We present selected data on the Polish energy sector, relevant from the perspective of the changes taking place in the Polish energy sector. The data come from the report - 'Energy Transformation in Poland. Edition 2024'.
We present selected data on the Polish energy sector, relevant from the perspective of the changes taking place in the Polish energy sector. The data come from the report - 'Energy Transformation in Poland. Edition 2024'.
● Poland has achieved the third-highest GDP growth since 2004 (behind Ireland and Malta).
● The consumption of energy and fuels (especially for transport) in the Polish economy continues to grow, but the role of coal is clearly declining. Combined with an increase in the use of RES, Poland is beginning to reduce greenhouse gas emissions.
● Since 1990, net reductions in greenhouse gas emissions in Poland have amounted to 18.3% (32.5% in the EU as a whole). However, they have increased by 3.2% since 2005 (the year the ETS was launched). According to estimates, the first declines in Poland’s emissions appear in 2023, but no official figures for that year have been provided.
● Among countries that emitted more than 50 million tonnes of CO2eq in 1990, Romania (-75.1%) and Slovakia (-53.7%) are the leaders of the reduction.
● If the current trend continues, in the coming years Poland will have higher emissions than France, whose economy is four times larger than Poland’s.
● Although primary energy consumption has remained at a similar level for years (or is declining gently), total energy consumption in the Polish economy is increasing. This is due to imports of processed products, such as fuels (diesel, LPG).
● Over the 2013-2022 period, domestic energy consumption increased by 6.3% (258 PJ), with a 16.1% decrease in supply (-477 PJ). The decrease was mainly due to the decline in the mining of energy resources and the too-slow development of RES, which is unable to replace the losses in obtaining coal, among other things.
● This results in the growing dependence of the Polish economy on energy imports from abroad.
● Import dependence is the ratio of imported energy to energy consumed domestically.
● The Polish economy’s dependence on energy imports increased from 28% to 43% between 2013 and 2022.
● For years, the largest import dependency was for oil. As much as 96-97% of the oil consumed in Poland comes from abroad.
● In 2023, the estimated import dependence on natural gas was 83%, which is 5 p.p. more than 2022 and 11 p.p. more than 10 years ago.
● Steam hard coal imports in 2023 covered 19% of domestic consumption. The decrease in the ratio compared to 2022 is due to the fact that while domestic output was falling, the rate of decline in coal consumption was even faster. However, over the decade, dependence on imported steam coal increased by 19 p.p.
● Dependence on renewable energy imports (mainly biofuels and biomass) hovers around zero.
● In 2023, the value of energy and fuel imports to Poland was an estimated PLN 139 billion. In 2022, after accounting for inflation, it was the equivalent of PLN 241 billion, and in 2014 the equivalent of PLN 102 billion.
● Nearly half of this amount (46%) was oil imports (PLN 64 billion), 26% natural gas (PLN 36 billion), and 8% coal (PLN 11 billion).
● After eliminating fuel supplies from Russia, Saudi Arabia became the biggest beneficiary of Poland’s import dependence. In 2023, it earned PLN 31.5 billion from supplies to Poland. Second place went to Norway and third to Denmark.
● In the last two years, the process of diversification of directions from which Poland imports energy resources has significantly accelerated.
● In 2023, gas and coal imports from Russia were completely replaced by purchases from other countries, and the volume of oil imports was small. Currently, Poland is clearly dependent on Russia only in the area of LPG imports.
● Gross electricity consumption amounted in 2023 to 170.2 TWh. End-user consumption accounted for 85.7% (145.9 TWh), and the remaining 14.3% (24.3 TWh) included consumption for CHPs’ and power plants’ own needs, as well as losses in transmission and distribution networks.
● Pumped storage power plants required 1.9 TWh of electricity in 2023 — that’s 1.1% of gross domestic consumption. These units produced 1.3 TWh, so the efficiency of this energy storage type was 71.6%.
● In 2022 (the latest data), the largest end-user of electricity was industry (68 TWh). Households consumed 29 TWh.
● The dominance of production from coal results in high consumption for power plants’ own needs — it accounts for 9% of Poland’s gross consumption.
● The increase in electricity consumption (related to the electrification of sectors) will, on the one hand, put increasing pressure on the electric power system, but, on the other hand, will reduce total energy consumption across the economy due to higher efficiency.
● In 2023, sales of heat pumps were lower than in the record year of 2022, at more than 124,000 units. At the end of 2023, there were about 657,000 of them. 37,000 electric cars (BEVs and PHEVs) also arrived, totaling more than 98,000 at the end of 2023.
● According to Forum Energii estimates, the share of air-conditioned household space is also growing. In 2021, it amounted to about 1.8%, while in 2012, less than 0.5% of household space was air-conditioned.
● There were no significant changes in fossil fuel-fired capacity in 2023.
● The only significant changes were in renewables, which added 5.6 GW.
● Photovoltaics (4.8 GW) were responsible for most of the increase in renewable capacity, of which 1.9 GW was prosumer solar PV.
● There was also an increase of 0.8 GW of wind capacity, which is mostly the result of investments made in RES auctions in earlier years.
● At the end of 2023, prosumer installation capacity reached 10.7 GW. This represents an increase of 21% (1.9 GW) over the year.
● This capacity consists of nearly 1.4 million prosumer installations (+16% year-on-year). Photovoltaic installations account for 99.97% of them.
● Estimated total prosumer electricity production is about 9.1 TWh. Estimated self-consumption was about 2.3 TWh, which means that about 1.4% of domestic consumption did not have to be sent through the NPS.
● Prosumers fed 6.8 TWh of electricity into the grid. This corresponds to 4.1% of national generation.
● 60.5% was coal’s share of gross electricity production in 2023 (9.9 p.p. less than in 2022).
● Production from RES was 27.1%, 6.2 p.p. more than in 2022. A record 45.2 TWh from renewables made them the second-largest producer of electricity in 2023, overtaking lignite. This was possible thanks in part to reduced demand for electricity (down 4.3% y/y).
● For the first time, production from wind exceeded 20 TWh, reaching 23.2 TWh (14%).
● Electricity production from natural gas reached its highest level ever, at 16.5 TWh (9.9% of electricity production).
● Coal units recorded the lowest capacity factors ever. Values for coal approached those for high wind turbines.
● Production from coal fell by 25.6 TWh (-20% y/y): from hard coal by 13.1 TWh (-17% y/y), from lignite by 12.5 TWh (-26% y/y).
● This is a result of very high prices for hard coal and CO2 emission allowances, as well as the low flexibility of coal sources, for which there is less and less room in the system with the rapidly growing production from RES.
● Production from natural gas increased by 4.8 TWh (+41% y/y) primarily due to the decline in natural gas prices, which have become competitive with high coal prices, and the higher flexibility of these sources, which work better with the variables of RES.
● Among RES, production from photovoltaics (+39% y/y, +3.2 TWh) and wind (+17% y/y, +3.4 TWh) grew most rapidly. The only decline was in biomass co-firing (-8% y/y, -0.2 TWh).
● Pumped storage plants, the system’s only significant energy storage, were once again utilized at record levels for the second year in a row — 26% more than in 2022.
● An estimated 74.4 GWh of electricity was subjected to non-market redispatch (curtailment) in 2023. This is an amount comparable to the annual demand of 30,000 households.
● 56% of this value was related to the curtailment of photovoltaic (non-prosumer) installations, while the remaining 44% was curtailment of wind farm production. In 2022, only wind farm generation was curtailed (8.4 GWh).
● In earlier years, non-market redispatch did not occur because RES capacity was too low. Currently, there are 26.8 GW of non-controllable RES installed, while the minimum system demand amounts to 11 GW.
● Non-market redispatch is a tool for maintaining system stability and regulation, used as a last resort by the TSO. The main reason is the low flexibility of the system (primarily conventional power plants) combined with the high capacity of RES.
● For years, electricity prices for households in Poland have been among the lowest (nominally) among neighbouring countries.
● Taking into account all taxes and levies, in H1 2023, the price of electricity in Poland was 19.9 eurocents/kWh, that’s 56% less than in Germany, 47% less than in the Czech Republic, 1/3 less than in Lithuania and Sweden, and 7% less than in Slovakia.
● Electricity prices for households are largely shaped by a country’s tax and regulatory policies. It is not a simple reflection of wholesale energy prices on the exchange.
● After deducting VAT and all recoverable taxes and levies, the average price of electricity for industry in Poland was 21.35 eurocents/kWh, 7% higher than for households.
● Historically, Polish energy prices for industry have been low compared to its neighbours, but since the second half of 2021, they have been rising faster than in most neighbouring countries. During this time, prices have risen by 96%, compared to 21% in the Czech Republic and 121% in Slovakia.
● In 2023, Poland’s steam hard coal imports amounted to 14.7 million tonnes — 2.2 million tonnes (-13%) less than in 2022 and 7 million tonnes (+91%) more than in 2014.
● 35% of imported coal came from Colombia, 32% from Kazakhstan, 9% from South Africa, 8% from Indonesia, and 16% from other countries. Poland did not import a single tonne from Russia.
● In 2023, 1.5 million tonnes of steam coal were exported, which was 0.6 million tonnes (-29%) less than in 2022 and 5.3 million tonnes (-78%) less than in 2014. The main customers for Polish steam coal were the Czech Republic (62%), Ukraine (13%), Slovakia (9%), and Germany (5%).
● According to Forum Energii estimates, hard coal consumption in 2023 was about 57 million tonnes, down from 2022 by about 8 million tonnes (-12% y/y).
● Net imports fell by 2.5 million tonnes (by 17%, to 12 million tonnes). Mining fell by 4.8 million tonnes (by 9%, to 48.4 million tonnes). According to estimates, about 4 million tonnes of coal were put on the heap, increasing inventories.
● Over the 10-year period, hard coal consumption fell by about 17 million tonnes (-23%), mining fell by 24.9 million tonnes (-34%), and net imports increased by 10.7 million tonnes (+733%).
● Estimated consumption of steam hard coal fell by 16% (-8.3 million tonnes) year-on-year in 2023, to about 45 million tonnes.
● In 2023, 85% of steam coal (38.4 million tonnes) was used for electricity and heat production (in power plants, district heating plants, and CHPs). The remaining 15% (6.6 million tonnes) is the total consumption of other industries.
● Consumption for electricity generation is declining the most, with almost all of the decline relative to 2014 occurring in 2023.
● In 2022 (the latest data available), households consumed 6.7 million tonnes of steam coal (12.6% at the time), that’s 1.3 million tonnes less y/y (-16%) and 4.4 million tonnes (-40%) less over the previous 10 years.
● Poland’s natural gas supply diversified in 2023 after imports from Russia ended (they fell from 8.5 bcm in 2014 to zero in 2023).
● In 2023, 40% of imported natural gas came from Denmark (Baltic Pipe). The US (24%), Qatar (23%), and Germany (7%) are also important suppliers. Other directions accounted for 12% of imported gas.
● In total, natural gas imports (both by pipeline and LNG) in 2023 amounted to 16.7 bcm, 0.6 bcm (4% y/y) more than in the previous year and 4.1 bcm (+33%) more than 10 years ago.
● In 2023, 0.8 bcm of natural gas was exported — 61% flowed to Ukraine, 37% to Lithuania, and the remaining 2% mainly to the Czech Republic and Germany.
● LNG imports accounted for a record 42% (7.1 bcm after regasification) of natural gas imports.
● In 2023, natural gas consumption increased by an estimated 0.6 bcm (+3%) over the previous year to 17.8 bcm of high-methane gas equivalent.
● Net imports increased by 0.4 bcm (+3% y/y, to 14.2 bcm). Domestic production is estimated to have declined by 0.8 bcm (-18% y/y, to 3.6 bcm), and inventories by 0.2 bcm. At the end of 2023, storage fill was 95.4%.
● Over the decade, natural gas consumption increased by 2.1 bcm (+13%), while domestic production fell by 1.4 bcm (-29%). Net imports increased by 3.1 bcm (+28%).
● In 2023, one-third of natural gas (210.7 PJ) was consumed for electricity and heat production. Total consumption in other industries was 67% (437 PJ).
● The largest consumer of natural gas in Poland is industry, which in 2022 (the latest data) accounted for 33% of domestic consumption (207.6 PJ). This represents a decline of 19% y/y and 9% over the decade.
● The second-largest consumer of gas in Poland are households, which in 2022 were responsible for 29% of consumption (181.7 PJ). This represents a decrease of 5% y/y, but an increase of 27% over the decade.
● In 2023, there was a diversification of the directions of crude oil supplies to Poland — after a significant reduction in imports, only 5% of that year’s imports (1 million tonnes) came from Russia. In 2014, it was 90% (21 million tonnes), and in 2022 47% (12 million tonnes).
● Russia’s place in crude oil supplies to Poland was taken by Saudi Arabia (45% of imports, 11 million tonnes) and Norway (35%, 9 million tonnes). The U.S. brought 6% of it (1 million tonnes), and from other directions 10% (2 million tonnes).
● In total, Poland’s crude oil imports amounted to 25 million tonnes, the same as in 2022.
● Poland exports almost no crude oil. The only, insignificant, stream (0.18 million tonnes) flowed, as every year, to Germany.
● After two years of declines, crude oil consumption rose to 26.6 million tonnes in 2022, up 1.9 million tonnes y/y (+8%) (latest available data).
● Net imports increased by 2.7 million tonnes (up 11%, to 26.1 million tonnes), while domestic production fell by 4% (to 0.9 million tonnes). Inventories increased by 0.3 million tonnes.
● In 2013-2022, crude oil consumption increased by 2.4 million tonnes (+10%), domestic extraction decreased by 0.1 million tonnes (-11%), and net imports increased by 3.2 million tonnes (+14%).
● In 2023, the prices of energy commodities traded on the international markets normalised. However, prices remained higher than before the outbreak of the energy crisis and Russian aggression against Ukraine.
● Natural gas recorded the largest price declines. On the European TTF exchange, declines are 72% y/y, on the Polish TGE, 69%, and on the US Henry Hub, 61%. Relative to 2019, however, these prices remain higher by, respectively, 158%, 150%, and 14%.
● Coal on the European ARA exchange was also cheaper, down 56% y/y, although relative to 2019 the price was 126% higher.
● The only raw material whose prices increased relative to 2022 was Polish coal (PSCMI1), which became 20% more expensive. Relative to the end of 2019, it was 150% more expensive.
● In 2022, Poland was ranked third in the world („up” four places y/y) in terms of the specific carbon intensity of primary energy consumption.
● Kazakhstan had the most carbon-intensive economy (3.11 t CO2/toe). Poland, with a score of 2.89 t CO2/toe (+0.05 y/y), ranked just behind South Africa (3 t CO2/toe). By comparison, the economy of the United Kingdom emitted 27% less than Poland (2.1 t CO2/toe), and the French economy emitted 53% less (1.36 t CO2/toe).
● Greenhouse gas emission intensity of electricity production in 2022 in Poland was 666 kg CO2/MWh, the highest in the EU.
● Such a high intensity has and will continue to have an impact on industry, among others, due to the growing importance of the carbon footprint of industrial production, which must be reported. With high prices for CO2 emission allowances, the cost of electricity generation also increases significantly, which translates into high prices on the wholesale market.
● At the end of 2023, the weighted average price of CO2 emission allowances on the primary market (EEX) was 68.69 euro/t CO2.
● In February 2023, EUA prices exceeding 100 euro/t CO2 were recorded for the first time, but in the second half of the year price declines were observed.
● The volume of allowances sold by Poland amounted in 2023 to 65.1 million tonnes. This is 2.1 million tonnes more than in 2022.
● The country’s budget gained PLN 24.67 billion from auctions of CO2 emission allowances (EUA and EUAA). This is PLN 1.4 billion more than in 2022 and PLN 24.3 billion more than in 2014.
● PLN 107.4 billion in total in nominal terms was the budget’s revenues over the 10 years of CO2 allowance sales. Adjusted for inflation, it is PLN 129.8 billion.
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Marcin Dusiło, Forum Energii