European Commission to review Polish state aid for new nuclear power plant

The European Commission has begun assessing whether Polish state aid for a new nuclear power plant in Lubiatowo-Kopalino complies with EU rules. Poland plans to support the 3750 MW project using a combination of three instruments. The Commission will now examine in detail whether the planned support is proportionate. The first AP1000 unit, supplied by US company Westinghouse, could begin commercial operation in 2033.

The European Commission announced that it had launched an in-depth investigation into the planned Polish support for the country’s first nuclear power plant. Poland submitted a plan to the Commission last September to support state-owned company Polskie Elektrownie Jądrowe (“PEJ”) in building a new nuclear power plant in Lubiatowo-Kopalino. During its preliminary investigation, the European Commission found that the support was necessary and that the project would not go ahead without it, but it had concerns about the scale of the support and whether it complies with EU state aid rules.

The public support that Poland plans to provide for its first nuclear power plant must be assessed by the Commission to ensure that it complies with state aid rules. These rules aim to preserve competition in the internal market. We will also assess the impact on the EU internal energy market under competition rules. As usual, all interested parties can submit their comments,” said Teresa Ribera, Executive Vice-President for a Clean, Just and Competitive Transition.

Poland plans to combine three support instruments:

• capital support amounting to around 30% of the expected costs
• a state guarantee for the loan PEJ will take out to finance the project
• a Contract for Difference (CfD), ensuring revenue stability throughout the power plant’s lifetime

The Commission will in particularexamine whether the use of a CfD for 60 years is justified given the other two measures, and whether other companies could deliver the project with a smaller amount of aid. The Commission will also analyse the impact of the support package on competition in the electricity market.

Poland’s first nuclear power plant

Poland selected the Lubiatowo-Kopalino site in the municipality of Choczewo in Pomerania, northern Poland, for its first nuclear power plant in 2022. The project предусматривается three US AP1000 pressurised water reactor units, each with a capacity of 1250 MW (gross).

PEJ estimates the total project cost at 192 billion zlotys (around CZK 1.1 trillion). The company has already received indications from several banking institutions that they would be interested in financing the power plant project.

The country could begin construction of the first unit as soon as next year. PEJ plans to bring the units into commercial operation around 2033 to 2037. However, the project for Poland’s first nuclear power plant has already faced delays during the preparation stages. The original estimates envisaged commercial operation of the first unit as early as 2020, and later 2025.