While analyzing the density of the Polish electricity grid (Fig. 5), it would be useful to make a reference to the condition of the grid in some European countries. In accordance with 2009 data (Fig. 5), Poland ranked second-worst (Stankowska 2009), followed only by Hungary, in terms of infrastructure density of highest-voltage transmission lines, with 41 km per 1000 km2.
When comparing the density of electricity grids between Poland and other European countries (Figure 7), the difference is clearly noticeable. As mentioned earlier, Poland has one of the Europe’s lowest infrastructure densities of highest-voltage transmission lines.
Especially during summer period, electricity demand largely exceeds the average level, particularly in major agglomerations. Many networks in these areas have already reached their operational limits and must be extended and upgraded (Wasiuta 2014). Therefore, firm conclusions can be drawn regarding the extent of required investment projects in Poland.
In Polish economy, the demand for hard coal is partially fulfilled with imports, and that trend is forecasted to continue. In 2017, coal imports into Poland was 13,3 million tons which is 18% of total consumption. By the end of 2019, 16,7 million tons of coal were imported into Poland, which is 24% of total consumption (Statistics Poland (GUS) 2020).
In Poland, steam coal accounted for most of the imports. The largest quantities (61% of total imports) were imported into Poland from Russia, followed by Australia with 19.2% (although it was coking coal only); 8.6% of total coal imports originated from the USA and Columbia (EUROSTAT 2020b).
The problem of lignite extraction is also discussed intensively, mainly with the environmentalist community, because it has a strong environmental impact (Wojnowski 2002). For the energy sector and the coke industry, it would be impossible to switch exclusively to Polish raw materials because some types of coal are not extracted in Poland (Wasiuta 2014). Compared to neighboring countries, Poland has relatively large coal resources, documented natural gas reserves, shale gas, Europe’s largest geothermal reservoirs. Among the non-biomass renewable options, wind power has the largest potential in Poland. The main challenges to its development are the limited number of locations with high wind speed. Offshore offers better wind speed than onshore, but its costs are twice as high (Waydel 2008; Gielen et al. 2015).
Nuclear power plants are a controversial source of energy for the society and a potential target for hackers, and therefore involve the issues of national security. Nevertheless, it can be pointed out the low carbon emission aspect of nuclear energy (Johnson 2009). Having the above in mind, according to different calculations, wind energy, for instance offshore wind energy at the Baltic sea, could be a substitute for nuclear energy in Poland (2012; Kowalczyk 2019). In this context, the diversification of energy sources is a fundamental aspect of managing the risks to secure supplies of energy raw materials to any country. Renewable energy sources could play a major role in this process. The production of electricity from renewable sources, and especially distributed generation production cannot be perturbed by foreign governments or other national or international organizations; this is an essential aspect for the country’s energy security.
Though more expensive, cogeneration is more environmentally friendly and consists in the simultaneous production of electricity and heat used in industrial processes, building heating and water heating. It results in saving conventional sources and reducing carbon emissions, as promoted under the relevant EU Directive (European Parliament 2012). Cogeneration is crucial for the national energy security. The European Union pays particular attention to promoting this technology by emphasizing not only its energy efficiency but also the ability to considerably reduce the emissions of carbon dioxide and other harmful chemicals. While this technology attracts interest from the coal and gas industries, it may also be combined with renewable energy sources. Undoubtedly, such a solution contributes to reducing the use of conventional fuel in electricity and heat production processes.
The greater use of primary energy contained in fuel in the simultaneous production of electricity and heat contributes to improvements in energy efficiency. This is the key advantage of this system: energy efficiency may be up to 30% higher compared to separate generation of both types of energy in condensing power plants (electricity) and boiler stations (heat). Cogeneration plants provide heat and power 50 -70% more efficiently than traditional facilities. Observation of technological processes shows that a cogeneration system uses 100 fuel units to produce 40 units of electricity and 50 units of heat whereas a total of 170 fuel units are required to produce the same amounts of energy in separate processes (Buczyńska 2015; Schleup 2008).
However, real benefits can be attained through the use of renewable energy sources. If used instead of conventional fuels, they contribute to a further reduction in carbon emissions. In cogeneration, renewable energy sources mainly mean the use of biomass. Ingredients used to cogenerate heat and electricity include: farm waste, waste food, plants and waste wood. In broad terms, biomass also means biogas which is produced with the use of manure or in waste treatment plants. The greatest shares of biomass used in cogeneration systems are reported in Sweden and New Zealand, i.e. countries with the largest forestry and wood industries (Buczyńska 2015).
In Poland, total electricity production from high-efficiency cogeneration did not change much over the 2007–2017 period. At the end of 2007, it was 159,348 GWh, representing ca. 17.5% of electricity production. The corresponding figures at the end of 2017 were 16.72% respectively (Central Statistical Office 2020).
The key advantages of cogeneration schemes include: reduced fuel consumption per energy unit; reduced emissions of pollutants; reduced heat losses in transmission networks; dispersion of energy sources; and creation of new local jobs.
The Polish Energy Law (Ministerstwo gospodarki 1997) provided for certain forms of support for cogeneration. Note that the Regulation of the Minister of Economy of December 15, 2000 (issued with the participation of the Department of Energy) on the obligation to purchase electricity from non-conventional and renewable sources of energy, electricity cogenerated with heat and heat from non-conventional and renewable sources, and laying down the extent of this obligation (Journal of Laws 2000) was only relevant to large energy undertakings while providing little help to small companies. The Regulation of the Minister of Economy, Labor and Social Policy concerning detailed scope of the obligation to purchase electricity and heat from renewable sources of energy and electricity cogenerated with heat (Journal of Laws 2003) entered into force in 2003. In accordance with these assumptions, the obligation to purchase renewable energy was introduced.
The adoption of the Act on Renewable Energy Sources (Sejm of the Republic of Poland 2015b) was followed by many changes. For the first time in Poland, feed-in tariffs were introduced which specify the principles for the sale of energy by the smallest RES micro-installations to the grid.
Because of the fact, that the support mechanism for high-efficiency cogeneration expired at the end of 2018, the Ministry of Energy prepared a draft Act on Promoting Electricity from High-Efficiency Cogeneration (2018) providing for a new support mechanism for the producers of energy from cogeneration installations. By the end of 2019 the law was adopted and entered into force (Sejm of the Republic of Poland 2019). The introduction and implementation of these changes is an important element in the fight against high levels of pollutants and greenhouse gases in Poland. In addition to cogeneration, tri-generation becomes increasingly important, especially in Germany (because of the availability of the technology). This means using the same technological process to generate heat, electricity and cooling energy in order to reduce the amount and cost of primary energy required to produce each of these energies separately (Gailfuß 2019).
Heat, cooling energy and electricity are three totally different products subject to different laws. While the market for heat and cooling energy is of a purely local nature, electric power is sold across a wide territory (on a countrywide and Union-wide basis). Ecological arguments and the strategic importance of cogeneration and tri-generation, mainly due to improvements in the efficiency of primary fuel consumption through the use of heat, are the reasons why efforts are being made to introduce stronger economic incentives and legal frameworks supporting the use of these solutions. The cogeneration policy results from the EU climate policy. To meet the objective of reduced carbon emissions, it is necessary to considerably reduce heating-related emissions.
Self-sufficiency means not only secure supplies of energy to end customers from external and internal suppliers but also the internal operational security of the entire energy sector. In Poland, it is threatened by many factors, such as miners’ strikes, the deplorable condition of transmission networks, as reflected by numerous network failures and measures taken by monopolists who do offer certain products to end customers but charge extremely high prices. These threats may be qualified as socio-political, technical and economic aspects. However, the customer does not care about the reasons behind a disruption in energy or fuel supply. Some countries, e.g. the US, Italy or Japan, are not energy self-sufficient but feel secure. This is because their national energy policies address various dimensions: efficiency (in Japan), diversification (Italy and US) and adequate foreign policy, especially alliances (in Japan and US). Equating energy security with self-sufficiency may result in an attempt to build a country which does not need any external relationships. This would be unviable, as illustrated by the example of North Korea (2007). However, the above does not mean that Poland should refrain from seeking a greater degree of self-sufficiency in industries which rely on other countries, i.e. the gas and liquid fuels industries.
The development of renewable energy sources is among the key objectives of the Polish energy policy. The draft “Energy policy for Poland to 2050” (Ministry of Energy 2015a) developed by the Ministry of Economy includes a long-term development strategy for the energy sector, a forecast of fuel and energy demand and an implementation program. Also, it clearly indicates the development of RES to be a strategic objective (Ministry of Energy 2015b). The document defines priority lines of action, such as: improvements in energy efficiency; increased security of fuel and energy supply; diversification of electricity production (through the introduction of nuclear energy); greater use of renewable energy sources, including biofuel; development of competitive markets for fuel and energy; and reduced environmental impact of the energy sector. The Minister of Economy monitors the ongoing progress in policy implementation. Also, an interministerial team in charge of national raw material policy (Poland 2012) has been in place since 2016. The key role of RES in the development of the Polish energy sector is also reflected by the adoption of the long awaited Act on Renewable Energy Sources (Sejm of the Republic of Poland 2015a).
The key lines of development for the energy policy are as follows (Ministry of Economy 2009): improvements in energy efficiency; increased security of fuel and energy supply; diversification of the electricity production mix through the introduction of nuclear energy; extended use of renewable energy sources, including biofuel; development of competitive markets for fuel and energy; reduced environmental impact of the energy sector. The defined energy policy orientations are largely interdependent. The improvements in energy efficiency reduce the increase in demand for fuel and energy. This contributes to energy security by making the country less dependent on imports while also helping reduce emissions and the resulting environmental impact of the energy sector. Similar effects can be achieved by promoting a greater use of renewable energy sources, including biofuel, clean coal technologies and nuclear energy.
To comply with European Union obligations, Poland as well as all EU countries, is required to reach the share of energy from renewable energy sources in EU’s gross final consumption of energy in 2030 which is 32% (European Parliament 2018). Every country will also be committed to a greater integration of renewable energy sources into the energy system, for increasing flexibility of the energy system and maintaining grid stability, developing transmission and distribution grid infrastructure and intelligent networks. It should be also noted, that initially much was expected from the use of biofuels and bioliquids, including a reduction in transport carbon emissions and freeing the country from dependence on fossil fuel supplies from abroad. However, in reality, the situation proved to be much more complicated. The European Union issued two Directives which require the member states to attain specific levels of biofuel use in transport. For the calculation of a Member State’s gross final consumption of energy from renewable energy sources and the minimum share of biofuels and bioliquids consumed in transport, where produced from food and feed crops, shall be no more than one percentage point higher than the share of such fuels in the final consumption of energy in the road and rail transport sectors in 2020 in that Member State, with a maximum 7% of final consumption of energy in the road and rail transport sectors. As a consequence of this policy, large areas under existing crops started to be converted to biofuel feedstock production. At the same time, to meet the growing demand for food, it was necessary to establish new agricultural areas. This is done through deforestation and destruction of peatland and other valuable habitats which naturally store carbon and reduce atmospheric carbon emissions. The above is referred to as Indirect Land Use Change (ILUC) (Bhatia 2014; European Commission 2017; Lapola et al. 2010).
According to assumptions of the “Polish energy policy to 2030,” support mechanisms for RES development in Poland need to be strengthened; improvements should be made to the investment climate; new, more effective economic instruments should be deployed to provide a momentum for RES investments and for the production of RES-based technologies while also maximizing the absorption of European funds, mainly under the Regional Operational Programs, Rural Development Program and the Infrastructure and Environment Operational Program, allocated to such projects as: production of renewable energies together with the connection to the distribution/transmission network (hydropower, wind, solar, geothermal, biogas and biomass energy); construction and reconstruction of networks enabling the connection of renewable electricity to the National Electricity System; construction of installations for biofuel and its components.
Even though the relevant act was adopted, the development of RES in Poland continues to face many problems. The uncertainty surrounding the regulations and the absence of support for the development of a dispersed RES system are the main barriers to the development of this sector in Poland. According to the “Polish renewable energy machinery industry: updated business directory and assessment of development opportunities for the industry in the 2020 and 2030 time horizon,” (Wiśniewski et al. 2016) a report by the Institute for Renewable Energy, the absence of a consistent support policy for the Polish RES industry may result in halting its development and losing measurable benefits. It has already become apparent that some industries of this sector face an uncertain future. For instance, solar energy companies are doing somewhat better but without adequate incentives from the government they, too, may stop developing. Currently, as many as 33,800 people are employed in the RES industry. According to the “energy revolution” (2013) scenario developed by the Institute of Renewable Energy in 2013, over 100,000 people could be employed in the Polish RES industry in 2030, i.e. as many as in the entire apparel industry in 2018 (Wiśniewski et al. 2016; Statistical Publishing Establishment 2019). In 2016, the number of employees in the RES industry in Poland and in the EU was 43,300 and 1,139,050, respectively (Wasiuta 2018). In turn, according to a report by IRENA, there were 9.8 million people employed in the RES industry around the world in 2016, most of them (over 3.8 million) in China, the leader of renewable energies. The European Union ranked second with nearly 1.2 million RES jobs; Germany and France had the largest share (334 thousand and 162 thousand, respectively) . Note also that EU enterprises own 40% of all patents for renewable technologies (Tomaszewski 2018).
According to experts from the Institute for Renewable Energy, the Polish industry of solar energy equipment alone may contribute a total of PLN 18.5 billion to the budget in 2015–2030. However, this cannot be done without a stable legislation and a long-term policy which provide support for dispersed RES systems .
A stable and socially equitable support system is a necessary condition for the development of the Polish RES sector, especially including the most promising small and micro-installation segment. Feed-in tariffs are the most effective support instrument for the development of the RES sub-sector specialized in the manufacture of power generation equipment. The benefits of this system are the predictability and simplicity of support. It is also crucial that support has to be provided mostly for dispersed investments in small and micro-sources to encourage the development of local companies and prosumers. In order for renewable energy companies to develop, the equipment manufacturing sector must be included in official statistics on the RES sector (which currently are not kept) . The amendment to the RES Act extends the support for RES development by combining feed-in tariffs with a system of rebates (Article 4 of the RES Act (Sejm of the Republic of Poland 2015b)) which enables cashless settlement of payments for electricity used by prosumers and produced in a micro-installation.
So far, the Polish RES industry has the longest track record in the production of solar collectors, biomass boilers and heat pumps. Each year in Poland, specialized companies sell and install equipment worth PLN 2 billion. A steep decline in multiannual support programs for RES-based heat production and the promotion of coal as a local fuel are barriers to the development of these traditionally strongest companies of the Polish RES industry and make it impossible to offset losses incurred domestically with exports (Sejm of the Republic of Poland 2015b).
By leveraging market mechanisms, the Energy Efficiency Act introduces a series of measures, including the system of energy performance certificates – so called “white certificates”, which should drive measurable energy savings in three areas: increased energy savings for end customers; increased energy savings in personal equipment; and reduced electricity, heat and natural gas losses across the industry and in distribution networks. B2C energy suppliers are required to receive and submit “white certificates” for redemption to the President of the Energy Regulatory Office. Otherwise, they must pay a compensation fee. Electricity, natural gas and heat suppliers are required to obtain a specific number of certificates depending on the amount of energy sold.
Although the households keep improving their energy efficiency ratios, energy demand in this sector is estimated to grow until 2030. While total energy consumption will increase only slightly (by ca. 5%), the increase in the consumption of one of its components (electricity) will grow by as much as 50%. Electricity production uses the greatest amounts of primary energy, and therefore electricity savings are potentially most beneficial to the environment. Since early 2000s, Poland has witnessed tremendous improvements in energy efficiency. Indeed, the energy intensity of Gross Domestic Product decreased by nearly one third. However, energy efficiency of the Polish economy is three times lower compared to the most developed European countries and approximately two times lower than the EU average level. Also, primary energy use per capita in Poland is almost 40% lower than in the“old 15” EU countries. This suggests there is a great potential for energy savings in Poland, which is a characteristic of economies experiencing rapid growth (Ministerstwo Infrastruktury i Rozwoju 2014).
Households use ca. 20% of electricity consumed in Poland (Maj 2015), and have the greatest impact on consumption growth rates. The potential for savings seems considerable, yet not adequately used. Therefore, the question could be explored whether households should be provided with greater support in the area of electricity savings.