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HomeNuclearPEJ seeks insurance for Polish nuclear power plant

PEJ seeks insurance for Polish nuclear power plant

29 February 2024

Polskie Elektrownie Jądrowe (PEJ), which is responsible for the construction of Poland’s first nuclear power plant, has joined the Mutual Insurance Association (TUW) of the Polish Mutual Insurance Institution (PZUW). It said the move is an important step toward providing insurance coverage for the project.

An illustrative example of how the plant might look (Image: PEJ)

In November 2022, the then Polish government selected the 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 PEJ. The country’s Ministry of Climate and Environment in July issued a decision-in-principle for PEJ to construct the plant. The aim is for Poland’s first AP1000 reactor to enter commercial operation in 2033.

“Insuring the project, which is strategic for Poland and its energy security, is one of the conditions for its execution,” PEJ noted. “The range of insurance contracts used in this type of investment project is very wide. They include construction and assembly work, as well as, for example, transportation or civil liability. Having adequate insurance coverage protects the interests of both the investor and the general contractor, and is required by the institutions that finance the investment project as a condition for obtaining debt financing.”

PEJ said well-designed insurance reduces project risks. “First of all, it protects against the financial consequences of contingencies that may possibly occur during the construction process on this type of project.”

With a view to insuring nuclear investment projects in Poland, the TUW PZUW entered into a strategic cooperation in 2023 with the UK’s Nuclear Risk Insurers (NRI). PEJ said the agreement with NRI, which protects civilian nuclear facilities in the UK and is involved in more than 300 similar projects worldwide, gives it access to know-how, as well as internships and training.

Owned by the PZU Group, Poland’s largest mutual insurance association has simultaneously launched an initiative to create a nuclear insurance pool, a consortium of Polish insurers that will provide coverage for nuclear power in the country.

“Joining Mutual Insurance Association of the PZUW is an important element in building the company’s insurance strategy for the construction and operation phase of Poland’s first nuclear power plant,” said Wojciech Rosiński, director of PEJ’s Finance Division. “Accession to the TUW PZUW will allow us, as an investor, to gain access to specialised nuclear insurance offered on the market.”

“What unites us is taking on ambitious challenges,” added TUW PZUW President Rafał Kiliński. “The aim of the project to build the nuclear power plant is to ensure Poland’s energy security, and our ambition is to participate in providing insurance coverage for this project. That is why we are glad that a company as important to the energy transition as Polskie Elektrownie Jądrowe has become a member of our mutual insurance association.”

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