Heaps grow, and mining becomes…. coal the national currency.    

History is once again coming full circle – everything has already been done. Coal is getting cheaper on world markets (about PLN 500/ton), while the domestic cost of mining is almost twice as expensive (more than PLN 930/ton). The mining efficiency per employee abroad is ten times higher (at least). Salaries in Poland are rising constantly, and unions are showing last year’s inflation reading (and expecting increases). Renewable energy sources are becoming more and more efficient and are displacing coal generation, so consumption in the power industry is declining. The winter ended quickly and was relatively mild. These sentences about the Polish mining industry can be repeated periodically. The only thing that changes is the size of the financial hole – now 7 billion zlotys are probably urgently needed, while at the same time, the mountains of unsold coal, so-called “heaps”, are growing. Already more than 4-5 million tons (that’s more or less the monthly output), and the coal trucks are adding more daily. The mines are launching dramatic appeals for money (no liquidity) and stuffing the coal (because soon there will be no way to mine and no place to store it). The unions habitually show a social contract for mining and proposals for raises, reinforcing the message with sirens and tyres at protests in front of the Diet.  It can be said that precisely what could have been predicted six months ago, seeing the price trends, has happened… but again, the situation has taken us by surprise. Is there a solution? (Other than the usual topping up 7 billion or more just this year).

I propose a creative concept referring to the existing system of coal allowances (miners are entitled to 8 tons of coal as a salary supplement).  How about this – coal as a national good and national currency?  If 1 ton = 500 zlotys, you can use coal in any commercial transaction. After all, a salary payment (the average gross salary in the mining industry is about 13 thousand zlotys) equals 20 tons of coal. Mining (according to official statistics) employs about 75 thousand people – so per month… you can stuff 1.5 million tons.

On the other hand, in metallurgy (about 25 thousand people) and in the power industry (there are as many as 215 thousand, but not all in coal generation – and another 25 thousand will undoubtedly be found), so together, another 1 million tons. In a short period (a quarter), it is possible to unload the heaps and bring coal into widespread circulation.  A loaf of bread – 0.5 kg of coal, a cube of butter a little higher – 0.75 kg. Similarly, other products. And since we are a technological country, you could make applications and not even bring coal in shopping nets (like cash) but use it virtually on unique platforms (coal stays on the heaps; we have some share – a few dozen is a month, and we buy everything as a virtual transaction).  In this way, our national asset could have the role of “Polish bitcoin” or be the equivalent of an actual gold store (like the NBP). In the end – coal would be the real “black gold”, a central coal warehouse in Ostrow Wlkp. Like the US Fort Knox, mining can keep spinning (subsidies remain).

Turow lignite mine’s legal odyssey… Lawyers’ costs are about to top the balance sheet.

Apart from specialists in the sector, the ordinary public is already completely lost in the rulings on the Turow lignite mine. The latest (this week) decision of the Provincial Administrative Court overturned the environmental decision of the General Director of Environmental Protection. I assume someone who reads the news strips on TV screens cannot determine whether this is good or bad for the mine. As a reminder, previous verdicts and decisions (in cases started by a complaint from environmental organisations) have one by one shifted the pendulum one way or the other – suspending the permit for long-term operation of the mine or allowing it to operate without problems. The whole thing started in a hearing at the CJEU in 2021 (the Czech Republic’s complaint against Poland, the famous penalties and subsequent withdrawal after the agreement). Still, it quickly moved on to other complaints already in Polish courts (a protest by environmentalists and German border local government officials regarding the environmental decision – generally just allowing work until 2044). The WSA’s ruling initially suspended that decision, but it was appealed, and the WSA’s decision was overturned by the NSA (formal issues and additional decisions subsequently taken). The WSA has overturned this decision (environmental, modified), but the mine can work not only until 2044 but until 2026. However, again, the ruling will be appealed (and probably modified).  The mine itself and the employees are, of course, following the case closely and keeping it up-to-date, but it is a horse’s chance if anyone not from the sector understands what is going on and what these rulings mean. A tragic case for the workers (uncertainty of the future), but brutally accurate as far as the future of coal in Europe is concerned – it (coal) will be finished off not so much by the competition itself but by the regulations of financiers (bans on financing the sector with CO2 emissions) and the actions of lawyers (more lawsuits). In practice, the mine (and the power plant) will continue to operate after 2026 (it’s rather complicated to imagine a work stoppage just in 2026), but in turn, it’s probably impossible to dream that nothing will change until 2044 (there will probably be some “middle” scenario coinciding with the end of coal in the Polish power industry around 2035). However, looking at the legal disputes in the WSA, NSA, CJEU and subsequent courts, and the involvement of more law firms, one can satirically fear that soon, in the cost items of the mines, the expenses for lawyers will be higher than other salaries and taxes and even the cost of repairs of large mining machinery. This amusingly shows the reality of our world… without a lawyer… not a move.

RES micro-installations – do they have a feminine nature? More than 7 TWh “from nothing”?

In an old joke (now incorrect), women can make three things out of nothing – a hat, a salad and a brawl. My wife doesn’t wear hats, but in other respects, the incorrect joke is quite true. In the energy industry, the feminine nature is undoubtedly in RES micro-installations (installed capacity up to 50 kW). Out of the blue, in just a few years, there appeared in the Polish system a total of more than 1.4 million installations (98% prosumers), 11 GW of installed capacity and more than 7 TWh of production per year. Micro-installations are only talked about in the context of subsidies or promotion of government-supporting investments (although realistically, the money is usually from CO2 emission fees, and never more than 10-15% of what we pay in bills anyway).

As you can see, micro-installations are already at the production level from a large nuclear reactor, which is said to be 15 years old and will be built at a minimum of another ten years. Unfortunately, the dynamics of newly built micro-installations have been strongly declining in the last year because the “simple” and most efficient systems are already installed on the buildings of prosumers who have much of their own money to invest. It would be a shame to waste such potential and not try to shift energy from exclusively strong, large, pumped-up units (like nuclear power) to softer, distributed and individualised micro-installations (after all, as you can see, it goes paradoxically faster and just as efficiently). So maybe (looking at all the technical and satirical posts) – let’s do things differently? Let’s invest as much as possible in grids (let’s remove connection problems), in storage (let’s remove problems with production dependence on weather) and instead of complaining about the new European changes – let’s get out in front ourselves and build micro-installations on every possible building – state, school, hospital and private. After all… the energy industry is a woman…