Renewable Energy Act

In February 2015 Poland adopted its long-debated Renewable Energy Act. The new law was amended two times and entered into force in July 2016. The Law replaces the green certificate system with auction scheme. The first auction took place on 30th of December 2016 with results being announced early January 2017. Further auctions took place in spring 2017 and were scheduled as well for summer and autumn 2017. However, the latter two 2017 auction rounds were canceled as the Act was not clear on combining auction contract with other forms of public support breaching EU’s rules on fair competition. These inaccuracies triggered work on the subsequent amendment to the Act that entered into force on 29th of June 2018. The June 2018 amendment modified the auction system and in effect unblocked it. The Energy Regulatory Office (URE) of Poland is obliged to organise and run auction rounds by the end of 2018 and in 2019 in order to bring new renewable power capacity into the system. The June 2018 amendment modified auction technology baskets. The new baskets are as follow: 
 |  Basket  (PL: “Koszyk”)  |  Technologies eligible 
 |  Basket 1  |  1) installations using only biogas obtained from landfills; 2) installations using only biogas obtained from sewage treatment plants; 3) installations using only biogas other than those specified in items 1 and 2 above; 4) exclusively dedicated biomass combustion installations or hybrid systems; 5) only installations using biomass, biogas, biogas or agricultural biogas incinerated in a dedicated multi-fuel combustion plant; 6) exclusively dedicated to biomass combustion installations or hybrid systems, in high-efficiency cogeneration. 
 |  Basket 2  |  1) installations using only hydropower for electricity generation and 2) installations using only geothermal energy for generating electricity, as well 3) installations using only offshore wind energy. 
 |  Basket 3  |  Agriculture biogas installations 
 |  Basket 4  |  1) onshore wind 2) solar PV installations 
 |  Basket 5  |  Hybrid installations Projects selected through auction processes will receive 15 year long Power Purchase Agreements. The design and introduction of the auction support system was a revolutionary change in the area of support for electricity generation from renewable sources. This system ensures the competitiveness of entities entering the auctions, which translates into maximum favourable electricity prices, and consequently has an impact on the cost of electricity offered to end users. The auction is won by entrepreneurs who offered the lowest energy sales price. The principles of the auction mechanism, together with subsequent updates of the RES Act, were subject to changes, which concerned, among others, the system of division into so-called "auction baskets". Over the period of several years the auction settlement method has also evolved. The auctions held in 2016 and 2017 were won by participants who offered the lowest selling price - until the quantity or value of this energy specified in the auction announcement is exhausted. The amendment to the Act of 2018 introduced the so-called rule of enforcing competition. According to this rule, the auction is won by the participants who offered the lowest energy sale price and whose bids did not exceed 100 per cent of the value or amount of energy specified in the auction announcement and 80 per cent of the amount of electricity covered by all submitted bids. Such a provision allows to avoid a situation in which all bids win the auction, even if the amount or value of electricity in the submitted bids does not exhaust the entire volume or value indicated in the announcement.

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