Poland to Block Sale of Key Energy Assets

Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--The Polish government has passed new regulations that will block energy companies like Électricité de France SA (EPA:EDF) (Paris, France) and ENGIE (EPA:GSZ) (Paris) from selling power and heating assets.

The new regulations give the government the power to veto potential buyers of the companies controlled by the companies. The list of newly protected assets also includes state-owned copper and silver company KGHM Polska Miedz SA (WAR:KGHM) (Lubin, Poland), Polish energy company Tauron Polska Energia SA (Katowice, Poland), chemicals company Grupa Azoty S.A., telecoms firm TK Telekom (Warsaw, Poland) and the combined heat and power plant (CHP) assets of Fortum Oyj (HEL:FUM1V) (Espoo, Finland) and PKP Energetyka (Warsaw).

Speaking to reporters at an energy event, Poland's Energy Minister Krzysztof Tchorzewski said: "If EDF decides to exit Poland, then by putting EDF on such a list we are gaining the right to veto a potential buyer," reported Reuters.

EDF controls around 15% of the country's heating assets and its 1.7-gigawatt Rybnik power plant supplies 7% of the total electricity. At the start of this year, the company announced plans to sell off its Polish coal-fired heating and power plants worth an estimated 2 billion zlotys ($498 million). ENGIE wants to sell its Polaniec coal-fired power plant, which accounts for 5.5% of Poland 's electricity.

Poland relies on coal for about 85% of its electricity, but most of the plants are old and inefficient, while the government is under pressure from the European Union (EU) to lower its emissions and clean up its energy mix. Last May, the government pledged not build any more coal-fired power plants, while committing to investing in making existing plants more efficient. For additional information, see May 20, 2015, article - Poland: No New Coal-Fired Power Plants.

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