Lack of investments may result in a shortage of electricity

Maciej Bukowski, president of Wise Europa, in the report “On inflation and energy prices” emphasizes that high energy prices are not the only problem we will face in the coming years. – Our main problem in this decade will not be whether electricity and heat will be more expensive or cheaper than in the previous one, but whether they will be available at all in the amount we will need – he emphasizes.

He informs that most of the Polish power units closing the electric power system and heat plants in cities are old enough to balance on the verge of technical wear. – At the same time, the investment process is stifled by the strategic ambivalence and operational ineffectiveness of the Polish state – he writes.

Meanwhile, the markets are focusing on electricity prices that are set to rise, and the government holds the responsibility for the European Union’s climate policy. – We should rather admit to ourselves that the prices will for some time be higher than before and higher than in neighboring countries (with the same price of EU ETS certificates) due to our own investment negligence. We spent a large part of our time on the construction of new zero-emission capacities and mass thermal modernization of buildings, allocating budget revenues from carbon taxes (today it is over 1% of GDP) not for investments in new heating plants or support for renewable energy, but for transfers and consumption – he argues.

And he adds that instead of opening the energy market to private investors interested in the development of renewable energy sources, the authorities blocked their investments, hoping that this would help state-owned companies, which at the same time were forced to take over non-promising coal assets.

Bukowski also notes that Poland has spent several years preparing for a nuclear project. Overall, we were doing roughly half of what we could, and at most a third of what we should. So let us not be surprised that we are now facing higher energy prices and a completely real power shortage, even if the EU ETS prices are low – he concluded.

Energy shortages are a real threat, which was also indicated by the previous Minister of Climate and Environment, Michał Kurtyka. – It will be difficult for Poland to build new production capacities until 2025, which will be compensated by the currently operating coal capacities. Therefore, work is underway to prepare a new mechanism, which of course requires talks with the European Commission – said Jacket in spring this year during a conference organized by the Polish Chamber of Commerce.

We are talking about a mechanism that would replace the capacity market after 2025, when it will no longer be possible to support the oldest coal-fired power plants. Although the government has announced the construction of a nuclear power plant in 2033, there are already voices that delays should be expected. Gas blocks are created, but the rate of increase of these powers is not sufficient. Offshore windmills are under construction, but the process is also very time-consuming. Balancing the national energy system may prove to be a challenge.

During the same conference, Kurtyka appealed to energy groups to accelerate investments in alternative generation sources to coal. These, however, will not be able to cope with the challenges without systemic support.

Energy companies have their limitations. There are still carbon assets in their portfolios. And this reduces the investment possibilities of corporations, because most financial institutions do not want to lend money to entities with “dirty” assets. The Ministry of State Assets has announced that the coal blocks will be transferred to a new organism next year, the so-called NABE. But even if the project was successful, they now largely have their hands tied.

Poland is still waiting for the approval of the National Reconstruction Plan. We are to get over EUR 58 billion for its implementation, which will have to be spent within five years. Of this amount, EUR 23.9 billion are subsidies and EUR 34.2 billion – loans. However, the plan has not been approved by the European Commission, and the EU is waiting for the Polish government to meet the conditions for the judicial system in Poland presented in October.

– I do not see a vision of how the government would like to implement the green transformation of the Polish economy. The National Reconstruction Plan should be the driving force behind these changes in terms of finances. There is money to be taken, which should work today for the implementation of the Polish transformation, for building a non-emission national economy, for getting Poland out of the post-and-demic crisis. This is not happening – says Marcin Korolec, former Minister of Environment in an interview with Interia.

He emphasized that the deadline for spending the amounts under the KPO is 2024. – Every day without money shortens the period of their spending. Meanwhile, the transformational processes are long-lasting. The fact that we have lost the last six months means that some projects will simply not be realized – he says.

He argues that KPO funds should be massively allocated to financing investments in renewable energy, including prosumer energy, but also to the installation of heat pumps or the construction of a high-speed railway, which will allow you to change from planes to trains also on longer routes. – Meanwhile, the government wants to slow down the development of photovoltaics, which changes the rules of settlements with prosumers. Why slow down the development of production capacities that are outside of energy companies? – Korolec wonders.

The big problem is the 10H rule, which has practically halted the construction of new windmills onshore. According to the current law, no windmill can be built at a distance less than 10 times the height of the turbine (including raised blades) from the buildings. Until some time ago, there was talk of the need to relax this regulation, but recently the topic has died down again.

– The lack of new capacities is a threat to the stability of the system, but also a huge risk for the Polish industry. Many industries, including automotive, emphasize that they need green energy in the network to export their products. They are competing not only with the price but also with the carbon footprint of the goods they produce. In a moment, there may be a risk that our suppliers will lose contracts due to too high a carbon footprint – said Korolec.

Meanwhile, according to the estimates of Polskie Sieci Elektroenergetyczne, the demand for energy in Poland will grow. In 2025 it is to amount to 170.1 TWh, in 2030 181.1 TWh, in 2035 191.9 TWh, and in 2040 204.2 TWh. Accumulation of shutdowns of coal-fired units is expected in the years 2030-2040.

Monika Borkowska

About Eric Wilson

The variety offered by video games never ceases to amaze him. He loves OutRun's drifting as well as the contemplative walks of Dear Esther. Immersing himself in other worlds is an incomparable feeling for him: he understood it by playing for the first time in Shenmue.

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