Court blocks Polish coal plant, in win for climate campaigners

Client Earth successfully challenged the Ostrołęka C project on behalf of shareholders, arguing it was a bad financial bet as renewables become competitive

Campaigners have won a climate lawsuit against a third coal power plant planned in Ostrołęka, Poland (Photo: Wikimedia Commons/PanSG)


Poland’s “last coal-fired plant” may never go ahead, after a district court struck down the company resolution authorising construction on Thursday.

The ruling dealt a blow to the 1GW Ostrołęka C project, a joint venture between utilities Enea and Energa backed by the government.

It is a major win for Client Earth. The environmental law firm had bought shares in Enea and filed a lawsuit against the project on the grounds it posed an “unacceptable” financial risk to investors.

“This is an excellent result for Enea’s shareholders and for the climate,” Client Earth lawyer Peter Barnett said. “The plant is a stranded asset in the making, facing clear and well-documented financial risks.

“Companies and their directors are legally responsible for managing climate-related risks and face potential liability if they fail to do so. Enea and Energa should lay this project to rest before it incurs any further costs to the companies and their shareholders.”

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Revived in 2016, the €1.2 billion project was part of the government’s plan to ensure the country’s energy security. It was presented as a necessary supplement for renewable energies that will partly replace a number of old coal power plants due to be taken offline by 2020.

With a controlling stake in Enea, the Polish government pushed through company approval despite concerns raised about the project’s economic viability. In September 2018, 22% of non-government shareholders voted against starting construction and 58% abstained. At project partner Energa, with 37% opposed the project.

The €1 trillion global asset manager Legal & General Investment Management, which is invested in both Enea and Energa, said that its clients faced “very high financial risks due to its uncertain policy support, rising carbon prices, unreliable capacity payments and threat of new technologies in energy generation,” Reuters reported at the time.

Client Earth claimed its case against Enea was a world first, in the way it forced the company to reckon with climate risk. As carbon-cutting regulations kick in and clean energy sources become competitive on price, it argued, coal generation is an increasingly bad bet.

“Pursuing this project puts an unnecessary burden on the state and taxpayers and is in no way necessary for national energy security,” said Marcin Stoczkiewicz, head of Client Earth Poland.

“Enea and Energa need to look at what the future of energy is in Poland. There is vast employment potential in cheaper, domestic renewables.”

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