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Created on: 2018-01-11 14:06:30
Last update: 2018-02-01 11:17:51
Greig Aitken, Coal Campaigner at BankTrack
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About Enea Group
The Enea Group is a Polish coal mining and power company based in Poznan. Enea operates in several sectors of the energy market: coal mining, generation of electricity, energy distribution and energy trade. It has separate subsidiaries focused on each of these areas.
Enea owns and operates several large coal power plants including Ostroleka C (1,000MW) and Kozienice (2,820MW) as well as the Bogdanka coal mine, which produces 9 million tonnes of coal annually. Founded in 1904, the company is the fourth largest energy group in Poland. In September 2017 it held assets totalling PLN 25.75 billion (USD 7.53 billion).
ul. Gorecka 1
Miroslaw Kowalik |
listed on Warsaw Stock Exchange
Several of Enea Group's operations are responsible for severe adverse impacts on the health of local people:
- Enea's Kozienice coal power plant was responsible for an estimated 650 premature deaths, 320 cases of bronchitis and 186,500 days of absence from work in 2013, and health costs due to pollution caused by this plant amounted to an estimated EUR 920 million in 2013 (Europe's Dark Cloud, 2016). Greenpeace estimates that the new unit at Kozienice (planned capacity of 1,000 MW) will result in an estimated additional 72 premature deaths and 16,352 days off work annually (Greenpeace Poland, 2013);
- the pollution effects of Enea's Polaniec coal power plant result in an estimated 178 premature deaths each year (Lifting Europe's Dark Cloud, 2016);
- the planned Ostrołęka C coal power plant will be, over its projected lifetime of 40 years, responsible for an estimated 900 to 2,000 premature deaths, 280 to 620 cases of chronic bronchitis in adults, 1,300 to 3,000 cases of bronchitis in children, between 190,000 to 420,000 days of sick leave and 100,000 asthma attacks in children (estimated statistics taken from the analysis 'Study on the health impact of the planned Ostrołęka C unit').
The production of energy by burning coal has strong adverse impacts on the environment and climate change. Enea's overall power production for 2015 resulted in the emission of 12 million tons of CO2, 32,350 tons of sulphur oxides and over 17,142 tons of nitrous oxides. These pollutants are responsible for having major adverse climate change impacts, as well as on the environment and public health.
Secondly, producing energy from coal requires heavy usage of water. In Poland, 70 per cent of water usage is used for the production of energy from coal, compared with the EU average of 13.7 per cent. The Kozienice plant for instance uses almost 100 m3 water per second for cooling its generators. In order to increase access to water for Kozienice Enea is planning to build a dam on the river Vistula. The interruption of the ecological continuity of the Vistula will have direct negative impacts on at least six Natura 2000 areas within the basin of the upper Vistula in which Atlantic salmon are protected.
The company's operations are also linked to several incidents of accidental pollution. In June 2014, a failure in the Kozienice power plant resulted in oil flowing into the Vistula river (wiadomosci.dziennik.pl). In the winter of 2016 thousands of dead fish were found near the water intake in the area of Enea's Polaniec power plant. Their deaths may have resulted from the hot water discharge by the plant (echodnia.eu).
New report smashes Ostrołęka C - the power plant shows deep unprofitability
The latest report by Michał Hetmański,Instrat Foundation, "Ostrołęka C - what's next with the last coal-fired power plant in Europe?" shows complete lack of profitability of the largest new coal-fired power plant in the EU and serious legal doubts connected with it. Ostrołęka C can get only 15% of its revenues from the capacity market. Even under optimistic assumptions it will never provide investors with return on the investment. Ostrołęka C requires "adding" at least PLN 2.3 billion throughout its life cycle, i.e. an additional approx. 50% of the construction cost. In the optimistic scenario of a very slow increase in the prices of CO2 emission allowances and rapid rise in electricity prices - the power plant still turns out to be unprofitable. The power plant can generate electricity (LCOE) at a price of 488 PLN / MWh or even 505 PLN / MWh. This is much more than in the case of just recently developing polish wind farms (300), offshore farms (420) and even photovoltaic (440).
Extraordinary General Meeting of ENEA S.A. convened for 24 September 2018
On 24 Semptember 2018 a resolution on expressing qualified consent to commence the Construction Stage in the project Ostrołęka C will be put to shareholders vote. The qualified consent is necessary to commence the Construction Stage in the project Ostrołęka C 'consisting in the preparation, construction and exploitation of a bituminous coal fired power unit for supercritical parameters of steam with a gross capacity around 1,000 MWe'.
The Enea Group has received finance from several financial institutions. A list of bonds underwriting and corporate loans (Enea's 2017 annual report) can be viewed below. The five bonds issued are:
- PLN 3 billion (expires 2020), led by PKO BP, Bank PEKAO, BZ WBK, Bank Handlowy
- PLN 1.0 billion (expires 2026) and PLN 0.150 billion (expires 2027), led by BGK
- PLN 1.5 billion (expires 2021), led by ING Bank Slaski, PKO BP, Bank PEKAO, mBank
- PLN 301.911 million (expires 2018), led by Bank PEKAO