demand for energy, despite a decline in exports and some forms of energy production. On the other hand, the availability of energy in the European Union has increased, with a visible increase in the share of renewable energy sources, which has been constantly growing. The increase is particularly visible in 2018 and 2019, where the share of renewable energy sources exceeded solid fossil fuels. At this point, it is worth identifying and comparing the production of electricity from renewable energy sources in Poland (

Table 3. Share of renewable energy in electricity production from renewable sources in Poland and the average for EU-27 countries in the years 2017–2020.

Specification	Years	Poland %	EU-27 (Average) %
	2017	66.8	42.9
	2018	76.1	42.4
Solid biofuels	2019	73.4	41.8
	2020	71.6	40.1
	2017	0.7	6.3
	2018	0.7	6.2
Solar energy	2019	1.1	6.5
	2020	2	7.1
	2017	2.4	12.1
	2018	1.4	13.5
Hydro	2019	1.4	12.2
	2020	1.5	12.8
	2017	13.9	12.8
	2018	9.1	12.6
Wind	2019	10.6	13.9
	2020	10.9	14.7
	2017	3	6.6
	2018	2.4	6.3
Biogas	2019	2.4	6.2
	2020	2.6	6.3
	2017	9.9	6.5
	2018	7.5	6.6
“Liquid biofuels”	2019	8	6.8
	2020	7.8	6.4
	2017	0.2	3.2
	2018	0.2	3.1
Geothermal	2019	0.2	3
	2020	0.2	3
	2017	1	4.3
	2018	0.8	4.1
Renewable municipal waste	2019	0.8	4
	2020	1.1	3.9
	2017	2	5.2
	2018	1.8	5.3
Heat pumps	2019	2.1	5.5
	2020	2.4	5.7

Source: https://ec.europa.eu/eurostat/statisticsexplained/index.php?title=Main_Page (accessed on 23 May 2023).

).

The presented data indicate that Poland achieved results in selected areas (e.g., “liquid biofuels” or “solid biofuels”) above the EU-27 average in terms of the use of the presented energy sources in the analyzed period. It is positive to note that almost everywhere the utilization of renewable energy sources has been increasing. However, it is unfortunate to observe that in the analyzed years, Poland performed poorly in comparison to some EU-27 countries outside Lithuania, particularly in the area of solar energy production [28], even when compared to neighboring countries (Figure 1).

The presented compilation indicates that Poland has a significant growth potential, which should be accompanied by the creation of appropriate investment and legal conditions for both businesses and individual customers [29,30,31]. This is also confirmed by the indicator of the share of electricity from all renewable sources in gross final electricity consumption, which has been at the following levels in recent years: 13.4% (2015), 13.3% (2016), 13.1% (2017), 13.0% (2018), 14.4% (2019), 16.2% (2020), 17.2% (2021) [32]. It should be noted that the establishment of the possibility of “energy independence” requires significant financial and organizational investments, and the efficiency and return on investment are achieved over many years [33]. Therefore, legislative changes and investment financing facilitations have been essential elements supporting the development of electricity production from solar sources, especially photovoltaics [34,35]. This is necessary from the point of view of the development of this form of energy production in the EU (

Table 4. Electricity from solar photovoltaic in the EU-27 in GWh.

	2017	2018	2019	2020
Solar photovoltaic	102,051.94	108,199.62	118,201.58	140,124.76
Solar photovoltaic (<20 kW)	10,427.95	11,228.61	12,415.04	14,138.64
Solar photovoltaic (20 kW–1000 kW)	22,351.38	22,080.58	24,625.71	28,229.68
Solar photovoltaic (1 + MW)	14,231.76	16,360.18	18,235.39	19,507.27
Solar photovoltaic (Off grid)	109.40	233.25	296.65	561.26

Source: https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Energy_production_and_imports# Renewables and wastes (accessed on 30 October 2023).

).

As part of the actions of the so-called sustainable energy policy, the energy policies of both the European Union and Poland [36,37] strongly promote the use of renewable energy technologies, especially photovoltaics [30,31,32,33,34,35,36,37,38,39]. In Poland, legal regulations have been established, including the Act of February 20, 2015 [40,41] on Renewable Energy Sources and the Energy Policy of Poland until 2040 (PEP2040) [42]. Within this policy framework, a strategic goal has been defined: energy security: while ensuring the competitiveness of the economy, energy efficiency, and reducing the environmental impact of the energy sector, taking into account the optimal utilization of domestic energy resources. Within the framework of PEP2040, eight policy directions were further specified, divided into areas, and additionally detailed into twelve strategic projects. These projects expand the list of projects from the Strategy for Responsible Development in the “Energy” area. Other government initiatives and regulations aimed at increasing the share of renewable energy in Poland have also been taken. Key actions to create a favorable investment environment include providing financial support, preferential taxation systems, implementing appropriate regulations for individual customers and businesses, establishing emission rights trading mechanisms, and promoting eco-friendly actions [43,44]. As a result of these efforts, photovoltaics, as one of the key sources of renewable energy [45], have become a significant area of interest driven by growing environmental awareness in society and economic benefits, such as reducing electricity costs and the opportunity to sell excess energy to the grid. This is confirmed by the installed photovoltaic capacity (giga watt GW) in 2022, which reached 4.9 GW. Comparatively, Poland ranks very high in comparison to countries like Germany (7.9 GW), Spain (7.5 GW), the Netherlands (4.0 GW), France (2.7 GW), and Italy (2.6 GW). The total capacity in Poland increased by 29% compared to 2021 [46]. Despite the growing need to strengthen the grid infrastructure for efficient connection and transmission of energy [47], grid connection development is ongoing [48,49]. These positive results in the photovoltaic sector are the outcome of financial support programs [50,51] such as “Prosument”, “Clean Air”, and “My Electricity”. With rising energy prices and well-presented policies highlighting the ecological and economic benefits, decision-making for solar panel investments has accelerated [52].

For example, the “My Electricity” program (a program for financing micro photovoltaic installations, currently in its fifth edition) allowed for the disbursement of a grant in the amount of 1,742,050,374 Polish Zloty (PLN). This includes amounts of PLN 1,262,552,156 for the “My Electricity 1.0” and “My Electricity 2.0” editions (years 2019–2020), PLN 485,017,549 for “My Electricity 3.0” (in 2021), and PLN 184,685,126 for “My Electricity 4.0” (in 2022). Visible fluctuations in the granting of funds resulted from the number of submitted applications, their assessment in terms of financing possibilities, and the availability of aid funds. It should be emphasized that this program is intended for individuals who want to generate electricity for their own use, with a maximum coverage of 50% of the investment costs. The distribution of realized investments in Poland under the “My Electricity” program is presented in Figure 2.

The analysis of the “My Electricity” program indicates significant economic potential for owners of micro photovoltaic installations. This is particularly evident due to substantial financial support, which reduces investment costs [53]. Figure 2 shows that the greatest interest is visible in central Poland (in the voivodeships: Wielkopolskie (47,437 applications) and Mazowieckie (47,079 applications)) and southern Poland (in the smaller voivodeships: Slaskie (44,913 applications), Malopolskie (44,634 applications), and Podkarpackie (35,543 requests)). The diversity of submitted applications and the funds awarded depends on many variables, e.g., local policy regarding environmental protection, field possibilities for large installations, atmospheric factors, and the resource capabilities of entities. Despite this, it can be observed that the demand is continually increasing because there are tangible benefits to investment implementation [54,55]. Utilizing one’s own source of energy enhances profitability and expedites the return on investment, since it reduces electricity bills (especially as energy prices continue to rise) and/or allows for the resale of excess generated energy to the grid. Additionally, it is worth noting that the development within the photovoltaic sector, especially in terms of technological advancements, has increased the efficiency and longevity of solar panels [56,57]. This directly translates into economic viability and the attractiveness of investments.

“Clean Air” is another a program in Poland aimed at improving energy efficiency and replacing heat sources in residential buildings. The program includes subsidies and loans for the modernization of heating systems, including the installation of heat pumps, replacement of old furnaces (coal-fired) with more ecological ones, and thermal insulation of single-family residential buildings or residential premises separated into single-family buildings. The aim of the program is to improve air quality and reduce pollutant emissions. The indicators of achieving the program goal are [58]:

• Number of buildings/residential premises with improved energy efficiency 3,030,000;
• Number of ineffective heat sources replaced with low-emission ones in residential buildings/premises 3,000,000;
• Additional capacity to generate electricity from installed photovoltaic micro-installations: 750 MWe;
• Reduction in final energy consumption: 38,100,000 MWh/year;
• Reduction in dust emissions with a diameter of less than 10 μm (PM10): 213,000 Mg/year;
• Reduction in benzo-α-pyrene emissions: 142 Mg/year;
• Reduction in CO₂ emissions: 14,200,000 Mg/year.

The program is to last from 2018 to 2030, where funding agreements will be signed only until 31 December 2027. The budget allocated to support investments is PLN 103 billion. By March 2023, over PLN 320 million was spent because 14,582 applications for co-financing for the replacement of a source were submitted, as well as 18,840 applications for the replacement of a heat source and 4658 applications for a subsidy for a photovoltaic installation.

“Prosumer” is the name of the program created by the National Fund for Environmental Protection and Water Management in Poland, which provides funding for the purchase and installation of micro-installations of renewable energy sources. It is addressed to people who plan to build a small RES installation or micro-installation (renewable energy sources), producing electricity or heat for their own needs with the possibility of selling surplus energy. Financing can be obtained for the purchase and installation of electricity sources (maximum capacity) [59]:

• wind farms (power up to 40 kWe1)—using wind energy (electricity),
• photovoltaic panels (power up to 40 kWp)—using solar energy (electricity),
• solar collectors (power up to 300 kWt)—as above (electricity and heat),
• micro-cogeneration (power up to 40 kWe)—using primary energy contained in fuels,
• heat pumps (power up to 300 kWt)—a device that extracts energy from water, air, or the ground to heat water (thermal energy),
• biomass (power up to 300 kWt)—installations using plant biomass, organic waste, animal excrement, etc. (thermal energy).

Basic assumptions of the program: [60]

• the program budget is PLN 800 million,
• implementation deadline: 2014–2022 with the possibility of concluding loan agreements (credit) with a subsidy until 2020,
• installations for single-family and multi-family residential buildings (including newly built ones),
• maximum amount of eligible costs PLN 100–450 thousand, depending on the type of beneficiary and investment,
• specified maximum unit eligible cost for each type of installation,
• loan/credit interest rate—1% per annum,
• maximum loan/credit financing period—up to 15 years,
• exclusion of the possibility of obtaining co-financing of the project costs from other public funds,
• the project cannot be completed before submitting the application,
• for one residential building—one subsidy under the program,
• the maximum period of implementation of the project is 24 months from the date of concluding the co-financing agreement with the beneficiary.

3. Research Methodology

The broadly addressed topic of green energy, especially investment returns and the prospects of renewable energy sector development, is crucial in shaping the conditions for the stable development of the energy sector in Poland.

The aim of this case study is to assess an energy investment in photovoltaic panels (PV) within a logistics center (LC) located in the Pomorskie Voivodeship. As part of the logistics center, the construction of an automated warehouse covering an area of 11,000 square meters, nearly 1500 square meters of office space, and almost 6000 square meters of green areas has been planned.

For the purposes of this study, the hypothesis has been adopted that the analyzed investment in the LC facility, considering various forms of financing, will pay off within 15 years.

When establishing assumptions and identifying data, it is important to note that the implementation of the new billing system, Net-billing, is carried out in several stages, and Poland is currently in the second stage, which is in effect from 1 July 2022 to 30 June 2024. The value of electrical energy is determined for each calendar year and is the product of the sum of the amount of electrical energy introduced into the distribution network by the prosumer and the monthly market price of electrical energy for a given calendar month. Therefore, the price of electrical energy introduced by the prosumer into the network during this period is determined as the monthly market price (RCEm).

Therefore, to confirm the hypothesis and the objective of the study, an investment assessment model was utilized. This model takes into account the price of electrical energy on the commodity exchange in specific time intervals and the energy demand necessary for the construction of the logistics center in Pomorskie Voivodeship, Poland. It should be emphasized that the planned investment is solely intended to provide the investor with the appropriate amount of energy necessary to carry out the tasks of the logistics center. At the beginning of the investment, the investor must forecast the energy demand for future settlement periods in hourly intervals, the rate of changes in commodity and service prices (inflation), and the absence of investment-related actions. Identification of the power of a PV installation is expressed in units of megawatt peak (MWp). It shows how much electricity, calculated in megawatt hours (MWh), can be produced by the entire photovoltaic installation. MWh, on the other hand, is a unit of measurement of electricity determining the electricity consumption by users (e.g., households). For example: 10,000 PV panels with a power of 325 Wp = 3,250,000 Wp = 3250 kWp = 3250 MWp. In the analysis, the price of energy produced in specific periods was calculated as the product of the forecasted energy efficiency in a given year (decreasing due to the decline in cell efficiency) and the price of 1 kWh (kilowatt hour) of energy adjusted for inflation. Additionally, in the case of renewable energy investments, the capital return/profit generated for each period will also be reinvested at the same rate of return as the alternative form of secure energy investment. In simplified terms, this concept encompasses the expenses incurred by the purchasers related to the cost of adapting the facility.

The analysis took into account a constant inflation rate of 7% as well as three financing variants: the first entirely from equity capital, the second with 50% equity capital and preferential credit, and the third variant with 20% equity capital and 80% commercial credit, which is the most expensive but the fastest option in the investment.

4. Results

4.1. Results of the Technical and Economic Assumptions

The following assumptions were made for the analysis of the logistics center with an area of 12,500 m², an installed capacity of 1.000 MWp, and an annual energy production of 1050.00 MWh, which should ensure a 100% share of energy production. The calculation of energy production took into account the productivity loss coefficients for PV panels provided by manufacturers (

Table 5. Changes in the productivity of PV panels.

The Period of Reduced Productivity for PV Panels	Reduction in Productivity of PV Panels [%]
1—after the first year	2.00
From 2 to 10 years	0.45
From 11 to 15 years	0.5

Source: own study based on: https://www.nrel.gov/pv/cell-efficiency.html (accessed on 30 October 2023).

).

Research conducted by specialists from the National Renewable Energy Laboratory (NREL) and other panel manufacturers (e.g., Longi Green Energy, Jinko Solar, Trina Solar) prove that panel consumption varies, which directly affects the possibilities of obtaining energy. When assessing energy demand, the lifespan of photovoltaic panels and the durability of panels in terms of production possibilities were taken into account.

Table 6. Amount of produced energy and productivity loss in the years 2023–2037.

Year	Energy Production in MWh/Year	Productivity Loss of the PV System in a Given Year [%]	Efficiency of PV Panels [%]
2023	1029.0	2.0	98.0
2024	1024.3	0.45	97.55
2025	1019.6	0.45	97.1
2026	1014.8	0.45	96.65
2027	1010.1	0.45	96.2
2028	1005.4	0.45	95.75
2029	1000.7	0.45	95.3
2030	995.9	0.45	94.85
2031	991.2	0.45	994.4
2032	986.5	0.45	93.95
2033	981.2	0.5	92.45
2034	976.0	0.5	92.95
2035	970.7	0.5	92.45
2036	965.5	0.5	91.95
2037	960.2	0.5	91.45

Source: In-house development based on data from TGeBase (the Polish Power Exchange) and PV panel manufactures.

presents the amount of energy produced in relation to productivity loss during the analyzed period.

The analysis assumed that the final efficiency of the panels would be approximately 91% (91,45%) (Table 6). The assumption was assessed based on the panels’ compliance with the durability standards specified by the IEC (International Electrotechnical Commission) regarding, among others, resistance to dust and sand, temperature and humidity, and mechanical loads. This safety guarantees that the PV panels can still be used after 15 years, as manufacturers assume a period of use (lifespan) of up to 25 years.

Table 7. Net costs in thousands of euros for individual direct components of the PV installation for the logistics center.

Direct Component	Net Costs in Thousands of Euros	Percentage Share [%]
Mounting	59.6	14.4
Wiring Cost	29.8	7.2
Installation Labor Cost	50.4	12.3
PV Panels	239.4	58.3
Inventory	31.9	7.8
Total	410.0	100

Source: In-house development based on data.

indicates the necessary components of the PV installation for the implementation of the planned logistics center investment.

For the analysis, the cost of photovoltaic panels per 1 Wp was assumed to be EUR 0.25, and the cost of the inverter per 1 Wp was EUR 0.034. These are the average prices of devices available on the market during the analyzed period for this type of investment.

Additionally, when analyzing the investment costs, it is necessary to take into account the applicable VAT (8%)—EUR 32,800.80 thousand, which the logistics center will settle over a period of 3 years.

For the total direct and indirect expenses of the PV panel installation project at the logistics center (

Table 8. Total direct and indirect expenses for the installation project of PV panels (1 MW) at LC based on CaPex.

Expenses Related to the Project	Net Costs in Thousand Euros	Percentage Share in the Investment [%]
Documentation	31.9	5.6
Financial and legal services	4.2	0.7
Connection conditions and connection point	19.1	3.3
Cost of additional access road	13.8	2.4
Fencing of the area	10.6	1.8
Structures	59.6	10.4
Inverters	31.9	5.6
AC/DC wiring	29.8	5.2
PV panels	239.4	41.6
Mounting work	50.4	8.9
Other construction work	12.8	2.2
Monitoring and HSE systems	5.7	1.0
Perimeter security and potential equalization systems	5.7	1.0
Transformer substation	53.2	9.2
Other expences	6.4	1.1
Total	574.5	100

Source: In-house development based on CapEx-EXCEL-IT.xlsx.

), a CAPEX (capital expenditures) analysis was used. In economics, CAPEX refers to expenses directly related to product development. When applied to the PV panel installation project at the logistics center, it can be simplified as the expenses incurred by the clients related to the cost of adapting the facility. All conceptual work, designs, permitting documents, and implementation fall under capital expenditures.

Formula and calculation of CapEx:

CapEx = ΔPP&E + Current Depreciation

where:

CapEx = Capital expenditures

ΔPP&E = Change in property, plant, and equipment

Capital expenditures are also used in calculating the free cash flow to equity (FCFE). FCFE is the amount of cash available to equity shareholders. The formula for FCFE is:

FCFE = EP − (CE − D) × (1 − DR) − ΔC × (1 − DR)

where:

FCFE = Free cash flow to equity

EP = Earnings per share

CE = CapEx

D = Depreciation

DR = Debt ratio

ΔC = ΔNet capital, change in net working capital

Or:

FCFE = NI − NCE − ΔC + ND − DR

where:

NI = Net income

NCE = Net CapEx

ND = New debt

DR = Debt repayment

4.2. Results of Financing Assumption

An important aspect of every investment is determining the method of financing. The analysis assessed the possibility of using external financing, because in the long run it is more beneficial for investors and ensures the financial security of the investment. The analysis of investment financing possibilities showed that the most effective and safest share of capital is the 20/80 ratio.

Table 9. Investment cost with a commercial loan.

Specification	Financing Cost in Thousands of Euros	Percentage Share [%]
Equity	114.5	20
Commercial loan	460	80
Total	574.5	100

Source: In-house development based on data from commercial banks.

presents the adopted structure of the cost of financing the implementation of the investment with 20% equity and 80% commercial loan.

The presented investment costs (in Table 9) should also include a 23% VAT, which amounts to a cost of EUR 132,135.00. Additionally, with a loan (depending on the selected bank) ranging from 9.8% to 15.0%, it constitutes a cost of EUR 45,080 to 69,000 without additional financing VAT, which would be financed from the company’s own liquidity capital. Considering VAT in commercial loan financing, the repayment amounts will increase from EUR 58,020 to 88,800.

Additionally, equity levels and cash levels without VAT were calculated. A sensitivity analysis was conducted on the rising cash level due to changes in the project’s financing with equity capital in thousands of euros (

Table 10. Sensitivity analysis of the cash level rising due to changes in the financing level of the PV panel project at LC for the period 2023–2037 in thousands of euros.

Year	Equity Participation 10%	Equity Participation 20%	Equity Participation 50%	Equity Participation 100%
2023	2.17	8.87	28.4	60.62
2024	21.83	34.32	71.19	132.32
2025	−35.92	−17.59	36.72	126.96
2026	37.6	55.02	106.72	192.57
2027	50.68	73.49	141.28	253.94
2028	−2.36	27.66	117.13	265.94
2029	5.4	40.51	145.23	319.45
2030	13.25	53.3	172.85	371.8
2031	−6.11	191.6	180.85	413.78
2032	0.21	40.77	205.85	462.11
2033	−25.55	51.79	198.19	477.08
2034	−25.28	30.53	223.34	533.23
2035	−19.21	37.06	246.38	577.53
2036	−12.92	57.78	268.94	620.81
2037	−1.43	75.08	303.87	684.62

Source: In-house development.

). Four equity participation levels were applied: 10%, 20%, 50%, and 100%.

An important element for our calculations is the assumed increase in energy prices and capital costs at interest rates in short-term and long-term loans (

Table 11. Energy prices and capital costs by loan duration.

Discount Rate per Year	Interest Rate [%]
Short-term loan interest rate per year and commission (1%)	6
Long-term loan interest rate per year and commission (0.25%)	10.05–15.25
Selling price of energy according to base 1 MWh in Q1 2022	EUR 99.65

Source: In-house development based on data from commercial banks and https://www.ure.gov.pl (accessed on 30 October 2023).

). Of course, from the point of view of investment profitability, an increase in energy prices is more favorable for CL, as is a decrease in loan interest rates and commissions.

5. Discussion

The analysis of the profitability of investments in the method of energy production began to take into account the possibility of obtaining additional financial benefits resulting from the reduction in CO₂ emissions. The year 2021 was particularly important, when energy on the competitive market could be purchased almost twice as cheaply (an average of EUR 53.55/MWh). At that time, the difference between the over-the-counter market (OTC market) and the competitive market was greater, exceeding 1.34 EUR/MWh. In the investment analysis and evaluation, it should be emphasized that there is a reduction in CO₂ emissions, where the logistics center (LC) does not incur costs related to emissions (Figure 3). Transaction costs for CO₂ emission allowances (KTCO2) correspond to variable costs directly associated with the purchase/sale transaction of CO₂ emission allowances on the exchange, in connection with the delivery or receipt of balancing the energy required on the balancing market. These costs in 2021 amounted to 1.00 PLN/Mg (0.21 EUR/Mg) of CO₂, and, starting from 2022, they are subject to indexation based on the forecasted average annual price index for consumer goods and services recognized by the President of the Energy Regulatory Office, as justified within the approved VFB Tariff (Tariffs of Volunteer Fire Department) for a given calendar year. In the case of the LC investment mentioned above, during the analysis of the previous period, the company would have saved 9.8%. This means that, with the use of investment support (in accordance with Article 39 of the RES Act) and the production of 14,940 MWh in the first year, the LC would have generated an additional income of EUR 54.25 thousand.

The analysis allows us to conclude that even with changes in the auction price according to TGeBase (

Table 12. We will implement such activities in the future.

2022	2023	2024	2025	2026	2027	2028	2029	2030	2031	2032	2033	2034	2035	2036
6.7%	14.9%	−5.8%	−0.6%	−5.2%	−4.0%	−6.1%	−0.9%	−1.7%	−3.6%	−1.0%	−0.9%	−2.3%	−1.1%	−1.3%

Source: In-house development.

) and a decrease in panel productivity, but with additional financial support from external funds, the LC investment is profitable.

Depreciation is another important element in our analysis. The LC assumed depreciation of tangible and intangible assets at 20% over a 5-year period (2023–2027). In the case of energy equipment such as substations, a depreciation period of 10 years (10% each year) was assumed. Due to the high cost of installations like PV panels, inverters, cables, and installation, a depreciation period of 15 years was assumed, with 14 years at 7% and the final year at 2% (Figure 4).

Additionally, in the LC investment, additional expenses were assumed:

-

insurance at a rate of 5% throughout the analyzed period,

-

maintenance services—4.5% in the first year, 4% in the second year, 3.5% in the third year, 2% in years 4–8, 1.5% in years 9–12, and 1% in the last 3 years.

The LC investment in the Pomorskie region of Poland, when analyzing financial costs (Figure 5), shows the projected interest and loan fees as well as fixed assets from 2023 to 2037 in thousands of euros.

Short-term liabilities remain at a similar level of EUR 32.1 thousand throughout the entire period, while with long-term credit, the liabilities will decrease (Figure 6).

The analysis shows a decrease in long-term liabilities from 2023 to 2037, with no credit servicing costs in the last 2 years. Not every logistics company, when building a logistics center, can afford to finance it solely from equity plus short-term liabilities. Typically, they must have accumulated equity capital of at least 65 percent, which companies often hesitate to do due to constantly changing market conditions and economic fluctuations in high-risk environments. They opt for long-term liabilities with 20 percent equity capital instead. In the financial analysis, the results of the company’s financial performance were taken into account, hence the negative values and the depreciation of LC automation, which have a significant impact on the financial result in years with a 10- and 20-percent equity capital share. Additionally, the analysis includes amortizations and costs, as well as projected profits, which are not presented in the article by the authors. This principle is also confirmed in the analyzed investment. The assessment of capital involvement (share of equity level) to cash level is presented in Figure 7.

Sensitivity analysis, from the point of view of investment security and the possibility of financing the investor (cash), turned out to be the best option with an own share of 20%. It did not expose the entity to excessive financial burdens, guaranteeing the security of operations and repayment of liabilities. Additionally, the analysis of economic indicators indicated that this is good option:

1.	Level of equity capital	10%	20%	50%	100%
2.	NPVR (net present value NPV)	0.21	0.04	−0.07	−0.11
3.	NPV (net present value) (in thousand euros)	12.66	4.32	−21.41	−64.75
4.	Equity (in thousand euros)	61.36	120.73	306.82	613.64
5.	IRR (internal rate of return) of the investment 6.3%

This is true especially since the investment efficiency measurement index, NPVR, is greater than 0, reaching a value of 0.04, and the appropriate capital capabilities of the investor guarantee the success of the investment.

While analyzing and assessing the selection of the best variant of using equity capital, the impact of TGeBase (TGE) and CAPEX was also assessed. Impact analysis resulting from energy changes (TGE) has consequences, among others, in shaping the investment’s operating costs together with compensation and affecting the cash level. Of course, price increases enable a faster return on investment, while price decreases extend them, thus determining the profitability of the investment. In our research, we assumed a fixed price, even though we made calculations, which allowed us to omit additional risk assessment. However, it is worth noting that in the analysis we calculated the changes but did not subject them to further analyses. The analysis from the TGeBase level to the NPV level was expressed in installments:

1.	Increase or decrease—EUR/MWh	−10%	0.0%	10%
2.	NPVR	−0.05	0.04	0.11
3.	NPV (in thousand euros)	−6.02	4.32	12.95
4.	TGeBase average over 15 years	69.66	77.41	85.23

The analysis showed that the NPVR level of 0.0 was achieved with a −5% decrease in the TGeBase level. Price changes (TGeBase) also had an impact on the sensitivity of the cash level (Figure 8).

The analysis of the sensitivity of the cash level (cumulatively) to changes in capital expenditures (CAPEX) also shows that the best (optimal) solution is the situation when the equity capital expenditure amounts to 20% (Figure 9). This optimal choice of financing share (Figure 10) is confirmed by the following economic indicators assessing the CAPEX level to the NPV level:

1.	Increase or decrease—EUR/MWh	−10%	0.0%	10%
2.	NPVR	−0.39	0.04	0.54
3.	NPV (in thousand euros)	−52.27	4.32	60.00
4.	CAPEX (in thousand euros)	675	613.64	552.27
Source: In-house development.

The analysis conducted allows us to conclude that the energy investment in PV panels in the logistics center (LC) will pay off within 15 years using external financial resources. Attempts were made to demonstrate that the profitability of the investment and the payback period are influenced by both the loss of energy productivity (Table 6) as well as the financing possibilities (structure of equity share) and the amount for compensation.

6. Conclusions

Investments in photovoltaics, analyzing data on electricity generated in the EU (Table 4), indicate great interest in various production capacities. This means that the installations we analyzed will probably become “everyday”. This means that large economic entities, in order to achieve savings and guarantee energy security, will decide on pro-ecological investments, e.g., in photovoltaics. The analysis showed that this type of investment is profitable and, based on our assumption, pays off within 15 years. The study, among other things, took into account the selection of the best share of equity capital to external capital and the impact of variable prices. In the case of the TGeBase analysis, an increase in energy prices benefits the logistics company planning to install PV panels on the LC facility. In the CAPEX analysis, a decrease in expenditures results in a EUR 138.23 thousand benefit for the logistics company over the 15-year period.

When analyzing the investment project for PV panels at the LC facility in Pomorskie Voivodeship, the capital contribution, potential investment aid, change in loan interest rates, total value of the investment (direct and indirect costs CAPEX), and energy price fluctuations were taken into account. Unfortunately, the study did not identify the risks and methods of managing them.

6.1. Recommendations

In the future, the authors should take steps to expand our knowledge, both in terms of assessing other pro-environmental investments, in the area of developing the field of photovoltaic panels as an element of the energy mix. It is particularly important to examine trends—the authors have already taken the initiative in these areas (they are not yet systemic)—and to verify the energy obtained after installation and after several years of using the installation. These activities will help the authors to see the impact of such large investments and their profitability. Additionally, the authors will consider conducting analyses of the impact of this type of investment on the socio-economic environment of the region and the investors themselves, as well as identifying and managing investment risk. The authors’ future analytical activities will be complemented by the identification and assessment of the phenomenon of panel disposal, which may also significantly affect the assessment of the investment and its profitability.

6.2. Limitations

The key limitation of this analysis is the case study method, which focuses on only one investment (one company). We believe this is a good example, but in the future, it would be worth analyzing more similar companies to understand what factors determined the investments, what were the production and financial expectations, and what the process of achieving this looked like. The limitation also applies to information obtained from the investing entity. However, the financing activities for investments in photovoltaic installations presented by us are relatively universal and can be used in other organizations in this field.

6.3. Implications

The results of our research expanded the theoretical basis for assessing a large investment in photovoltaic installations used by a logistics center in Poland. This study fills the scientific gap regarding the analysis of the implementation of such investments in the field of generating electricity for own needs. Based on our research, we identified, among others, energy demand, loss of productivity, and, in particular, investment financing opportunities that can be applied to other similar logistics entities. The main business implication of the study is the possibility of using the results by other similar entities. In this way, they can reduce the level of pollution, organize pro-ecological activities, and start producing energy from renewable energies. It is worth noting that such activities [61,62] may also have an impact on building a positive image of the organization. In today’s market, as Rashid [63] noted, a green image can provide us with a more loyal customer and can be economically beneficial.