Poland is generally known as a climate policy sceptic and remains the only EU member state that has yet to sign up to the goal of net zero by 2050, insisting it will need more time to fully decarbonise. It may therefore come as a surprise to learn that by at least one measure, Poland is a leading investor in a green post-Covid-19 recovery. Nonetheless, without a clear steer from government, the country will find it difficult to break its addiction to coal and decarbonise its economy.
Energy Monitor has analysed policies recorded by the Energy Policy Tracker, an online database maintained by environmental think tanks. According to an analysis of six different countries, Poland has invested the greatest share (82.3%) of post-Covid-19 energy and climate-relevant spend in clean energy, rather than fossil fuels. That compares with 60.6% for Germany and just 34.0% for the UK.
The Energy Policy Tracker’s particularity is that it only looks at already-adopted policies. In this case, that means the tracker does not yet fully reflect plans for the EU’s €672.5bn ($795.1bn) Recovery and Resilience Facility (RRF), which lies at the heart of the EU’s post-Covid-19 €750bn Next Generation EU stimulus package. Countries have until 30 April to submit national recovery plans to the European Commission for approval.
The EU is committed to a green recovery and 37% of the RRF – of which Poland will get some €60bn, €23.9bn of that in grants – has to be spent on measures that benefit climate action.
Energy efficiency first
In what looks like an encouraging sign, energy efficiency, so far, makes up the second-biggest chunk, after railways, of Poland’s post-Covid-19 energy and climate spend. This appears to be in line with the EU’s ‘Energy Efficiency First’ mantra for energy policy.
However, Joanna Flisowska, head of climate and energy at Greenpeace in Poland, cautions that the biggest part of this is $3.46bn for high-efficiency cogeneration – which is most likely fuelled by coal or gas.
Overall, Flisowska is sceptical of Poland’s green recovery efforts. “I don’t see it,” she says. “We risk missing a big opportunity to accelerate the energy transition. There are plans for offshore wind and there are investments in rooftop solar, but these would have happened anyway. EU laws leave less and less room for fossil fuels, but that is a forced impact. We do not see a change in the Polish government’s policy and plans.”
Under the energy efficiency label, other, smaller sums are set aside for energy-saving streetlights, modernisation of district heating networks, and better insulated, less polluting homes. A ‘Clean Air 2.0’ programme has €412m to improve air quality and lower greenhouse gas emissions by replacing obsolete boilers and better insulating homes.
This is probably the last EU budget cycle where Poland is getting so much EU money. Joanna Flisowska, Greenpeace
In the national recovery plan that it will submit to Brussels, Poland foresees the greatest share of climate and energy spend, or €3.81bn out of €6.35bn, going to “clean heat”. Over 80% of that will support the “replacement of heat sources and energy efficiency in dwellings”. This is significant considering that overall, “heating buildings is one area across Europe where monetary handouts remain vastly below what is needed”.
However, campaigners question what will replace coal, which still makes up half of all domestic heating in Poland. They worry it will be new coal or gas boilers, rather than renewables. In a new analysis in March 2021, Forum Energii, a Polish think tank, promotes electrification as the way forward. It sees tremendous potential in heat pumps. Thanks to their efficiency, a house heated by a heat pump emits 40% less CO2 than a house heated by coal, even taking into account Poland’s coal-heavy electricity mix, the group says.
Moreover, Poland has big plans to decarbonise that mix. At the start of February 2021, it adopted a new energy strategy for 2040. This foresees the share of renewable energy in final energy consumption rising to 23% by 2030.
Offshore wind is at the heart of Poland’s renewables plans, with an assumption it will be able to role out several gigawatts (GW) over the next decade, up from zero today. To facilitate this, Poland passed a historic Offshore Wind Act in January. This policy is supposed to pave the way to just under 4GW in 2030 and 28GW in 2050.
Renewable energy and EV plans
The Energy Policy Tracker also has a list of subsidies targeting renewables, including support for biomass, rooftop solar PV and electric vehicles (EVs).
Incentives such as the ‘My Electricity’ programme for rooftop solar put the country on track for 14.5GW of solar PV – or a fifth of the capacity mix – by the end of 2030, suggests GlobalData. That figure is up from 3.9GW at the start of 2021.
Aleksandra Gawlikowska-Fyk, head of the power sector at Forum Energii, says e-mobility is a big priority with subsidies for e-buses, e-cars, e-company cars, e-vans, e-taxis and charging infrastructure, but warns that Poland has yet to develop a real strategy to move the sector forward.
Indeed, she worries that Poland generally lacks a systematic vision of how to add new renewables to the system. There is a headlong rush for offshore wind, while onshore wind remains blocked by the “10H” rule, which means wind farms can only be built at a distance from residential buildings equal to at least ten times their tallest turbine. There is support for solar PV, but inadequate investment in the distribution grids it plugs into.
Think tank Ember finds the new strategy’s renewables roll-out largely unchanged from older scenarios that assumed much lower CO2 prices. Flisowska says the new strategy has been outdated from the get-go.
Going forward, Poland’s national recovery plan pencils in €836m for renewables, just over half of it (€437m) for offshore wind development in the Baltic Sea. The rest is for transmission grids and energy communities, including support for collective prosumer agreements. Clean mobility is set to get roughly the same amount of money as clean energy, about €6bn. Just over a third of this (€2.19bn) will go to EVs and their charging infrastructure, plus second-generation biofuels.
New in the recovery plan is a pot of money (€797m) for hydrogen and the alternative fuels derived from it. Poland is finalising a national hydrogen strategy, which will target 2GW of electrolysis capacity by 2030. The idea is to use offshore wind to power the electrolysers from the second half of the decade. Expectations are high, but “the discussion in Poland will be more sober than in many countries”, Gawlikowska-Fyk predicts, largely because of the slow roll-out of renewables.
Elephants in the room: coal, gas and nuclear
Coal is ever the elephant in the room in Poland. The new energy strategy aims to reduce the share of coal in the electricity mix from over 70% or 120 terawatt-hours (TWh) today to 56% (75TWh) in 2030. Experts such as Ember say this is not enough for the EU to meet its 55% greenhouse gas emissions reduction target for 2030. This goal caps coal’s contribution at 55TWh – for the EU as a whole!
They also worry that the strategy envisages a near quadrupling of gas-fired electricity generation to 54TWh a year, which would make Poland the third-biggest consumer of gas for power in the EU. That said, so far there are few plans to invest in gas. Companies such as ZE PAK, which has pledged to close all lignite plants by 2030, are switching to biomass and other renewables, and starting to think about hydrogen.
If nuclear doesn’t happen in 2033, what is the plan B? Aleksandra Gawlikowska-Fyk, Forum Energii
In line with plans for electrification, Poland’s new strategy also builds expectations for nuclear power. It foresees the construction of six nuclear units, the first operational by 2033. Campaigners say this is a high-risk strategy. “If nuclear doesn’t happen in 2033, what’s the plan B?” Gawlikowska-Fyk says. The Polish government committed to nuclear power 11 years ago, but little has happened since.
According to the Energy Policy Tracker, support for coal is a small part of Poland’s post-Covid-19 spending plans so far. If Germany’s coal exit is anything to go by, however, it has the potential to become much more expensive. The Polish Mining Group, which represents national coal mines, is asking for €1.5bn in post-Covid-19 government support. A decision on this sum is ostensibly due by the end of the month.
Meanwhile, Poland’s largest utility, PGE, has welcomed the new energy strategy. Last October, it committed to go carbon neutral by 2050. However, Flisowska says the company is still pursuing new lignite mines and keeping coal plants open. “They are escaping the responsibility of planning for transition,” she says. “They hope the government will bail them out.” At the same time, PGE is putting forward green recovery plan projects for clean energy support.
The build back from Covid-19 gives Poland an opportunity to accelerate its transition away from coal and towards a net-zero future, but it will need to match recovery funds with sound governance if this vision is to become a reality. “This is probably the last EU budget cycle where Poland is getting so much EU money,” Flisowska comments. “Without ambitious climate policies and targets, however, it is hard to use this money […] to accelerate new investments that go beyond business as usual.”
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Energy Monitor is running a special series of analyses of post-Covid-19 climate and energy-related spend and policies, to determine whether countries really are building back better.
The data behind this series is based on Energy Monitor’s interpretation of work done by Energy Policy Tracker. This tracks public money commitments and policies that could impact a green recovery post-Covid-19. Policies are assigned on the criteria of which energy technology they benefit and whether they have environmental strings attached. While the original source had five categories, we have opted to distinguish solely between whether a measure benefits fossil fuels or clean energy (or nuclear power).
The measures are very different in nature and include countries’ Covid-19 recovery strategies, national climate policies and bailout measures for companies. We brand the whole package of measures as Covid-19-related government policy responses from an energy and climate perspective.
Our measurement of a country’s performance may not be fully complete as certain measures, such as tax incentives or new taxes, may not be included in our methodology.
The data covers the period from March 2020 to 10 February 2021.