FriOct02

Polish utility ZE PAK to close all its lignite plants in line with UN Climate Agreement

Polish lignite utility ZE PAK says it will shut all of its Polish lignite plants by 2030, making it the first fossil fuel company in the country to commit to a coal plant exit in this decade. ZE PAK’s move comes shortly after the Polish government announced it intends to use state aid to keep failing hard coal mining company PGG on life support until 2049, indicating that the government has not yet grasped the reality of the coal industry’s decline.

ZE PAK, which has all but pulled the plug on its Ościsłowo lignite mine project [1], and announced it will lay off 450 workers this year, will not only close all of its lignite plants by 2030, it will also shut down all but one of its mines by 2023, citing their declining economics [2]. State-owned hard coal mining company PGG is in a similar state of financial trouble, reporting losses of more than EUR 107 million last year, and further losses of revenue since the COVID pandemic began [3].

ZE PAK’s decision to close all of its coal plants by 2030 due to unviable economics reflects the reality of the industry across Europe,” said Kathrin Gutmann, Europe Beyond Coal campaign director. “The Polish government on the other hand is in denial about coal’s decline, and claims it intends to drag out hard coal production until 2049. Trying to strong-arm the European Commission into approving a decades-long carbon subsidy at the same time that the EU is discussing increasing its climate ambition is squandering valuable time and resources that should be put towards planning the just transition of coal communities.”

ZE PAK’s decision to phase-out its lignite plants by 2030 at the latest is a step in the right direction. ZE PAK should now focus all its efforts on the just transition, investments in clean energy alternatives, and on repairing environmental damages caused over the years,” said Anna Meres, Climate & Energy Campaigner at Greenpeace, Poland.

While it has a long way to go to achieve its transformation, the fact that ZE PAK is going from being a  utility that was planning new mines and generated over 90 percent of electricity from lignite in 2019, to one that will now close all of its power plants by 2030 is remarkable,” said Kuba Gogolewski, Senior Finance Campaigner at Fundacja “Rozwój TAK – Odkrywki NIE”. “The speed of change which can result in Wielkopolska being coal free even by 2026 shows how fast the energy transformation is now happening in Poland, and what its coal regions, coal heavy utilities, and the Polish government need to prepare for.

Source: https://beyond-coal.eu/2020/10/01/polish-utility-ze-pak-to-close-all-its-lignite-plants-in-line-with-un-climate-agreement/

Notes:

  1. https://ri.zepak.com.pl/pl/raporty/raporty-biezace/1465-informacja-o-zamiarze-ujecia-w-sprawozdaniach-finansowych-za-pierwsze-polrocze-2020-roku-odpisow-aktualizujacych-wartosc-aktywow-oraz-ich-szacunkowym-wplywie-na-wyniki-finansowe.html
  2. ZE PAK closures: The two remaining units of the Konin coal plant will close by 2022, which was announced a few months ago, the remaining units of Patnow 1 coal plant will close by 2024, and Patnow 2 coal plant will close by 2030. Adamow mine will close this year, the company’s two Konin mines will close in 2023, and its Ościsłowo mine project has been removed from its baseline assets scenario. This leaves just the company’s Tomislawice mine without a closure date.
  3. https://energy.economictimes.indiatimes.com/news/coal/hit-by-virus-polands-top-coal-firm-plans-cuts/77232226
  4. https://www.reuters.com/article/us-poland-coal-idUSKBN25V1BS
  5. Polish coal, state-owned utility PGE has been told by a district court in Łódz that it must negotiate with ClientEarth to reduce its impact on the climate. The decision came after lawyers from the environmental NGO demanded that PGE closes 11 of its 12 coal units at its Bełchatów coal plant by 2030, arguing that the climate and the environment are common goods that legally must be protected under Polish civil law. It’s the first time a Polish court has upheld that the climate crisis must be acted on. PGE has also announced that it will close four units at its Rybnik coal power plant (totalling 900 MW of capacity) by the end of 2022.
  6. UN Paris climate agreement compatible pre-2030 coal phase-out
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