Energy 21 July, 2017 9:00 am   
COMMENTS: Janusz Steinhoff

Steinhoff: Poland should invest in diversification of energy sources

“In the long term Poland should invest in significant diversification of energy sources,” Janusz Steinhoff, former Vice-Prime Minister and Minister of Economy, engineer and PhD comments for 

The energy mix is part of the energy policy. And energy policy is the starting document for ensuring the country’s energy policy, increasing the competitiveness of the Polish economy, improving energy efficiency as part of the EU internal energy market, limiting the impact of energy production on the environment and considering the solutions proposed in the winter package. It is Poland’s energy constitution.

The assumptions for the energy policy presented by the Ministry of Energy propose a 60% participation of coal in the energy mix by 2030. I will actually agree that this figure may be even higher. This is a plausible forecast. However, in the long-term, in the 2050 perspective, these propositions will change, even though I realize that it will not be easy to switch from coal to other sources. Yet, we should keep in mind that it will be necessary.

Without a strategy in the form of energy policy and stable regulations, the risk for investors will continue to be too high and the future of the Polish energy sector unclear. At the same time neither the energy mix, nor its necessary, evolutionary changes will be predictable.

I hope that the Polish government will convince the European Commission to scratch the CO2 – 550 kg/MWh emission limit from the winter package. I believe the current propositions discriminate against an energy industry based on solid fuels. If 1 ton of CO2 emissions costs EUR 15, gas will be competitive. This price is not the highest; however, there can be other price relations between various energy sources. If the price is EUR 40, renewable energy sources will become competitive. If it is even higher – at EUR 80-100, nuclear energy will be competitive. However, such high prices seem impossible.

I welcomed the fact that the government submitted to the Sejm a bill on the capacity market. I support rational propositions that facilitate the modernization processes of production units. Such a solution, for instance, would propose to set the emission limit at a level achievable for state-of-the-art units.

In the long term Poland should invest in significant diversification of energy sources. Considering the EU’s climate policy, it is irrational to base our energy mix on brown and hard coal for the long term. Today our coal-fired power plants emit on average, i.e. per 1 MWh, ca. 1000 kg/MWh (brown coal emits more than hard coal). Currently the cost is at PLN 170, so we will pay an additional EUR 30 (ca. PLN 120) and the price for electricity will almost double. It will financially impact the public sector consumers and the competitiveness of our economy. This is why we have to be cautious, we should take into consideration all of the announcements of EU regulations. By 2020 we have to increase the level of renwables in the energy mix to 15%. We should also start thinking on how to quickly do away with cogeneration.