Between Permitting and Bankability

Environmental and Social (E&S) Compliance in Wind Energy Projects in the EU

(case study: Poland)

1. Why a Fully Permitted Projects In Not Always Bankable

This paper is prepared from the perspective of environmental and social (Environmental & Social – E&S) compliance as applied by international financial institutions (IFIs) and commercial banks in project finance transactions. It is not an analysis from the standpoint of classical administrative law.

Poland, within the broader EU regulatory context, is used as a case study, analysing three typical wind project profiles:

• offshore wind farms – Category A,
• onshore wind farms – Category A,
• onshore wind farms – Category B.

EU and national permitting frameworks (EU/PL) are treated as a necessary set of administrative decisions enabling project implementation. The analysis then maps the outcomes of permitting against lenders’ E&S requirements, illustrating:

• where formal legal compliance constitutes credible evidence of compliance for financing purposes, and
• where, from a financing perspective, it remains insufficient.

The reference framework comprises four widely applied families of E&S standards:

• IFC Performance Standards (2012, PS1–PS8),
• EBRD Environmental and Social Policy (2024, ESR1–ESR10),
• EIB Environmental and Social Standards (2022, 11 thematic standards),
• Equator Principles (EP4, 2020) – a banking framework requiring application of the IFC Performance Standards (and EHS Guidelines) for Category A and B projects, together with ESDD, ESAP and monitoring.

The key methodological distinction is straightforward:

Permitting answers the question “Is the project administratively admissible?”,
whereas E&S compliance answers the question “Is the project understood, managed and documented throughout its lifecycle in a manner acceptable to lenders?”.

How Bankability Is Understood in This Paper

Project bankability is understood as the project’s ability to obtain and sustain debt financing on terms acceptable to lenders, provided that all material risks – including environmental and social risks – have been identified, assessed, allocated and are subject to an effective management system throughout the project lifecycle.

In this sense, bankability is not limited to the execution of financing agreements. It also encompasses the fulfilment of conditions precedent, project stability during construction and operation, resilience to regulatory and social risks, and the ability to refinance or divest the asset.

From a financing perspective, E&S requirements do not replace administrative permits. Instead, they constitute a structured enhancement of permitting, standardising projects in terms of:

• time-based feasibility control (ensuring that environmental and social conditions can be implemented within construction and operational schedules without generating uncontrolled delays or costs),
• risk transparency, allocation and management (including clarity as to responsibility for mitigation, implementation of measures, provision of evidence and cost allocation across the lifecycle),
• comparability across markets and transactions (facilitating credit assessment, project benchmarking and portfolio-level risk management),
• long-term asset value protection (through a lifecycle approach, consistent reporting, mitigation of reputational risks and readiness for refinancing or asset transactions),
• institutional project memory (embedding environmental and social knowledge in a form resilient to changes in teams, contractors and asset ownership).

2. A Practical Perspective

Ambiens’ perspective is shaped by long-standing work at the interface between lenders’ and sponsors’ interests, where environmental and social decisions translate directly into bankability, financing structure and project deliverability. The objective of this approach is not to replace the investment or permitting process, but to translate it into the language of risks, obligations and management mechanisms that are relevant for financing, regulatory compliance and long-term asset value.

In practice, Ambiens’ experience in E&S and wind project bankability encompasses four complementary areas, which together reflect the competence profile expected by financial institutions:

• BC-Wind – the most recently financially closed offshore wind project in Poland, developed by Ocean Winds (JV of EDPR and ENGIE). Ambiens acted as Lenders’ Independent Environmental and Social Consultant, delivering comprehensive Environmental and Social Due Diligence (ESDD) and preparing and supporting the implementation of a lifecycle-based Environmental and Social Action Plan (ESAP) in line with current lenders’ expectations.
• Baltic Power – the first offshore wind farm in Poland to reach project finance financial close and Final Investment Decision (FID). Ambiens served as Lenders’ Independent Environmental and Social Consultant, delivering full Environmental and Social Due Diligence, supporting the financial close process, and preparing and agreeing an Environmental and Social Action Plan based on the full suite of leading E&S frameworks, including the Equator Principles (EP4), IFC Performance Standards, EBRD Environmental and Social Policy and EIB Environmental and Social Standards. Early transaction experience and E&S practices developed in dialogue with more than 25 financing institutions established a reference point for subsequent offshore wind projects in Poland.
• Potęgowo – an onshore wind farm in construction and operation, for which Ambiens provides post–financial close E&S advisory services, including lender reporting, oversight of compliance with environmental decision conditions, management of social issues and monitoring of publicly disclosed E&S commitments.
• Onshore wind projects – Category B – a broad portfolio of assignments for commercial banks and IFIs, including ESDD for moderate-risk projects, support with proportional E&S risk allocation and management, and tailoring of requirements to project scale and risk profile in line with credit practice and lenders’ expectations.

Within the Polish market, this combination of mandates remains uncommon. It reflects not only advisory experience for lenders and IFIs, but also in-depth understanding of national permitting realities and international compliance frameworks (EP4, IFC Performance Standards, EBRD ESP, EIB Standards), applied in a consistent and transaction-relevant manner.

This perspective enables projects to be viewed simultaneously through the lenses of bankability and delivery realities, and explains how permitting documentation is interpreted in ESDD processes, which risks lenders consider material, and why fully permitted projects may still require a structured approach to E&S risk management.

This approach has been shaped through dialogue with more than 40 financial institutions, including commercial banks, export credit agencies and IFIs, enabling practical comparison of E&S risk approaches across transactions and portfolios.

3. Development Reality: Permitting at Scale (UE / Poland)

3.1. Onshore Wind Farms

Permitting for onshore wind farms in Poland is typically sequential and centred on key administrative decisions and permits, supported by multiple opinions, approvals and positions from sectoral authorities. The process is based in particular on:

• spatial planning (local development plans),
• the EIA procedure and environmental decision,
• construction permits and associated decisions,
• grid connection conditions and agreement,
• operational approval decisions.

Quantitative perspective:
Onshore wind projects typically involve 5–7 key administrative decisions, supported by several dozen opinions, approvals and sectoral positions (most commonly 20–40), issued by authorities at local, regional and sectoral level. The process is highly dependent on local spatial, environmental and social context, as well as on the sequential nature of proceedings.

Qualitative perspective:
The complexity of onshore wind permitting does not stem solely from the number of decisions, but from how environmental, spatial and social constraints translate into project design, layout, technical parameters and implementation sequencing. In practice, these constraints materialise through decision conditions, compensation requirements or mitigation measures, which directly affect project execution and require active management throughout the project lifecycle.

3.2. Offshore Wind Farms

Offshore wind permitting operates within a multi-layered administrative decision-making system, covering both offshore and onshore project components, and governed by distinct legal regimes and institutional competences. The process centres on a series of key decisions, supported by extensive sectoral consultations and approvals, particularly in relation to the marine environment, navigation safety, defence, security and energy infrastructure.

Quantitative perspective:
In practice, offshore wind permitting involves at least 8–12 key administrative decisions, complemented by several dozen to over 100 opinions, approvals and positions issued by national and sectoral authorities. The volume of formal administrative interactions is materially higher than for onshore projects, with parts of the process running in parallel for offshore and onshore components.

Qualitative perspective:
The scope and nature of decisions and approvals in offshore projects cover, inter alia, location within maritime areas, impacts on the marine environment, navigation safety, critical infrastructure, export cables and onshore grid connections. These constraints affect technical design, installation scope, construction sequencing and operational conditions, and require coordination across multiple authorities throughout the project lifecycle.

4. Permitting and E&S Requirements: Coverage Scope

Coverage of environmental and social (E&S) requirements by EU/PL permitting across wind project types, benchmarked against leading financing standards.

Methodology for Assessing E&S Coverage

The percentage ranges presented below do not represent a binary assessment of “compliant / non-compliant”. They reflect the outcome of a structured comparative analysis applied in ESDD reviews and permitting documentation assessments, aimed at capturing the actual degree of coverage of E&S requirements.

In practice, the analysis is conducted at the level of individual requirements within each standard family (e.g. PS1, PS2… / ESR1, ESR2… / EP1–EP10), mapping the effects of administrative decisions, conditions and approvals against lenders’ expectations, taking into account:

• their materiality from a project risk perspective,
• the time horizon (development, construction and operation),
• the level of management, control and documentation expected by financing institutions.

Accordingly, the table presents coverage ranges for each standard family and project type. These ranges represent observed minimum and maximum levels of coverage across individual requirements within a given family, rather than a single averaged score for the standard as a whole.

Identified gaps do not indicate non-compliance with law. However, they may delay or complicate financial close and result in additional obligations for sponsors, as required by lenders at financial close, construction or operational stages (e.g. ESAPs, enhanced reporting, monitoring or conditions precedent).

E&S standard family	Offshore wind – Cat A	Onshore wind – Cat A	Onshore wind – Cat B	What permitting typically covers	What is typically missing (examples)
Equator Principles (EP4)	10–40%	15–50%	25–60%	Core EIA-related requirements (impacts and permit conditions) and limited formal disclosure elements	Transactional and governance mechanisms: independent review, covenants, ESAPs, monitoring and reporting (e.g. continuous lender reporting in offshore projects)
IFC Performance Standards (PS1–PS8)	10–45%	20–55%	30–65%	Primarily PS3 and PS4, and partly PS6, reflected in permit conditions and mitigation measures	PS1 (ESMS and management systems), PS2 (labour), PS5 (land), PS8 (cultural heritage) as processes and evidence of implementation (e.g. permits do not replace contractor ESMS)
EBRD Environmental & Social Requirements (ESR1–ESR10)	15–45%	25–55%	35–65%	Environmental aspects aligned with EIA and sectoral permit conditions, and limited H&S obligations	E&S management (ESR1), labour (ESR2), stakeholder engagement (ESR10) and lifecycle monitoring and reporting (e.g. apparent “high compliance” in Cat B projects masking implementation gaps)
EIB Environmental & Social Standards	15–45%	25–55%	35–65%	Formal legal compliance and selected environmental requirements, particularly those arising from EIA procedures	Governance, lifecycle approach, audits and reporting; requirements relating to vulnerable groups as management practices (e.g. need for integrated monitoring and adaptive management offshore)

Practical observation: the lowest coverage levels are typically observed in offshore projects (Cat A), while the highest are seen in onshore projects (Cat B). The latter can be misleading: the higher the apparent “paper coverage”, the greater the risk that permitting is overestimated and that lender-required E&S management tools (ESDD/ESAP, ESMS, monitoring) are activated too late, potentially shifting obligations into financial close, construction or operation.

5. Impact of Environmental and Social Conditions on Financing

Wind project lifecycle illustrating the timing of E&S requirements and their relevance for project bankability.

From a lenders’ perspective, key observations arising from the relationship between permitting and E&S requirements can be summarised as follows:

• EU/PL permitting is a starting point, not an endpoint, for bankability assessment. A complete set of administrative decisions enables financing processes to begin, but does not in itself demonstrate that a project is feasible, manageable or resilient over its lifecycle.
• E&S compliance management does not begin at pre-financing due diligence. In practice, assumptions later tested in ESDD are shaped much earlier, alongside permitting decisions, project design, schedules and contractual structures.
• Differences between leading E&S standards have direct transactional implications. Divergent approaches to management systems, reporting and evidence of implementation affect financing structures, conditions precedent, covenants and post–financial close obligations.
• Each project requires an individual assessment regardless of formal permit completeness. Project status, permitting strategy, local environmental and social context and delivery model mean that formally comparable projects may differ materially in risk profile from a financing perspective.
• The lowest levels of E&S coverage are observed in offshore projects (Cat A), while the highest are seen in onshore projects (Cat B). The latter can create a false sense of completeness, leading to delayed mobilisation of lender-required management tools.
• The growing importance of biodiversity, climate adaptation, governance and reporting means that an increasing share of E&S requirements extends beyond the traditional scope of administrative decisions, even for projects with a moderate risk profile.

Ultimately, project bankability does not arise from the mere existence of permits, but from whether permitting has been translated into a coherent, documented and proportionate E&S risk management system, acceptable to financing institutions during financing, construction and operation.