Energy 19 February, 2018 11:00 am   
COMMENTS: Teresa Wójcik

A technocrat and a visionary quibble over nuclear energy

Nuclear power in Poland is a necessity according to the government, and the decision to establish a Polish nuclear power plant “will surely be made in the first half of the year” – writes Teresa Wójcik, editor of

[tt] The government has still not developed the announced document setting out a long-term energy strategy until 2050 [/tt]. The document entitled “Poland’s Energy Policy until 2050” is to determine the development of the national energy mix and what sources and to what extent will participate in the national energy mix.

Is nuclear energy necessary?

On the basis of official statements of Minister Krzysztof Tchórzewski, it is only known that the ministry managed by him does not intend to push for the construction of new coal blocks after the finalization of currently implemented projects, except perhaps Ostrołęka. We also have assurances that by 2050, about 50 percent of electricity will come from coal-fired power plants, up to 20 percent from renewable sources, that we will also generate electricity from gas and nuclear blocks. Here, however, there is no specifics, although at the end of January this year, the energy minister Krzysztof Tchórzewski, mentioning the expected major events in the energy sector in 2018, mentioned among others the government’s decision on the possible construction of a nuclear power plant. He stressed that in his opinion, the nuclear energy in Poland is a necessity, and the government’s decision to establish a Polish nuclear power plant “will definitely be in the first half of the year”. This is an indispensable element in the Polish energy mix – believes Tchórzewski.

It sparked, but it does not spark anymore

Before the government was reconstructed, at the end of the year there were opinions that between the energy ministry headed by Krzysztof Tchórzewski and the ministry of development of the deputy prime minister Mateusz Morawiecki, there was a spark between traditionalists from conventional energy and innovative Morawiecki and his hinterland. Therefore, Wojciech Myślecki, who was associated by some with the prime minister, would replace Tchórzewski, and Morawiecki would have a trusted man in a ministry important for the entire economy and thanks to him a decisive influence on energy policy. But this did not happen, probably it was someone’s wishes incompatible with the strategy of the ruling party.

It is only worth reminding that Myślecki is the president of the board of a consulting company Global Investment Corp. and advisor on strategic programs at BZ WBK – a bank managed by Mateusz Morawiecki in 2007-2015. Myślecki is also a strong person at the National Center for Research and Development (NCBiR), where he is the Chairman of the New Technologies of Power Generation Group and a member of the Supervisory Board of KGHM. At a time, he was also a member of the Energa Wytwarzanie Supervisory Board. He was then known as a strong supporter of building small (then still coal) 240-250 MW energy blocks, as much more convenient to build a flexible and more efficient power system. At the same time, he was objective, because he pointed out that the rationality of the decision to build a single block is that in Ostrołęka there are indeed connection conditions for 1000 MW and a construction site, although it should be dedicated to a special RES system.

Technocrat and visionary

Myślecki, however – unlike Tchórzewski and the current prime minister – is less technocrat and more a visionary. Instead of comparing the current profits and losses, he assesses that by 2070 coal will completely disappear from the energy sector. It will disappear and that is it. The chairman of the team of modern power generation technologies at the NCBR also questioned the construction of a large nuclear power plant, which would be based on currently available technology. It is better to wait for a new one, he concluded, because in 15 to 20 years a new technology in the nuclear power industry may emerge, which will allow the construction of smaller, self-cooling blocks. When asked by an expert about the future of large energy units, he replied that the era of large blocks is passing away. The future belongs to prosumers. – Photovoltaic sources have entered the exponential curve of productivity growth simultaneously with the fall in the marginal price of energy unit generation from these sources. This energy will be different than we imagine. Otherwise you will have to use it. I would not risk creating any energy mix at the moment – said Dr. Myślecki.

Meanwhile, Minister Tchórzewski, pragmatic to the pain, criticized Germany’s experiences with the visionary renewable energy. First of all, he calculated the annual costs of the German RES support system, which amounted to around € 25 billion. And he referred to the “rebellion” of German society towards Energiewende, which, however, is not confirmed by public opinion polls, which mostly support the return to renewable sources. He also pointed at huge damage of the German economy caused by the gradual liquidation of nuclear energy.

Who will finance the Polish nuclear power plant?

PGE dropped out because it is betting on large offshore wind farms. Unexpectedly, PKN Orlen is going to take care of the nuclear energy, although it adds a new, significant, but expensive industry. The only rational justification: Orlen has large and free assets. But does it have to spend it in the nuclear block? Former president Władysław Jasiński and his team were not supporters of this concept. Well, there is a new president, more eager and now Orlen is looking at various projects that can be successfully incorporated into the group’s strategy. Also involved in the construction of a nuclear power plant, which, of course, it “carefully analyzes”. Especially that the stock market did lot like this idea and Orlen papers lost 4,4 percent immediately.

An investment in a nuclear power plant is a long-term prospect of success. Orlen has so far preferred faster successes: the production and sale of electricity is carried out immediately and in principle without risk. Obviously, the president Obajtek emphasized that “all projects that PKN Orlen implements must undergo restrictive investment analyzes”. This also applies to the nuclear power plant. – We analyze all possible projects that may fit our strategy, naturally including the nuclear power plant project, “said Mirosław Kochalski, the former vice president of Orlen, in an interview with Reuters. At the end of January, PKN Orlen announced that in 2018 expenditures on investments in the entire Orlen group are to amount to PLN 4,8 billion, with PLN 3 billion in the downstream segment (refinery, petrochemicals, energy), in the usptream segment (mining) – PLN 0,8 billion, in retail – PLN 0,7 billion, and in the case of corporate functions – PLN 0,3 billion.

The prime minister looks positively at nuclear energy

Prime Minister Mateusz Morawiecki conditionally supports the development of nuclear energy in the country. In his expose, only one sentence related to nuclear energy: – “we look positively at the atom”. In one of the previous interviews, the current prime minister, and then the minister of development and finance, stated that he was in favor of “cheap nuclear energy”. You can also see that he wants to have a financial model for nuclear power plant that will allow him to overcome resistance in many structures, including at the Ministry of the Environment. According to the government, strong investors like Orlen remain against the expensive differential contract.

According to experts from the Ministry of Energy, the construction of a 1,000 MW nuclear power plant is to last 10 years. The decision should be taken in the first half of 2018 – Minister Tchórzewski believes. – “In the first quarter we will end issues related to the notification of the capacity market”. The launch of this instrument will open the perspective for energy investments, including the construction of nuclear blocks. And it will ensure stability for several years ahead. Not only stability – also very large savings. Indeed, from the energy market research it appears that taking into account all the components of costs incurred by the society, it turns out that in the perspective of the entire life of the plant, electricity from nuclear power plants is the cheapest (85 USD / MWh), more expensive is energy from coal-fired power plants (155 USD / MWh) ) due to the costs of human health losses and CO2 emissions, and wind energy (177 USD / MWh) and solar energy (222 USD / MWh) are the most expensive sources of electricity. An NCBJ study on this subject can be found on the website of the Committee on Energy Problems of the Polish Academy of Sciences. Finally, the most important from the point of view of European climate policy requiring a large reduction of carbon dioxide. Nuclear power plants are currently the largest emission-free source of electricity. This is confirmed by resolutions of the European Parliament and IPCC reports. If the government of Mateusz Morawiecki manages to convince the European Commission to take into account the average emissions from the energy sector, then nuclear blocks are the best solution for Poland. The sooner, the better.