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Orlen SAOrlen energy believes CCS technology in Poland needs legal changes and separate strategy
Poland's largest energy concern Orlen sees barriers in the domestic law, mainly geological and energy one, to the optimal development of Carbon Capture and Storage (CCS) technology in Poland, group's representatives said. They added that funding was also needed and that a separate strategy for CCS development in the country would be useful.
"Carbon Capture and Storage (CCS), i.e. the capture, transport and underground permanent storage of CO2, is a technology that Orlen has been considering for some time as a technology that could serve to decarbonise industrial assets across the Orlen group," head of liquid fuels market regulation at Orlen Tomasz Prost told reporters.
He added that Orlen is in talks with the national administration, as it is in national law that it identifies regulatory barriers to the optimal development of this technology, especially in the geological and mining law and implementing regulations.
"A massive barrier is that one of the regulations, the location regulation, indicates that underground coal storage cannot be carried out on the land area of the Polish state. We are of a different opinion," Orlen's expert said.
Prost pointed out that the concern's internal analyses show a large geological potential for CO2 storage, also confirmed by specialised institutions such as the National Geological Institute. The idea is to use post-carbon geological formations depleted of oil and gas.
"We are working very hard to get the land opened up. The leadership of the Ministry of Climate and Environment has recently been communicating that we can indeed count on submitting legislation for public consultation in the second half of this year," Orlen's executive director of risk management and compliance Jakub Ruszel stressed.
Other changes to the geological and mining law advocated by Orlen include fees for access to mining information.
"This concerns, among other things, access to geological information for mining companies - it should be made easier, fees should be abolished at least at this initial stage of the development of this project," Prost stressed.
He added that estimates by Orlen group's companies show that these are initially hundreds of millions of zlotys in fees to the state budget.
Orlen's experts also see the need for changes to the energy law, which now incompletely, in their view, defines the rules of carbon transport. In their view, Poland's gas infrastructure operator Gaz-System is a natural contender to take over the role of CO2 transport system operator in Poland.
As the representatives recalled, EU regulations indicate that oil & gas companies, including Orlen, should contribute to an EU-wide storage target of 50 million tonnes of CO2 by 2030. In the following years, this target is set to increase strongly (to 280 million tonnes in 2040 and 450 million tonnes in 2050).
The experts stressed that the company needs changes in the regulatory environment to meet this target.
"Secondly, CCS technology and the discussion around it has already matured to such a point that we think it has merited the adoption of a separate central strategy to show the direction of CCS development in Poland," Prost continued.
"Thirdly, we see the need to build a positive image for this technology by launching public communication and information that it is a safe technology," he added.
Tomasz Prost also pointed to the need for external financial support for the CCS project - in the form of, for example, preferential loans, as this is a capital-intensive technology, and Orlen will only have resources 'up to a certain point' in running this project.
In his view, hope for raising domestic funds is provided by the Ministry of Climate and Environment (MKiS) amendment to the ETS Act and the proposed requirement to earmark 100 percent of the inflows from the sale of emission allowances for climate purposes.
Orlen also sees a powerful potential to use saline, mineral deposits under the bottom of the Baltic Sea for CO2 storage, but, as the experts pointed out, some state parties to the Helsinki Convention, which sets out the environmental principles for the management of the Baltic Sea resources, claim that CCS in the Baltic is impossible. Parties to this convention are Denmark, Estonia, Finland, Lithuania, Latvia, Germany, Poland, Russia, Sweden and the EU.
"We dispute these claims due to the fact that in other sea areas in the European area this CCS is possible and is already being carried out (in the North Sea basin)," Prost told reporters.
"We are lobbying (...) to resolve this issue unequivocally for the benefit of the state's party to this convention and companies such as Orlen, we have the support of the Polish government here (...). We estimate that 2026 should bring a prejudgement on this issue," he concluded.
jz/ ao/ han/
