(Bloomberg) -- Poland is taking steps to avoid last year's power cuts, but its plan for the summer still hinges on a hope that it won't get too hot.
PSE SA, the Polish power grid operator, moved all planned maintenance outages to autumn and took steps to ensure emergency electricity imports from Germany, Sweden and Lithuania, Chief Executive Officer Eryk Klossowski said Monday. Still, a sudden loss of capacity through an unplanned outage or extremely hot and dry weather could put supply at risk, the European Network of Transmission System Operators said last month in its summer outlook.
“Up till now the risk has been avoided,” Klossowski said on the sidelines of a conference in Warsaw. “But only the next weeks will show if we've been successful. Weather conditions, as well as being able to avoid unplanned outages, will be crucial.”
Last August, central Europe's biggest economy suffered electricity shortages for industrial users for the first time in almost three decades because of the unusually hot summer. About 84 percent of the country's power is generated by burning coal, and power plants owned by Enea SA and Engie SA that use water from the Vistula river to cool their facilities. They have to limit power output when temperatures rise because they aren't allowed to dump the heated water back into the river because of environmental rules.
Temperatures are poised to rise above average in the coming days, according to a forecast by MDA Weather Services. Enea has already began curbing output at its Kozienice Power Plant on the Vistula because the temperature of its cooling water is too high.
Last year's heatwave saw the temperature soaring to record 36.6 degrees Celsius (97.9 Fahrenheit) on Aug. 8 and hovered above 30 degrees for about two weeks. Warsaw is currently 24 degrees Celsius and temperatures are set to rise to 28 degrees by July 13, AccuWeather said on its website.
While the government is making steps to increase available capacity, it will not happen overnight. The nation's first capacity auction will be held late next year, and it may allow Poland to add 10 gigawatts to its fleet only by 2021, Energy Minister Krzysztof Tchorzewski said on Monday in Warsaw.
Polish power for August slid 1 percent to 186 zlotys ($46.55) per megawatt-hour on Tuesday, according to broker data compiled by Bloomberg. The contract began trading this month.
“It will all depend on the weather,” said Teresa Schinwald, a Vienna-based analyst at Raiffeisen Bank AG. “Everyone involved is working hard on not repeating last year's emergency measures, for example by rescheduling maintenance, but you cannot cover every risk, and weather is always external.”
To contact the reporters on this story: Ladka Bauerova in Prague at lbauerova@bloomberg.net, Maciej Martewicz in Warsaw at mmartewicz@bloomberg.net. To contact the editors responsible for this story: Lars Paulsson at lpaulsson@bloomberg.net, James M. Gomez at jagomez@bloomberg.net, Andrew Reierson
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