Insight Poland

The long road to energy security: Poland’s plan to break free from Russian gas

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Warsaw, Poland – In the wake of Russia’s invasion of Ukraine, and increasingly tenuous relations between the EU and the Kremlin, the question of European “energy security” has become a key concern. However, this question is hardly new, and for countries such as Poland, the task of overcoming dependence on Russian energy has long been a priority. 

Centrally located on the EU’s eastern flank, Poland looks to position itself as a major player in the new reality of European energy.

An unwilling customer

In January 1992, during the very early and tentative stages of the transition to a market economy, Poland’s crucial supply of Russian (formerly Soviet) gas was suddenly cut. As a result, many of Poland’s already struggling industries were forced to hold operations in order to prioritize energy demand in the winter. The crisis quickly set a tone for countries in Central and Eastern Europe who had not yet moved away from the economic legacy of the Communist bloc.

From the Russian side the cause of this gas cut was ostensibly due to the bureaucratic chaos which followed directly after the dissolution of the Soviet Union in late 1991. However, this explanation was received with more than a little skepticism by Poland and other countries which depended on gas imports from Russia.

In Poland and notably in the view of the then chief of the Polish Intelligence Agency Piotr Naimski, the gas crisis in 1992 demonstrated at the very least that Russia could not be viewed as a stable energy partner.

At worst the crisis indicated that the newly emerging Russian Federation was able and potentially willing to use their energy dominance as a means of asserting influence in their former sphere. As Naimski asserted, the crisis was a continuation of Polish-Russian relations marked by “200 years of wars, partitions, occupation and the communist regime.”

Naimski who has been referred to as “Poland’s energy czar” has since become a key player in this debate and is currently the government’s plenipotentiary for strategic energy infrastructure. Largely in cooperation with the Law and Justice party (PiS) he has pushed for a diversification of the Polish energy market, and a break with Russia.  

That notwithstanding, from the perspective of the 1990’s there remained a long road to Polish energy independence. Over the next 30 years the question of energy and of Polish-Russian relations would become a political facet and a driving force in policy.  

Building alternatives

What actually constitutes “energy independence,” may not be so straightforward in a country which has historically been a major coal-based energy producer. However the move away from coal, as one of the most polluting and emitting energy sources, has become a reality, and despite its availability there is an increasingly high price associated with mitigating its environmental impact.  

In terms of gas, significant progress to move away from dependency on a Russian supply began as early as 2001, when the initial agreement over a gas pipeline was signed between Poland and Norway. Despite having gotten off to a slow start the project moved to consolidate. The process picked up speed after 2006 when Russia again played its hand by cutting off gas to supply to Ukraine, which went on to raise further concerns about Russia’s reliability as a partner.

The final form of this initiative resulted in what has since been called the “Baltic Pipe Project.” Ultimately this pipeline would run gas directly from Norway, through Denmark leading to a final hub on the Baltic coast of Poland. Conveniently, this project is set for completion as early as October 2022.

Another key project, which also happened to emerge from the 2006 Ukraine scare, resulted in the construction of the Świnoujście liquid natural gas (LNG) terminal near the Polish city of Szczecin.

Already completed in 2015, this terminal has taken advantage of the recent advances in LNG production, particularly in the United States and in Qatar. The turn to LNG imports has seen great deal of support even before the most recent Russian invasion of Ukraine, with the Świnoujście terminal set to be expanded by the end of 2022, and another terminal to be completed by 2025 in Gdansk.

In many ways Poland’s long-standing plan to diversify gas supply, even beyond the initiatives mentioned here, seem to have anticipated the ongoing conflict with Russia. However, for the time being there will continue to be an energy gap which, for Poland, will likely be filled with coal.

A regional gas hub?

In parallel to the diversification of Poland’s gas market, where multiple sources have become available, Poland has also come to play a central role in the further distribution of gas to other countries in Central and Eastern Europe which face pressure to diversify.

One such project, which seeks to expand the energy infrastructure in between 12 EU members, is the so-called “Three Seas Initiative,” three seas here referring to the countries located between the Baltic, Black, and Adriatic coasts.

The initiative which began in 2015, was co-founded, sponsored by Polish president Andrzej Duda, as Poland owing to its central location in the region will necessarily play a key role. This effort furthermore coincides with regional skepticism to Russian backed energy infrastructure, most notably with the construction of Nord Stream 2 which would expand the state-owned Gazprom’s access to European markets.

On another level, the significance of Poland, as an energy player in the region, has increased somewhat indirectly with the development of Poland’s very own state-controlled “national champions” of energy. Over the last several years, PKN Orlen, which is already one of the largest petrochemical companies in Central and Eastern Europe, has further acquired Lotos Group, another major oil refiner, and PGNiG (Polskie Górnictwo Naftowe i Gazownictwo), the largest oil and gas company in Poland.

Final approval of these mergers was granted as recently as the beginning of 2022. The result of these monumental mergers is a new regional energy giant which is controlled (up to 50%) by the Polish state. While this distinctly “statist” approach to energy has drawn criticism, president Andrzej Duda has asserted, with regard to the mergers, that “thanks to the contracts signed, the energy security of central Europe increases significantly.”

Owing in large part to a preemptive approach to energy security, Poland has found itself in a uniquely advantaged position within the region. While uncertainties remain, particularly with regard to the political “state” influence over the key sector, Poland has already come far in bridging the energy gap left by Russia.

By Nathan Alan-Lee

Nathan is a research assistant working with the Jagiellonian University in Krakow and a PhD student at the UCL School of Slavonic and East European Studies. He completed his Masters degree in European studies at the Jagiellonian University, focusing on party politics in Central and Eastern Europe. Currently, he is pursuing a study of politicisation and partisan influence in society, emphasising memory and historical revisionism.