{"id":3362,"date":"2026-09-03T15:50:27","date_gmt":"2026-09-03T13:50:27","guid":{"rendered":"https:\/\/ireform.eu\/?post_type=publikacja&p=3362"},"modified":"2026-09-14T12:34:45","modified_gmt":"2026-09-14T10:34:45","slug":"towards-a-fair-reform-of-the-eu-ets-what-is-polands-interest-in-the-eu-negotiations","status":"publish","type":"publikacja","link":"https:\/\/ireform.eu\/en\/publication\/towards-a-fair-reform-of-the-eu-ets-what-is-polands-interest-in-the-eu-negotiations\/","title":{"rendered":"Towards a fair reform of the EU ETS. What is Poland\u2019s interest in the EU negotiations?"},"content":{"rendered":"

Poland stands to gain as much as PLN 180 billion by 2040 from the changes to the EU ETS proposed by the European Commission. This figure could rise to as much as PLN 240 billion if Reform Institute’s recommendations in the current EU-level negotiations are implemented. Whilst effective diplomacy is important, ambitious modernisation of industry and the energy sector \u2013 including efforts to implement the accelerated transition scenario (WAM) from Poland\u2019s National Energy and Climate Plan \u2013 will be even more crucial for Poland\u2019s favourable balance within the system, according to <\/span><\/b>a new publication by the Reform Institute <\/span><\/b>\u2013 <\/span><\/b>“Towards a fair reform of the EU ETS. What is Poland\u2019s interest in the EU negotiations?”<\/span><\/b><\/a>.<\/span><\/b>\u00a0<\/span><\/b><\/p>\n

Additional billions in exchange for stricter conditions\u00a0<\/span><\/b>\u00a0<\/span><\/p>\n

In mid-July, the European Commission presented proposals for changes to the EU ETS. This marks a pivotal moment in the intense debate, which has been ongoing for months, regarding the system\u2019s impact on the competitiveness of the European economy. Negotiations on the proposed course correction are particularly important for Poland, which faces a significant challenge in achieving a just transition due to the high share of fossil fuel use and the billions flowing into the state budget and Polish companies from the scheme.<\/span>\u00a0<\/span><\/p>\n

According to the latest publication, Poland could gain as much as PLN 180 billion from the Commission\u2019s EU ETS reform proposal as a result of: a slower decline in the number of allowances within the scheme, the extension of the Modernisation Fund (MF) until 2040, the introduction of the Industrial Decarbonisation Bank (IDB) with preferential access for lower-income countries under the ETS Investment Booster, and the extension of the Innovation Fund (IF). If the EC changes are implemented, the Polish government and Polish entities can expect total financial benefits from the EU ETS to exceed PLN 550 billion between 2026 and 2040.<\/span>\u00a0<\/span><\/p>\n

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The increase in funding for the transition <\/span>is to be accompanied by restrictions <\/span>on the government\u2019s <\/span>freedom <\/span>to spend the billions generated by the EU ETS. At least 50 per cent of revenue from national auctions is to be channelled <\/span>back <\/span>to sectors covered by <\/span>the<\/span> EU <\/span>ETS, whilst <\/span>the solidarity <\/span>mechanism<\/span> \u2013 which until now has been allocated <\/span>to national auctions and constituted revenue for <\/span>the <\/span>state <\/span>budget <\/span>\u2013 <\/span>will be directed to the Modernisation Fund<\/span>, which has more restrictive guidelines<\/span>.<\/span><\/span>\u00a0<\/span><\/p>\n

As <\/span>Micha\u0142 <\/span>Wojty\u0142o<\/span>, <\/span>S<\/span>enior <\/span>P<\/span>ublic <\/span>P<\/span>olicy <\/span>A<\/span>nalyst and <\/span>co-author<\/span> of <\/span>the publication<\/span>, notes:<\/span><\/span><\/p>\n

Increasing the capacity <\/span>of EU funds <\/span>financed by the EU ETS, <\/span>together with <\/span>greater <\/span>transparency regarding <\/span>the <\/span>spending <\/span>of <\/span>EU<\/span> ETS revenues <\/span>and <\/span>the obligation <\/span>to <\/span>plan<\/span> this <\/span>spending<\/span> in advance<\/span>, <\/span>is intended to ensure a larger <\/span>and more predictable <\/span>flow of funds for investments in the modernisation of industry <\/span>and <\/span>the energy sector<\/span>.<\/span><\/span><\/p><\/blockquote>\n

National measures even more important than negotiations<\/span><\/b>\u00a0<\/span><\/p>\n

The publication clearly shows that, for Poland\u2019s overall balance in the EU ETS to be close to equilibrium, it is necessary to implement the accelerated transition scenario (WAM) from the Polish National Energy and Climate Plan (NECP). Under the WAM scenario, the cost of purchasing allowances exceeds the financial benefits for Poland by no more than PLN 7 billion per year; however, if the additional increase in the Modernisation Fund (FM) compared to the European Commission\u2019s proposal, or an extension of the allocation for lower-income countries in Phase II of the Industrial Decarbonisation Bank (IDB) is negotiated, Poland\u2019s annual financial benefits may exceed the costs of purchasing allowances.<\/span>\u00a0<\/span><\/p>\n

The pace of the transition within the country is <\/span>even<\/span> more significant for the balance of Poland\u2019s participation in the EU ETS than the outcome of the negotiations in Brussels. <\/span>Striving to implement the WAM scenario<\/span> of<\/span> the NECP<\/span> should be <\/span>one <\/span>of the main objectives <\/span>of the Polish government<\/span>, not only <\/span>in the context of <\/span>the sustainable and just modernisation of the Polish economy, but also <\/span>in terms of reducing the costs of the EU ETS for the economy. The total costs of purchasing allowances in the EU ETS up to 2040 could be as much asPLN 270 billion lower for Polish entities than in the reference scenario (WEM) of the NECP, equalling the total financial benefits from the system -emphasises Aleksander \u015aniegocki, President of the Reform Institute.<\/span><\/p><\/blockquote>\n

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The Reform Institute, in its new publication, also proposes the following at national level:<\/span>\u00a0<\/span><\/p>\n