What awaits us in the upcoming heating season?

With an expert eye

Anna Pawłowska-Kawa, specialist in the field of ecological heating devices

September of this year marked the warmest in over a century, spanning the entire history of measurements in Poland. While many rejoiced in the high temperatures and abundant sunshine throughout the month, ecologists are raising concerns, emphasizing that the temperature increase of 3.6°C compared to the average for this period is a clear indication of a warming climate. Regardless of one’s perspective on the matter, it is undeniable that the heating season is rapidly approaching, officially at least, even if current thermometer readings suggest otherwise. The question arises: are we heading toward a scenario similar to last year?

It can be confidently stated that the heating season last year was among the most challenging, if not the most difficult, in modern Poland’s history. The Russian aggression against Ukraine significantly disrupted the fossil fuel market. Despite being one of the largest pellet producers in Europe, Poland predominantly relied on pellet imports from Ukraine and Belarus. The embargo on Russian coal revealed an insufficient domestic coal supply. Additionally, social unrest and concerns about raw material shortages led to Poles buying larger quantities than needed. Demand only started to decrease after reaching peak prices in December 2022. However, the familiar prices below PLN 1,000 per tonne for coal or pellets became a distant memory. At its height, pellet prices reached up to PLN 3,000/t, and eco-peas were at PLN 4,000/t.

Poland navigated through last year’s energy crisis relatively unscathed, partly due to an exceptionally mild winter. Nonetheless, many still shudder at the mention of pellet or coal prices, especially considering the challenges faced when attempting to purchase fuel online from Polska Grupa Górnicza. Tuesdays and Thursdays at 4 p.m. saw a nationwide rush to buy coal, leading to constant website overloads and the frustrating message, “Sorry, please try again later!” Camping in front of fuel depots, attempting to bypass PGG’s overloaded store, receiving dubious offers from “hackers,” and encountering scams from private sellers were all part of the chaos.

This year, prices appear more stable but certainly not low. A ton of certified pellets now costs between PLN 1,500 and 2,000. This is influenced by the ongoing war in Ukraine, elevated electricity prices, wood exports, State Forests’ sales policy, and rising packaging material costs. The commonly purchased eco-pea coal ranges from PLN 1,500 to PLN 1,800, while coarser-grade coal like walnut can be acquired for approximately PLN 1,200/t.

We will have plenty of coal this heating season

According to Minister of Climate Anna Moskwa, the Polish energy sector is currently sitting on substantial coal reserves, particularly fine coal earmarked for power plants and thermal power plants. The reserves have grown significantly, reaching 7.5 million tons for domestic energy use as of August 1, 2023, compared to 4.26 million tons the previous year. Despite this surplus, coal for household use lacks quality standards, with the government extending the suspension of quality requirements until December 31, 2023. This decision has led to an influx of coal, potentially of lower quality, from countries like Australia, Indonesia, and Colombia.

The government cites the high dependence of households on coal for heating purposes and the presence of over 64,000 tons of coal from state treasury companies in municipal landfills as reasons for the extension. The LW Bogdanka mine, with coal on the verge of acceptance standards due to high sulfur content, played a crucial role in the decision. The Ministry contends that LW Bogdanka significantly contributed to meeting the coal needs of Poles last year, especially in the eastern part of Poland. Complying with quality requirements now could hinder the sale of domestically mined coal.

However, such decisions appear at odds with anti-smog resolutions, including upcoming bans on “smokeholes” in certain voivodeships and coal burning in various cities. Warsaw, for instance, plans to ban coal burning on October 1, the official start of the heating season, aligning with measures in Wrocław, Krakow, and certain spa towns. From 2024, Sopot will also implement a similar ban. Exceptions will apply to installations meeting ecodesign requirements or class 5 standards, allowing owners to continue coal burning until the end of the installations’ lifespan. Comparable regulations will extend to nearby poviats near Warsaw from 2028.

What does coal without quality standards mean for us?

Brown coal has experienced a resurgence in popularity due to the suspension of fuel standards and a shortage of hard coal. However, beyond its relatively low price, there are few advantages to be found. Brown coal, also known as lignite, has been categorized as a “prohibited fuel,” akin to mud and coal fleet (excluding industrial purposes). This raw material is essentially a rock in a transitional phase between peat and energetic hard coal, characterized by high humidity—initially containing up to 40-50% water upon extraction—and susceptible to moisture absorption if not adequately protected.

Its calorific value is low, ranging from about 6 MJ/kg to 20 MJ/kg, whereas hard coal can achieve a calorific value of 30 MJ/kg. However, the primary concern with lignite isn’t its moisture content or calorific value; rather, it’s the detrimental impact on the environment. The combustion of lignite releases substantial amounts of greenhouse gases, particularly carbon dioxide and sulfur dioxide. Additionally, it emits significant quantities of PM 2.5, PM 10, cadmium compounds, and mercury. Moreover, lignite poses a considerable threat to heating devices, causing damage to exchangers, feeders, boiler components, and creating hazardous soot in chimneys that increases the risk of fires.

A turn towards brown coal also among our western neighbors

The German energy company RWE has made a surprising decision to close down a wind farm in western North Rhine-Westphalia in favor of expanding a lignite mine. This move appears contradictory to Germany’s widely promoted pro-ecological policies and is sparking controversy, as wind farms were supposed to be a cornerstone of the country’s energy transformation.

RWE justifies the decision by citing the ongoing energy crisis stemming from the war in Ukraine. The company asserts that, at this juncture, the priority is ensuring energy security for Germans rather than focusing on the ongoing fight against climate change. However, the decision raises questions about whether addressing the energy crisis should take precedence over climate change concerns.

This is the air Europe breathes

In late September, the British daily “The Guardian” published the findings of a research study on air quality in Europe, conducted by researchers from the University of Utrecht (Netherlands) and the Institute for Tropical Affairs and Public Health (Switzerland). The results reveal a dire situation, with only 2% of Europeans breathing air that meets the parameters deemed acceptable according to World Health Organization (WHO) guidelines. The most alarming conditions are reported in North Macedonia, where up to two-thirds of the population is exposed to PM 2.5 concentration levels exceeding the limits by four times. In the capital city, these standards are exceeded up to six times.

source: The Guardian

Examining the map, it becomes apparent that searching for regions with better air quality than Poland seems challenging. Alongside Serbia, Albania, Romania, Slovakia, Hungary, and the aforementioned North Macedonia, Poland falls into the category of countries where air pollution standards are exceeded at least twice. These findings, released just before the heating season, paint a discouraging picture. While the data pertain to 2019, pollution levels in some countries may have undergone slight changes due to local activities. However, with the abolition of quality standards for solid fuels, it is unlikely that this shift will have a positive impact in Poland.

Heating season – what about electricity?

For the year 2023, electricity prices have been kept at the 2022 tariff levels, with three consumption thresholds, raised in July:

• Up to 3,000 kWh/year for all households.
• Up to 3,600 kWh/year for households with disabled individuals.
• Up to 4,000 kWh/year for holders of the Large Family Card and farmers.

Households staying within these limits will receive a retroactive 12% reduction in their bills from the beginning of 2023, equating to approximately PLN 125. Once these limits are exceeded, the maximum applicable rate is PLN 0.693 per 1 kWh. Households using electricity for heating (via a heat pump or electric boiler) were granted an allowance of up to PLN 1,500 for the last heating season, provided they lack a photovoltaic installation.

However, concerns arise for this group of consumers regarding electricity price forecasts for 2024. The abandonment of rate freezing and solidarity shields may lead to a potential 70% increase compared to the current price, reaching approximately PLN 1.57 per 1 kWh of energy, as estimated by Forum Energii. Responding to these forecasts, Jacek Sasin, the Minister of State Assets, assured on Radio Plus on September 21 that the government would not allow energy prices for households in Poland to become prohibitively high, ensuring that energy remains accessible and not a luxury.

Waiting for NABE

The National Energy Security Agency (NABE) was introduced in May 2021, with the Ministry of State Assets officially announcing the power sector transformation program in March 2022. This initiative aimed to separate coal assets from major energy groups, consolidating them into a distinct entity with the State Treasury holding 100% of the shares. NABE’s mission was to acquire coal assets from Tauron Group, PGE, Enea, and Energa, liberating them from unprofitable ventures affected by escalating CO2 emission allowance prices.

NABE was envisioned as a guardian of energy security during the gradual shift away from coal, recognizing the sector’s significant 70% contribution to the Polish energy landscape. The closure of the last hard coal mine was planned for 2049 under a social agreement between the government and miners. By 2040, the energy mix was expected to transition significantly, with renewable and nuclear energy collectively contributing over 70% to total production. NABE was designed to safeguard coal sector employees, facilitating a smooth transition and preparation for upcoming changes.

However, the NABE Act, along with a related act proposing a 5% reduction in electricity prices, faced rejection by the Senate on September 7. This implies that progress on these initiatives may be stalled until a new government is in place. With limited time until parliamentary elections and no scheduled additional sessions in the Sejm, details on electricity prices, NABE establishment, and potential energy sector support must await developments “after the elections.”

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