Shale gas, new coal tech to help Poland cut CO2-minister

WARSAW Fri Nov 8, 2013 8:34am EST

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WARSAW (Reuters) - Coal-dependent Poland will continue to reduce carbon emissions by replacing outdated power plants with coal-fired units based on new technology and by exploiting shale gas resources, the environment minister said.

"I am very optimistic about the (prospects) of shale gas in Poland," Marcin Korolec told Reuters Television before U.N. climate talks to be held in Warsaw next week.

Shale gas would spur economic growth and help cut greenhouse gas emissions, the minister said.

The Kyoto Protocol required Poland to reduce emissions by 6 percent in 2008-2012 compared to 1988. The country managed to slash emissions by almost a third in that period, however, after the collapse of outdated Soviet-era industries.

This left the state, which generates most of its electricity from coal, with room to raise emissions by up to 14 percent above 2005 levels as part of an EU goal of cutting the bloc's emissions by 20 percent below 1990 levels by 2020.

But since Poland cannot afford to shut its coal-based power plants and switch to wind farms, it is looking for other ways to stay within the EU target and face deeper reduction obligations that the bloc is likely to impose.

Enthusiasm for shale gas in Poland has faded after a number of global players including Exxon Mobil pulled out, saying red tape is delaying commercial output and Warsaw's draft proposals to cut bureaucracy do not go far enough.

San Leon Energy Plc, a Poland-focused shale explorer, also conceded that proving the viability of shale in the country is taking time.

The minister, who will host the U.N. climate talks from November 11-22, said CO2 emissions in Poland would be reduced thanks to investment in new coal-based power units, which will gradually replace the outdated ones.

"Our goal is to have a solution which is as competitive as possible as to the price but also as environmentally friendly as possible," Korolec said.

"That is why the number of new investments we are promoting also in the coal sector will bring CO2 reduction, because we will change technologies from old-fashioned to new ones."

Poland's grid operator expects that 6.6 gigawatts of the current 37 gigawatts of installed capacity will be taken off the grid by 2020 as outdated power plants close.

Plans for new units include the construction of a 1,075-megawatt plant by 2017 by the country's third-biggest power producer, Enea, in Kozienice, central Poland.

(Writing by Agnieszka Barteczko; Editing by Alister Doyle and Dale Hudson)

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