Press play to listen to this article
WARSAW — Poland’s subsidy program has led to a boom in small-scale photovoltaic projects — which is turning into a problem.
The program has been so successful — the country generates 5.4 gigawatts of power from solar, above its minimum 5 GW target for 2025 — that now the government is planning to revamp its subsidy scheme.
Poland already has 700,000 domestic solar installations, and Deputy Climate and Environment Minister Ireneusz Zyska expects that to rise to 1 million by the end of the year.
“This all creates risks, especially for the grid,” Zyska said at a regional economic conference last month.
That’s why the government is working on legislation that changes the rules for small-scale prosumers — people who both generate and use power.
Currently, the successful “My Electricity” program subsidizes small individual PV installations ranging from 2 kilowatts to 10 kW in capacity, with a subsidy of up to 3,000 złoty (€660). Users also get to take back 80 percent of the power they put into the grid for their own use at no charge — essentially treating the national network as a personal battery.
The legislation would scrap that, forcing prosumers to sell any excess power to the grid at market prices, and to buy back any needed electricity — usually at times when their panels aren’t working — also at market rates.
“We have been forced to move away from subsidies … but we’re working to ensure that the new solutions will still be attractive for current and future prosumers,” Zyska said.
The government plans to bring in the new system as soon as January, with no transition phase, Zyska told the Dziennik Gazeta Prawna newspaper this week. He said that the current system “is the most favorable to prosumers in the whole EU, if not the world.”
The booming PV industry says that the plans, especially without a transition phase, are “concerning.”
“[We have to] publicize this issue and fight for the subsidy system to remain,” PV Poland, a lobby group, said Monday.
From coal to sun
It’s a novel problem for Poland, which still generates about 70 percent from its electricity from coal. When the current Law and Justice party government took power in 2015, it largely throttled the onshore power industry with tougher restrictions, instead promoting less controversial offshore projects. Because of that, Poland looked certain to miss its 2020 EU-mandated target of 15 percent of its final energy consumption coming from renewables.
But thanks to the boom in solar, as well as the pandemic-induced economic slowdown, Poland looks to have almost hit that goal, reaching 14.9 percent; according to energy analysis website wysokienapiecie.pl.
Poland’s PV capacity ballooned 200 percent to nearly 4 GW last year, according a report by Poland’s Renewable Energy Institute, a think tank. According to SolarPower Europe, a lobby group, Poland was the EU’s fourth-fastest growing PV market in 2020, behind Germany, the Netherlands, and Spain.
“Micronstallations are the fastest growing PV segments in Poland and it’s just going to grow because saturation is still very low — there are millions of buildings on which you can put PV panels on,” said Dawid Zieliński, CEO of Columbus Energy, one of Poland’s leading suppliers of PV projects.
But getting more solar online means more government spending as well as completing long-delayed upgrades in the Polish grid to be able to handle variable renewables.
“With growth at the rates we’ve seen, what’s needed now is a response from the grid, otherwise there’ll be just too much capacity and many installations will be shut off by the system during peak generation times,” said Grzegorz Wiśniewski, head of the Renewable Energy Institute and a long-time promoter of solar power in Poland.
He said that his think tank had predicted that once the PV installations rise above 5 GW, that would create problems for grid stability. “That level has now been crossed,” he said, warning that means installations will be cut off at peak times to prevent surges. That happened for the first time on April 5, when there was a spike in power production thanks to strong winds and sun shine.
“The electricity grid has limited flexibility,” Zyska said. “It can’t be a storage for ever greater numbers of prosumers. Not making changes will lead to a catastrophe.”
He said Poland was also acting to conform to EU rules, which mandate splitting accounting for power fed into and extracted from the grid.
With some analysts predicting that solar power could reach 20 GW in five years, there’s growing pressure on the grid operator to ensure the system is flexible enough to deal with renewables, which means ensuring customers balance their power demand, investing in energy storage as well as stable backup sources of power. Otherwise the operator could face steep compensation payments to producers excluded from the grid at peak times.
“In order for the smallest installations not to disrupt the grid, they should be — and most likely will be — equipped with small energy storage,” said Zieliński.
Wiśniewski said that grid operators have wasted the last few years, and Poland now risks not being able to meet EU renewable targets — Poland is to use renewables for 21 percent of final energy consumption by 2030. That creates huge problems for a country already dealing with a surge in permit prices under the EU’s Emissions Trading System, which are now above €60 a ton of CO2.
“We need instruments like dynamic tariffs and reducing peak generation by storage and sector coupling in order to better balance out supply and demand of power,” he said.
This article is part of POLITICO’s premium policy service: Pro Energy and Climate. From climate change, emissions targets, alternative fuels and more, our specialized journalists keep you on top of the topics driving the Energy and Climate policy agenda. Email [email protected] for a complimentary trial.
Source: https://www.politico.eu/article/poland-solar-power-subsidy-program/
