In Poland: A new government, same thorny old question
The first months after the Polish elections show that the new government will postpone important decisions about mining in Poland. Renewable energy may pay the price for this delay. Michal Olszewski takes a look.
Prime Minister Beata Szydło has an inscrutable face and a calm, almost absent smile, which she also wears when she speaks to the miners. They’d like to know what the future of Polish coal mining will look like. Or, to put it another way, they’d like binding assurances about this future to be outlined in clear colours. And such assurances were given. On February 22, the prime minister stated that coal would remain a pillar of Poland’s energy mix, and that changes in the mining industry, though necessary, would be ‘rational’. We can therefore presume that the government will do everything to put off addressing the thorny old question of mining in Poland. This strategy works on the social level, but it is fatal in terms of the power industry and economy. It makes sense because it keeps Upper Silesia calm. It’s fatal, however, because in the long run it will deepen problems relating to mining, the power industry and the country as a whole.
How can this be the current situation, when we consider that mining in Poland has been subject to constant reforms and changes since 1989? Employment in the mining industry has dropped from nearly 400 thousand people in 1990 to somewhere over 90 thousand people today. Over the same period coal production has fallen twofold and efficiency has risen by about 30%. In this sense it is not possible to say that the industry has not changed over the last 25 years. Even so, Polish mining has been running at a heavy loss – just last year it experienced net losses of over PLN 2 bn (approx. 500 mn EUR). Poland extracts raw material which is not competitive with coal from South African, Australian or Siberian mines. Because of this, we hear the same media reports every winter: there are stockpiles of millions of tonnes of unsold raw material; mining companies calculate their losses; long-term contracts with the energy sector save the situation; unions protest against mine closures, politicians placate them by saying that there will be no closures. To this litany we should add one further factor, which shows the cost of hard coal mining in its current form: every year Polish mines sell around 800 thousand tonnes of coal waste – this should be directed to specialist facilities to be incinerated without causing environmental damage. However, because of its low price, this waste product ends up in households. This results in clouds of toxic smog above Polish villages and cities.
The necessity of maintaining the status quo in the Polish energy sector explains the lack of determination of the government with regard to renewable energy. There’s nothing exceptional about the current situation – the previous government exhibited a similar lack of will. For Polish politicians of all stripes renewable energy sources (RES) are like unwanted children. While the interest in RES is rapidly increasing around the world and the cost of their installation is falling, in Poland there remains a lingering conviction that they represent a harmful, German idea (and one therefore unsuitable for Poland), one which is intended to belittle the Polish power industry. An example of this lack of determination is the approach of the government to the civic energy sector. The Polish government has just postponed by half a year the introduction of feed-in tariffs for small manufacturers. The confusion around Polish wind energy is a more pointed example: a group of Law and Justice MPs have put forward a draft bill which would mean that new turbines would have to be constructed at a distance of at least ten times their height from the nearest building. This same distance would have to be maintained in the case of proximity to nature reserves, national parks and NATURA 2000 areas. The wind power industry cautions that in a country as densely populated as Poland, such rules would result in a virtual halt to the development of wind energy.
This reluctance does not cover one area: geothermal energy. Although it is known to be more expensive than wind power, it enjoys a special place in the hearts of the new government. Geothermal energy has a unique political cachet because it can count among its advocates the Redemptorist Father Tadeusz Rydzyk, the owner of an empire that includes a Catholic radio station, television channel and university. Rydzyk is a supporter of geothermal energy because he sees it as a heating source. Law and Justice regard Rydzyk as a partner, and in exchange for his wholehearted support they are prepared to bend to his whims.
When speaking about the Gordian knot of energy supply that Poland finds itself entangled in, it’s difficult not to make a historical comparison. In the 16th century the Polish Commonwealth founded its might on the strength of grain. This resource made its way to the port of Gdansk and was then transported west – to Holland, for example. Poland became a European superpower but the demand for grain began to drop, and then almost completely disappeared. Poland was not prepared and it slept (and ate) through its chance of progress. A similar story is happening with coal.