Poland's government approved a long-awaited draft law on
Tuesday that lays out new long-term subsidies for renewable energy, aiming to
cut costs to consumers as well as help the coal-reliant country meet EU climate
targets.
Under the draft law, which requires final approval by parliament and the
president, developers and owners of new renewable installations can sell their
energy at auctions for a fixed price that would be guaranteed for 15 years
regardless of market prices. The proposal would also set a ceiling on the
subsidy.
It would allow renewable power producers that are already in operation to keep
their current subsidies or choose to join the auctions.
Poland has been working for almost two years on a new renewables law that would
help it meet the European Union's green energy targets at the same time as
keeping costs relatively low.
Poland generates around 90 percent of its electricity from coal and must
increase renewable energy to at least 15 percent of the total by 2020 to meet
EU rules on carbon emissions.
Change has proved difficult, however, as renewable power producers complain
that an uncertain legal environment has prevented them from making new
investments.
The previous subsidy system did not provide long-term guarantees, and
governments across Europe have been progressively cutting subsidies.
The government has calculated that the cost of its current subsidy system would
rise to 7.5-11.5 billion zlotys ($2.5-$3.8 billion) a year by 2020. ($1 =
3.0364 Polish Zlotys)
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