Fair energy transition
As the largest power utility in Poland, the PGE Group has a direct and significant impact on society. It is the guarantor of an uninterrupted supply of electricity and heat, and fulfils important economic roles, both nationally and regionally. At the same time, it is a workplace for more than 40,000 people. PGE’s impact on society is therefore a key ESG factor influencing the Group’s operational decisions.
The PGE Group’s energy transition is being carried out in such a way that the occurring processes take into account and respect:
The interests and needs of local communities
Territorial administrations
Investors and businesses
The needs of the natural environment
The creation of new jobs for the current employees of the coal and lignite sector
The PGE Group makes sure that entrepreneurs and employees in the energy sector as well as residents of coal and lignite regions are part of the entire transition process and actively participate in it. The transformation of mining and quarrying regions is a complex, difficult and ambitious task, and comprehensive measures are needed to maximise the security of the local population (especially lignite mine and power plant employees and their families, who are directly affected by the transformation of the lignite regions), and to maintain the economic potential of the regions that have been heavily dependent on mine and power plant operations for several decades. It is also crucial to ensure the energy security of the region and the state as a whole in the process of phasing out the operation of coal and lignite assets.
The transformation projects implemented by the PGE Group in the Łódzkie and Dolnośląskie provinces are part of the process of changing Poland’s energy mix in the low- and zero-carbon directions.
In the PGE Capital Group, a transition concept has been developed for the Bełchatów and Turów power complexes. Among other things, it provides for the further development of renewable energy sources (mainly in the area of photovoltaics and onshore wind farms), as well as ambitious investment projects to stabilise generation capacities and strengthen social, economic and territorial cohesion.
Regardless of the process of spinning off coal assets, the PGE Group will remain active in the lignite regions, as both an experienced investor in the energy transition process and an initiator of activities supporting the economic development of these areas.
The largest employer in the Bełchatów region is the PGE Capital Group comprising
PGE Górnictwo i Energetyka Konwencjonalna and its subsidiaries providing support services to the power plant and lignite mine.
At present, almost 7,700 people are employed at the power plant and mine in Bełchatów, as well as PGE GiEK’s head office.
Bełchatów energy complex
In order to bridge the employment gap in the region, which will result from the gradual reduction in the operations of the mine and power plant, PGE is planning a number of projects over the next several years, including both renewable energy development and land projects, as well as pro-social projects such as the already functioning Competencies Development Centre.
PGE has prepared a just transition concept that presents a plan of investment projects in a complementary way, along with their justification and implementation schedule. In the case of the Łódź region, where the Bełchatów Complex operates, it presents specific investment projects for the years 2021-2043 to be carried out by the PGE Group and complementary projects to be carried out outside the PGE Group, thanks to which a total of over 15,000 new jobs may be created in modern sectors of the economy. The implementation of this ambitious plan depends on the involvement of many entities, also at the national level, as it exceeds the capacities of the PGE Capital Group.
The plan includes projects such as:
The construction of wind farms with a capacity of up to 50 MW
Photovoltaic farms with a capacity of up to 200 MW
Energy storage facilities with a capacity of up to 200 MW
The creation of a RES technology centre on the basis of today’s conventional energy support companies, which will be transformed into entities pursuing renewable projects: production, overhauls, as well as recycling and recovery of end-of-life renewable raw materials,
The Competencies Development Centre – a dedicated programme for power plant and mine employees and local residents aimed at creating opportunities for retraining for the purposes of the renewable energy generation sector
Just Transition – the Bełchatów Region in 2043
In 2023, the preparatory works for investment projects relating to the construction of RES were being continued, in particular those providing for the verification of the stability of the land intended for the foundations of new facilities. A tender for the construction of the 50 Kleszczów farm was also carried out in 2023. This project is already scheduled for implementation between 2024 and 2025. It will be implemented in a special purpose vehicle in which the Kleszczów Commune is a shareholder, thus ensuring the participation of the local community in the transformation of the region. The project has also applied for supplementary funding from the Just Transition Fund.
Competencies Development Centre in Wola Grzymalina in support of vocational training
An important step in preparing employees of the Bełchatów Complex for a fair energy transition was the establishment of the Competencies Development Centre of the Łódzkie Province and PGE Polska Grupa Energetyczna S.A. in Wola Grzymalina (CRK). In September 2023, the centre wrapped up its first year of providing vocational training and support to the region’s residents.
The Center is a place that provides an opportunity for training and qualification development for employees in the energy sector, re-training of employees in the conventional power generation sector and residents of the region interested in changing or acquiring new qualifications.
The training programme offered covers a wide range of issues concerning renewable energy sources, resources, acquisition, design and use in the area of solar, wind, geothermal and hydro power, as well as issues concerning renewable energy technologies, the ecological effects of energy conversion, the legal basis for environmental protection and the development of renewable power generation in Poland and around the world.
In 2023, 91 persons participated in qualification vocational courses offered by the Centre in the following subjects:
- Technician of renewable energy devices and systems,
- Automation technician,
- Welding technician,
- IT technician,
- Programming technician.
The Centre also organises projects receiving public funding. One of them was “Support for a New Vocational Start”, a project receiving European funds and grants from the Łódzkie Province.
- It was aimed at natural persons working, studying and/or residing in one of the seven districts (Bełchatowski, Piotrkowski and Piotrków Tryb., Radomszczański, Łaski, Pabianicki, Pajęczański) of the Łódzkie Province. Support was provided to 68 persons (55 percent of them women) who:
- had lost their jobs due to reasons not attributable to them within a period of no more than 6 months prior to the date of accession to the project;
- had been scheduled for dismissal or threatened with dismissal for reasons not attributable to them (at least 20 persons). The project ran from 1 February 2022 to 30 November 2023.
The Centre also organises projects receiving public funding. One of them was “Support for a New Vocational Start”, a project receiving European funds and grants from the Łódzkie Province.
It was aimed at natural persons working, studying and/or residing in one of the seven districts (Bełchatowski, Piotrkowski and Piotrków Tryb., Radomszczański, Łaski, Pabianicki, Pajęczański) of the Łódzkie Province. Support was provided to 68 persons (55 percent of them women) who:
- had lost their jobs due to reasons not attributable to them within a period of no more than 6 months prior to the date of accession to the project;
- had been scheduled for dismissal or threatened with dismissal for reasons not attributable to them (at least 20 persons).
The project ran from 1 February 2022 to 30 November 2023.
“Improving the competencies and qualifications of the pupils and teachers of the Competencies Development Centre of the Łódzkie Province and PGE Polska Grupa Energetyczna in Wola Grzymalina” was another project implemented with the support of public funds. It resulted, among other things, in an improvement in the qualifications of 130 participants, an increase in the competencies of 16 teachers, the adaptation of the educational offer and the acquisition of modern equipment to support vocational training in line with the demand of the labour market.
As part of the project, state-of-the-art computer equipment was purchased, the welding, RES and automation laboratories received new equipment and official standards were purchased from the Polish Committee for Standardisation. The welding course and the electrical qualifications photovoltaic system installer course were successfully completed by 50 and 100 participants, respectively. Courses for teachers included such subjects as English, automation, welding, RES and management in the energy sector. The project ran from 1 August 2022 to 31 December 2023.
91
persons participated in qualification vocational courses offered by the Competencies Development Centre
68
people were supported in the project: Support for a New Vocational Start, a project receiving European funds and grants from the Łódzkie Province
130
students improved their qualifications and 16 teachers increased their competences as part of the project: Improving the competencies and qualifications of the pupils and teachers of the Competencies Development Centre of the Łódzkie Province and PGE Polska Grupa Energetyczna in Wola Grzymalina
50
people were trained in welding courses
100
people completed the electrical qualifications photovoltaic systems installer course
Just Transition Fund
PGE Polska Grupa Energetyczna S.A. has been taking a number of measures to support the Łódzkie and Dolnośląskie Provinces in their efforts to obtain funding from the EU’s Fair Transformation Fund (FST) since 2020, actively participating in works on the development of the following:
- the Territorial Fair Transition Plan for the Łódzkie Province,
- the Territorial Fair Transition Plan for the Dolnośląskie Province (with regard to the Zgorzelecki District), as well as
- the National Fair Transition Plan.
The needs of the Łódzkie and Dolnośląskie (Zgorzelecki sub-region) Provinces are highlighted in these documents as requiring special attention.
In accordance with the Regulation of the European Parliament and of the Council (EU) of 24 June 2021, the Just Transition Fund is designed to mitigate the negative social and economic impacts of the climate and energy transition in so-called coal and lignite regions. PGE S.A. has made intensive and numerous efforts to have the Łódź region (where the Bełchatów Energy Complex is located) and the Zgorzelec sub-region (with the Turów Energy Complex) recognised by the European Commission (EC) as “coal regions” within the meaning of the Just Transition Fund, thereby gaining access to support from the EU Just Transition Fund (or more broadly – Mechanism).
Money from the Just Transition Fund will be available for the following purposes:
Job creation activities
Employee training to facilitate the retraining and acquisition of new occupational skills by workers previously employed in the coal and lignite sector
Restoring the region’s economic potential
Diversification and modernisation of the local economy
Projects facilitating the development of renewable energy sources,
Projects supporting the rehabilitation of mining and post-mining sites
PGE S.A. participated in consultations on successive versions of the drafts of the Territorial Just Transition Plans and the National Just Transition Plan. In 2023, PGE also provided the administration with the data and forecasts necessary for a possible update of the existing Territorial Just Transition Plan for the Łódzkie Province.
On 5 December 2022, the European Commission approved five just transition plans for Poland, under which around EUR 3.85 billion will be available to five Polish regions for projects under the Just Transition Fund. The resources from the JTF will support the climate transition of the mining areas located in the Śląskie, Małopolskie, Wielkopolskie, Dolnośląskie and Łódzkie Provinces.
The involvement of PGE Polska Grupa Energetyczna S.A., the information provided to the local and central administrations and the European Commission, as well as the data and forecasts related to the operation of the Bełchatów Power Plant were of key importance in the consultation process with the EC and determined the positive decision of the European Commission regarding the Łódź region. The Łódź region was allocated EUR 369.5 million from the Just Transition Fund. The money is to support, among others, employees currently working at the Bełchatów Power Plant, as well as those in the mining and related sectors. The EC stresses that, among other things, training will provide workers with new skills and prepare them for employment in new “green sectors”.
With regard to the EC’s positive decision concerning the Dolnośląskie Province, the European Commission decided to allocate the funds for this region entirely to the Wałbrzych sub-region, with the complete exclusion of, among others, the Zgorzelec sub-region. Of the EUR 581.5 million allocated by the Commission under the Fair Transition Fund to Lower Silesia, the Wałbrzych sub-region will receive the whole amount. Due to the operation of the Turów Power Plant in the Zgorzelecki District, the PGE Group has emphasised the importance of this sub-region of the Dolnośląskie Province from the very beginning, requesting that resources from the Fund be allocated to both the Wałbrzych and Zgorzelec sub-regions. The European Commission eventually decided that resources from the current edition of the Fund could only go to regions where basic power generation units would be decommissioned by 2030. Given the timetable planned so far for the gradually decommissioning of the Turów Power Plant, the Zgorzelec sub-region will be able to apply for resources from the next edition of the Just Transition Fund and can count on the support of the PGE Group.
~3,85 billion EUR
will be available to five Polish regions for projects under the Just Transition Fund
369,5 million EUR
from the Just Transition Fund
581,5 million EUR
allocated by the Commission under the Fair Transition Fund to Lower Silesia
The PGE Group intends to successfully implement further ambitious investment and
systemic projects in the Łódzkie and Dolnośląskie Provinces, using the Fair Transition Mechanism as well as other sources of financing.
PGE also allows for the possibility of modifying its projects developed for the purpose of the just transition, depending, among other things, on the course of the competition process within the framework of applying for sources from the Just Transition Fund, so that the financing of these projects is as effective as possible from the perspective of the PGE Group and at the same time so that these activities serve the regions and their local communities in the best possible way.
The approval of the Territorial Just Transition Plans paves the way for dedicated funding under the other two pillars of the Just Transition Mechanism: the InvestEU Just Transition Scheme and the Public Sector Loan Facility, which combines Commission grants with European Investment Bank (EIB) loans. Therefore, the European Commission’s positive decision to include the Łódzkie Province in access to the Just Transition Fund (which was made possible thanks to strong involvement on the part of PGE Polska Grupa Energetyczna S.A.) not only means real assistance for the Łódź region and its inhabitants (especially the employees of the Bełchatów Power Complex), but also creates new opportunities for the Group within the framework of the entire Just Transition Mechanism. The PGE Capital Group will continue to actively participate in efforts to make the most of opportunities to support investment activities based on grants from the EU and national sources.
Irrespective of its support for obtaining grants from the Just Transition Fund, PGE is planning and implementing further investment projects (including ambitious renewable energy undertakings) in the two aforementioned regions with a view to preparing them for the energy transition.