diff --git a/src/ert/config/observation_vector.py b/src/ert/config/observation_vector.py
index f77364b0ade..59a3799a2bf 100644
--- a/src/ert/config/observation_vector.py
+++ b/src/ert/config/observation_vector.py
@@ -3,8 +3,6 @@
 from dataclasses import dataclass
 from typing import TYPE_CHECKING, Dict, Iterable, List, Union
 
-import xarray as xr
-
 from .enkf_observation_implementation_type import EnkfObservationImplementationType
 from .general_observation import GenObservation
 from .summary_observation import SummaryObservation
@@ -12,6 +10,8 @@
 if TYPE_CHECKING:
     from datetime import datetime
 
+import polars
+
 
 @dataclass
 class ObsVector:
@@ -27,25 +27,28 @@ def __iter__(self) -> Iterable[Union[SummaryObservation, GenObservation]]:
     def __len__(self) -> int:
         return len(self.observations)
 
-    def to_dataset(self, active_list: List[int]) -> xr.Dataset:
+    def to_dataset(self, active_list: List[int]) -> polars.DataFrame:
         if self.observation_type == EnkfObservationImplementationType.GEN_OBS:
-            datasets = []
+            dataframes = []
             for time_step, node in self.observations.items():
                 if active_list and time_step not in active_list:
                     continue
 
                 assert isinstance(node, GenObservation)
-                datasets.append(
-                    xr.Dataset(
+                dataframes.append(
+                    polars.DataFrame(
                         {
-                            "observations": (["report_step", "index"], [node.values]),
-                            "std": (["report_step", "index"], [node.stds]),
-                        },
-                        coords={"index": node.indices, "report_step": [time_step]},
+                            "name": self.data_key,
+                            "index": node.indices,
+                            "report_step": time_step,
+                            "observations": polars.Series(
+                                node.values, dtype=polars.Float32
+                            ),
+                            "std": polars.Series(node.stds, dtype=polars.Float32),
+                        }
                     )
                 )
-            combined = xr.combine_by_coords(datasets)
-            combined.attrs["response"] = self.data_key
+            combined = polars.concat(dataframes)
             return combined  # type: ignore
         elif self.observation_type == EnkfObservationImplementationType.SUMMARY_OBS:
             observations = []
@@ -59,13 +62,14 @@ def to_dataset(self, active_list: List[int]) -> xr.Dataset:
                 assert isinstance(n, SummaryObservation)
                 observations.append(n.value)
                 errors.append(n.std)
-            return xr.Dataset(
+
+            return polars.DataFrame(
                 {
-                    "observations": (["name", "time"], [observations]),
-                    "std": (["name", "time"], [errors]),
-                },
-                coords={"time": dates, "name": [self.observation_key]},
-                attrs={"response": "summary"},
+                    "name": self.observation_key,
+                    "time": dates,
+                    "observations": polars.Series(observations, dtype=polars.Float32),
+                    "std": polars.Series(errors, dtype=polars.Float32),
+                }
             )
         else:
             raise ValueError(f"Unknown observation type {self.observation_type}")
diff --git a/src/ert/config/observations.py b/src/ert/config/observations.py
index d1e8580c982..d1ee31744b8 100644
--- a/src/ert/config/observations.py
+++ b/src/ert/config/observations.py
@@ -4,7 +4,7 @@
 from typing import TYPE_CHECKING, Dict, Iterator, List, Optional, Tuple, Union
 
 import numpy as np
-import xarray as xr
+import polars
 
 from ert.validation import rangestring_to_list
 
@@ -42,8 +42,22 @@ class EnkfObs:
     obs_time: List[datetime]
 
     def __post_init__(self) -> None:
-        self.datasets: Dict[str, xr.Dataset] = {
-            name: obs.to_dataset([]) for name, obs in sorted(self.obs_vectors.items())
+        grouped = {}
+        for vec in self.obs_vectors.values():
+            if vec.observation_type == EnkfObservationImplementationType.SUMMARY_OBS:
+                if "summary" not in grouped:
+                    grouped["summary"] = []
+
+                grouped["summary"].append(vec.to_dataset([]))
+
+            elif vec.observation_type == EnkfObservationImplementationType.GEN_OBS:
+                if "gen_data" not in grouped:
+                    grouped["gen_data"] = []
+
+                grouped["gen_data"].append(vec.to_dataset([]))
+
+        self.datasets: Dict[str, polars.DataFrame] = {
+            name: polars.concat(dfs) for name, dfs in grouped.items()
         }
 
     def __len__(self) -> int:
diff --git a/src/ert/storage/local_experiment.py b/src/ert/storage/local_experiment.py
index ff00f939b04..07869063eb4 100644
--- a/src/ert/storage/local_experiment.py
+++ b/src/ert/storage/local_experiment.py
@@ -8,6 +8,7 @@
 from uuid import UUID
 
 import numpy as np
+import polars
 import xarray as xr
 import xtgeo
 from pydantic import BaseModel
@@ -142,7 +143,7 @@ def create(
             output_path = path / "observations"
             output_path.mkdir()
             for obs_name, dataset in observations.items():
-                dataset.to_netcdf(output_path / f"{obs_name}", engine="scipy")
+                dataset.write_parquet(output_path / f"{obs_name}")
 
         with open(path / cls._metadata_file, "w", encoding="utf-8") as f:
             simulation_data = simulation_arguments if simulation_arguments else {}
@@ -306,7 +307,7 @@ def update_parameters(self) -> List[str]:
     def observations(self) -> Dict[str, xr.Dataset]:
         observations = sorted(self.mount_point.glob("observations/*"))
         return {
-            observation.name: xr.open_dataset(observation, engine="scipy")
+            observation.name: polars.read_parquet(f"{observation}")
             for observation in observations
         }