New jobs arrive with a new economy as a coal-mining town taps diverse opportunities in the global Restoration Economy

Southern Poland may not be known for wine-making—its economy and culture has for centuries been defined by mining—but Piotr Kurdziel believes the region is on the cusp of change.

Kurdziel, a former businessman who established the Libiąż Vineyard 12 years ago, has reason to be optimistic.

His operation bottled 10,000 liters last year, and an increasing number of buyers are enotourists—visitors who want to sample wine at the source while exploring local sights.

The rising popularity of enotourism paired with the growth of Poland’s wine market, he says, offers the region an opportunity to move away from its identification with coal, diversify its economic base, and provide indirect jobs for local suppliers.

It’s a vision of the future that looks dramatically different than the past: a restoration economy.

Kurdziel, like many residents, business owners, and local officials in Libiąż, has always thought of the town as extension of the Janina coal mine, about 2.5 km away.

Waste from the coal mine was trucked to and processed in Libiąż at a 64 hectare (about 158 acres) mining waste heap.

The mine and the waste heap in Libiąż have long been the largest employers in the area, and made it possible for many small and informal businesses to flourish.

Since 2016, however, there has been no need to process mine waste in Libiąż—a reflection of policies that promote clean energy initiatives.

Municipal officials, mine managers, trade unions, business leaders, and community activists are now working together, with support from the World Bank’s Just Transition initiative, to repurpose the land comprising the Libiąż waste heap in ways that will strengthen the region economically and socially while mitigating the effects of climate change. [This is the kind of opportunity documented in the 2020 book, RECONOMICS: The Path To Resilient Prosperity.]

These are long-term plans: The technical recultivation of the heap extends to 2026 and the biological recultivation extends to 2030, according to Krzysztof Paw, a Janina mine representative.

The strategies for Libiąż, as with other coal transition strategies around the world, pursue a long-term, sustainable growth path while protecting local communities. After all, says Libiąż’s mayor, Jacek Latko, “Our job is to ensure that our citizens live in good conditions.”

Some of the options under discussion for the former waste heap include solar farms to encourage renewable energy generation and industrial parks in special economic zones to attract investment, development, and jobs.

Turning the site from an environmental liability to an asset with a projected revenue stream will also help to attract financing, using the value of the repurposed lands as collateral.

Infrastructure is another focus: New roads connecting Libiąż to larger cities will give residents access to a network of employment markets, while allowing outside entrepreneurs, developers, and investors to more easily scope out business opportunities.

Each step of the path forward has been charted with great deliberation. That’s because Poland’s dependence on coal is complex—rooted in geopolitical reality, economic necessity, and cultural tradition.

In 2020, coal generated 70.1 percent of the country’s electricity—the highest share in Europe—and Poland produces more coal than any other nation in the European Union.

Though Poland is undergoing a fundamental power sector transformation, “it remains one of the most coal-dependent countries in the world,” according to The Green Transformation in Poland, a new World Bank report.

The current energy crisis introduces “a lot of uncertainty,” Latko acknowledges.

Europe is experiencing an energy shock of considerable breadth and complexity, according to Gallina A. Vincelette, Country Director for the European Union at the World Bank.

High energy prices and coping measures to cushion the impact on vulnerable households and firms are common, and pose a threat to slow the clean energy transition in Poland and globally,” Vincelette says.

To overcome this, government support should be not only timely, but also time-bound, well-targeted, and transparent. In addition, Poland should continue to prioritize energy efficiency and incentivize investments in storage and renewables to produce sufficient, reliable, and affordable energy. Poland has the natural resources and know-how to achieve energy security through a clean energy transition,” she added.

Despite the current challenges, Latko and other officials believe that transitioning away from coal offers compelling economic and social opportunities while bringing much needed climate benefits.

We want to support everything related to green energy,” says Józef Gawron, Deputy Marshal of the Małopolskie province, which includes Libiąż, and regional plenipotentiary for Poland’s Just Transition. “This is our future.

Gearing up for a Just Transition

Though every country’s transition from coal is unique, many governments around the world face the same challenges that Libiąż does as they navigate toward clean energy sources.

The deliberate, steady process of repurposing of the land that once housed the Libiąż waste site is an example of what’s possible when communities take the first step towards converting coal dependence to a more diversified local economy, says Demetrios Papathanasiou, World Bank Global Director, Energy and Extractives.

The repurposing of former mining lands and assets is part of the World Bank’s approach to the Just Transition, a multi-year planning process that puts people and communities at the center of the transition to clean energy.

Mining lands have an important role to play in the shift to clean energy.

There is enough space in post-mining lands to generate as much electricity with solar as all the coal and lignite power currently produced in the EU,” as one report suggests. The authors, from the European Commission’s Joint Research Centre, found that the installation of solar photovoltaic (PV) cells—which convert sunlight, a renewable energy source, into electricity—could be a “lifeline” for European coal regions in transition.

Increased investments in energy efficiency and renewable sources, especially wind and solar power, will be an important way for Poland to meet its energy demands, according to the World Bank’s The Green Transformation in Poland.

The renewable energy potential for post-mining land in Poland is especially noteworthy. As of a a decade ago, the country’s mines covered over 26,000 hectares (about 64,000 acres). Though that figure has diminished, two-thirds of Poland’s residential heating still comes from coal—double the share used by the Czech Republic and Bulgaria.

The effect of households’ dependence on coal is visible to all. Two-thirds of Europe’s most polluted cities are located in Poland, according to the World Health Organization. The consequences for Poland’s people are severe: Coal emissions are blamed for serious health risks that translate into significant economic costs.

Around the world, coal’s impact on the health of the climate is just as dire. Coal activity is a main contributor to greenhouse gas (GHG) emissions and pollution that exacerbates climate change. GHG emissions can cause global warming, which triggers extreme weather events like record-breaking high temperatures, droughts, wildfires, and flooding from heavy rains. To rein in the threat, the Intergovernmental Panel on Climate Change (IPCC) has proposed that OECD nations should end coal use entirely by 2030, and all coal-fired power stations must be shut by 2040.

Following this guidance, the provisions of the Poland Energy Policy for 2040 (PEP 2040) assume a decrease in coal’s share of energy generation from 75 percent to no more than 56 percent by 2030; Poland has committed to phase out coal by 2049. Cleaner energy sources, such as the renewable solar power farms being proposed in Libiąż, are expected to fill the need. Within Poland, government support for solar PV has made the country one of the “fastest-growing” PV markets in the EU, according to the International Energy Agency.

The European Commission’s nearly EUR 17.5 billion Just Transition Fund, supported by the World Bank, is assisting coal transitions. Poland is to be the largest recipient of the Just Transition Fund, with an allocation of EUR 3.5 billion.

New jobs for a new economy

Just Transition efforts in Poland have benefitted from lessons learned in past coal transitions there and around the world. In some communities, for example, closing mines created a persistent, destabilizing demand shock as displaced workers struggle to transition to new jobs, according to a World Bank report on managing the coal transition.

For the transition to be just and effective, we need to assure employment for workers, creating new jobs and re-skilling,” according to Alicja Messerszmidt, Chairwoman of the Polish Trade Union Alliance Kadra of the ZE PAK Group.

That’s why projects that are part of the Just Transition, as in Libiąż, anchor their efforts to repurpose mining lands in job retraining and attracting private investment to stimulate local economic development, says Gawron. “Since decarbonization [following the mine closures] affects families’ budgets, providing them with prospects for development, for starting their own business, for service and recreational activities, and creating new functions for these [former mining sites], is…a very important direction for us.

Thermoplast, a Libiąż-based plastics processing company with state-of-the-art recycling installations, is one of the firms investing in Libiąż’s former miners. “We are constantly looking for new products and new technologies, and for this we also need people,” says Piotr Dyba, a Thermoplast management board member. “The employees who come to us from the mining industry will be the most useful employees.

Thermoplast is also working with the local vocational school to create a pipeline of workers who are committed to staying in Libiąż. A new partnership between the school and Thermoplast will train students to work there and in other non-mining jobs.

We want to prepare [our students] to enter the labor market,” says Jadwiga Bochenek, the school’s headmaster. “When the market changed, and when we started paying attention to more environmentally friendly energy sources…we began to educate mechanics and energy technicians [in addition to mine workers].”

Thermoplast now employs 163 people and has plans to expand. “We see development opportunities here,” Dyba says. “In 30 years, we will have a thriving economic zone.”

Collaborative, community-based planning

The partnership between the high school and Thermoplast did not happen by chance. It emerged following large-scale planning meetings about the coal transition, convened early in the transition process by the municipality of Libiąż. It is one of many cross-sector agreements that are facilitating investment opportunities, says Latko, the mayor.

But investment and employment aren’t the only agenda items. Participants in these planning meetings acknowledge that shifting away from coal ushers in a cultural transformation as well as an economic transformation—and they are paying close attention to how the shift can improve the quality of life for the whole community.

This awareness is enabling an expansion of women’s roles, according to Monika Łyszczasz, from Libiąż’s Social Welfare Center. It is a necessary change, she says, because historically in coal-dependent regions like Libiąż, “The father worked in the mine, and the mother looked after the house and the children,” Łyszczasz says. Even today, women comprise only 32 percent of people employed in Libiąż.

The consequences are far-reaching. When unemployment increases among men who are miners, women not working outside the home experience higher levels of domestic violence, food insecurity, and a decline of status, with little potential for improvement, as a recent World Bank study of mining communities around the world found.

To turn this around, Libiąż is actively trying to boost women’s participation in the local labor market and ensure that men and women benefit equally from the green transition, says Magdalena Kozak, the head of Libiąż’s municipal development department, who is overseeing the repurposing of the waste site. Last year, Kozak and representatives of the European Commission initiated a workshop on women’s role in the coal transition.

Women of different ages and from different backgrounds were able to see what opportunities and challenges the transition brings, and how to nurture their own and their daughters’ careers, so that they are not excluded from the labor market,” Kozak says.

The shift away from mining monoculture and toward a more diversified economic base “means new opportunities” for women in Libiąż to participate in public life, Łyszczasz says. More than 80 percent of the Social Welfare Center’s clients are women, and it now runs programs to prepare them to start their own businesses and for careers in renewable energy fields.

For the local municipality, engagement with communities like the Social Welfare Center has been critical to advancing the transition from coal. Coalition-building with government ministries and other stakeholders has also been helpful for mine workers’ trade unions, in Libiąż and across Poland. The social partnerships and collective bargaining have been “very important,” according to Grzegorz Trefon, advisor to the Kadra Trade Union Alliance.

As a former miner, Libiąż’s mayor, Jacek Latko, is no stranger to trade unions’ collective bargaining process, but these days he is focused on engaging with a wide range of stakeholders. He makes it a priority to regularly visit companies like Thermoplast and entrepreneurs like Piotr Kurdziel, the vineyard owner, to convey that that their businesses are key to Libiąż’s future—and that they shouldn’t relocate.

Not that Kurdziel, at least, has any thoughts of leaving Libiąż. Stewardship of the vineyard “lasts not one year, not two, but one’s entire life, and it spreads to other generations,” he says. “I have three sons. If one of them takes over, it will also be his children who will look after the vineyard.

Photo via Adobe Stock.

This article by originally appeared on the website of the World Bank. Reprinted here (with minor edits) by permission.

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