Statutory price regulation at the electricity market

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On 28 December 2018 Sejm (lower chamber of the Polish Parliament) adopted the Act amending the Act on the Excise Duty and selected other acts (“Act”), which aims at temporary stabilization of electricity costs being incurred by final customers, in particular by implementing the following instruments:

  • imposing temporary restrictions on traders as regards setting of electricity prices;
  • temporary „freezing” of transmission and distribution tariffs applied by electricity grid operators;
  • decrease in excise duty on electricity and in the rates of transitional fee incurred by final customers of electricity.

The Act has entered into force with the effect from 1 January 2019.

INSTRUMENTS REDUCING COSTS OF OBTAINING ELECTRICITY

* The detailed manner of calculating the difference between the Maximum Price and the weighted average price of electricity at the wholesale market will be specified in the regulation of the Council of the Ministers.

The mechanisms consisting in freezing of electricity prices, distribution and transmission fees, as well as the mechanism compensating electricity price differences are of a temporary nature and concern only the year 2019.

BUDGET AND FINANCING

[Fund for the Payment of Price Differences] The estimated cost of the mechanism compensating the differences in the price of electricity in 2019 amounts to ca. PLN 4 billion. The payments of the compensations (differences) will be made from the newly created special public fund called the Fund for Payment of Price Differences, whose authorising officer (Pol. dysponent) will be the Minister of the Energy, whereas the manager responsible for making payments – the company called Zarządca Rozliczeń S.A.

The Fund will be financed, in particular, from the resources obtained in result of completing auction of unused greenhouse gas emission allowances, which were allocated to the power generation plants. If the abovementioned funds prove insufficient, the Act provides for the possibility to use the funds collected at the account of the transitional fee and the renewable energy sources fee.

[The National Green Investment Scheme] According to the Act, the National Green Investment Scheme will be credited with additional PLN 1 billion from the resources obtained as a result of the auction of unused greenhouse gas emission allowances allocated to the power generation plants. These funds will be granted, in particular, to the investments carried out by the DSO, as well as other investments concerning renewable energy sources or high-efficiency cogeneration units, investments related to the adjustment of power generation plants to the BAT requirements and investments in energy storage.