WARSAW, 14 February 2020 – Polish energy companies Enea SA and Energa SA have suspended financing for Ostrołęka C, the last coal plant under construction in Poland, citing difficulties obtaining external financing and the changing EU green new deal policy landscape.
While the decision is only a first step towards the needed cancellation of the 1GW plant, it is an important admission that the future for coal in Europe is bleak, and that Poland’s efforts to keep its coal industry on life support risk leaving it with stranded workers and stranded assets.
“The reality that there is no future for old coal, let alone new coal, in Europe is finally dawning on Poland’s energy sector,” said Zala Primc, Europe Beyond Coal campaigner. “It’s been clear for years that Ostrołęka C is a losing bet financially. Cancelling the project now in favour of a switch to clean, renewable energy will reverse Energa and Enea’s declining fortunes while protecting the health of Polish people, and our climate.”
“Rising CO2 prices are leaving existing coal power plants with financial trouble. Building new coal with the hope that annual profits would cover CAPEX was highly unrealistic, and this has finally sunk in for Energa and Enea,” said Michal Hetmanski from Instrat, a Warsaw-based energy and economics think tank. “We’ve shown that the companies would have been looking at a loss of EUR1.5 billion over 30 years for Ostrołęka C – almost the entire value of the investment to build the plant in the first place.”
“While it is positive that Energa and Enea have cancelled financing for Ostrołęka C, banks such as Santander and BNP Paribas should also rule out financial support for Energa and Enea until the coal plant is cancelled once and for all,” said Kuba Gogolewski, Fundacja “Rozwój TAK – Odkrywki NIE” Senior Finance Campaigner. “Polish PZU, currently lead insurer for the project, should use this opportunity to announce an end to its support for new coal project underwriting, and end coal investments overall without exception. Talanx and other insurers should also take note and close the Polish loophole in their coal insurance policies.”
- Ostrołęka C is a 1GW, EUR1.2bn (initial budget), joint venture between Enea SA and Energa SA. Analysis here: https://instrat.pl/en/ostroleka-c-3-en/
Europe Beyond Coal is an alliance of civil society groups working to catalyse the closures of coal mines and power plants, prevent the building of any new coal projects and hasten the just transition to clean, renewable energy and energy efficiency. Our groups are devoting their time, energy and resources to this independent campaign to make Europe coal-free by 2030 or sooner. www.beyond-coal.eu