Polish Miners’ Strike May Hit The Wall as Coal Is on The Way Out

(Bloomberg) -- Polish coal miners planning a protest in Warsaw later this month may find it more difficult than ever to secure their pay hike demands.

The workers, whose strong negotiating position harks back to the Solidarity union’s emblematic fight against communism, have so far seen most of their expectations met by every government in the last 30 years. This time it could be different.

Coal is becoming less popular in the European Union’s largest eastern economy that’s also one of the heaviest polluters. The government, which came to power in 2015 with the firm support from miners, has signaled that the good times for coal are over.

“Unless we want to liquidate mines we all need to understand the situation and certainly not ask for unrealistic things,” State Assets Minister Jacek Sasin told WPolsce.tv website on Monday. “We know what’s the European Union’s climate policy and that coal is its main victim.”

The unions at PGG SA, the EU’s largest coal producer that is located in the Silesia region, want the company to increase wages by 12%. They held a two-hour emergency strike earlier on Monday and scattered coal on the doorways of the offices of regional lawmakers, including Prime Minister Mateusz Morawiecki’s.

On Feb. 28, miners plan to come to the capital to hold a protest. PGG, which according to Sasin posted a net loss last year, says it can’t afford to meet the demands. In the last three years, PGG paid 1.1 billion zloty more in salaries than originally planned, bending to unions’ demands.

‘Unrealistic’

Poland’s coal usage dropped to the lowest ever last year as energy production from renewables and gas rose, while electricity imports reached an all-time high.

“Unfortunately, we have a free energy market and we can’t totally eliminate imports -- of both electricity and coal,” Sasin said.

Two state-controlled utilities announced last week they were suspending financing for a coal-fired power plant at Ostroleka, for which they had spent close to 1 billion zloty already and which was set to be the country’s last new venture with the raw material. They now will analyze whether it’s possible to switch it to gas.

Polish Miners’ Strike May Hit The Wall as Coal Is on The Way Out

Still, the ruling party has to tread carefully ahead of a presidential election on May 10. Protests getting out of control in the capital may tarnish its image of a defender of ordinary citizens after efforts to build a patriotic welfare state.

“Unfortunately, as far as the EU’s climate policy is concerned we need to face up the facts,” PGG Chief Executive Officer Tomasz Rogala said earlier this month. “Breaking the green trend is practically impossible anymore and we need to adjust. However, we need to do it on our own terms.”

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