In the context of implementing new regulations as part of changes to the EU ETS, during last week’s EU Climate Change Committee, Member States have adopted a draft amendment to rules regarding the allocation of free allowances.  The new regulation enables district heating installations in Poland and other eligible states to receive free additional allocations under specific conditions, more favorable.

“Thanks to the solutions negotiated by the Polish government, heating companies will be able to benefit from an additional 30% of free emission allowances, as a result of which they will be able to reduce costs and allocate more funds to investing in more ecological technologies,” announced the Polish government, which currently holds the presidency of the Council of the European Union.

Current regulation stipulates that “an additional free allocation of 30 % of the quantity determined pursuant to Article 10a shall be given to district heating for the period from 2026 to 2030 provided that an investment volume equivalent to the value of that additional free allocation is invested to significantly reduce emissions before 2030”.

According to the Polish minister of Climate and Environment, the European Commission proposed initially just 10% of additional emissions allowances. “But as a result of the comments and actions of the management of the Ministry of Climate and Environment, more beneficial solutions for Poland were developed,” stated the government official. 

According to media reports, Poland has been pushing since last September for allocating free allowances “while implementing climate investments rather than at the end of the period, as stated in EU regulation,” as stated by Carbon Pulse at that time. 

A recent report by Forum Energii revealed that 42% of households in Poland use districting heating, approximately 15 million citizens. However, more than 80% of the system is based on fossil fuels, mainly coal combustion.