Time for nuclear offset

US involvement in the Polish nuclear project is the only hope for its implementation. It’s time to decide whether Polish concessions for the largest ally will turn to a stable source of nuclear energy supplies – writes Wojciech Jakóbik, editor-in-chief of BiznesAlert.pl.

Polish society once again hears about the possibility of Polish-American talks about the involvement in the nuclear project in Poland. This time Wirtualna Polska reports that President Andrzej Duda can talk with Donald Trump about the nuclear power plant during the visit scheduled for June 12.

The Polish nuclear project is not going forward because of lack of government decision, which formally continues the implementation of the Polish Nuclear Power Program, but actually hesitates whether or not it is better to invest in Renewable Energy Sources. The pat continues and may extend beyond the parliamentary elections that will take place this autumn, because building a nuclear power plant may provoke dissatisfaction amongst trade unions in Silesia due to the perspective of the loss of jobs in coal mines.

At the same time, Poland is seeking to increase US involvement in its security sector. Talks about the US military base which would give a permanent, not rotational, presence of the American army, are underway. It seems that the element of negotiations is the declaration of the defense minister about the will to buy 32 F35 fighters from Lockheed Martin. Such planes would improve the country’s security thanks to fifth-generation solutions that allow them to be invisible to radars, but estimated cost of so many units reach 10 billion PLN. Spendings on US equipment is increasing after adding the costs of the anti-missile shield within the Vistula program and rocket artillery within the Lobster program. With such significant purchases in the US, we should effectively expect offsets. A similar offset took place after the purchase of 48 F16 fighters from Lockheed Martin by the government of Leszek Miller. Within its framework, about USD 6 billion was spent in a decade, that is over PLN 12 billion according to the current rate. This amount refers aviation, vehicles and energy projects.

F35 purchases outperform the purchase of F16. Adding significant expenditures for other defense programs as well as political concessions, such as the Iranian summit in Warsaw, a significant amount of liabilities is being collected. The offset for new fighters and other concessions should therefore be significantly larger. Perhaps, therefore, Polish society will hear about the US capital involvement in the Polish nuclear project, which is to be financed by domestic banks from domestic funds, and the cost can range from 4 to 10 billion PLN a year for a decade. Will the Americans be willing to pay extra to the Polish nuclear energy? I described symptoms concerning the readiness of the Polish authorities to deal with the nuclear offset in 2017, but the matter has not gone far yet.

It is not clear whether the President’s visit in the US can make a difference. The impact of regular contacts of the Polish Government Plenipotentiary for Strategic Energy Infrastructure, Piotr Naimski, who is also talking about the nuclear energy using these contacts is more likely. If the US does not help, it’s time to stop discussing this issue and launch other energy projects. The opportunity to revision is to be the adoption of the Poland’s Energy Strategy which should be announced for the holiday of 2019.