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  • Service: Tax
  • Type: Regulatory update
  • Date: 9/24/2014

Poland 

Taxes and Incentives
Poland Taxes and incentives for renewable energy KPMG Global Energy & Natural Resources.

Support schemes

Investment and other subsidies


  • Support schemes are applicable for solar, wind, geothermal, hydro, biomaterial and offshore technologies.
  • Renewable energy is exempt from excise tax.
  • In some cases solar photovoltaic modules cannot be subject to real estate tax as other constructions. (The planned act on renewable energy sources might provide otherwise.)
  • Agriculture tax payers may claim a refund of investment costs if the investment relates to renewable energy (up to 25 percent).
  • Subsidies and grants from the EU Structural Fund in Poland or other domestic institutions (for example, the National Fund of Environmental Protection and Water Management).

Currently the following sources of financing for renewable energy projects are available:


The Stork Programme – financing of distributed, renewable energy sources (RES)


  • Support under the Stork Programme will be given for investments involving construction or reconstruction of RES installations with capacities from the following ranges:
    • wind power plants – from 3 MWe,
    • photovoltaic systems – from 200 kWp to 1 MWp,
    • energy from geothermal waters – from 5 MWt to 20MWt,
    • hydropower plants – to 5 MW,
    • biomass-fired heat Sources – to 20MWt,
    • biogas plants – from 300 kW to 2 MWe,
    • production of electricity in high efficiency cogeneration biomass – to 5 MWe.
  • All companies may apply for support.
  • The level of support, given in the form of preferential loan, is between 30 per cent and 75 per cent of eligible cost of the project (depending on the investment type). The amount of support reaches from 2 million Polish Zloty (PLN) up to PLN 40 million.
  • The Stork Programme will be implemented in the years 2014 – 2022, the spending is possible up to 2020.

Support for of a low-carbon and resource-efficient economy: part 1) energy and electricity audits, part 2) improvements of energy effectiveness of companies, part 3) e-accumulator - ecological battery for industry

 

  • Companies investing in undertakings leading to energy savings may apply for support.
  • Support under Part 1) will be given in the form of grant up to 70 per cent of eligible investment costs. Support under Part 2) and Part 3) is given in the form of preferential loan. The amount of support reaches from PLN 300 000 up to PLN 50 million. The maximum level of the loan may not exceed 75 per cent of eligible cost of the project.
  • All three parts will be implemented in the years 2014 – 2017, the spending is possible up to 2017.

Other incentives


Besides aid sources mentioned above, the investor may also apply for other incentives related to broadly defined energy sector, in particular:


  • grants from EU funds for the Financial Framework for 2014-2020 and national programmes designed inter alia for investment and employment (i.e. new manufacturing plants, innovative technologies), R&D activities (i.e. development or improvement of products, services or technologies), other activities, such as environmental protection, training sessions, logistics.
  • incentives from the Polish Government (R&D projects, environmental projects, the Programme of support of investments of considerable importance for Polish economy for years 2011-2020),

Incentives obtained by the investors in Poland are subject to Polish and European Union state aid rules which determine, inter alia the maximum level of support, beneficiaries and the detailed conditions of support.

Operating subsidies

Green certificate system


Remuneration for renewable energy produced: the average market price of 181.55 PLN/MWh for the last year (2013) plus the market value of green certificate (certificate of origin) granted by the Energy Regulatory Office.

Quota obligation

Rates (2014): 13 percent of all energy produced (floors relate to all types of renewable energy). The quota is increasing in stages and will reach 14 percent in 2015 to 20 percent in 2021.

Additional information

Legal basis


The Act of Energy Law enacted on 10 April 1997 and the respective decrees from the Ministry of Economy.


In April 2014, the Council of Ministers announced the draft of the act on renewable energy resources which will implement the provisions of Directive 2009/28/WE into the Polish law. According to the new act, the level of support for renewable energy will differ depending on the source of renewable energy. The highest support will be provided for small energy installations (e.g. photovoltaic installations and micro-installations used solely for energy producer's purpose). This act provides also new mechanism for sale of renewable energy at auction. Additionally, it is not entirely sure whether the current regime of RE support will be applicable to the existing energy installations once the new act on renewable energy resources comes into force (under the current wording of the new act, the energy producers will be eligible to choose between the current scheme and the new one).


Administrative procedures


Business activity in the area of production of renewable energy is a licensed activity and requires a permit granted by the president of Energy Regulatory Office. Such a permit can be sought by an entity that meets requirements specified in the Energy Law, especially the ability to provide the financial, organizational and technical resources required to perform the licensed activity. As a rule, permission is given for the fixed term but not longer than 50 years.


Grid access


Priority access is granted over nonrenewable electricity producers. The costs of connecting to the electricity grid are determined by the actual costs incurred to construct the line. Those costs may be partially refunded to the investor, depending on the year and production capacity.


Green certificates scheme


Electricity producers may apply to the president of Energy Regulatory Office for green certificates (also known as certificates of origin), if they have produced renewable energy or if they are required to pay substitute fees calculated in line with the energy law. The green certificates are similar to securities; they are transferable and tradable on the regulated market (for example, the Polish Power Exchange) or within the over-the-counter market. Generally, if energy producer does not achieve the minimum level of share of renewable energy (for 2014 – 13 percent), he is obliged to purchase green certificates at the market (for redemption) or has to make a compensation payment.


Sale


Electricity distributors have a legal obligation to acquire a certain amount of renewable energy generated in Poland. For the year of 2013, the above percentage limit of renewable energy will amount to 12 percent. Otherwise, the electricity distributor is obliged to buy the missing amount of renewable energy (by means of green certificates) on the market. The prices of renewable energy have been determined based on average prices of energy in the previous year. (The amount for 2012 was PLN201.36 /MWh). The renewable electricity producers have priority over other producers with regards to the distribution of produced energy.

 

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