Poland is looking for a revolution in coal. The renewal of Poland’s coal fleet of highly and inefficient power plants is now seen by the Polish government as drivers of Poland’s economy. Cheap electricity for consumers and industry is the mainstay of economic growth in the country. In addition, coal gasification and turning coal into liquid fuels offers opportunities in innovation for industry and for researchers. This is the viewed given by Poland’s Energy Minister Krzysztof Tchórzewski, it was also reflected in the views of other Polish energy executives speaking on the opening panel of the Energy Futures Week, in Poznan, Poland on May 10, 2016 – focused on innovation in the energy sector.
Poland’s pursuit of a coal revolution – and innovation in the sector, comes after the failure of the country to launch a shale gas revolution. So I’m very grateful to the organizers of the conference to invite me to this event to continue my observations and grow my knowledge of the Polish energy sector. So my comments below – and around the conference – are not directed at the forum, because without such a place where ideas are aired, I – and others – would have less access to the views of the leaders of the Polish government and energy companies. So I’m immensely grateful to have literately a front seat on the reformulation of Polish energy policy.
With that said, not once during the day was ‘shale gas’ or ‘carbon capture and storage’ mentioned – until I brought it up in the final session of the day (I’ll write a separate post later). I felt like I was breaking the china at a party. I wasn’t that the people in my panel were against or forgot about these things, but rather the previous speakers, particularly from state owned companies were fighting for maintaining coal as a central element of Poland’s energy mix – at the lowest cost, i.e. without high emission pricing. The panelists in this session, including representatives from RWE, PGE, and PGNiG – also put forward a more technology and consumer orientated energy system, than heavy coal. So some moderation needs to be expressed about continuation of centrally supply orientated energy sector – that participants are aware runs counter to international trends. To understand developments in Poland it becomes understanding the heavy coal driven supply model, with utilities awareness of changing consumer and technology preferences and opportunities.
Returning to the discussion in the opening session, the theme was built on the need for low cost energy in Poland. socially and economically Poland cannot afford ‘high’ priced renewables in the energy mix. The EU is pursuing zero carbon emissions in the power sector by 2050, and the Minister Tchórzewski stated the Polish government, “we reject that, clearly unacceptable” the sacrifices for Poland would be too great to move away from coal. The path for Poland is higher efficiency power plants, so more power output can be gained by more efficient burning of coal. Renewables, in the view of Tchórzewski are expensive and require 100% reserves by other power sources – making them very expensive to run, and making them unreliable, whereas if coal fired power plants are only operated, then they are more efficient, due to better predictability of demand and operations. Finally, the grid itself can only support 10% of renewables, and so renewable must be constrained for security of supply reasons.
Overall, the panelist seemed to agree that Poland has an image problem when it comes to their efforts to reduce carbon emissions. Poland, as was stated, added renewables to the grid at twice the rate of other European countries last year. And emission reductions, as was mentioned by the PGNiG representative have dropped 30% since 1989 while the Polish economy has expanded seven fold. Billions have already been spent modernizing coal power plants but the EU regulatory requirements are constantly changing, make past improvements irrelevant, thus costing end-consumers even more money. Echoed by many on the panel, was this demand for a stable and predictable regulatory environment, investments into the power sector are being devalued by the instability in EU regulations.
The common position of the panelists was the end-user price of household consumers and Polish industry. Energy prices cannot go higher than what they are now, this justifies the pursuit of coal and maintaining Poland’s fleet of coal fired power plants, while keeping out both German renewable electricity from the Polish grid, and restraining the growth of on-shore wind and solar in Poland.
Panel I – Opening panel – The energy sector: between security, innovativeness and competitiveness
Moderator: dr hab. Mariusz Swora
1. Prof. dr hab. inż. Maciej Chorowski – Dyrektor, Narodowe Centrum Badań i Rozwoju NCBR
2. Krzysztof Tchórzewski – Minister Energii
3. Dr Ted Kury – Director of Energy Studies for the Public Utility Research Center PURC, University of Florida
4. Mirosław Kowalik – Prezes Zarządu Enei
5. Remigiusz Nowakowski – Prezes Zarządu TAURON Polska Energia
6. Hans ten Berge – Sekretarz Generalny Eurelectric