Poland: Energy Legal Alert - August 2013
Small three-pack enters into force on 10 September 2013
On August 16, 2013, President Bronislaw Komorowski signed the act to amend the Energy Law and some other laws, i.e. the so-called small three-pack. The small three-pack was published in the Journal of Laws of the Republic of Poland on 27 August 2013 so it will enter into force on 10 September 2013. The law has already been submitted to the Government Legislation Centre, so probably it will be soon published in the Journal of Laws of the Republic of Poland. Therefore provisions of the small three-pack will take effect already from 10th September 2013. Some provisions such as e.g. those releasing the so-called industrial companies from the fulfillment of the part of obligations regarding the certificates of origin will come into force after issuance of a positive decision by the European Commission. Amendment of the Energy Law is primarily intended to prevent the imposition of fines that threaten Poland as a result of its failure to transpose EU directives into Polish law. There is a risk that provisions of a small three-pack will not be enough to protect Poland against the fines of the European Commission. Small three-pack does not introduce i.a. priority of a grid access by the renewable energy sources in accordance with the requirements of Directive 2009/28/EC of 23 April 2009 on the promotion of application of the energy from renewable sources. In case the decision of the European Commission is sustained Poland still will be under threat of fines of around euro 133,000 per day.
Facilities for energy-intensive companies
Small energy three-pack introduces amendments with respect to entities obliged to obtain and redeem certificates of origin for electricity. This obligation was imposed so far primarily on energy companies selling electricity to final recipients. After the amendment the above obligations will also be imposed on the so-called industrial recipients. According to provisions of the small three-pack, industrial recipient is the final recipient whose main business activity constitutes the activity within the industry branches such as food, metals, ceramic building materials, rubber and plastic products. Industrial recipient a which in the calendar year preceding the year of the obligation fulfillment consumed not less than 100 GWh of electricity, the cost of which amounted to not less than 3% of its production will be required to obtain and redeem the certificate of origin.
Small three-pack also introduces mechanisms that allows the energy-intensive companies to reduce costs associated with the obligation to obtain and redeem the certificates of origin depending on the energy consumption of a given industrial company. Reduced costs for energy will be based on the mechanism of reduction of the basis for calculation the amount of the obligation to obtain and present for redemption the certificates of origin. Depending on the amount of the electricity in the production the obligation’s reduction shall vary from 20% to 80%.
Provisions on the partial exemption of energy-intensive companies from the obligation shall enter into force after issuance of a positive decision of the European Commission on the conformity of the state aid provided for in the Act with the common market.
Photovoltaic farm constitutes industrial facilities
On 01 August 2013 the amendment of the Regulation of the Council of Ministers of 09 November 2010 on types of projects likely to have significant effects on the environment came into force. The amendment explicitly stipulates that photovoltaic panels together with the accompanying infrastructure constitute industrial facilities, and are among the projects likely to have a significant impact on the environment, in case when the building area is not less than 0.5 hectare in areas under some form of nature protection and not less than 1 hectare in other areas. The amendment was introduced as a consequence of unclear law provisions with respect to construction of photovoltaic farms. So far, authorities have interpreted law provisions differently and not always included construction of photovoltaic farms to projects likely to have significant impact on the environment. As a result, a different practice with this respect was applied.
The decision on the location of a public investment can be annulled
On June 19, 2013, the Voivodeship Administrative Court in Warsaw, ref. No. IV SA / Wa 750/13 issued a judgment on the admissibility of the annulment of the decision on the location of a public investment. In the reasons of the judgment the Court referred also to the possibility of annulment of the decision on the location of a public investment for wind farms after the lapse of 12 months from the date of delivery of such decision.
According to the Court the possibility of the annulment of the decision on the location of a public investment for a wind farm stems from the fact that the existing law provisions do not allow to classify the construction of wind farms as a public investment. Wind farms are not included in a closed catalogue of projects constituting public purposes specified in the Act on the Real Estate Management. Therefore, there is no legal basis for institution of the proceeding to issue decision on the location of a public investment for a wind farm at all.
In the current case law, however, courts consistently rejected the possibility of annulment of the decision on the location of a public investment for wind farms after the lapse of 12 months from the date of delivery of such decision.
Pursuant to Article 53 paragraph. 7 of the Law on Spatial Planning and Development, the decision on the location of a public investment cannot be annulled after the lapse of 12 months from the date of its delivery or announcement. In the most recent judgment WSA took the view that in the case of a decision issued without legal basis, the 12-month period does not apply and the possibility of its annulment is not limited in time. Therefore, in such a case the authority had no legal basis to apply Article 53 paragraph 7 of the Law on Spatial Planning and Development.
Problems with G ratio = 0
Entities implementing the wind farm investments will need to deal with the obligation to provide more and more detailed reports on the impact of a given project on the environment. During the assessment of the impact of the project on the environment, there is carried out i.a. an assessment of acoustic impact of a given project on the protected areas. One of the parameters used for calculation of the noise propagation is the so called G ratio, i.e. the ratio of ground porosity. Depending on the ground around the investment when calculating the noise propagation there is used G ratio = 0 in the case of hard ground and G ratio = 1 in the case of grounds characterized by high porosity, i.e. covered by vegetation. The scope of environmental impact is examined in the environmental report whose assumptions, guidelines and test methods should be given in the decision of the Regional Directorate of the Environment Protection (Polish: RDOS) which authority imposes an obligation to carry out an environmental impact assessment. Guidelines of RDOS are binding for the investor.
Sometimes it happens that RDOS in its decision imposes on the investor obligation to use G ratio =0 when preparing an environmental impact assessment. This ratio is the least favorable to the investor. The obligation to use G ratio = 0 is generally justified by authorities by the fact that it is more appropriate to assess the intensity and scope of environmental noise generated by wind turbines. It also happens that authorities require from the investor to change test method after the environmental report has been prepared. This practice, however, may lead to extension of the procedure aiming at obtaining the environmental decision.