2016 in the Polish energy sector

2016 will soon come to an end. It has not brought the long-awaited recovery to the Polish industries that rely on the production and combustion of coal. We can’t see the end of the crisis; instead, what we see is the reluctance of Polish politicians to embrace renewable sources of energy. Michał Olszewski takes a look.

Turów Coal Mine (Photo by Media Wnet, edited, CC BY-SA 2.0)

Turów Coal Mine (Photo by Media Wnet, edited, CC BY-SA 2.0)


Euphoria following Donald Trump’s election

Polish politicians and conservative journalists seem to be delighted at the outcome of the US presidential elections. No wonder, as an important element of Trump’s campaign agenda was an all-out criticism of both global and American climate policies. In his view, global warming is a Chinese invention designed to drag down the US economy. Trump has announced that he will constrain the activities of the US Environmental Protection Agency, and he has voiced his acute skepticism of the Paris Agreement. This is great news for a large part of Poland’s current political scene: Poland on its own is too weak a political power to dismantle the complicated and long-term decarbonization process, and it has no support for this within the EU. For those seeking ideas for maintaining the dominance of the coal industry in Poland, Trump’s plans are a windfall.

Coal mines still at rock bottom

Contrary to boisterous announcements made a year ago, the Law and Justice government has not implemented any changes to the coal mining industry, at least not the changes anticipated by the miners. During the election campaign the miners heard a lot of reassurance and confirmation of the central position of the industry in Poland’s economy. Politicians said that the only thing the industry required was reasonable restructuring. At the beginning of 2016 Grzegorz Tobiszowski, Secretary of State at the Ministry of Energy, declared unambiguously: “No mines will be closed.” However, in November it turned out that the contrary will be the case: the European Commission has agreed for the Law and Justice government to earmark PLN 8 billion for the closure of unprofitable mines. According to unofficial information, the plan concerns seven mines, which employ a total of over 15 thousand workers. Evidence of the condition of these mines is telling: each ton of coal extracted in other Polish mines generates a loss on average of PLN 27, while in the seven mines to be closed the average loss generated is three times higher.

By deciding to close down these mines, Law and Justice have broken a significant campaign promise. Will this save the Polish coal mining industry, which is in any case in need of thorough restructuring? I doubt it. It is possible, though, that the industry will no longer be subsidized to the extent it is today. The miners’ hopes have been raised by the recent increase in the value of shares in Jastrzębska Spółka Węglowa, a result of the rising price of coking coal. However, the end of misery for the Polish mining industry is still nowhere near.

Coal dispute between Poland and Czech Republic

In October, Arca Capital Bohemia filed a complaint with the European Commission against the Polish government. In the complaint Arca accused Poland of providing the industry with unlawful state aid. According to the Czech company, Polish coal mines have received subsidies amounting in total to over EUR 1 billion over recent years, which has enabled Poland to maintain operations at unprofitable coal mines. Meanwhile, although the Czech industry was perceived as an example of successful restructuring a few years ago, it is now struggling with its own problems, mainly caused by low coal prices which have pushed some Czech mines to the edge of insolvency. It is important to note that coal mines in the Czech Republic employ more than ten thousand Polish miners.

COP22 in Marrakech

The outcome of the summit was presented by the Polish delegation as a great success for Poland’s climate diplomacy. The Ministry of the Environment pitches itself as a key actor of the Paris Agreement and seeks to raise the international community’s interest in its idea for how to reduce carbon emissions. This idea takes the form of so-called “forest carbon reduction plantations,” which are supposed to reduce CO2 concentrations in the air. According to data from the Ministry, enlarging forest cultivation areas and planting species of tree which capture CO2 particularly efficiently should lead to the capture of 40 million tons of the gas over 10 years. The trouble is that the idea has attracted sharp criticism from experts who claim that in order to compensate for Poland’s emissions, even covering the entire surface area of the country with such CO2 capture plantations would not be sufficient! The government is pushing this idea not just because it thinks that Poles have invented a revolutionary new environmentally-friendly and cheap solution. It is also trying to convince others that signatories of the climate agreement may choose their own ways to combat emissions, either through reduction or through capture. The Polish government would prefer the latter solution, although it is clearly a solution that treats the symptom and not the cause.

Poland’s government declares its readiness to host a forthcoming climate summit, and it is certain they will try to use the event to promote the global forestation concept. However, the next climate conference will be organized by Fiji, an island country which is already doomed as it is slowly disappearing under rising sea levels. The Polish forestation concept is hardly what the people of Fiji are crying out for.

Inconsistent positions on renewables

This is a significant detail, although one missed by many commentators: when talking about the problems of the energy sector, Beata Szydło’s government uses two mutually exclusive narratives. The first one is classic, with coal as the key asset and renewables treated as the fifth wheel. This narrative is presented by the Ministry of Energy which, apart from supporting coal mining and coal-based power generation industries, issues bizarre messages from Minister Krzysztof Tchórzewski – like his recent statement in which he complained about Poles “not using enough energy.” There is also another group of officials at the Ministry of Development, who from time to time announce that “there is no alternative to the strengthening of the position of renewables.” Naturally, recent ideas concerning electric vehicle production also come from the latter source.

There is no doubt as to which of these two narratives currently shapes the government’s actions. Politicians from Law and Justice, members of parliament, ministers and the president are hiding in their coal trenches. The roadblocks for the renewable industry, such as the anti-turbine act and the amendment to the act on renewable sources, are clear evidence that this year has been a dark time for Polish producers of green energy.

Michał Olszewski (born 1977) – journalist, reporter, writer. For more than twelve years he worked for Gazeta Wyborcza and Tygodnik Powszechny, where he concentrated mostly on environmental issues. He is engaged in a Krakow-based campaign against air pollution.

by

Michał Olszewski

Michał Olszewski (born 1977) – journalist, reporter, writer. For more than twelve years he worked for Gazeta Wyborcza and Tygodnik Powszechny, where he concentrated mostly on environmental issues. He is engaged in a Krakow-based campaign against air pollution.

4 Comments

  1. Graeme Birchall says

    None of the large islands in Fiji are coral atolls, though they do have coral reefs. So the threat of sea-level rise is probably no worse than for many other countries.

  2. American coal miners will inevitably be betrayed by Trump: he has filled his Cabinet with oilmen, who long ago decided to throw coal under the bus. The ideas that Trump will do anything for Polish coal miners is delusional. His support for Putin raises the Russian security threat to Poland. The country will need to rely even more on France and Germany, who are no friends to Polish coal.

  3. heinbloed says

    Btw:. Thanks for the interesting report, Michał Olszewski.

    Esp. the part with the Polish miners working in Czech is an eye opener, the Czech mines being threatened by the Polish (national) subsidies which in turn are EU monies …. what a clown’s economy:)

    Happy new year!

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