President signs bill on funding for Polish nuclear power plant

In November 2022, the then Polish government selected Westinghouse AP1000 reactor technology for construction at the Lubiatowo-Kopalino site in the Choczewo municipality in Pomerania in northern Poland. An agreement setting a plan for the delivery of the plant was signed in May last year by Westinghouse, Bechtel and Polskie Elektrownie Jądrowe (PEJ) - a special-purpose vehicle 100% owned by Poland's State Treasury. The Ministry of Climate and Environment in July issued a decision-in-principle for PEJ to construct the three-unit plant. The aim is for Poland's first AP1000 reactor to enter commercial operation in 2033.

The total investment costs of the project are estimated to be about PLN192 billion (USD49 billion).

In September last year, the Polish government announced its intention to support this investment through: an equity injection of about PLN60.2 billion covering 30% of the project's costs; state guarantees covering 100% of debt taken by PEJ to finance the investment project; and a two-way contract for difference (CfD) providing revenue stability over the entire lifetime of the power plant of 60 years.

President Duda has now signed a bill that "provides for the provision of investment financing in the amount of PLN60.2 billion as part of the recapitalisation of the PEJ company by the State Treasury in the years 2025-2030. The remaining amount will be obtained from financial institutions, primarily foreign institutions supporting exports originating from equipment suppliers' countries, including export credit agencies, in particular the American export credit agency Export-Import Bank of the United States.

"The investment in the scope of [the first plant] is to be financed by 30% from equity capital and 70% from foreign capital. It was assumed that external financing will be incurred after the owner's own contribution has been made in full, in accordance with the equity first principle," a presidential statement said.

The act introduces reporting obligations regarding the use of public support in a given year. An appropriate report will be submitted by PEJ to the Plenipotentiary, and the Plenipotentiary will submit information in this regard to the Council of Ministers.

In December 2024, the European Commission launched an investigation into whether the planned public support for Poland's first nuclear power plant complies with EU rules on state aid. It has yet to give its approval.