Investors going with the wind
The report's findings for Poland are confirmed by several local investment funds, which state that, despite the country's great potential, investors are being turned off by a muddled and uninviting regulatory system, and heading elsewhere. Others, however, beg to differ.
EU directives require what will be almost a doubling of renewable energy production by 2010. Yet according to the WWF, Poland has so far failed to come up with any comprehensive implementation of EU directives, and has been unable to slash time-consuming bureaucratic procedures which obstruct access to the power grid, or create the kind of stable and favorable tariff system for renewable energy providers that could act as an incentive for investment.
The report identifies the growing of biomass crops for energy production as a solution for the future exploitation of Poland's large areas of agricultural land, much of which will cease to be cultivated as the farming sector shrinks after May 1. Yet despite great investor interest in a sector that could provide between 40,000-60,000 new jobs for those who will most need them over the next twenty years, Poland's natural wind resources are far from being fully exploited, the WWF claims.
"Poland has set itself ambitious targets in terms of renewable energy, but has not created the legislation which would make them achievable," says Giulio Volpi, Climate Policy Officer at WWF. It's a view echoed by Ludmiła Lakomiec, office manager at the research and advice organization, Baltic Renewable Energy Center.
"When the government came up with a comprehensive national strategy for the environment in 2000-2001, we were inundated with emails and phone-calls from would-be investors. But then none of it was fully put into effect, and interest died away," she says.
As an example of the incomplete legislative framework, Giulio Volpi points out that although the government has set up a system allotting renewable energy quotas to distributors, there are no penalties for those which don't meet their quotas, "which renders the allotment of quotas fairly pointless."
Not only is the legislation incomplete, in many ways it's positively unfriendly to potential investors, argues Adam Pool, Chief Investment Officer at Environmental Investment Partners, a company which invests in environmental projects. Another drawback is Poland's failure to provide the kind of favorable and stable tariff system for renewable energy suppliers which would enable this country to meet its own targets by attracting investment in renewable energy.
"Countries which offer a set price for renewable electricity, are obviously much more attractive for investors because they enable investors to predict their profits," he says.
And according to Giulio Volpi, long waiting times and complicated procedures for grid access, meanwhile, also discourage potential funds by making investment more expensive by delaying returns.
The problems are not merely legislative but also technical in nature, argues Bernd Panzar, director of Lorica, a German based windmill construction firm. He points to areas such as Pomorze, which has plenty of large, flat and empty spaces that used to be state farms, and which are ideal for windturbine construction - except that such areas lack roads and access lines to the grid.
"We'd like to invest in Poland but for the moment it lacks the conditions which enable you to make concrete decisions," he says.
At least another six German firms and one Spanish company, which had considered investment in the local renewable energy sector, are also known to have decided that, based on relative merits, Spain, Portugal and France represent more promising fields for investment than Poland's muddled and non-transparent regulatory climate.
Michał Wilczyński, vice-president of Ekofundusz, the Polish Debt for Environment Swap, however, has a different take on the issue. Agreeing that biomass firing is potentially a great employment creator, as well as being technically less challenging to install than wind-power, he nevertheless disagrees that its development is being held back by bad legislation.
"We have a biomass boom right now," he says, "200 biomass heat plants have appeared over the last few years, despite the lack of a favorable legislative climate, because farmers themselves have seen the business opportunities."
Progress in the development of wind energy is also, according to Wilczyński, impressive. Up from just one megawatt of renewable electricity three years ago, he claims, Poland now has 65-70 megawatts installed, while some 1,500 applications to build windmills in Poland are currently waiting to be processed, despite the waiting times and lack of feed-in-tariffs.
"It doesn't look to me as if investment in renewable energy is allowing itself to be discouraged," he says.
EU directives require what will be almost a doubling of renewable energy production by 2010. Yet according to the WWF, Poland has so far failed to come up with any comprehensive implementation of EU directives, and has been unable to slash time-consuming bureaucratic procedures which obstruct access to the power grid, or create the kind of stable and favorable tariff system for renewable energy providers that could act as an incentive for investment.
The report identifies the growing of biomass crops for energy production as a solution for the future exploitation of Poland's large areas of agricultural land, much of which will cease to be cultivated as the farming sector shrinks after May 1. Yet despite great investor interest in a sector that could provide between 40,000-60,000 new jobs for those who will most need them over the next twenty years, Poland's natural wind resources are far from being fully exploited, the WWF claims.
"Poland has set itself ambitious targets in terms of renewable energy, but has not created the legislation which would make them achievable," says Giulio Volpi, Climate Policy Officer at WWF. It's a view echoed by Ludmiła Lakomiec, office manager at the research and advice organization, Baltic Renewable Energy Center.
"When the government came up with a comprehensive national strategy for the environment in 2000-2001, we were inundated with emails and phone-calls from would-be investors. But then none of it was fully put into effect, and interest died away," she says.
As an example of the incomplete legislative framework, Giulio Volpi points out that although the government has set up a system allotting renewable energy quotas to distributors, there are no penalties for those which don't meet their quotas, "which renders the allotment of quotas fairly pointless."
Not only is the legislation incomplete, in many ways it's positively unfriendly to potential investors, argues Adam Pool, Chief Investment Officer at Environmental Investment Partners, a company which invests in environmental projects. Another drawback is Poland's failure to provide the kind of favorable and stable tariff system for renewable energy suppliers which would enable this country to meet its own targets by attracting investment in renewable energy.
"Countries which offer a set price for renewable electricity, are obviously much more attractive for investors because they enable investors to predict their profits," he says.
And according to Giulio Volpi, long waiting times and complicated procedures for grid access, meanwhile, also discourage potential funds by making investment more expensive by delaying returns.
The problems are not merely legislative but also technical in nature, argues Bernd Panzar, director of Lorica, a German based windmill construction firm. He points to areas such as Pomorze, which has plenty of large, flat and empty spaces that used to be state farms, and which are ideal for windturbine construction - except that such areas lack roads and access lines to the grid.
"We'd like to invest in Poland but for the moment it lacks the conditions which enable you to make concrete decisions," he says.
At least another six German firms and one Spanish company, which had considered investment in the local renewable energy sector, are also known to have decided that, based on relative merits, Spain, Portugal and France represent more promising fields for investment than Poland's muddled and non-transparent regulatory climate.
Michał Wilczyński, vice-president of Ekofundusz, the Polish Debt for Environment Swap, however, has a different take on the issue. Agreeing that biomass firing is potentially a great employment creator, as well as being technically less challenging to install than wind-power, he nevertheless disagrees that its development is being held back by bad legislation.
"We have a biomass boom right now," he says, "200 biomass heat plants have appeared over the last few years, despite the lack of a favorable legislative climate, because farmers themselves have seen the business opportunities."
Progress in the development of wind energy is also, according to Wilczyński, impressive. Up from just one megawatt of renewable electricity three years ago, he claims, Poland now has 65-70 megawatts installed, while some 1,500 applications to build windmills in Poland are currently waiting to be processed, despite the waiting times and lack of feed-in-tariffs.
"It doesn't look to me as if investment in renewable energy is allowing itself to be discouraged," he says.
