|End-of-day quote - 01/25|
Poland should scrap coal and energy plan, environmentalists say
|11/25/2020 | 11:37am|
WARSAW, Nov 25 (Reuters) - Poland should scrap a plan to merge state-run energy groups after they have shifted coal assets into a separate entity because it won't deliver on EU climate targets, a report by environmentalist group ClientEarth and think tank Instrat said.
The chief executive of state-run utility PGE said last month that merging PGE with peers Tauron and Enea after offloading their coal assets into a separate state entity would boost the companies' investment potential.
The plan has been approved by the state assets ministry, which is working on details.
"The restructuring plan is not only inconsistent with the European Union climate policy and not very ambitious in terms of closing coal assets. It also turns out that while it will not bring benefits for the climate, it will also mean multi-billion losses for the state," Pawel Czyzak, an economist from Instrat think tank, said in a statement.
The report showed that if the plan is implemented, in 2030 Poland will generate 92.2 terrawatt hours (TWh) of electricity from coal, or more than five times more than it should if it followed EU climate policies.
It also said that while PGE would gain 31 billion zlotys ($8.3 billion) from offloading coal assets, the state would lose 26.5 billion zlotys, as it would also take over the debt of PGE's coal unit.
PGE has said it has no other choice than discarding coal to be able to attract financing for investment.
ClientEarth and Instrat also said coal assets should be part of a portfolio of a listed company, which would guarantee that the process of phasing out coal is transparent.
The state assets ministry, which oversees coal and energy, was not immediately available for comment.
Poland generates most of its electricity from coal and is the only EU state which has not pledged to become carbon neutral in 2050. However, the government has encouraged investment in clean energy sources and some of state-run companies, including PGE, say they want to become climate neutral in 30 years.
($1 = 3.7540 zlotys) (Reporting by Agnieszka Barteczko; Editing by Mark Potter)