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Friday, 30 March 18
EXPLAINING POLAND'S COAL PARADOX - FORBES
 In the U.S. coal is succumbing to market forces despite the Trump Administration’s push to support the industry. Abundant, cheap and cleaner natural gas together with ever more efficient and increasingly affordable wind and solar continue displacing coal in electricity generation. But to assume this is the general worldwide trend would be a serious mistake. In fact, even in the heart of “renewable-friendly” Europe, coal is and most likely will continue to be a fuel of choice. Despite coal’s obvious shortcomings that include high CO2 content and local air pollutants, Poland projects that in 2050 coal will still constitute 50% of its energy mix. The strong commitment to coal expressed most recently in the government’s program for the hard coal sector, is driven by host of factors that include social, electoral and policy considerations. As a general statement, it is important to understand the powerful role these factors play in the fuel mix across different countries.
Currently, Poland tops the EU list of biggest coal energy producers, and coal continues to dominate the energy mix in Poland (50%), accounting for a whopping 80% of electricity generation. Going forward, the country is looking into expanding coal production through investment in multiple new mines, including those producing lignite. These plans correspond with power-generation and district heating investments in new plants or expansion of existing facilities.
At the same time, Poland has been behind the EU schedule in implementing the mandated share of renewables energy sources (RES) in the Polish energy mix. The government has also been visibly slow with implementing the 2015 law on renewable energy sources, which in contrast to many EU countries, includes coal as part of the renewable energy mix via coal-biomass based cogeneration.
On the surface, the Polish government’s strong commitment to coal is removed from the realities of the current EU policy direction and market conditions. It goes against the trends in most OECD countries where a less-CO2 intensive energy mix includes increases in RES and natural gas while phasing out coal. Additionally, by pursuing coal Poland opens itself to disputes with the EU that can include substantial monetary fines. Moreover, Polish policy seems to contradict the government’s recent commitment to fight high levels of smog in many cities.
However, a deeper dive reveals that the pervasive use of coal in Poland cannot be explained in strictly environmental or market terms, or even in reference to the EU policy direction.
Coal takes a special place not only in Poland’s energy mix but also in the nation’s collective heart. The coal industry has been traditionally revered, if not romanticized, and much of this continues today. As reported by Poland’s Public Opinion Research Center (CBOS) in 2016, miners in Poland are respected at levels (82%) comparable to university professors (80%) and more than medical doctors (74%) or teachers (71%).
Miners have also enjoyed high salaries and pensions, often several times higher than the national average. In addition, they are highly organized within politically influential trade unions. The government is well aware that any decision that endangers the future of mining will meet with substantial protest, as exemplified by the events of 2015 when miners threatened to end the government of Ewa Kopacz, then Polish Prime Minister. A new law to restructure Poland’s largest mining company was met with widespread protests by miners and their unions, who saw the law as a prelude to the closing of four mines in the Upper Silesia region. Negotiations that ensued resulted in the government’s strong commitment to keeping all mines open, effectively assuring the mining jobs that could have otherwise been eliminated.
Thus, any policy that could potentially limit coal and negatively affect mining jobs can have immediate negative consequences for the incumbent government as well as serious electoral implications. There are 55 seats (out of 460 seats) in the Sejm (the lower chamber of the parliament) and 13 (out of 100) in Senate (the upper chamber of the parliament elected in Upper Silesia – the region historically known as “the kingdom of black coal.” Additional “coal” seats are dispersed around the country where lignite is mined. When compared to prospective EU disputes and/or fines, electoral and public support considerations are more immediate and can directly affect chances of survival for any incumbent government.
Intertwined with socio-political consideration is the second major issue that explains coal’s strong position and commitment to coal going forward – energy security. In Poland, the concept of energy security is viewed predominantly as low dependence on Russia, and it is at the top of government and general public priorities. Domestically available coal offers predictability and peace of mind at a time when renewable energy is still at the very beginning of its development, a potential nuclear power plant is still in discussion stages, and the majority of natural gas consumed in Poland needs to be imported from abroad, primarily from Russia.
Recognizing the geopolitical consequences of dependence on Russian gas, Poland has diversified its pool of natural gas providers, thanks to the newly built LNG terminal in Swinoujscie. But, LNG imports are intended to back out Russian gas rather then provide substitute for coal; so they are unlikely to push out coal in the same manner domestically available natural gas has in the US. In fact, part of the planned expansion of LNG imports into Poland is designed to capitalize on Poland becoming a hub for LNG distribution to other European countries.
Coal policy is a difficult balancing act for Poland. It needs to take into account immediate electoral, social and energy security considerations as well as the country’s commitments as a member of the EU. Poland receives substantial EU subsidies, including €27.4 billion for the Program on Infrastructure and Environment that stresses low-emission economy and environmental protection in addition to infrastructure development and energy security. Those funds could potentially be at risk going forward if Poland does not live up to its stated RES and emissions obligations.
The situation is also difficult for the EU more generally, as it highlights the tensions and different priorities between “high income Western Europe” and “middle income Central and Eastern Europe”. To be truly successful the EU has to understand the heterogeneous needs and priorities of its members. Strict RES development goals not adjusted to local needs, combined with potential fines and reprimands for noncompliance are unlikely to achieve the climate and decarbonization goals the EU has established. Instead rigid rules could push countries like Poland where government’s skepticism towards the EU is already high, toward a non-EU future. The issue seems to have been considered by the EU, which has recently committed €1.25 billion ($1.55 billion) to assist the Polish government with mine closures that could address some of the hardships such closures could have for the affected population. One might suspect substantive help provided to coal-dependent regions – including re-training and unemployment compensation – could alleviate some of the social and electoral considerations. Also, support toward less carbon-intensive energy sources that could be developed domestically – such as biogas – could facilitate a less coal-intensive future. Lastly, research toward and potential development of capture and storage solutions and/or coal gasification could accommodate some of Poland’s reliance on coal while minimizing its negative externalities, such as CO2 emissions and smog.
Source: Forbes
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Tuesday, 01 May 18
SUPRAMAX: COAL RUNS, A 61,000-DWT WAS FIXED BASIS DELIVERY SURABAYA, FOR A TRIP VIA INDONESIA, RE-DELIVERY INDIA AT $15,000 - BALTIC BRIEFING
Capesize
Rates eased in the East, as the week closed out with the momentum slowing. Levels on the key West Australia/China run dropped to $7.25 ...
Tuesday, 01 May 18
GLOBAL MINER PEABODY EYES SALES OPPORTUNITY IN INDIA’S RISING COAL IMPORTS - BUSINESS STANDARD
Indian imports of coal will continue to rise, reckons the world’s largest private sector coal miner Peabody Energy. Glenn Kellow, president a ...
Saturday, 28 April 18
STRONG ASIAN DEMAND CONTINUES TO HOLD UP THERMAL COAL MARKETS - REUTERS
Asian thermal coal demand is defying its typical seasonal slowdown as well as the expanding use of renewables and natural gas, with prices holding ...
Friday, 27 April 18
PEABODY ENERGY'S REVENUES FOR THE FIRST QUARTER ROSE 10 PERCENT OVER THE PRIOR YEAR TO $1.46 BILLION
Peabody Energy's revenues for the first quarter rose 10 percent over the prior year to $1.46 billion driven by improved seaborne coal pricing a ...
Thursday, 26 April 18
BALTIC EXCHANGE LAUNCHES ESCROW SERVICE FOR VESSEL SALES
The Baltic Exchange will be launching an Escrow Service for its members to hold deposits for ship sale transactions. The move will allow Baltic Exc ...
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- Cigading International Bulk Terminal - Indonesia
- Economic Council, Georgia
- Directorate Of Revenue Intelligence - India
- San Jose City I Power Corp, Philippines
- Australian Commodity Traders Exchange
- The University of Queensland
- Petron Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Rashtriya Ispat Nigam Limited - India
- Kapuas Tunggal Persada - Indonesia
- Sojitz Corporation - Japan
- Orica Australia Pty. Ltd.
- Heidelberg Cement - Germany
- Eastern Energy - Thailand
- Mercuria Energy - Indonesia
- International Coal Ventures Pvt Ltd - India
- PTC India Limited - India
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Deloitte Consulting - India
- Pendopo Energi Batubara - Indonesia
- Wood Mackenzie - Singapore
- GMR Energy Limited - India
- Baramulti Group, Indonesia
- Kobexindo Tractors - Indoneisa
- Medco Energi Mining Internasional
- Ministry of Mines - Canada
- Vizag Seaport Private Limited - India
- Indo Tambangraya Megah - Indonesia
- Tata Chemicals Ltd - India
- Goldman Sachs - Singapore
- Sindya Power Generating Company Private Ltd
- Indian Energy Exchange, India
- Antam Resourcindo - Indonesia
- Anglo American - United Kingdom
- Interocean Group of Companies - India
- Savvy Resources Ltd - HongKong
- Cement Manufacturers Association - India
- Indonesian Coal Mining Association
- Miang Besar Coal Terminal - Indonesia
- Bukit Makmur.PT - Indonesia
- Bukit Baiduri Energy - Indonesia
- Malabar Cements Ltd - India
- Lanco Infratech Ltd - India
- Jindal Steel & Power Ltd - India
- Independent Power Producers Association of India
- Sarangani Energy Corporation, Philippines
- Coal and Oil Company - UAE
- Planning Commission, India
- Power Finance Corporation Ltd., India
- South Luzon Thermal Energy Corporation
- AsiaOL BioFuels Corp., Philippines
- Jorong Barutama Greston.PT - Indonesia
- ICICI Bank Limited - India
- Gujarat Sidhee Cement - India
- Trasteel International SA, Italy
- Petrochimia International Co. Ltd.- Taiwan
- Coalindo Energy - Indonesia
- Parliament of New Zealand
- Vedanta Resources Plc - India
- Kartika Selabumi Mining - Indonesia
- Africa Commodities Group - South Africa
- GVK Power & Infra Limited - India
- Ministry of Finance - Indonesia
- Thiess Contractors Indonesia
- Merrill Lynch Commodities Europe
- Energy Development Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Larsen & Toubro Limited - India
- Formosa Plastics Group - Taiwan
- Renaissance Capital - South Africa
- Ceylon Electricity Board - Sri Lanka
- Holcim Trading Pte Ltd - Singapore
- Latin American Coal - Colombia
- Indian Oil Corporation Limited
- Electricity Authority, New Zealand
- Simpson Spence & Young - Indonesia
- ASAPP Information Group - India
- Maharashtra Electricity Regulatory Commission - India
- McConnell Dowell - Australia
- VISA Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Bharathi Cement Corporation - India
- GAC Shipping (India) Pvt Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bayan Resources Tbk. - Indonesia
- The Treasury - Australian Government
- Gujarat Mineral Development Corp Ltd - India
- Orica Mining Services - Indonesia
- Parry Sugars Refinery, India
- Essar Steel Hazira Ltd - India
- Bulk Trading Sa - Switzerland
- The State Trading Corporation of India Ltd
- Xindia Steels Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Altura Mining Limited, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tamil Nadu electricity Board
- Therma Luzon, Inc, Philippines
- PNOC Exploration Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Iligan Light & Power Inc, Philippines
- Kumho Petrochemical, South Korea
- New Zealand Coal & Carbon
- Price Waterhouse Coopers - Russia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Georgia Ports Authority, United States
- Straits Asia Resources Limited - Singapore
- Kepco SPC Power Corporation, Philippines
- Bhushan Steel Limited - India
- PowerSource Philippines DevCo
- Posco Energy - South Korea
- Aditya Birla Group - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- CNBM International Corporation - China
- Commonwealth Bank - Australia
- Electricity Generating Authority of Thailand
- Borneo Indobara - Indonesia
- Semirara Mining Corp, Philippines
- Singapore Mercantile Exchange
- PetroVietnam Power Coal Import and Supply Company
- White Energy Company Limited
- Grasim Industreis Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Meralco Power Generation, Philippines
- Indika Energy - Indonesia
- Bangladesh Power Developement Board
- Globalindo Alam Lestari - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Rio Tinto Coal - Australia
- Minerals Council of Australia
- Bahari Cakrawala Sebuku - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- TeaM Sual Corporation - Philippines
- Manunggal Multi Energi - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Makarim & Taira - Indonesia
- Samtan Co., Ltd - South Korea
- Ministry of Transport, Egypt
- Carbofer General Trading SA - India
- Kalimantan Lumbung Energi - Indonesia
- Central Electricity Authority - India
- Madhucon Powers Ltd - India
- Mercator Lines Limited - India
- Maheswari Brothers Coal Limited - India
- SN Aboitiz Power Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Riau Bara Harum - Indonesia
- Chamber of Mines of South Africa
- Leighton Contractors Pty Ltd - Australia
- Global Coal Blending Company Limited - Australia
- Sinarmas Energy and Mining - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Mjunction Services Limited - India
- Siam City Cement - Thailand
- Dalmia Cement Bharat India
- Agrawal Coal Company - India
- Asmin Koalindo Tuhup - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- London Commodity Brokers - England
- SMC Global Power, Philippines
- Bhatia International Limited - India
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- European Bulk Services B.V. - Netherlands
- Binh Thuan Hamico - Vietnam
- Pipit Mutiara Jaya. PT, Indonesia
- Metalloyd Limited - United Kingdom
- Port Waratah Coal Services - Australia
- Karaikal Port Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Eastern Coal Council - USA
- SMG Consultants - Indonesia
- Uttam Galva Steels Limited - India
- Kaltim Prima Coal - Indonesia
- Videocon Industries ltd - India
- Standard Chartered Bank - UAE
- Sree Jayajothi Cements Limited - India
- Barasentosa Lestari - Indonesia
- IHS Mccloskey Coal Group - USA
- Oldendorff Carriers - Singapore
- Attock Cement Pakistan Limited
- Intertek Mineral Services - Indonesia
- Romanian Commodities Exchange
- Ambuja Cements Ltd - India
- India Bulls Power Limited - India
- Coastal Gujarat Power Limited - India
- Mintek Dendrill Indonesia
- Sical Logistics Limited - India
- LBH Netherlands Bv - Netherlands
- Wilmar Investment Holdings
- Salva Resources Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Energy Link Ltd, New Zealand
- Edison Trading Spa - Italy
- Siam City Cement PLC, Thailand
- Indogreen Group - Indonesia
- MS Steel International - UAE
- IEA Clean Coal Centre - UK
- Banpu Public Company Limited - Thailand
- Australian Coal Association
- Thai Mozambique Logistica
- Global Business Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Alfred C Toepfer International GmbH - Germany
- Jaiprakash Power Ventures ltd
- Meenaskhi Energy Private Limited - India
- Star Paper Mills Limited - India
- Billiton Holdings Pty Ltd - Australia
- Global Green Power PLC Corporation, Philippines
- Sakthi Sugars Limited - India
- Aboitiz Power Corporation - Philippines
- Central Java Power - Indonesia
- Chettinad Cement Corporation Ltd - India
- Timah Investasi Mineral - Indoneisa
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