Poland’s electric power company PGE is calling for mitigating the additional costs of the energy transition by introducing appropriate amendments in the Commission proposal to reform the EU Emissions Trading Scheme (EU ETS).
This is what emerged in an online webinar attended by representatives of the European Commission, MEPs, market analysts and leading think tanks.
During his speech, PGE’s Vice-President for Corporate Affairs Paweł Cioch emphasised that due to the long-term investments carried out and planned by PGE, the proposal to use all domestic revenues from the sale of CO2 emission allowances to finance climate-friendly investments is a change in the right direction.
“This means that more public funds will be dedicated to finance the energy transition,” he said. “However, we must keep in mind that – for certain countries – the investment needs stemming from 55 per cent climate target largely exceed the national revenues from the EU ETS. Because of that, countries like Poland have a structural deficit of allowances, which has been estimated by the think-tank Forum Energii at 660 million of allowances less than Poland’s expected emissions until 2030.”
This means more than 40 billion euros that Polish companies will have to pay through the ETS auction platform into the budgets of other EU countries by 2030 instead of the Polish budget.
To achieve the higher EU target of reducing greenhouse gas emissions by at least 55 per cent, Poland needs investments of 136 billion euros and when all available funds are taken into account, the investment gap in Poland still remains and is estimated at as much as 93 billion euros. Therefore, PGE’s Vice-President for Corporate Affairs pointed out that the funds proposed by the European Commission for mitigating the social costs of transition are definitely insufficient.
“We must mitigate extra energy transition costs through an appropriate increase of the Modernisation Fund,” states Mr Cioch. “We must keep the possibility to finance gas investments from the Modernisation Fund if the EU wants to show that it has good recognition of different starting points between Member States.” –