1EC BREC

The Regional REEEP Meeting, 3-4 July, Szentendre 2003

Status of policies and financial mechanisms to promote RES

in Poland

Magdalena Zowsik

EC Baltic Renewable Energy Centre (EC BREC/IBMER)

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GENERAL INFO

• Poland - country in Central Europe• 312.680 km2 area; 38,7 mln people• Forests - 28,1 % Poland, i.e. 8.8 mln ha. • Agricultural lands – ca. 60% of the Poland. • 38% of the population live in the rural areas. • Agriculture and forestry give 4.8% of GDP but 27% of the

employed in Poland work in agriculture (0.4% in forestry). • Rural areas have a very high unemployment rate 18%, reaching

even 50% in some places.

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ENERGY SECTOR & RES

• The energy sector is dominated by the hard coal• Electricity is produced in 98% from fossile fuels• 68% of heat demand in urban areas is met by district

heating networks. • The share of the other energy sources inc.

renewables is growing slowly, in 2001 it was ca. 2,9% of total primary energy consumption (in that 98 % biomass)

• Total primary energy consumption is slowly decreasing (in 2000 it was 3812,4 PJ).

RES-Policy making and strategic documents

Resolution of the Polish Seym on Increase of RES Utilisation

Renewable Energy Act (2003?)

Agricultural Policy Economic and Social Policy

Financial Policy Infrastructural Policy Environmental policy

Strategy of Sustainable Development of Poland to 2025

Enforcement documents Excisce Odinance

Draft Biofuels Market Act

Quota Obligation Ordinance

Energy Act

Council of Ministers

(Assumptions to) Energy Policy to 2020

Coherent Structural Policy for Rural Areas and Agricultural

Development

Policy making documents

Development Strategy of Renewable Energy Sector

Polish Seym: final endorsement of documents

State Environmental Policy 2003-2006

Act on Financial Support to Investments

Update on (Assumptions to) Energy Policy

to 2020

Ecological Scenario to the State Energy Policy

National Development Plan

Development Strategy of Rural Areas in Poland 2004 - 2006

The Ordinance on the Public Support to Evironmental

Investments

Thermal modernisation Act

Economic Strategy of the Polish Government ‘Initiative-Development-Labour’

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ENVIRONMENTAL POLICY

1. „National Development Plan”

2. „Kyoto Protocol” Kyoto Protocol ratified in 2002: 6% emission

reduction within 2008-2012 comparing to 1988, c.75 mln tonnes of CO2 surplus to be traded

annually

3. „Second Environmental Policy”

4. „ Polish Development Strategy Of Renewable Energy Sector”

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(1) POLISH DEVELOPMENT STRATEGY OF RENEWABLE ENERGY SECTOR

Poland has adopted already the national renewable energy strategy

(by the Polish Parliament in 2001)and is harmonising its environmental

and energy policy with those of EU

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Strategic targets: 7,5% in 2010 14% in 2020increase of the total energy production from RES by 235 PJ (up to 340 PJ)

Expected increase of capacity production in renewable energy sector by 2010

7,5%

4570 PJ – Expected total energy demand

in 2010 according to the scenario

“Polish Energy

235 PJ – Requested increase of

capacity production in RES sector by

2010

105 PJ – Production of energy from RES in 1999

(2) POLISH DEVELOPMENT STRATEGY OF RENEWABLE ENERGY SECTOR

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ENERGY POLICY

„Assumptions of the Poland’s Energy Policy to 2020” , 2000

„Energy Act”, 1997 (amendments 2000, 2002)

„Thermodernisation Act” „Quota obligation ordinance”

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ENERGY POLICY-ORDINANCES

„ Quota obligation ordinance”, 2000

Electricity suppliers are obliged to buy from national producers offered amount of electricity and heat from renewable energy sources (2.4% in 2001, 7.5% in 2010)

Problems:

- lack of tariffs

- lack of fines for not fulfiling the obligation

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ENERGY POLICY- A NEW ORDINANCE

„Quota obligation ordinance”, 2003

The obligation of buying RES energy moved to the Energy Act

Definition of biomass and biogas

Permited co-firing of biofules with fossil fuels

2,4 2,5 2,65 2,85 3,13,6

4,2

5

6

7,5

0

1

2

3

4

5

6

7

8

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

% a

nnua

l RES

ele

ctric

ity s

old

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AGRICULTURAL POLICY

• A draft „Act on Biofules Market”• „Act on agricultural tax”

– 25% reduction of agricultural tax in case of RES investment (valid during 15 years after construction of installation)

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FINANCIAL POLICY

„Financial Support for the Investments Act”, 2002

„The Ordinance of the Council of Ministers of the Public Aid for Environmenal Protection”, 2002

„Excise Ordinance”, 2002

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FINANCIAL POLICY (2)• For investment:

Green funds (subsidies & loans) Structural funds (after EU accesion) Central budget- Act on Financial Support to Investors Central budget, local governments’s budget- National

Development Plan

• For production of RES electricity:

Exemption of excise tax on electricity 0.02 PLN/kWh (0.056 Euro) c. 10% of electricity price (Excise Ordinance)

• To support production:

Exemption of excise tax on fuels – around 45% of the fuel price for bioethanol (Excise Ordinance-each year)

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10,0

20,0

30,0

40,0

50,0

60,0

EUR/MWh

biogas biomass large water energyplant

small water energyplant

wind fossil fuels

electricity buyback rates for different RES and fossil

biogas

biomass

large water energy plant

small water energy plant

wind

fossil fuels

RES average 45 EUR/MWhe

FINANCIAL SUPPORT

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POLICY PRIORITIES & RES

Legal regulations in RES sector- introduction of RES Act

RES Acts should regulate: Polish law transposition according to the Directive

2001/77/EC:

- RES definition, - creation of market mechanisms supporting the RES e.g. Green certificate market, - system of Green energy labelling

Statistics on RES Data collection on the existing RES installations Creation of dedicated RES fund

Educational and promotional actions and international co-operation

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CONTACT

• Further information available from EC BREC office in Warsaw

– Rakowiecka 32, 02-532 Warsaw – tel/fax (+48 22) 848 48 32, 646 68 50, 646 68 54,

– e-mail: ecbrec@ibmer.waw.pl

– Internet: http://www.ibmer.waw.pl/ecbrec