French SCOR - one of the largest European reinsurance companies - is clearly dissociating itself from any involvement in the Ostrołęka C power plant construction project.
"SCOR, through its Large Risk Underwriting unit (Business Solutions), is neither involved nor intends to be involved in the procurement of any kind of re/insurance services to the proposed Ostroleka C 1000 MWe coal-fired plant in Poland"
writes Claire Le Gall-Robinson, Secretary General of SCOR in response to a letter from the Foundation "Development YES - Open-pit Mines NO" and UnFriend Coal dated 28 January 2019.
"SCOR's answer proves that it will be more and more difficult for Polish companies planning new power plants or coal mines to find a reinsurance company willing to participate in risk sharing and at the same time potential applicants will demand more for their services. This should give food for thought to PZU, which insures the majority of Polish mining and coal companies, as well as companies such as ZE PAK or PGE, which are still planning to build new open-pit lignite mines,"
comments Kuba Gogolewski, a financial campaigner from the Foundation "Development YES - Open-pit Mines NO".
"We are pleased with SCOR's declaration, although not entirely surprised. It is hard to expect a reinsurer to get involved in a project with such a high reputation, environmental and financial risk. Paradoxically, this power plant will cause the least loss if it does not operate at all. We also know that by 2030 we must phase out coal. Otherwise, climate change will reach the size of a global catastrophe resulting in the loss of life and health of hundreds of millions of people. SCOR understands the seriousness of the situation and is gradually phasing out its involvement in this sector. Ostrołęka C should never be built. We appeal for a similar declaration to other players in this market, including PZU, the largest Polish insurer"
adds Diana Maciąga, Climate and Energy Coordinator at the Pracownia na Rzecz Wszystkich Istot Association.
Insurers and reinsurers
According to the report "Insuring Coal No More: The 2018 Scorecard on Insurance, Coal and Climate Change", in 2018 activities in the coal industry has already been limited by companies responsible for one third of the reinsurance market. SCOR tightened its lignite insurance policy in 2017, and a year later Swiss Re and Munich Re joined it, announcing even more far-reaching restrictions in reinsurance/insurance of the coal sector.
Insurers are also withdrawing support for the fossil fuel sector. Last year, Allianz and Generali reduced their coal insurance, AXA tightened its coal policy and Zurich announced the restrictions already in November 2017. At least 19 leading insurers managing assets worth more than USD 6 trillion, i.e. 20% of global assets in the industry have already withdrawn funds from investments in coal companies. The 7% increase compared to 2017 is a result of the actions of Generali, Lloyd's, Hannover Re, AG2R La Mondiale and Groupama, who have since announced a new divestment policy, and the strengthening of policies by AXA, Allianz and Munich Re. Meanwhile, the largest Polish insurer seems to be completely disregarding this trend and the risks associated with coal insurance. The PZU Group is a leader among companies insuring the Polish coal sector. It protects mines responsible for over 80% of domestic coal mining and coal-fired power plants generating about 30% of the capacity installed in the National Power System.
Elektrownia Ostrołęka C
Ostrołęka C is a controversial project of Energa and Enea companies, developed despite serious threats to human health, environment and climate, and numerous legal and economic doubts. Analysts of the Instrat Foundation point to the deep unprofitability and unviability of this project: the investment will bring approx. -6.2 billion PLN loss, i.e. more than the cost of its construction. This project has been criticised many times in the energy sector as posing a threat to the national energy sector, being unjustified and irrational, which has been confirmed, among others, by the Eurorating agency, the Jagiellonian Institute, co-founder of Polish Electroenergetic Networks (PSE), Prof. Jan Popczyk and the Minister of Energy himself, Krzysztof Tchórzewski, as well as by several appeals and lawsuits filed by shareholders of the companies. Social organizations indicate that it does not meet the EU BAT emission standards, which is why its integrated permit was challenged. Independent experts warn that 40 years of operation of Ostrołęka C may result in as many as 2,000 premature deaths, the health costs of its operation have been estimated at EUR 340-680 million (PLN 2.9 billion).
Kuba Gogolewski, email@example.com
Diana Maciąga, firstname.lastname@example.org