European Commission to Scrutinize Polish Aid for Nuclear Plant

The European Commission will look into Poland’s decision to support the state-owned company Polskie Elektrownie Jądrowe sp. z o.o. (PEJ) in the construction of a new nuclear power plant in Lubiatowo-Kopalino.

The Commission said in a media release it has launched an in-depth investigation, after being informed about the decision in September 2024.

PEJ plans to bring the facility online in 2030 to deliver up to 3,750 megawatts of electricity to the power grid. The total investment in the project is estimated at EUR 45 billion ($46.6 billion), the Commission said. The facility will enhance the security of electricity supply for Poland and its neighboring countries, aiding in the decarbonization of the energy sector and diversifying Poland's energy mix, it said.

Poland will support the investment with a EUR 14 billion ($14.5 billion) equity injection for 30 percent of costs; state guarantees for 100 percent of PEJ's debt; and a two-way contract for difference (CfD) ensuring revenue stability for 60 years, according to the Commission.

“The public support that Poland plans to grant for its first nuclear power plant needs to be assessed by the Commission to make sure that it is in line with State aid rules, which aim to preserve competition within the internal market. According to the Competition rules, we will also evaluate the impact on the EU’s internal energy market. As usual, all interested parties can submit their observations”, Teresa Ribera, Executive Vice President for Clean, Just and Competitive Transition, said.

The preliminary assessment finds the aid package to be necessary; however, the Commission said it doubts that the measure, at this stage, is in line with EU state aid rules. The investigation it launched will look into the appropriateness and proportionality of the aid package.

“Given there are three different aid measures (equity, guarantees, two-way CfD) that together limit the risk for the beneficiary, it is important to ensure that overall no more aid than what is strictly necessary is ultimately granted. In particular, the Commission will examine further (i) whether the 60-year duration of the CfD is justified taking into account the other two measures, and (ii) whether there could have been other companies interested in leading the project which might have resulted in a smaller aid amount”, the Commission said.

The Commission added that it will look into the impact of the aid package on competition in the electricity market and whether this is kept to the minimum.

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