Session 3a Challenges in using EU structural funds for energy projects : RES case in PL

1. Second European Conference of Municipal Energy Managers Warsaw, 5-6 October 2006 Session 3a Challenges in using EU structural funds for energy projects: RES case in PL Chair introduction Grzegorz WIŚNIEWSKI gwisniewski@ieo.pl Institute for Renewable Energy (EC BREC/IEO) Warszawa, Poland www.ieo.pl

2. Importance of EU support Disposed of domestic institutions GRANTS: - STRUCTURAL AID LEGISLATION Development Strategy for RE sector: public support of 228 Mio PLN/a. (10 years, until 2010) Investments LOW SCALE OF PRODUCTION Renewable energy technologies If only 1% of Structural Funds for investments in RE sector: community support of app. 300 Mio PLN (2004-2006) HIGH COSTS Disposed of comunity institutions R &D IEE 6 FP www.ieo.pl

3. EU pre-accession programs 2001-2004 – first experiences in Poland 1. PHARE(Infrastructure) – energy infrastructure, up to 75% of investment value. Examples:geothermal heating plants in Pyrzyce municipality and Podhale region 2.SAPARD(Scheme 3.5)– renewable energy-related projects, local communities, up to 50% of eligible costs (max. 420 000 PLN=app. 100 000 EUR). Total aid granted 4,8 Mio PLN=app. 1,15Mio EUR 9% 19% 14% 15% 7% 2% 34% 3. ISPA(Environmental Protection) – alternative energy-related projects (above 50 MW, above 50 Mio EUR), up to 75% of eligible costs.Neither RESproject supported. www.ieo.pl

4. Sustainable energy in national development program 2004-2006 National strategic documents National Development Plan (NDP) Community Support Framework (CSF) Agriculture 1 Competitiveness 2 Regional Development 3 Human Resources Transport Fisheries Technical support Community Iniciatives Strategy for Cohesion Fund Interreg Environment Equal OP Supplements Transport EAGGF ERDF Cohesion Fund !) SPO-ROL- SOP Restructuring and modernisation of food sector and development of rural areas 2)SPO-WKP- SOP Economy Competitiveness Growth 3) ZPORR - Integrated Regional Operational Programme www.ieo.pl

5. Technologies and beneficiaries of RES utilisation www.ieo.pl

6. Problems and difficulties with implementation of NDP 2004-2006 in Poland(1) Already competitive energy technologieswill besupported „MARKET-ORIENTED” NDP 2004-2006 Lack of specified budget for RES & RUE, Lack of transparence, Diffused responsibility INCOHERENT APPROACH towards RES& RUE – 3 Operating Programs, several Implementing Institutions Difficult to gauge whether assistance is used in full extent and along with its purpose Lack of QUANTIFIABLE indicators for RES, e.g. MW, number of installations, etc. INCOHERENT DEFINITIONSof RES (unconventional, alternative, renewable sources) Other technologies, not included to RES, may be supported Delay in opening of the calls for proposals DELAY in state aid notification to European Commission www.ieo.pl

7. Problems and difficulties with implementation of NDP 2004-2006 in Poland (2) Limited RES market development (small scale installations excluded) Assistance for installations ABOVE 50 MW - OP Competitiveness, Cohesion Fund Strategy Insufficient incentive to stimulate investments in biomass and biogas LOW LEVEL of assistance(max. app. 20 000 – 30 000 EUR) - OP Agriculture Less applications for financial aid for RES than possible, Lower quality of applications POOR INFORMATION for potential investors LOW USAGE of pre-accession aid, INEXPERIENCE of investors See above www.ieo.pl

8. Programmes and Instruments Eligibility Priorities Allocations 1. Convergence objective 81.7% (EUR 251.33 bn) Regional and national programmes ERDF ESF Regions with a GDP/head 75% of average EU25 • innovation; • environment/ • risk prevention; • accessibility; • infrastructure; • human resources; • administrative capacity 57.6% EUR 177.29 bn 4.1% EUR 12.52 bn Statistical effect: Regions with a GDP/head 75% of EU15 and >75% in EU25 Cohesion Fund including phasing-out Member States GNI/head 90% EU25 average • transport (TENs); • sustainable transport; • environment; • renewable energy 20.0% EUR 61.42 bn 2. Regional competitiveness and employment objective 15.8% (EUR 48.79 bn.) Regional programmes (ERDF) and national programmes (ESF) Member States suggest a list of regions (NUTS I or II) • Innovation • environment/risk • prevention • accessibility • European Employment • Strategy 15.5% EUR 38.4 bn "Phasing-in" Regions covered by objec- tive 1 beween 2000-06 and not covered by the convergence objective 3.4% EUR 10.38 bn Cross-border and transnational programmes and networking (ERDF) Border regions and greater regions of transnational co-operation • innovation; • environment/ • risk prevention; • accessibility • culture, education of which: 77.6% cross-border 18.5% transnational 3.9% interregional + ENPI New round of EU Cohesion Policy 2007-2013 3 Objectives EUR 307.6 bn (0.37% of EU-GNI) 3. European territorial co-operation objective 2.44% (EUR 7.5 bn.) www.ieo.pl

9. RES related EU budged 2007-2013 (including ERDF and Cohesion Found) accompanied by required state and private financing – a general national framework for Poland www.ieo.pl

10. Some questions and themes for discussion • Is the scope and budged for RES and RUE clearly defined by the governments, at the level of „priority & action” in the national operational programmes and regional programmes? • Does the scope of action/priority result from generic national/regional RES/RUE strategy and encompass relevant implementation programme or this is just a „collection of particular wishes”? • What is the minimum size of eligible projects: are realy small scale projects (and SMEs) supported more than large scale projects (large companies)? • Is there a priority for innovative energy technologies (e.g decentralised systems) or it is support for already existed energy markets? • Were there local energy actors involved in the priories development process and in consultation? www.ieo.pl