Polish energy firms intensify coal lobbying in Brussels

6 November 2012, EurActiv

EXCLUSIVE: This year’s annual European coal industry conference in Brussels is being co-organised by the Central European Energy Partners (CEEP), which was founded by, and is mostly made up of, state-owned Polish energy firms.

Controversy broke out last year, when EurActiv revealed that the then-Polish EU presidency’s logo appeared on posters advertising the Second Coal Days conference.

But the third European Coal Days conference, which includes high-level MEPs and European Commission speakers, will also indirectly receive state funds from Warsaw.

As well as CEEP, the meeting is being sponsored by the World Coal Association and the centre-right European People’s Party in the European Parliament.

A spokesman for Euracoal, the coal industry association, told EurActiv that CEEP’s sponsorship would pay for conference events such as a breakfast in the European parliament on the conference’s opening day.

“Poland’s coal industry is pulling the strings,” commented Kuba Gogolewski, a Polish energy campaigner for the green group CEE Bankwatch.

“Instead of moving away from coal, and investing in clean energy technology, state-owned energy firms are using taxpayers’ money to sabotage the EU’s climate policy.”

No CEEP representatives were available to comment.

The energy association was founded by Grupa Lotos S.A, a state-owned Polish oil company. Most of its members are state owned, and more than 70% of its individual members are Polish.

All of the association’s executives are Polish and the organisation’s director, Janusz Luks, worked under the pre-1989 Communist regime for the Polish intelligence service. After 1989, he continued his work, and was promoted to the position of deputy director of the intelligence directorate in the Polish Intelligence Service (UOP).

CEEP describes itself as an ‘international non-profit association’ and presents the carbon-emitting interests of Central and East European EU states as being in “contradiction” with Western regions of the EU.

A recent Ernst and Young report commissioned by CEEP argued that the EU needs to develop a separate energy policy for Central and East European countries because they have a different energy and economic profile.

But whereas Poland relies on coal for 92% of its electricity, 59% of the Czech Republic’s electricity is coal generated, Slovakia and Slovenia depend on the fossil fuel for less than 15% of their electricity, and Latvia and Lithuania hardly use any coal at all.

‘Diamond age’ of coal

Stoked by bargain-bucket US export prices, coal is currently enjoying what Euracoal Secretary-General Brian Ricketts calls a “diamond age” with a global energy share that recently rose from 25% to 30%, its highest level since 1969.

Between the second quarters of 2011 and 2012, coal consumption rose by nearly a quarter in the UK alone, increasing fears that the EU’s planned route to decarbonisation by 2050 could be blown off course.

Ricketts insisted that Euracoal “doesn’t have an issue with” the EU decarbonisation target – of 80%-95% on 1990 levels by 2050 – but only if the rest of the world sets similar goals.

“Europe wants to reduce its carbon emissions to solve the global climate challenge but its emissions are only 13% of the global total,” Ricketts told EurActiv. “If we get to 2050 and the rest of the world has taken no action then what have we achieved?”

In the meantime, there was a clear “need for new investment in coal-fired power generation” in countries such as Poland, Ricketts argued, to replace ageing infrastructure.

Euracoal’s position is in line with CEEP’s – and Poland’s – but is disputed by Brussels and the other 26 EU states, which argue that it risks deferring European climate action and leadership indefinitely.

Rather, EU Climate Commissioner Connie Hedegaard argues, not taking climate action now will leave the EU playing catch-up in the global green technology race later.

Carbon capture and storage

The centrepiece of the case for coal’s role in a decarbonised future rests on carbon capture and storage, an experimental technology that aims to bury carbon dioxide emissions in geological formations.

Last month, the Global CCS Institute said that to prevent global warming rising above the UN’s containment target of 2 degrees Celsius, 130 new CCS plants would be needed by 2020. But no European CCS plants are operational, no demonstration projects have yet received funding from the EU’s NER300 fund, and carbon prices are too low to encourage private investment in them.

Euracoal does not support market reform to boost carbon prices.

But to reach the EU’s 2050 target, “we need to have modern coal-fired plants that reduce their emissions and are ready to take CCS retrofits in the future,” Ricketts said.

“If that can’t be done then the world has a serious problem,” he added, pointing to successful CCS plant operations elsewhere in the world.

Environmentalists complain that these typically involve Enhanced Oil Recovery – or the pumping of liquefied carbon into depleted oil reserves to aid fossil fuel extraction – so negating any potential carbon savings.

Meanwhile, the International Energy Agency’s chief economist has warned that if energy intensive plant builds continue unabated, the window to a 2 degrees warmed world will close in 2017.

“We are at a crucial crossroads,” Joris den Blanken, Greenpeace’s EU climate policy director said. “Either Europe allows new coal builds, locking in higher fuel costs and ballooning emissions, or we commit to an efficient renewables-based energy system.”

On 30 October, Greenpeace organised a protest in which farmers and local residents in Poland’s Krobia municipality repelled a planned drill for a new lignite coal mine on private lands. But nearby state-owned lands are being used to sink coal mines instead.

Energy lobby groups and the Polish government insist that coal use is in the national interest, but the battle over who speaks for Polish opinion on coal may still have fuel to burn.