Transformation of the Polish energy sector is the only way to permanently stabilise energy prices in our country. Experts agree that it is necessary to consistently build capacity in renewable sources and nuclear power. This will enable a systematic departure from fossil energy production, and thus independence from raw material price fluctuations and CO2.
Over the past year, the costs of energy production and its prices on the forward market have risen by up to several hundred per cent. End consumers were protected from significant increases by the provisions of the government's Solidarity Shield. It froze net energy prices for households and introduced a non-exceedable maximum price for small and medium-sized companies and sensitive consumers.
The difference between the cost of generating energy and selling it is covered by the power companies themselves. According to PGE's estimates, for this one company alone this year this will be an expenditure of around PLN 10 billion. These funds will go to the Difference Payment Fund. It is worth noting that even without these additional burdens, the PGE Group is the largest taxpayer among the companies listed on the WSE - last year the company contributed PLN 26.5 billion to the budget.
"PGE will pay PLN 10 billion this year so that Poles and Polish companies have access to energy at an acceptable price. However, we are aware that this is a short-term measure. In the long term, it is necessary to move away from fossil fuels and to consistently switch to zero- and low-carbon sources that are not susceptible to fluctuations in raw material prices and emission costs. However, the energy transition is a costly process - a total of PLN 75 billion will be spent on it by 2030. These are necessary expenditures to permanently halt price increases," says Wojciech Dąbrowski, President of PGE Polska Grupa Energetyczna and Chairman of the Governing Board of the Polish Electricity Committee.
Analysts at EY, in a report entitled 'Poland's Energy Transformation Path' prepared on behalf of the PKEE, estimated the total costs of this process at PLN 600 billion. Energy companies, which are primarily responsible for investment costs, are only able to cover a fraction of this amount.
"Depending on the criteria adopted, the costs of the energy transition can be estimated differently. Each time, however, we are only talking about billions of zlotys over the next few years. These are unprecedented sums - but much smaller than the potential costs that would be incurred if the energy transition were slowed down or stopped. 'Energy companies strive to keep energy prices low, but at the same time they do not stop very costly investments related to the energy transition, and this is the only way to protect citizens from future energy price increases,' says Professor Wojciech Suwała of the Department of Sustainable Energy Development of the Faculty of Energy and Fuels at AGH University of Science and Technology and emphasises: "It is sometimes forgotten that energy prices affect not only household budgets, but above all the costs for companies, including industry. Keeping energy prices low and stable is about ensuring the competitiveness of the economy."
One of the key factors currently affecting the cost of power generation is the price of EU ETS carbon allowances. These have increased fivefold in three years and now represent a key cost for fossil fuel power generation.
"As envisaged, EU ETS funds go to national budgets for energy transition. The problem is that Poland's demand, despite the decrease in emissions, is greater than the pool allocated to our country. In reality, therefore, Polish emitters, and consequently energy consumers, are indirectly financing the energy transition in other countries. It is precisely the Polish energy companies that are most burdened by the costs of shielding programmes that keep prices for consumers at an acceptable level, the costs of investments in the energy transition and the costs of the EU ETS. Each time, these are amounts counted in billions of zlotys," calculates Włodzimierz Cupryszak, a regulatory expert at the Polish Electricity Committee.
The process of moving away from fossil fuels is all the more challenging as it has to be implemented in parallel with the increase of generation capacity in the national electricity system. According to the assumptions of the update of Poland's Energy Policy, by 2040 electricity production should increase by more than 36% and installed capacity should more than double to around 130 GW to meet the growing demand for electricity.