High energy
prices are also
his weapon



High energy
prices are also
his weapon





Vladimir Putin stands behind Europe’s rising energy prices and is using his country’s resources to further his terrorist ends.

Make no mistake: Russia’s energy blackmail is a deliberate and fully conscious act.

The Putin-induced energy crisis has been ongoing since 2021. It was significantly worsened in February 2022, as a result of Russia’s invasion of Ukraine. The crisis is aimed at destabilising the West, creating chaos and, more recently, turning public opinion in European countries against Ukraine.

Russia has the world's largest natural gas reserves and is the largest exporter of natural gas. It is also the second largest exporter of oil and the third largest exporter of coal.

Even before the full-scale invasion of Ukraine, Gazprom gradually began reducing the volume of natural gas sales to European customers. Western storage facilities were drained as pipeline flows fell to zero.

The Kremlin exerts a significant influence on the price of Europe’s natural gas, holding reins on all the largest suppliers to the EU.

Russia lied its way into the invasion and has lied ever since. Gazprom is Russia, make no mistake. It has no choice but to lie in chorus with Putin.

Mark Dixon, founder of the Moral Rating Agency

August 01.2021

Source: Brueget, ENTSO-G Transparency Platform

July 31.2022

Welcome to the brave new world where Europeans are very soon going to pay €2,000 for 1,000 cubic meters of natural gas

Dmitry Medvedev, former Russian president and deputy chair of Russia's security council, 22 February 2022

In response to Putin's criminal invasion of Ukraine by Russia on February 24, 2022, Europe imposed harsh economic sanctions on Moscow

As winter drew in, the Kremlin reduced the EU’s energy supply almost to zero, compounding the drastic increase in prices on the European market.

Natural Gas EU Dutch TTF

Day Ahead Electricity Market - Average Prices 03.10.2022

Overall, this amounts to the largest commodity shock we’ve experienced since the 1970s.

Indermit Gill, a World Bank vice - president




Europe is being flooded by a wave of fake news about the energy crisis.

Russia's goal is to sow fear, discord and paralysis that undermines democratic institutions and critical Western alliances such as NATO and the EU.

Cory Gardner, former U.S. senator

Moscow is disseminating false and misleading information in an attempt to scare Poles into believing the energy crisis is much more serious than it really is. It wants to amplify people’s worries about potential problems in the electricity, gas and coal supply and even serious blackouts.

The aim of Russia’s disinformation campaign is to rouse such fear of prices and shortages that the west will destabilise and our societies erupt into social unrest

Sharing disinformation, especially about issues concerning energy, is a means to Russia's strategic ends, which is why it's so important to understand what's really going on

We know from experience that Russia tends to ramp up its disinformation efforts in times of social tension. (...) Disinformation campaigns often have a great effect on the human psyche.

Pia Lamberty, social psychologist, CeMAS




Countries by billion of cubic meters imported from Russia

Source: IEA. Szacunki na 2021

In terms of foreign suppliers, Russian gas was simply the cheapest. Rather than diversifying suppliers, routes to import Russian gas were diversified

Tim Schittekatte, research scientist at the MIT Energy Initiative

Germany's process of becoming dependent on Russian gas began back in 1970, when the construction of the first major gas pipeline between the Soviet Union and Germany was negotiated. The decision was part of "Ostpolitik," a policy initiated by Willy Brandt to bring Germany closer to Eastern Bloc countries.

Norbert Plesser, head of the gas department at the Economy Ministry, said at the time that Germany would never agree to rely on supplies from Russia for even 10 percent of its supplies.

To speak of the Federal Republic’s economic dependence on Moscow to a degree large enough to affect foreign policy indicates ignorance or malice.

German Chancellor Helmut Schmidt in 1980.

For decades, Germany has pursued a policy of "Wandel Durch Handel" toward Russia, that is, political influence exercised through economic relations. In 2020, just 50 years after the decision was made to pump blue fuel from the Soviet Union to Germany, Russia accounted for more than half of the natural gas supply and roughly one-third of the oil burned to heat homes and power factories and vehicles throughout Germany.

In 2011, the Nord Stream pipeline connecting the two countries was opened. Just three years later, Russia invaded Ukraine and annexed Crimea. Despite this violation of international law, an agreement was signed in 2015 to build Nord Stream 2 and for Gazprom to take over German gas storage facilities, putting control of German energy reserves in the hands of a foreign power.

All this happened despite repeated warnings from Central and Eastern European countries. As predicted by many experts from Poland and the countries of the region, Germany's policy of rapprochement with Russia ended up becoming a tool of aggression, blackmail and extortion by Moscow.

The German government bowed to industry forces pressing for cheap gas “all too easily”, while “completely ignoring the geopolitical risks”

Norbert Röttgen, a former environment minister and member of Angela Merkel’s Christian Democrat Union (CDU)

Germany failed to listen to the warnings from countries that had once suffered under Russia’s occupation, such as Poland and the Baltic states.

Annalena Baerbock, German foreign minister,

We must acknowledge how naive we have been about Russia and how mistaken we have been in our ideas about Russia’s actions. We should have listened more closely to our friends from the Baltic States and Poland, who have lived under Soviet rule. Together, we are now paying a high price for our dependence on Russian energy.

Ursula von der Leyen, European Commission President.

I was wrong, we were all wrong.

Wolfgang Schäuble, the former German finance minister.

My adherence to Nord Stream 2 was clearly a mistake. We held on to bridges that Russia no longer believed in, and that our partners warned us about.

Frank-Walter Steinmeier, the German president and the greatest German advocate of the trade “bridge” between east and west.



It’s not just the war and Moscow’s actions that drive up energy prices. Another factor is the European Union’s climate policy and related regulations.

Established in 2005, the EU Emissions Trading System (EU ETS) is the cornerstone of the EU’s climate change policy and a key tool for cost-effectively reducing greenhouse gas emissions.

The EU ETS operates on a “cap-and-trade” basis. It sets a cap on the total amount of specific greenhouse gasses that can be emitted by covered entities. This cap is reduced over time so that total emissions steadily decline.

Under the cap, regulated entities buy or receive emission allowances, which they can trade among themselves as needed. The limit on the total number of available allowances drives their value.

What started out in theory as a sensible system to reduce dependence on fossil fuels ended up in practice dramatically increasing energy prices in countries which were just starting their journey down the path of energy transition.

Emission allowances (EUAs) traded in the EU ETS are highly susceptible to speculation – their price at the allowance auction has risen from 10 euros per metric ton of coal in 2018 to more than 90 euros in 2022.

Up to one-fifth of the increase in energy prices can be
attributed to the level of the cost of emission allowances.

Frans Timmermans, the European Commission Vice-President in charge of EU climate policy

When energy prices began to rise dramatically in 2021, Poland was the first to call for the suspension of the ETS for the duration of the crisis. It did so again in August 2022.

For many years we have been calling for the Union's energy policy to be adapted to the specific characteristics of each country. So that the energy transition is carried out in a fair and wise manner. At present, it is necessary to reform the ETS system and, as an industry, we call for an end to the speculative nature of this mechanism.

Wojciech Dąbrowski, President of the Management Board of PGE Polska Grupa Energetyczna




For years, Poland has been aware of the dangers of dependence on Russian raw materials and has been taking the necessary steps to diversify its energy sources and thus ensure its energy independence.

In March 2022, Warsaw called for sanctions on Russian gas, oil and coal, which are Russia's main sources of income. Poland's Permanent Representative to the EU, Andrzej Sados, argued that as long as the EU does not stop buying raw materials from Russia, it will continue to finance Putin's war in Ukraine.

After criticizing the EU for incomplete sanctions against Russia, the Polish government decided not to wait for the entire EU to react and struck out alone with a unilateral decision to stop importing Russian energy sources on a national level. In late March, Warsaw decided to ban the import of Russian coal. Previously, Poland had imported about 8 million tons of the resource from Russia, which accounted for about 20 percent of the country's annual consumption

Not much later, when Putin tried to force Europe to pay for gas in rubles, Poland rejected the blackmail. As a result, on April 27 Moscow stopped pumping gas to Poland contracted under the Yamal agreement.

It should be noted, however, that Poland began pursuing a policy of diversifying its supply sources long before the Russian attack on Ukraine. So when Russia tried to blackmail Europe into stopping its support for Kyiv, Poland continued the diversification process, securing multiple energy suppliers and energy independence from Russia.

The government was able to do this without waiting for the European Union to make a decision. The issue can be interpreted as involving national security, and these are excluded from the clauses of the common trade policy.

Artur Novak-Far, lawyer, former deputy foreign minister



IN 2015-2022

Electric energy
and district heating

  • Two power units with a total capacity of 1,820 MW were built at the Opole coal-fired power plant, and an investment was completed at the Turów power plant, where a 496 MW lignite-fired unit was built.
  • Poland’s most modern gas-fired generating units with a total capacity of around 1,400 MW are being built at the Dolna Odra Power Plant. The new units will also be characterized by high flexibility, which is important in view of the large installed capacity of onshore wind farms in Pomerania and the planned new capacity in offshore wind farms
  • Investment in decarbonisation of CHP plants in Poland’s largest cities 
  • At the Kozienice Power Plant , two units of 1,000MW each are to be built. Work will start in 2025. The first unit will start operation in 2027 and the second in 2030.
  • Investments in offshore wind farms– according to the National Energy Policy until 2040, offshore wind energy will reach an installation capacity of about 5.9 GW in 2030 and up to approximately 11 GW in 2040.

The development of offshore wind energy in the Polish Exclusive Economic Zone of the Baltic Sea is one of the strategic priorities of PEP2040.

There are 7 planned projects with a total capacity of 5.9 GW that have already received support under the Offshore Act and further auctions are planned in 2025 and 2027 to contract up to 5 GW of additional capacity, with those projects to be built in the mid 2030s.

The intensive development of offshore wind energy can also support the energy transition as a new economic sector generating tens of thousands of new jobs.

Natural gas:

  • Poland’s natural gas import capacity has been increased. The expansion of the Świnoujście LNG terminal increasing annual regasification capacity to 8.3 bcma is scheduled for completion next year.
  • In 2022, two cross-border interconnectors with Lithuania (connecting Poland with the LNG terminal in Klaipeda – capacity: 2 bcm per year) and Slovakia (gas interconnector connecting Poland with Slovakia – capacity: 5.7 bcma towards Poland / 4.7 bcma towards Slovakia) were put into operation.
  • Commissioning of the Baltic Pipe pipeline connecting the Polish gas system with the Scandinavian one. The system with a maximum capacity of 10 bcm per year.
  • Domestic production: 4-4.5 bcm per year.
  • Storage facilities: total capacity of 3.2 bcm, filled to almost 100 percent.

The “Mój Prąd” (My Current) program has allowed the rapid development of photovoltaics in Poland, far exceeding forecasts from a few years ago. The program subsidizes the construction of photovoltaic installations on the roofs of the “average Joe”. Practically every fifth single-family home in Poland already has a photovoltaic micro-installation.

The “Czyste Powietrze”(Clean Air) program allows for the thermal modernization of single-family homes, which in turn increases the energy efficiency of said type of housing in Poland. Among other things, the program co-finances the insulation of buildings.

In short, Polish energy companies are securing electricity supplies, stockpiling raw materials, investing in the modernization of the distribution network and the development of renewable energy sources.




The Polish government has introduced programs that are similar to many programs introduced by other European countries, and among the most important measures are:

  • Anti-Inflation Shield – as part of the shield, the government has introduced, among other things, reductions in excise taxes on electricity, exemptions from excise taxes on electricity for households, reductions in excise taxes on certain motor fuels, and VAT rates on food or natural gas..
  • Solidarity Shield – freezing electricity prices at 2022 levels to consumption of 2,000 kWh/year or 2,600 kWh/year (for larger families, people needing more care from the state). An average family of 4 consumes about 3000-4000 kWh/a. 
  • Coal Allowance – support of PLN 3,000 per hearth fired by a large pool of solid fuels. This allowance will cover part of the cost. Currently, 1 ton of coal on the retail market costs circa 3500 PLN. An average household consumes about 2.5 tons of coal during the heating season. Before the energy crisis, a ton of coal cost in the range of 700 to 800 PLN.

Changes in the wholesale electricity market

A law has been initiated to change the current system of setting electricity prices on the balancing market, of which the main stipulations are:

  • Amending the system regulation on how to determine the maximum bid price for energy supply in the balancing market. Temporarily limiting the amount of the electricity price offered by generators to a maximum of covering the variable costs of power generation, excluding fixed costs. According to preliminary estimates, the proposed changes would lead to a decrease in the spot wholesale energy price by an average of 24 percent
  • The abolition of the so-called “obligo”, or exchange obligation, which requires electricity to be sold through the exchange market. The act assumes that abolition will reduce energy prices on the wholesale market.