Energy supply and environmental concerns in Poland after the transition towards a globalized world, Projects for Development Economics. Università Cattolica del Sacro Cuore - Milano
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cole915 March 2013

Energy supply and environmental concerns in Poland after the transition towards a globalized world, Projects for Development Economics. Università Cattolica del Sacro Cuore - Milano

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9 pages concerning the energy supply in Poland, both nuclear and renewable. Projects and challenges for the future.
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“Energy supply and environmental concerns

in Poland after the transition

towards a globalized world”

Mrs. Maria Aluchna

Francesco Coletti, 55895

1

Introduction After the years of transition Poland is passing through an unmatched growth of its GDP,

passing through the effects of the world crisis and getting closer and closer to Western

countries’ standards of living.

The shifting from a central planned economy to a market-based system opened Poland to the

globalized world which brought new opportunities and healthiness to the society, as well as

new challenges.

After Poland decided to join the European Union, it has been required to participate to all the

new main challenges the EU was proposing, starting from the transportation system, to the

environmental protection, to energy efficiency requirements. However, thanks to this joining

new investment and aids towards Poland became possible by international funds and banks.

In this report I will focus on the main challenges regarding energy supply and environmental

policy in Poland in a globalized world starting by showing a chart which presents a few data

concerning the contribution of all the renewables during the past decades (references will

follow), to show the differences before, during and after the transition process. Furthermore I

will present the Polish plan concerning the energy supply and its impressive and constant

growing.

As it can be easily seen, the real renewables booming took place in the 90s right after the so

called “shock therapy” led by Leszek Balcerowicz.

The Polish energy sector is currently facing a number of serious challenges. High demand for

energy, inadequate fuel and energy generation, significant dependence on external supplies

of natural gas and almost full dependence on external supplies of crude oil, as well as

commitments in the field of environmental protection.

As a member of the EU, Poland is now participating to the community energy policy and in

order to respect the European agreements and improve the energy efficiency it took several

paths:

• improve security of fuel and energy supplies;

• diversify the electricity generation structure by introducing nuclear energy;

• develop the use of renewable energy sources, including biofuels;

• develop competitive fuel and energy markets;

rancesco Coletti, 55895 System transformation in Central and Eastern Europe

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• reduce the environmental impact of the power industry.

According to the Central Statistical Office of The Polish National Energy Conservation Agency,

in the past 10 years almost right after the transition Poland has increased its energy demand

by approximately 20%, and the vast majority of this growth was satisfied by new importation

of foreign coal, oil and gas. If until a few years ago Poland was a net exporter of energy

(mainly to Slovakia and Czech Republic), in the past years due to this internal increasing

consumption, the country became an energy net importer. This new energy importation

significantly affected the payments balance that after the transition has always been negative,

as it can be seen in the table below.

2004 2005 2006 2007 2008 2009 2010 2011

Country

Czech

Republic

-5738,787 -1287,901 -2970,195 -7731,242 -4757,751 -4686,536 -7685,935 -6178,721

Denmark 5743,744 11125,75 8176,499 4234,795 9058,125 10550,79 18436,79 18890,05

Germany 127187,7 139929,8 181673,1 247660 224618,5 195271,7 199549,1 204784,8

Italy -16196,64 -29378,9 -48118,49 -51626,87 -66116,45 -41779,18 -72418,52 -67386,16

Poland -13258 -7242 -13147 -26501 -34957 -17155 -24030 -25023

Spain -54871,36 -83094,22 -110848,3 -144102,8 -153040,1 -70212,41 -62814,2 -52172,8

OECD -

Europe

131730,8 90803,53 62151,23 18198,97 -68568,7 112331,6 109770 115198,6

Development of renewable energy

The promotion of renewable energy would allow Poland to increase diversification of the

sources of supply and would also create conditions for power generation based on locally

available raw materials, with cheaper investments and dislocated generation units which

could improve local energy security and drop transmission losses.

Poland is now investing on many different kinds of renewable energies, starting from various

techniques of biomass gasification and conversion to biofuels. The increase of wind power,

mainly in the Baltic sea area is one of the big challenges of polish’s future energy plan. The

rancesco Coletti, 55895 System transformation in Central and Eastern Europe

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main energy policy challenges in the field of renewable energy in Poland can be sum up as

follows:

• Increasing the use of renewable energy sources in the final energy use to at least 15%

in 2020 and further increase in the following years;

• Increasing the share of biofuels in the market of transport fuels to 10% by 2020, and

increasing the use of second generation biofuels;

• Protecting forests against overexploitation in order to obtain biomass, and use of

agricultural areas for production of renewable energy sources;

• Using the existing weirs owned by the State Treasury for power generation;

• Increasing the diversification of supply sources and the creation of optimal conditions

for distributed power generation based on locally available resources.

Introduction of nuclear energy

A 2009 report to the Ministry of the Economy identified nuclear as the most cost effective

method of CO2 abatement and since Poland’s energy consumption is likely to keep on

growing by 54% to 2030, the energy security requires a sufficient energy supply and

renewables cannot satisfy the total national demand, at least in the short period.

This is the reason why nuclear energy has become one of the most desired energy sources

ensuring Poland some kind of energy independence. The Council of Ministers of January, 13,

2009 imposed an obligation on all process participants to take actions aimed at setting the

stage for implementing the nuclear energy production programme in Poland, whom realization

will be finalized by 2020 with the launch of the first nuclear power plant.

In 2011 The National Atomic Energy Agency PAA has also signed nuclear cooperation

agreements with the US Nuclear regulatory commission and the French Autorité de Sureté

nucléaire while the state owned energy company PGE has just adopted a plan to invest about

€80 billions by 2035 and this would raise the generating capacity from 13GWe to 21GWe.

According to the new European environmental policies thought, the coal consumption will

significantly drop by 2035, and PGE will generate energy using nuclear capacity for 36%, 11%

from gas, 14% from renewables, 33% from lignite and only 5% from coal.

rancesco Coletti, 55895 System transformation in Central and Eastern Europe

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The development of a new nuclear plan is always a critical issue in matter of public opinion,

because of lower security areas and worst health living conditions of the neighbourhood, but

a September 2009 poll showed that 70% of Poles understood the problem of the nation and

would support having a nuclear power plant within 100 km from their homes.

Transportation plan

A great add-on to the energy efficiency development is represented by efficiency improvement

in the transport sector, one of the sectors that mostly require a close collaboration with the

energy market.

Concerning the transport sector, Poland received in the past years a large amount of money

to improve its public transportation system and road network. For instance, the European

Bank of Reconstruction and Development financed many useful projects in Poland for a €28.7

billions of total project value, mainly regarding transportation and energy improvements.

Thanks to a €45 millions loan by the EBRD, Warszawa, the city where I’m currently living, has

now a fully new and modern tram system, also due to the cooperation between the EBRD

with the local authorities which helped the modernization with new solutions to the congestion

problems of the capital city. This new more reliable tram service will lead to a considerable

reduction in CO2 emissions, estimated at 30,000 tons annually.

Moreover, the EBRD is helping to inject private finance into the modernisation of Poland’s

municipal transport system with a loan for the construction and operation of an underground

car park in the historic part of Wrocław, Poland’s fourth largest city.

The project also launches the city’s programme to carry out urban transport improvements in

order to reduce congestion and further boost economic development in south-western Poland.

Environmental impact

Poland's environmental situation has improved since the end of the communist regime and its

environmental negligence, and has been improved by decreased emphasis on heavy industry

and increased awareness in environmental issues. However, Poland still has to recover from

rancesco Coletti, 55895 System transformation in Central and Eastern Europe

5

the overexploitation of forests during World War II and the loss of 1.6 million hectares of

forestland after the war. By the middle of the 90s, 75% of Poland's forests have been

damaged by air contaminants and acid rain.

In 1992 Poland had the world's 12th highest level of industrial carbon dioxide emissions, for a

total of 341.8 million metric tons and in 1996 the total rose to 356 million metric tons. Water

pollution in the Baltic Sea is 10 times higher than ocean water. Poland has 55 cubic km of

renewable water but only 2% is used to support farming and 64% is for industrial purposes.

Poland's cities generate on average 5.7 million tons of solid waste per year.

Since the protection of the natural environment is one of the most important policies of the

European Union, Poland has been now imposed many requirements regarding the reduction

of pollution emission into the air, sewage treatment and municipal and industrial waste

management, and is imposed to introduce EU directives into its national legislation.

These new policies are leading Poland to the implementation of a number of investment

projects such as: construction of sewage and water pipelines, more than a thousand of

sewage treatment plants, water treatment stations, construction of waste treatment and

recycling plants, modernisation of heating and power plants, and upgrade of hundreds of

industrial plants from the environmental protection perspective. Since all these new

investments are highly costly, the EU offered more financial aids with the programme

“Operational Programme Infrastructure and Environment”. The environmental priorities that

this fund is supporting, which Poland requires the most in the immediate next years are

• Water and sewage management

• Water management and protection of soil

• Resource management and counteracting environmental risks

• Initiatives aimed at adjusting enterprises to the requirements of environmental

protection

• Promotion of environmental-friendly attitudes

Also Germany, the first polish commercial partner, offered financial aid to pursuit the same

environmental target by signing an agreement between the Minister of Environment of Poland

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and the Federal Minister for Environment, Nature conservation and Nuclear safety of

Germany. In order to receive this aid, the beneficiaries must present projects that are model

solutions and best available techniques, and have trans border effect.

Thanks to these new policies and new environmental awareness, since 1998 Poland dropped

significantly the levels of air pollutants, as shown in the chart below.

Emission volumes of SO2, NOx, NH3 against national emission limits of the substances stated in the Treaty of

Accession of the Republic of Poland to the European Union, in the scope of directive 2001/81/EC on national

emission ceilings for certain atmospheric pollutants (source: ME)

rancesco Coletti, 55895 System transformation in Central and Eastern Europe

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Conclusions

In the last years, after the collapse of the communist regime the main challenge of Poland has

been to reach Western countries’ standard of living, opening its frontiers to a free market-

based economy, keeping at the same time the promises of a sustainable growing and

environmental regardful behaving made to the EU.

After 10 years of constant growing, despite the world crisis, a couple of results about energy

and environmental issues can be shown by these two additional charts.

The first one is picturing the air pollutant emissions from 1998 to 2008 compared to the GDP growth. Despite the GDP booming (+50% in 10 years)

emissions gradually decreased almost by 40%.

This second chart is showing the increase of the number of vehicles in the same decade (+60%) compared to the emissions trend (-20%). This significant fall has been possible thanks to the new cars emission policies introduced by the EU.

In conclusion, although nowadays

Poland is still facing the effects of

transition, for what is concerning energy supply and environmental topics it almost reached

the level of some Western countries and is keeping growing way more than the EU’s average,

thanks to people’s large efforts and new mentalities but also thanks to many helpful

international aids.

Looking at the past decades and the Polish reaction to the world crisis, the main new

challenges shown in this report are meeting all requirements to be accomplished very soon.

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References

Govern webpages

www.mg.gov.pl

www.mos.gov.pl

www.gios.gov.pl

European Bank of Reconstruction and Development

www.ebrd.com

World nuclear association

www.world-nuclear.org

Web’s encyclopedia: Encyclopedia of nations

www.nationsencyclopedia.com

rancesco Coletti, 55895 System transformation in Central and Eastern Europe

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