Poland Sees Power Prices Surging On EU Carbon Plan NORWAY: April 10, 2008 OSLO - Polish electricity prices could surge 50-70 percent if the European Union goes ahead with plans to force power producers to buy their carbon emission permits from 2013, Environment Minister Maciej Nowicki said on Wednesday. Nowicki said Poland would be particularly hard hit by the rules, proposed in January and contested by Warsaw, because nearly all of its electricity comes from dirty coal and lignite and so its power producers will need a large number of permits. "The EU's proposal is very unfortunate for Poland...it would be a big blow to industry and lower our living standards and we don't want to accept that," Nowicki told Reuters after talks with his Norwegian counterpart. "If Polish energy producers were to buy all their emission certificates already from 2013, it would mean spending some 4-5 billion euros ($6.3-7.9 billion) per year and translate into a 50-70 percent increase in electricity prices." Such a jump in power prices would also hurt Poland's ability to keep inflation low and adopt the euro early next decade. "I hope that the Commission will understand our view and revise their position," Nowicki said in an interview. Under the European Commission's scheme, aimed at limiting emissions of heat-trapping gases blamed for global warming, electricity generators will pay for all CO2 permits from 2013. Under the current scheme, companies have received their quotas free which critics say have given utilities windfall profits of billions of euros. Last year Poland's emissions undershot its permit quota and Nowicki said improvements in energy efficiency will further limit the country's carbon footprint of more than 200 million tonnes per year. Also, more than half of Poland's coal-power plants were at least 20 years old and in need of modernisation, which could bring new cleaner technology to the communist-era plants. "These plants must be modernised because we will not escape from coal (-based power production)," Nowicki said. He said new technology could cut emissions by 30 percent. Nowicki said Poland would also seek to boost the role of cleaner natural gas in its electricity mix and sought to take part in EU projects to build carbon capture and storage (CCS) facilities -- seen as a leading method of curbing emissions once the technology is fully developed. (Editing by Margaret Orgill) Story by Wojciech Moskwa REUTERS NEWS SERVICE