EU to scrutinise Warsaw over law curbing energy price rises

A general view on Belchatow Power Station from Slok water reservoir in Slok village, central Poland, 10 August 2015. [EPA/GRZEGORZ MICHALOWSKI]

The European Commission expects Poland to submit its new law cutting tax on electricity for scrutiny to see if it complies with EU laws prohibiting illegal state aid to companies, a Commission spokeswoman said on Thursday (3 January).

Poland’s lower house of parliament passed on 28 December legislation to cut tax on electricity as the ruling Law and Justice (PiS) party looks to prevent a jump in energy bills ahead of a parliamentary election this year.

EU weighs ‘derogation’ for Poland in bid to phase out coal

Greens have lashed out at the European Commission for trying to pass an exemption from draft electricity market rules that would allow poorer countries like Poland to continue subsidising coal because their GDP is lower than the EU’s average.

State-run utilities have proposed raising household bills by more than 30% next year to claw back revenue hit by a 65% jump in wholesale electricity prices and a 400% leap in carbon prices this year.

Just ahead of the lower house sitting, the PiS unexpectedly raised its proposal for compensation for utilities to 4 billion zlotys to help to offset their lost revenue.

The proposal lifted shares of state-run utilities Energa, Tauron and PGE by 1-5%.

EU forges deal on coal phase-out, with special Polish clause

European Union legislators reached agreement in the early hours of Wednesday (19 December) over a proposed reform of electricity market rules that includes a 2025 cut-off date for coal subsidies, and a special clause for Poland.

“A member state is obliged to notify to the Commission any state aid measures before they are put into effect,” Commission spokeswoman Mina Andreeva told reporters in Brussels.

“EU law sates that such measures need to be notified for the Commission to be able to look at them. So far, we have not been notified by the Polish authorities but we would expect them to do so,” she said.

Subscribe to our newsletters

Subscribe

Want to know what's going on in the EU Capitals daily? Subscribe now to our new 9am newsletter.