Polish government approves renewable energy law to help meet EU targets

Poland's government has approved a long-awaited draft law that lays out a plan for renewable energy subsidies with the aim of helping the country meet EU climate targets.

The draft was approved on Tuesday and still requires final approval by parliament and the president Bronisław Komorowski (pictured right).

Under the new legislation, developers and owners of new renewable installations will be able to sell their energy at auctions for a fixed price that would be guaranteed for 15 years regardless of market prices.

It would also allow renewable energy producers that are already operating to keep their current subsidies or choose to join the auctions.

Poland has been working for nearly two years on a new renewable energy law that would help it meet the European Union's clean energy targets at the same time as reducing costs for producers and consumers.

Poland currently generates around 90 per cent of its electricity from coal and must increase renewable energy to at least 15 per cent of its total energy mix by 2020 to meet EU rules on carbon emissions.

Change has proved difficult, however, as renewable power producers complain that an uncertain legal environment has prevented them from making new investments.

The previous subsidy system did not provide long-term guarantees, and governments across Europe have been progressively cutting subsidies.