Paweł Wróbel: How the European Green Deal accelerates the transition of the Polish energy sector Comments by: Michał Myck, Centre for Economic Analysis This presentation was presented by Michal Myck during the annual SITE Development Day 2021 conference at Stockholm School of Economics via Zoom. Disclaimer: SITE has the permission from Michal Myck to upload this presentation slide.

1. Comments by:
Michał Myck, Centre for Economic Analysis
SITE Development Day 2021
Environmental Policy in Eastern Europe
Stockholm/Online, 08 December 2021
Paweł Wróbel:
How the European Green Deal accelerates the transition
of the Polish energy sector

2. Key challenges for Poland:
- smog and air quality – estimated 46k deaths a year
- high degree of import of energy sources
- carbon intensive power sector
Need for a rapid transition - the key role of social acceptance:
- dealing with smog: Clean Air programme
- carbon taxes and redistribution: ensuring soft landing for
vulnerable households

3. Smog in Poland: Clean Air programme
- subsidies towards replacement of old (coal-fuelled) boilers and house
insullation:
- planned for years 2018-2029
- designed to reach 4.5m households (~30%)
- slow start of the programme but roll out successful since May 2020
- substantial resources: 23bn euro
- means-tested subsidies to facilitate adjustments among low income
households; tax credits for insullation
- so far 0.4m individual applications

4. How to address carbon taxation?
(microsimulation analysis, joint with World Bank):
- carbon tax of 45 euro (p.t. of emissions) = revenues of ~50bn PLN
- carbon taxation on its own regressive
(proportionally 2.5 times higher burden in D1 vs D10)
Þ redistribution of revenues back to households: whole package may
benefit low-income households (see also Antosiewicz et al. 2021)
- appropriate adjustment of the tax and benefit system can additionally
induce greater labour supply

5. Challenges and opportunities: bold decisions will be
needed in Poland to transform its energy sector and
improve air quality:
Þ key role of political determination and social support
Þ careful policy design crucial to ensure success
Thank you!
www.cenea.org.pl
e-mail: mmyck@cenea.org.pl
tt: @MichalMyck