Poland Prioritizes Cheap Power in Shift Away From Coal

Poland is prioritizing low-cost electricity as it revamps its energy policy and shifts away from its reliance on coal-fired generation, the nation’s environment minister said.

Marcin Korolec said he’d like to phase out subsidies for both clean power and fossil fuels, though the country must also replace aging power stations including some that are more than 40 years old.

“We are in quite a big crisis,” Korolec said yesterday at a Bloomberg New Energy Finance conference in New York. “We need new investment, but we are living in this paradigm of expensive energy prices. We are facing tremendous questions. Technology will answer the question, and price will answer it.”

The comments indicate how Prime Minister Donald Tusk’s government will balance demands to meet European Commission environment rules while limiting electricity costs. The Commission has censured Poland for its delays in implementing mandates for renewable energy, and the government this month announced plans to reduce subsidies for clean power.

Poland was one of the nations that blocked the commission’s proposal for boosting the price of carbon dioxide emissions. It’s also hosting the annual round of United Nations global warming talks, which start in November in Warsaw.

Korolec expressed skepticism about technology that captures carbon from smokestacks and stores it underground, called CCS, something that could scrub pollution from Poland’s coal plants. Utility scale CCS plants haven’t opened yet.

View on CCS

“CCS is a beautifully romantic story, but I don’t see it,” Korolec said during a panel discussion. “It is cheaper to build a gas plant.”

David Sandalow, assistant secretary for public policy at the U.S. Energy Department, agreed that even the latest carbon capture technologies are too costly to be competitive with other forms of reductions such as energy efficiency and wind power.

“It’s still expensive to strip out carbon from exhaust streams,” Sandalow said on the panel. “We believe it’s important because we need some form of CCS to have an impact on climate change.”

Korolec suggested he’d like to scrap any form of support for energy. “Maybe we have to introduce a phase-out of energy subsidies in all areas, a phaseout of fossil fuel and also renewable energies and concentrate on those technologies which are commercial,” he said.

To contact the reporter on this story: Christopher Martin in New York at cmartin11@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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