Industrial customers – eligibility for reduction in the purchase cost of electricity

​​​​​​​​​by Piotr Mrowiec

12 October 2015

The Renewable Energy Sources Act is associated almost exclusively with the new rules to support green electricity producers. However, worth pointing out is that it extends the group of enterprises eligible for enjoying the reduction in the purchase cost of electricity.

The Renewable Energy Sources Act (hereinafter referred to as the "RES Act") sets forth that to enjoy the reduction the interested enterprise must have the status of an industrial customer. To obtain this status two requirements must be met:

1. The enterprise's business activity needs to fall, in the prevailing part, into one of the industries provided for in the RES Act.
2. The RES Act requires that activities carried out in one of the above mentioned industries are energy-intensive. It is required that the value of the so-called intensity of electricity consumption for the enterprise amounts to no less than 3%. Pursuant to Article 53(2) RES Act, the intensity of electricity consumption is the ratio of the cost of electricity consumed for own needs to the gross value added calculated as the arithmetic mean over the last three years preceding the year of the fulfilment of the obligation to surrender or pay the substitute fee served as the basis for the RES fee calculation; if the activity was carried out throughout a period shorter than three years, the arithmetic mean needs to be calculated over the activity performance period.

Having the status of an industrial customer you should, no later than on 30 November of the year preceding the year of the obligation fulfilment, file with the President of the Energy Regulatory Office (ERO) a statement on conducting business activity bearing either of the PKD codes (see the table above); specify the amount of the electricity consumed and the amount of the electricity purchased for own needs in the calendar year preceding the year of the aforesaid obligation fulfilment; determine the value of the intensity of the electricity consumption and the amount of the electricity covered by the surrender obligation or the amount of the substitute fee serving as the basis for the RES fee calculation. In addition, the enterprise is obliged to present the auditor's opinion confirming that the intensity of electricity consumption was calculated correctly.

No later than by 31 December of the year preceding the year of the aforesaid obligation fulfilment the President of EOR draws up a list of industrial customers which have filed the statements and been qualified for allowance or exemption, and publishes the list in the Public Information Bulletin.

It is also worth noting that the industrial customer who has filed the statement is required to provide the President of EOR, by 31 August of the year following the year of implementation of the exemption or allowance, with information on the amount of electricity purchased for own needs in the year of the obligation fulfilment and on meeting the requirements to be eligible to enjoy the allowance or exemption, under pain of criminal liability for making false statements.

The procedure itself is, although this may not be apparent, simple and allows, subject to meeting the requirements, to make savings by reducing the cost of certificates of origin or substitution fees which are incurred by electricity suppliers on behalf of industrial customers whose electricity consumption is lower than 100 GWh per annum.