The Polish government is set to choose American company Westinghouse for the construction of its first nuclear power station, but only the first one due to current politics, reports portal ‘W zielonej strefie’
The Polish government is expected to announce in the coming days that American company Westinghouse will build the first nuclear power station in Poland, according to reports. However, for political reasons, a compromise will be struck by which Westinghouse will only be allowed to build the first nuclear power station, leaving the door open for other providers.
This solution is expected to lead to delays in the project, as the European Commission is likely to block, at Germany’s behest, Poland’s intention to allow the construction of the first nuclear power station to proceed. The Czechs have avoided falling into such a trap.
The Polish government was put under pressure from the American government, which pushed the Westinghouse case and gave Poland a 30-day deadline, despite the fact that the Polish-U.S. nuclear power agreement sets no deadlines on proceedings. The U.S. pressure has been intense.
Polish Prime Minister Mateusz Morawiecki in August attempted a reset in relations with France. One of the reasons for that reset was to gain France’s help in countering German opposition to Polish nuclear power capacity. France also has aspirations to participate in Poland’s nuclear build-out.
According to portal “W zielonej strefie,” the government has opted for a “squalid compromise,” which the portal feels will lead to the delay of the whole nuclear project in Poland. The decision to give Westinghouse the right to build the first nuclear power station was only made to address French concerns and persuade them not to lobby the European Commission to block the tenderless process Poland is about to choose.
However, the French do have some strong cards they can play. Poland had, under the previous energy tsar Piotr Naimski, favored the Americans with an actual state-level agreement, which may also have been desired by the French EDF and Korean KHNP. The whole process favored the Americans since they were the only ones able to prepare a detailed offer, as they had full information about the required parameters on the basis of AP-1000 reactor, which is the technology Westinghouse uses.
According to European law, for the process to be free of public tender requirements, a member state must prove that there is only one potential offer that meets the desired criteria or that the investment is a continuation requiring the same technology. It does not seem as if Poland met these criteria. The Czechs actually did hold a tender, and its terms of reference were negotiated with the Commission.
The Polish government is aware that the choice it is about to make is likely to lead to the Commission blocking the project. Germany is already lobbying France to block Poland’s nuclear power program. However France is still counting on Poland deciding to mix technologies and allow it to participate in the program.
The danger for Poland is that the French will feel cheated in the same way they felt let down over the cancellation of the Polish tender to buy the French Caracal helicopters. If they join forces with Berlin, the result could be a serious delay to the 2033 target date for the activation of the first nuclear power station in Poland, and a political defeat for the ruling Law and Justice (PiS) just months before it seeks re-election.
Could Nuclear Power Help Poland Kick Coal?
- Poland is a heavily-coal dependent country and it is being hit hard by sanctions on Russian fossil fuels.
- Poland is scrambling for new energy supplies, and the nation’s leaders have set their sights on nuclear power.
- Nuclear giant Westinghouse is offering to help Poland develop its nuclear power industry.
3.8 million people in Poland depend on coal to keep their homes heated through harsh northern winters. Last month when the European Union slapped sanctions on Russian coal, Poles flocked to local coal mines, queueing for days in the late August heat and sleeping in their cars in hopes of securing enough coal to make it through the winter. While Poland is the third biggest coal producing nation in Europe (after Germany and Russia), the nation has grown increasingly reliant on cheap Russian coal imports in recent years, rendering them vulnerable to coal price shocks in the wake of the Russian invasion of Ukraine and ensuing economic sanctions and supply chain volatility. "This is beyond imagination, people are sleeping in their cars. I remember the communist times but it didn't cross my mind that we could return to something even worse,” a man in the coal lines told Reuters. Poland is one of many nations that have recently been reminded in recent months of the dangers of relying too much on any one nation or form of energy production. Much of the EU is reeling from the loss of Russian natural gas after the Russian state-owned and -run gas company Gazprom cut off supply to the bloc indefinitely, blaming infrastructural issues that conveniently took place just as the EU decided to impose a price cap on Russian oil. France and China are also suffering from their own over-reliance on certain energy sectors: in France, nuclear production has plummeted at the worst possible moment thanks to a myriad of issues, and in China prolonged drought has slowed hydropower production to a trickle. Both of these squeezes have forced an increase in coal consumption, causing global coal prices to rise and compounding Poland’s energy woes.
Now, Poland is scrambling for new energy supplies, and the nation’s leaders have set their sights on nuclear power. Late last month, as Poles slept in their cars in coal queues, Poland's Council of Ministers amended national law in order to ease nuclear energy investment. The country had already planned, beginning last year, to start building six nuclear reactors to help wean Poland off of its long-standing reliance on coal under increasing pressure to lower carbon emissions and phase out the dirtiest fossil fuel. But the first nuclear power plant wasn’t slated to begin construction until 2026, and the first Polish nuclear reactor would not be commissioned until 2033. Subsequent units would be built every 2-3 years, bringing the budget for the whole project to a whopping PLN150 billion (USD32 billion) – at least. That plan, however, no longer seems feasible.
As Poland frets over how to keep homes heated through the winter, the government is in a huge hurry to speed up the nuclear power investment process. Warsaw is seeking a partner to help them start and scale up their nuclear energy sector as quickly as possible, and the United States has thrown its hat into the ring. The partnership, as Poland proposes it, would involve helping to install 6-9 gigawatts (GW) of nuclear capacity, and the partner would have to provide 49% equity financing for the project. "It's more than a commercial offer, it reflects 18 months of work and millions of dollars spent on analysis and evaluations,” says the Polish climate ministry.
Just this week Poland received an offer from Westinghouse, a Pennsylvania-based nuclear power company, to cooperate on the project. Westinghouse is competing with other entities from South Korea and France to win the nuclear project. South Korea's state-owned Korea Hydro Nuclear Power has submitted an offer to build the first nuclear plant in Polish history as soon as April. Several different French-based companies are also in talks with Poland, and the Polish Prime Minister Mateusz Morawiecki has been cozying up to French nuclear industry leaders, although France’s own domestic nuclear industry is currently in crisis.
By Haley Zaremba for Oilprice.com
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