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The Government Plenipotentiary for Strategic Energy Infrastructure Piotr Naimski has been dismissed due to his opposition to the Orlen-Lotos merger. He was preparing a plan to accelerate the construction of nuclear plants in Poland with the help of a US-South Korea tandem, but if his critics win, large NPPs could be replaced with many smaller ones – writes Wojciech Jakóbik, editor-in-chief at BiznesAlert.pl.
Opponent of the Orlen-Lotos merger dismissed
The critics of Piotr Naimski are using various arguments to justify his dismissal. However, the fact is that the dismissal took place on the day when the Extraordinary Shareholders Meeting of the Lotos Group approved the merger with Orlen, which minister Naimski opposed. Perhaps the government was holding the decision off until this matter was settled. The merger is strongly supported by Daniel Obajtek (Orlen CEO – ed.) and was back by almost all shareholders. Naimski’s opponents argue that together with Piotr Woźniak, who allegedly was in conflict with him and Civic Platform politicians who criticized the idea, he took part in a smear campaign against the Lotos-Orlen merger. Piotr Naimski lost the dispute over the merger, and his dismissal may have implications for Poland’s future energy policy. Other reasons for the dismissal may be heard on the grapevine as well. Either way, Naimski was the man who built the Baltic Pipe, which will launch in the fall allowing Poland to tap into gas deposits that will match the entire Yamal contract that was broken by Gazprom. Opponents accuse him of blocking renewable energy, although its development depends only partly on PSE (Polish state-owned grid operator – ed.) that was under his supervision, and partly on distribution companies. They question the pace of the search for a floating LNG terminal, because Germans have already ordered six ships for 2022-23, but Poles are yet to order their first, although Gaz-System explained there was no transmission infrastructure from Gdańsk anyway, and it will be built only in the middle of this decade. Naimski’s critics also believe that he unjustly and for too long blocked energy supplies from Ukraine, supported, among others, by Orlen. Finally, they accuse him of the slow implementation of the Polish Nuclear Power Programme (PPEJ). It is worth taking a closer look at this last charge.
Nuclear power delays
The current government has had time since 2015 to implement a new version of the PPEJ, which replaced its predecessors’ earlier plans. In contrast to the Civic Platform, which relied on the French EDF and a contract for difference, Law and Justice wanted a new partner, by default the American Westinghouse, and a financing model that included financial support from the country that provided the technology, and therefore probably the US. This plan was left on the back-burner due to disputes within the government on whether to develop nuclear power in Poland at all. Its implementation was kicked off only after the establishment of Polish Nuclear Plants that replaced PGE EJ1 and came under Naimski’s supervision. Due to difficult negotiations with the Americans, their offer was delayed until the end of the 2022 summer holidays. Minister Naimski was waiting for it before deciding on which tech partner and financing model to choose. The latter has been already agreed on and was to be presented in the right chronological order.
A nuclear tandem?
Russia’s attack on Ukraine delayed the publication of the impact assessment of the NPP on the environment originally planned for February. The dispute over the role of small nuclear reactors, which are not an alternative to large-scale NPPs, but are preferred by some state-owned companies, has delayed the preparation of a Special Act on Nuclear Power, whose goal was to impose a proper legal framework on the nuclear program. However, the attack accelerated Poland’s plans, and Warsaw began to consider cooperation with two foreign partners at once, namely the United States and South Korea. It was no accident that the Korean KHNP invited Polish journalists, including one of our own, to visit Seoul. It seems possible that the Polish Nuclear Power Program, which initially provided for one supplier of technology, could be expanded by adding another one. This would balance the interests of Americans and Koreans, giving Poland larger reactors and quicker. Poland needs nuclear power to transform the energy sector safely and without excessive dependence on gas in the era of the energy crisis. The opponents of Piotr Naimski can now present his plan to accelerate the investments after his dismissal.
More small NPPs?
However, different options are on the table as well. The SMR technology is gaining more and more supporters in the government, who see it as a simpler replacement for large-scale nuclear plants, despite the fact that it is not clear when this technology will be implemented. This is a great solution for any industry that wants to get off the grid and reduce energy bills and CO2 emissions, but the National Power System will still need a baseload in the form of large reactors. It is not without reason that the Belgians, the French, and perhaps, once again, the Germans, who are considering keeping the last three power plants in operation, are betting on large-scale NPPs. However, the faction that supports buying many small reactors instead of investing in a few big ones will push for its agenda.
Countries with a mature energy and climate policy implement it regardless of personnel changes, because individual megaprojects do not depend on a single politician, but on a political consensus. However, the twists and turns of the Baltic Pipe show that in Poland this history has been different. Thanks to Piotr Naimski, a gas supply route from outside Russia will be available in the fall, complementing the expanded LNG terminal and the planned floating FSRU terminal. The fate of the Polish Nuclear Power Programme depends on whether the government retains credibility in relations with the Americans by replacing the outgoing minister with someone with equally good contacts in the United States, and also whether it will use the two-partner approach prepared by Naimski, or bet on buying many small reactors, as proposed by other parties involved in this disussion. The energy crisis is not the time for revolutions. Poland needs the Baltic Pipe and large scale nuclear power, which will be implemented without their existing spiritus movens, i.e. Piotr Naimski. The ceremony of the accelerated launch of the Baltic Pipe with the participation of the Danish royal family will be held at the end of September.
“The opening ceremony of the Baltic Pipe will be held on 27 September with the participation of the highest authorities of Poland, Denmark and Norway. I would like to thank everyone with whom I carried out this project. This is a great achievement, because it frees Poland from blackmail from Russia,” said the now former Government Plenipotentiary For Strategic Energy Infrastructure Piotr Naimski on the Polish Radio on the day of his dismissal.
