The draft regulation of the Ministry of Climate and Environment has cooled the renewable energy industries in Poland. Why?
According to some experts, the changes may ultimately lead to an increase in energy prices in Poland, but the first effect of the entry into force of the new version of the draft regulation on changing the volume of electricity resulting from exchanged certificates of origin will lack of interest in investments in the green energy sector in Poland.
– There will be much less interest in investments in renewable energy sources. The new regulations will affect existing projects and will certainly affect the construction of new investments or the crediting of investments – says Janusz Gajowiecki, president of the Polish Wind Energy Association.
– The cost of capital will rise as the risk to investors will increase dramatically and it will not be profitable for anyone to invest in RES. This will make energy prices in the country more expensive – adds PWEA representative.
What is it about? “It specifically concerns certificates of origin, which confirm that the energy comes from green, i.e. CO2-free, sources. According to the original assumption, trading companies with certificates would prove that in 2024 11 percent of the energy they sell will come from RES. According to the new version of the project, however, this percentage drops to only 5 percent, which according to the producers can cause disruptions in the functioning of the energy market.
Some RES experts believe that the project is good in itself, but that the devil is in the details. The new provisions have been proposed by the Ministry of Development and Technology and adopted by the Ministry of Climate and Environment.
– I don’t know if someone didn’t think it through, if they put a prime minister or a development minister, who wrote this 5 percent into the position. This is inconsistent with the approach promoted by the Law and Justice government in recent years or months. After all, this has led to an explosion when it comes to enriching Poland with energy resources, that we not only have one foot firmly on coal, but also on windmills, photovoltaics, offshore windmills, etc. For us, this is completely incomprehensible , unexpected and harmful to the country – explains Janusz Gajowiecki, representing the Polish Wind Energy Association.
– The worst thing is that we are not sure what will happen in the coming years; we do not have stability, but above all, the first year, 2024, the proposal of the Ministry of Climate was 12% of the amount of the exchange of certificates of origin, and now it has fallen to 5%. The case is unequivocal with the collapse of this system to zero. This ensures that there will not be sufficient demand for supply in the market. Simply put, some companies go bankrupt because there is no demand for their product, the expert adds.
According to the president of PWEA, the project is unfavorable for the RES industry in terms of diversification of energy resources in Poland. Gajowiecki believes that the project of the Ministry of Climate and Environment “affects new renewable energy sources, because this project already affects the existing ones, but it will also affect the financing of new investments.” – The cost of capital will rise, these risks will simply increase dramatically and it will not be profitable for anyone to invest in renewable energy sources in Poland – predicts Janusz Gajowiecki.
Will it be more expensive?
The president of PWEA believes that discouraging investors and the new 5% certificate of origin redemption proposal will lead to an increase in energy prices in the country. – This project will make energy prices in Poland more expensive – concludes the representative of the renewable energy sector.
On the Salon24 website you can read that “the proposed amendments did not define the amount of the obligation to redeem green certificates for three consecutive years (which has been widely praised by the RES industry as building predictable operating conditions), rather than specifying the value in question for one year, which does not create certainty.
“After introducing one of the most restrictive price caps for renewable sources in the European Union, destroying the market of guarantees of origin by imposing a tax on 97% of their turnover, the government finally decides to expand the market of green certificates to destroy. This appears to be a blow to RES in Poland.
Source: Do Rzeczy
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
