TAURON Wytwarzanie S.A. is part of the TAURON Polska Energia SA holding; the company's share in the national electrical energy market is 14%, and 16% in the local heat production market.
How would you evaluate the last year in the Polish power industry?
The year 2004 was very important for fuel and power industry. It was affected by the economic growth, energy production volume and sales have increased. However, the greatest success was commencing operations concerning the formation of organisational structures connecting fuel acquisition with power generation and distribution. We are particularly glad that Government and the Parliament representatives approved of such connections. Luckily, also in this case we can take advantage of the solutions developed in the European Union.
In spite of profit increase, the energy prices offered by producers have not increased and remained on the same level for several years. However, end customers should also recognise that situation. In case of heat energy produced in PKE, we took one step further – we offer the heat generated in Katowice Combined Heat and Power Plant and Łagisza Power Plant 5 percent cheaper than in the previous heating season.
What is, or can be, the influence of Poland’s EU membership on the Polish power industry?
Neither the Polish power industry, nor the Polish mining is ready to compete with the European Union competitors. We have to quickly reorganise our fuel and energy sector, a closer connection between the industries is necessary. In Poland – following the example of the western large energy suppliers – two strong organisations can be created, which would operate along with the previously privatised companies, which now are already part of western concerns.
It is estimated that within the next few years it would be necessary to withdraw from operation at least 1200 MW. The intensity of that phenomenon is not yet so high, but it will rapidly increase during the next 7-10 years. Reduction of the production capacity in Poland will be accelerated by the directives of the European Parliament and European Council and especially by the directive 2001/80/WE on reduction of the sulphur compounds and nitrogen oxides emission. Over 40 percent of capacity installed in the Polish power industry will not meet the SO2 emission standard after January 1, 2008. The NOx emission standard, which will come into force on January 1, 2016, will not be met by 90 percent of the sector suppliers. Let me also add, that by 2013, about 43 percent of the European (including Polish) power capacity would have operated for almost 40 years.
In what direction the privatisation process of such strategic economy branch in the context of national power safety will follow? Or may the privatisation process be stopped?
Within the next few months, the priority should be given to the integration and privatisation of companies, which would not become part of the consolidated holdings. Privatisation on the stock exchange, to which we have been preparing, would be the most profitable for PKE. We think that if our company was part of a bigger, vertically consolidated fuel and power industry holding, the value of our shares would considerably increase. It is a vital argument for The State Treasury, which is the major shareholder.
What is your opinion about the process of adaptation of power generation processes to global and European standards in Poland, what is done in this area and what are the guidelines for the future?
Average efficiency of power generation in Poland is about 37-39 percent, whereas in the EU it is 40-45 percent. Their facilities are usually more modern and more efficient, which reduces our competitive edge. We have in Poland some modern and efficient power units, which were modernised or constructed in the nineties. However, most of our power plants are over 30 years old. For this reason, instead of modernising the outdated and economically inefficient power units, we have to liquidate them.
According to experts, after 2008, despite completing the construction of Łagisza, PAK and Bełchatów II, as well as increasing performance of power units having IOS certificate and using low-sulphur coal, there will be a deficit of 20 TWh of energy per year (circa 3.500 MW in power plants).
Does the restructuring of heavy industry within PKE area of operations account for lower demand for electrical energy in this part of the country? How do you handle this and in what areas does your activity develop? Is lower consumption of energy by the Polish industry balanced by increasing the number of business entities, which are your customers?
Regional development is very significant to us. We actively participate, mainly via our Capital Group companies, in stimulating business activities and modern initiatives in Silesia as well as western Małopolska.
Due to economic growth, this year we are going to sell more energy. We have customers all over the country and local economic situation does not account significantly for electrical energy sales. The situation on heat market is different since heat is the product strictly connected with its place of generation. Owing to high performance and flexibility of our sales services and, above all, more and more attractive offers, we are becoming one of the leaders in Upper Silesia Agglomeration. Let me stress that in the 2003/2004 heating season, we lowered the prices of heat from Katowice Combined Heat and Power Plant and Łagisza Power Plant, which are two most important heat suppliers in the Katowice area.
What is, in your opinion, the role of power industry in Central Europe?
The consolidated Polish power companies should be strong enough to continue operations in the future European market. Naturally, we cannot exclude the future alliances with the European as well as global giants, but these would have to be on different terms, involving more partnership, taking into account local, not only corporate interests.
Even today in our strategies we assume the necessity of the development of multienergy activities. In the nearest future, we will be not only producing and supplying heat and electrical energy, but also the Internet as well as telecommunication services, water or maybe even gas. The future of our industry lies in providing full municipal services.
„Euroregion”