Poland Agrees to Funding for First Nuclear Plant

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Poland's government has agreed to partially fund the construction of its first nuclear power plant to the tune of 14 billion euro (US$14.4 billion).

A draft bill has been adopted by the government under Prime Minister Donald Tusk as the country awaits European Union (EU) approval for both the funding package and the project. Poland is aiming to have 6 to 9 gigawatts (GW) of nuclear power, starting with three reactors at the Lubiatowo-Kopalino site in northern Poland. Industrial Info reported that the project will use three Generation III+ AP1000 reactors from Westinghouse Electric Company (Cranberry Township, Pennsylvania) with a combined output of 3,750 megawatts (MW). The date of commissioning for the first reactor is 2033. For additional information, see November 22, 2022, article - Poland's First Nuclear Plant Project Goes to Westinghouse. The plant represents a historic shift for Poland, which is Europe's largest coal-using nation and relies on coal-fired power for more than 70% of its electricity. It also supplies more than 95% of Europe's hard coal. The country is under increased pressure from the EU to decarbonize its electricity mix as it has consistently failed to meet the EU's strict environmental requirements for greenhouse gas emissions reductions.

The government wants nuclear power to supply around one-fifth of the country's electricity by 2045. Government funding for the first project will be delivered in the form of cash or bonds to Polskie Elektrownie Jądrowe (PEJ), the state-owned company responsible for the plant. "The remaining amount will be obtained from financial institutions, primarily foreign institutions supporting the export of equipment suppliers...in particular the Export-Import Bank of the United States," according to the draft. There has been strong interest from international backers and the full cost of the project has been put at 45 billion euro (US$46.4 billion). Most recently, France's export credit agency, Bpifrance Assurance Export and French public credit institution, SFIL, have submitted letters of intent to PEJ amounting to US$3.75 billion. PEJ has also received a letter of intent from Export Development Canada, for up to US$1.45 billion to potentially support the project. At the end of last year, the U.S. International Development Finance Corporation signed a letter of interest with PEJ to provide more than US$980 million in financing support, while a similar amount was pledged by the U.S. Export-Import Bank. Combined, PEJ has pledges amounting to about US$23 billion to date.

The European Commission (EC) has opened an "in-depth investigation" to assess whether the public support that Poland plans to grant is in line with EU State aid rules. While the EC has found that the aid package is necessary and has an incentive effect, "it has doubts at this stage on whether the measure is fully in line with EU State aid rules." Teresa Ribera, executive vice president for Clean, Just and Competitive Transition, said: "The public support that Poland plans to grant for its first nuclear power plant needs to be assessed by the commission to make sure that it is in line with state aid rules, which aim to preserve competition within the internal market. According to the competition rules, we will also evaluate the impact on the EU's internal energy market."

Industrial Info is also tracking the country's planned second nuclear project, plans for which were submitted in late 2023 by PGE PAK Energia Jądrowa, a 50:50 joint venture by the country's two largest utility companies Polska Grupa Energetyczna S.A. (PGE) and ZE PAK. The venture wants to build a plant in the Patnów-Konin region of Wielkopolska province in central Poland using two or more APR1400 reactors from South Korea's Korea Hydro & Nuclear Power Company Limited (KHNP). The goal is to have a 2.8-GW plant commissioned by 2035, which will satisfy 12% of Poland's electricity demand.

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