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15th Aug 2018

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What does Poland (really) want from the 2030 package?

  • The future 2030 framework needs to avoid a “one size fit all” approach. (Photo: German presidency 2007)

European Union leaders are planning a political debate on their 2030 climate-energy package targets when they meet in Brussels at the end of October.

The issue is a sensitive one for Poland: the Polish Electricity Association (PKEE) co-hosted a major conference with Eurelectric in Warsaw on 26 September to debate how to balance climate and energy policies.

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In the run-up to the October 23-24 EU Summit, PKEE is keen to show that the Polish electricity is open to a a positive outcome of the energy package to meet Europe's climate change commitments. But PKEE says the eventual package agreed by EU leaders should take account of Poland's starting point when it comes to emission cuts.

Polish Energy Group (PGE) CEO Marek Woszczyk explains here why the EU's package has to be flexible enough to cater for each member state.

Why is Poland dragging its feet on the 2030 Package?

Poland and the Polish energy sector strongly support efforts targeted at cutting CO2 emissions. We've already done a lot. Our economy decreased its CO2 footprint by 30% in the last 25 years. The power sector has achieved efen higher reduction – 35% as compared to the Kyoto Protocol targets. There are only a few countries as dedicated to emissions reductions as Poland. Other examples: the Polish share of renewable energy sources in the energy mix rose from 1 to 14% in just six years (installed capacity).

At the same time, Eurostat data shows how Poland is the sixth most energy secure country in the European Union. A tougher climate policy would force Poland to suspend the mining of its coal and lignite resources, which in turn would mean importing natural gas from outside the EU and decrease national security. Conventional power production in the short and medium term can only be substituted by gas-fired power plants, and that would mean Central European economies would have to turn to Russia's Gazprom to fill the gap.

Ultimately, this is not about being against climate change policies, but rather about how we decide such policies. Europe shouldn't force Member States to forego their sovereign right to determine their energy mix – that was a right already enshrined in the Lisbon Treaty. If policies are imposed irresponsibly, they could trigger socio-economic problems and undermine our energy security.

Why do you think the 2030 Package would lead to price rises?

The European Commission is about to increase emissions reduction targets prior to taking such decisions at the global level. This is likely to marginalize the EU in the negotiating process and lead to a significant increase of energy prices, particularly in Member States using fossil-fuels to generate electricity. This is because energy prices are linked to CO2 prices and they will peak if the non-carbon/green economy is promoted while the EU continues to rely on fossil-fuels. We should also remember that we need this form of conventional energy to ensure security of supply.

What do you propose then?

The costs of decarbonization should be examined more closely for each Member State, with detailed impact assessments, before we agree on the 2030 framework. The decarbonization policy will affect Member States very differently depending on a variety of factors including their fuel mix, their historical economic structure, their ability to pay for emissions reductions, their domestic resources etc. The future 2030 framework needs to avoid a "one size fit all" approach.

The Ukraine crisis should remind European policymakers that indigenous energy resources - including Polish coal - are an important buffer against gas supply disruptions. Member States should not be penalized with heavy carbon costs if we want to maintain energy independence in the EU.

The European Commission should also set a firm deadline for Member States to phase out subsidies for renewable energy. Cheap renewable power in Germany in particular is distorting central Europe's electricity market. Renewables are important, but it will be decades before they become a key energy source for Poland and many other industrialized countries.

The solution for conventional energy has to be a continuance of partially free allocation of allowances to the sector. Such an exemption would allow Poland's power sector to use the funds saved on carbon costs to invest in much needed modernization and diversification.

Only lessening the burden on the operational side by enabling free allocation to carbon intensive power sectors can shield end consumers from rapid price increases. This price needs to be affordable for consumers – it is of outmost importance.

This free allocation should be set with fuel-specific benchmarks to reward the most efficient power generation sources of each fuel.

Disclaimer: This article is sponsored by a third party. All opinions in this article reflect the views of the author and not of EUobserver.

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