Preparatory work

 

The new draft of Polish law on the greenhouse gas emission allowance trading scheme (substituting the earlier Law of 22 December 2004) provides for the possibility for acceleration of the authorisation procedure for the granting of the greenhouse gas emissions permits.

 

In effect, an operator undertaking to realize combustion installation for the production of electricity may be granted the greenhouse gas emissions permits, and the “undertaking to realize” installation takes place on the day on which the investment process relating to this installation was physically initiated. The said Law further specifies that “the day on which investment process was physically initiated” means a day before 31 December 2008, on which “preparatory work” was undertaken on the installation’s building site.

 

The new Law is therefore intended (among others, obviously) to enable the operators, which undertook “preparatory work”, before 31 December 2008, on the installation’s building site, to be granted greenhouse gas emissions permits for these future installations by 30 June 2011.

 

The reasons to the new draft Law mention that the above-stated approach forms a derogation from the general rule according to which only an installation that is commissioned may be included in the scheme. The permit granted to the operators undertaking investments for the production of electricity will not, however, contain provisions on the allocation of allowances because, till commissioning, the installation won’t operate and, consequently, won’t produce emissions of greenhouse gases.

 

The reasons to the new draft Law underline, furthermore, that the notion “preparatory work” should be understood in the meaning imposed by the Polish Construction Law of 22 July 1994 (O.J. 2010, No 243, item 1623 as amended). The said Law in article 41 defines “preparatory work” as demarcation of the objects on the building site, the leveling and developing of the building site, building of the temporary objects, the connection of necessary technical infrastructure (Article 41 (3) stipulates, however, that preparatory work can be performed only on the building site which is covered by the construction permit).

 

The Polish media (http://www.wnp.pl/wiadomosci/136445.html) cited on 31 March the words of the Polish environment minister Andrzej Kraszewski. According to these releases, Polish power plants obtained from the European Commission free emission allowances for years 2013 – 2019. Pursuant to the minister’s words, ‘among the beneficiaries are operators which started the investment process by the end of December 2008’. The minister further specified that the matter regarded Article 10c, i.e. the rules on allocation of emission allowances for operators which started the investment process by December 2008. The minister said that, ‘As it seems, we will have these 15 GW and we will be able to calm down the investors that these installations will get free allowances’. He also added that ‘We won’t be probably glad with everything but it seems that the majority of our postulates will be respected’.

The minister reserved that he had received the answer from European Commission on 28 March in the evening and had been only after the preliminary reading thereof.

 

In my opinion the question seems to be, however, still doubtful. The guidance document of the European Commission literally doesn’t relate to the situation where operators, which undertook “preparatory work”, before 31 December 2008, on the installation’s building site, are granted greenhouse gas emissions permits for these future installations by 30 June 2011. The operators are still exposed to legal risks in that field then.