Poland’s problems in the energy transition process are deepening compared to Western and Northern European countries, according to this year’s study “Energy Transition Readiness Index”, where Poland received an overall rating of 2 on a five-point scale. Despite a growing share of renewables in the energy mix as well as social and political awareness of the need for change, the transition has stalled. One of the issues is underinvestment in transmission and distribution networks, which results in a high number of refusals to connect new renewable energy sources. Poland is also just starting to develop energy storage and smart monitoring of current power demand.
“Poland’s market is currently undergoing an energy transformation: for many years we have been observing the development of photovoltaics, wind turbines, and the Polish government has also decided to build nuclear energy. The EU’s Fit for 55 package, the Polish energy program until 2040 – these are assumptions that show we are already changing and will be changing. This program assumes that by 2030, 23% of gross energy will come from renewables, while at present, according to the Central Statistical Office, this share exceeds 16%, which shows that we still have a lot to improve on. We need to start thinking about what our energy sector will look like in the future,” says Bartłomiej Jaworski, an expert at Eaton.
The Association for Renewable Energy and Clean Technology (REA), in collaboration with Eaton, assessed the readiness and progress of European markets in the energy transition for the fourth time. The “Energy Transition Readiness Index” (ETRI) covered a total of 14 countries (Denmark, Great Britain, Germany, Poland, Spain, France, Finland, Sweden, Ireland, Italy, Norway, The Netherlands, Switzerland, and Greece). In a five-point scale, Poland received an overall rating of 2. This is the lowest result among the surveyed countries and a decline of one point compared to last year’s edition.
“Poland is unfortunately lagging behind compared to the EU countries, with Scandinavian countries leading the way,” says Bartłomiej Jaworski. “Of course, our plans for energy transformation are correlated with the possibilities of the economy – as a country that relies on coal, we cannot make such a leap without economic problems. Therefore, it seems that these plans are optimal, but we still have a lot of work to do to catch up with the countries that are leading in this aspect.”
In the “Energy Transition Readiness Index” ranking, Poland was positively evaluated in terms of identifying system needs related to increasing network flexibility and policy direction transparency – it received a score of 4 on a five-point scale, just like Sweden, Germany, and Denmark. We perform better than Switzerland and Italy, with only Norway receiving a higher rating. Compared to last year’s ETRI edition, Poland’s rating for socio-political support for energy transition also improved (from 2 to 3).
However, the study shows that there is still a lot to be done in adapting policy and legislation to necessary changes. Social acceptance and understanding of the need for energy transition and its associated cost are too low. There is also a lack of stronger commitment to implementing regulations necessary to attract investment – in this area, only Switzerland performed as poorly as Poland, while Denmark topped the list. Overall, the accessibility of the Polish energy market for investment in renewables fell.
“With the introduction of the net-billing system, investor interest in photovoltaics has significantly decreased, as has the number of installations with a capacity of up to 10 kWp, or small-scale OZE. We also have an unresolved issue of wind turbine construction, not only on land but also at sea, as both of these areas have their problems. When it comes to farms on land, there are issues related to how close to buildings they can be placed, which is key to how tightly and where we can build these wind turbines. Investors also suffer from a lack of building permits, so they cannot start investments,” lists the Eaton expert.
“It also seems that in pursuit of the next climate goals, we have forgotten about system stabilization. Last year saw the shut-down of renewable energy sources because demand was very low and supply very high. And this shows how important system stabilization is, meaning that alongside the development of renewable energy sources, conventional energy and nuclear energy must also develop.”
In last year’s ETRI report, there was a general decrease in the confidence of energy market participants in the socio-economic factors associated with energy transformation, largely due to fears related to the energy crisis. However, in this year’s report, the results of European countries improved compared to 2022. It is possible that the confidence of energy market participants is slowly returning to pre-crisis levels. Experts suggest that it would improve even more if the European Green Deal policy were implemented more quickly in European countries.
“What we can do fastest in Poland is to establish a consensus between the state and investors in the field of wind energy and improve the so-called wind act. The second issue is the valorization of subsidies to energy storage within the scope of small photovoltaics so that people who are charged under the net-billing system have the same or similar benefits as those who currently operate in the discount system. These are things we can do quickly. Long-term financial inputs and legal solutions are needed, primarily for the development of north-south transmission network infrastructure and subsidize professional energy operations to have the smallest number of refusals to connect,” emphasizes Jaworski.
Filling in the gaps indicated in the ETRI will be time-consuming and will require huge financial outlays. Therefore, both in Poland and other EU countries, a clear, consistent plan for energy transformation is needed, which will cover the roles of all its participants and set the direction of market reforms. It is essential to develop incentives for investment in zero-emission solutions, for example, through tax breaks, which should include so-called dispersed network flexibility resources, i.e., heat pumps, energy storage or electric vehicle infrastructure. Priority treatment of renewable energy production on electricity markets could also help increase investor confidence. The authors of the report underline that the time for implementing such actions is getting shorter, so it needs to start as soon as possible.
“Speaking about what else we can do to improve the situation and the development of renewables, at this moment the first issue is to attempt better regulation of the safety of photovoltaic installations and related projects. The first steps in this direction were taken in 2020 when a requirement was introduced to consult with a fire safety expert for installations with a power over 6.5 kWp. The second issue is the OZE auctions organized by URE, which could function differently to get a greater response from the market. The latest reports suggest that unfortunately, the interest is not as high as initially assumed,” says the Eaton expert.
