Spring package of legislative changes – Poland wants to maintain the pace of RES development

A look at the newest legislative measures of the Polish government allows us to believe that the government takes renewable energies more and more seriously as a decisive factor behind the security of energy supply. As a consequence, new provisions are implemented to improve the investment environment in selected renewable energy sectors in Poland.

The liberalisation of the legal environment is primarily manifested in the removal of the so-called 10H principle, which so far has prohibited construction of new wind towers at a distance shorter than 10 times the wind-tower-height from nearest buildings. The provisions led to the stagnation of the Polish RES development.

The newly adopted regulations allow now siting a wind farm at a distance of at least 700 metres from the nearest buildings. Even though the regulation is much more restrictive than the wind energy sector expected – it originally opted for shortening the distance to 500 meters – it will at least partly unlock the advantages of locations for wind towers in Poland and is a step in the right direction. However, the outcome of the liberalisation will depend on how municipalities will adjust their local spatial development plans.

In its spring legislative offensive, the government has paid a great deal of attention to a facilitated construction of agricultural biogas power plants which should contribute to at least partial independence from gas imports. Noteworthy, Poland has strong but still untapped potential in this area. Current estimates, based exclusively on agricultural products, indicate that more than 7.8 billion m3 of agricultural biogas can be produced per year (2000 MW) while the total capacity of all existing agricultural biogas power plants in Poland is only 144 MW. 

The main idea behind the bill is to improve the biogas investment process and to upgrade the legal framework to make better use of the potential of substrates used in biogas power plants and fermentation products.

An important change finally introduced by the bill is that it lays down a legal framework for the production of biomethane, including exact specification of biomethane parameters and creation of a legal environment for biomethane grid injection.

The RES industry in Poland warmly welcomed the amendments introduced to enable the construction of direct lines. A direct power line is a separated section of the grid that directly connects a RES plant to an end user (e.g. production facilities). Thus, by constructing direct lines energy may be supplied outside the distribution grid. This, again, is of crucial importance since the lack of grid connection capacity now forms a major obstacle for investments in renewable energy sources in Poland.

With the new regulations on direct lines it will be possible in some cases to build a direct line without the need to obtain an approval from the President of the Energy Regulatory Office. This is important since, as evident from the current practice of the authority, it has so far refused to give such approvals. 

Apart from the above-mentioned amendment, the new regulations introduce a register of direct lines and the so-called “solidarity fee” which direct line users will have to pay to maintain the national power grid.

An important bill currently processed in the Polish parliament is to introduce dynamic incentives.  The bill provides for the introduction of contracts with dynamic electricity pricing, based on the spot or day ahead market. The reform aims to equip energy offtakers with a tool that enables them to adjust the electricity consumption to prices in real time and thus to offer real savings to entities that meet their demand for electricity in times when energy is cheaper on the power exchange. 

The introduction of dynamic incentives offers a real chance to develop the renewable energy sector in Poland. Spot transactions will effectively increase demand for energy when renewable energy surplus is generated. This will reduce the risk of overloading the energy system with unused electricity which, in extreme cases, could limit the amount of electricity from renewable energy sources.

The direction of the above amendments should be assessed positively as it encourages investing in the RES development in Poland. This applies in particular to the so far untapped potential offered by the production of biogas and biomethane. On the other hand, the main beneficiary of amendments as regards direct lines will be producers operating PV systems.

The described bills to amend energy laws are still being legislated in the Polish parliament, except for the new regulations on wind turbines which came into force one month ago. However, it is highly probable that they will be adopted, especially as they implement requirements provided for in EU laws.