mBank fails to understand the core of the problem: money is not marked. While the PLN 1 billion obtained by Enea from the bond issue will be used to refinance its debt, the company will use its profits and own funds for the construction of Ostrołęka C and other harmful projects.
In its statement of 26 June 2019, mBank claims that it does not financially support the construction of Ostrołęka C coal-fired power plant, and that its existing relations with customers in the energy sector are to focus, among other things, on financing projects aimed at reducing the share of electricity generated from coal. Meanwhile, Enea clearly sees its future and growth in the opening of new coal mines and coal-fired power plants. Servicing bond issue will significantly improve the overall financial standing of the company make it easier to complete and continue these harmful projects. Enea will easily allocate its own funds, which it will no longer have to use to repay its debt, to its priority activities, such as the construction of the Ostrołęka C power plant. The case of Enea is a stark example of the difference between the withdrawal of financing for single coal projects and the complete termination of relations with companies that do not intend to stop fueling the climate crisis.
Enea does not have an energy transformation plan and climate strategy which should completely disqualify it from being a partner in any financial relations with modern, socially responsible institutions. Enea's dependence on coal can continue thanks to the coal co-dependence of other entities, such as banks.
Enea is developing a number of projects that have a negative impact on climate, health and natural resources.
- Enea produces more than 90 percent of its electricity from fossil fuels, mainly coal.
- Enea is one of the 10 most emission-intensive companies in the EU - in 2018 its Kozienice Power Plant alone emitted 14 million tonnes of CO2 - more than Ryanair's annual emissions.
- Enea has no climate policy or decarbonisation strategy. Enea's current strategy does not take into account the CO2 reduction path required for effective climate protection in line with the recommendations of the Intergovernmental Panel on Climate Change (IPCC) which are the basis for the European Commission's long-term strategy of achieving climate neutrality by 2050.
- Enea increases its debts by spending money on the construction of Ostrołęka C and the adaptation of the existing Kozienice and Połaniec units to the BAT/BREF conclusions, which will prolong their operation for many years. Although Enea assured that the shutdowns of old units would start as early as 2016, this date has now been postponed to 2029. Połaniec power plant is to finish its operation only in 2042 and Kozienice in 2050. Ostrołęka C is going to emit greenhouse gases even until 2064.
- Bypassing the law, Enea has built a threshold on the Vistula River for Kozienice Power Plant, which has been a physical barrier to endangered and protected fish species (including species protected under the European Natura 2000 network) and an obstacle to shipping on the Vistula River for over a year now.
- Enea is ranked 7th on the list of 103 energy companies that pose the greatest health risks in the European Union. In 2016, its coal-fired power plants in Kozienice and Połaniec caused about 410 premature deaths, 110,000 working days and up to EUR 1.2 billion in health costs.
- Ostrołęka C will emit about 6 million tons of CO2 annually. Independent experts warn that it may cause up to 2,000 premature deaths, and the health costs of 40 years of its operation were estimated at EUR 340-680 million (PLN 2.9 billion). This project has been repeatedly criticised in the energy sector as unjustified, irrational and a threat to the national energy system, which was confirmed by the Eurorating agency, the Jagiellonian Institute, the co-founder of PSE, Prof. Jan Popczyk and the Minister of Energy himself, Krzysztof Tchórzewski. It is also unprofitable and deeply unviable.
ING Bank Śląski was also supposed to participate in the bond issue for Enea under the 2014 agreement, but after the adoption of a new strategy excluding support for coal, it withdrew from this issue. There was no hindrance to mBank’s withdrawal as well. However, it chose short-term profit over and above the long-term security of its customers.
There is no better time for mBank to completely eliminate support for companies such as Enea, as BNP Paribas, Credit Agricole or ING BŚ have already done so. mBank states that fossil fuel-based power generation has never been its crucial focus and accounts for only 1 per cent of its loan portfolio. This summer, young people and adults around the world are demanding rapid, concrete action to reduce greenhouse gas emissions, and cities in Europe and around the world are struggling with murderous heat waves that are just a foretaste of the disaster ahead.
- says Kuba Gogolewski, financial campaign from the Foundation "Development of YES - Discoveries NO".
mBank’s parent company - Commerzbank - excludes financing of new mines and coal-fired power plants. Commerzbank also expects its German clients from the energy supply sector to limit the share of electricity generated from coal (based on their production performance) to below 30 per cent by the end of 2021. A corresponding cap of 50 per cent is expected for clients based outside Germany.
We have been in dialogue with mBank for 2 years now. Our proposal for the bank is very specific and not new. We demand that mBank aligned its climate policy with Commerzbank’s criteria. In this way, it gives the energy companies an ultimatum: either you change or you do not use our services. Enea produces most of its energy from, is expanding its coal fleet with Ostrołęka C and has no decarbonisation strategy. mBank enables the company to raise a PLN billion and does not give it any incentive for transformation. This has to change as soon as possible.
- comments Diana Maciąga, climate coordinator from the Pracownia na rzecz Wszystkich istot (Workshop for All Beings) Association.
Contact:
Diana Maciąga, Association Workshop for All Beings, e-mail: diana@pracownia.org.pl
Kuba Gogolewski, "Development YES - Discoveries NO" Foundation, e-mail: k.gogolewski@fundacja.rt-on.pl
Actions taken so far as part of the dialogue between social organizations and mBank:
