Energy 13 June, 2018 3:00 pm   

Capacity market in Madrid. Poland needs more time and money (REPORT)

Different countries have different experiences with energy sectors. A general overview cannot be simple. In the European Union, we are in a special triangle; somewhere between the security of supply, market and climate change – said the head of Tauron Polish Energy, Filip Grzegorczyk, during a press conference organised by the Polish Electricity Association.

Poland goes in the right direction

Mr Grzegorczyk said that in Spain one can observe changes in climate policy after a recent change of the government. – A new direction makes huge problems for the Polish economy and the Polish energy sector. We are not questioning the idea and necessity of climate protection itself, but we are looking for other options for reaching the goals set by the European Union. We are transforming the sector; we are introducing the renewable energy sources very quickly, also in our company. We started when coal-fired power plants produced 90 per cent of energy consumed in Poland. The question is, what is reasonable to expect from us? We do want to change, but you cannot expect the impossible – said the head of Tauron. He also stressed that the Polish energy sector is going in the right direction, but needs different measures to achieve it. – We need more money and more time and we will achieve the same goals as everyone – said Filip Grzegorczyk.

EU mechanisms

Dr Frank Umbach said that the energy transition is difficult as energy mixes in each EU country are different. – Poland depends on coal, and France depends on nuclear energy, and the European Commission must take it into account. We are not questioning the overall goal of decarbonisation, but the question is how far can the countries go together to achieve these strategic goals. We live in an era of unprecedented changes in the energy sector and this phenomenon is global. Last February, the EU accepted four capacity mechanisms in the Member States – France, Poland, Italy and Greece – we also have strategic reserve models, like in Germany, which are going in a different direction. 

The German case

Dr Umbach said that the German governments believed that this model is a cheaper solution than the capacity market, but this is still debated as a controversial topic in Germany. This model got pretty complicated – we added a lot of additional offshore wind power in the Baltic Sea for instance, but most of the nuclear power plants that are going to be closed are located in the south of the country. It creates a new problem of transferring electricity from north to the south. That relates to the internal competition. We do not have the national transmission grid in place. Building new renewable capacities happened much faster than building new transmission grids to regions that are abandoning the nuclear power. Also, coal-fired power plants, that still provide 40 per cent of energy in Germany, are more competitive than gas units. Even the most modern gas power stations bring losses to their companies. In effect, coal and gas power stations operate just a few hours a day to provide backup when wind and solar energy is not available – said Dr Umbach.