The Polish Draft Act on the Capacity Market in light of EU law

The report concludes that the Polish Draft Act on the Capacity Market constitutes State aid and is incompatible with EU law. Key issues include the exclusion of foreign capacity providers, potential environmental harm through subsidies for high-emission units, and a lack of competitive pricing mechanisms. The report estimates that the capacity market will cost end users approximately EUR 16.8 billion (PLN 73.5 billion) between 2021 and 2035. Furthermore, the Draft Act conflicts with the EU's 'Winter Package' proposal, particularly regarding decarbonisation goals and the requirement for cross-border participation.

• The remuneration for fulfilling capacity obligations under the Draft Act is classified as State aid because it is funded by a state-imposed charge on end users, grants selective advantages to certain energy undertakings, and affects trade between EU Member States.
• The Draft Act is deemed incompatible with the EU internal market for three primary reasons: it allows for subsidies that may harm the environment, it prohibits operators from other EU Member States from participating, and it may fail to ensure enough generators participate to establish competitive prices for new or modernised units.
• The proposed mechanism may be rejected by the European Commission if it supports new generating units with an average CO2 emission factor of 700 g/kWh or more, as this would contradict the goal of phasing out environmentally harmful subsidies.
• The Draft Act is inconsistent with the EU's Proposal for a Regulation on the internal market for electricity, specifically regarding the requirement that capacity mechanisms be open to providers from other Member States and the proposed limit that units emitting 550 g CO2/kWh or more be ineligible.
• The total additional cost to all end users from 2021 to 2035 is estimated at a minimum of EUR 16.8 billion (PLN 73.5 billion), based on data from the Regulatory Impact Assessment.
• The ability of the Minister of Energy to set separate 'baskets' and clearing prices for new or modernised units could turn the auction into an administrative allocation of high-value contracts to state-controlled companies like ENEA, PGE, and Tauron.

APA

Kukuła, W., & Stoczkiewicz, D. M. (2017). The Polish Draft Act on the Capacity Market in light of EU law. ClientEarth. https://www.clientearth.org/media/mjmb0zjv/the-polish-draft-act-on-the-capacity-market-in-light-of-eu-law-ce-pl.pdf

Chicago

Kukuła, Wojciech, and Dr Marcin Stoczkiewicz. The Polish Draft Act on the Capacity Market in light of EU law. ClientEarth, 2017. https://www.clientearth.org/media/mjmb0zjv/the-polish-draft-act-on-the-capacity-market-in-light-of-eu-law-ce-pl.pdf.

Wikipedia

{{cite report |last1=Kukuła |first1=Wojciech |last2=Stoczkiewicz |first2=Dr Marcin |title=The Polish Draft Act on the Capacity Market in light of EU law |publisher=ClientEarth |date=February 2017 |url=https://www.clientearth.org/media/mjmb0zjv/the-polish-draft-act-on-the-capacity-market-in-light-of-eu-law-ce-pl.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{kukua2017polish, author = {Kukuła, Wojciech and Stoczkiewicz, Dr Marcin}, title = {{The Polish Draft Act on the Capacity Market in light of EU law}}, institution = {ClientEarth}, year = {2017}, month = feb, url = {https://www.clientearth.org/media/mjmb0zjv/the-polish-draft-act-on-the-capacity-market-in-light-of-eu-law-ce-pl.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }