Warsaw – US renewable energy group Invenergy says it has begun international arbitration against Poland, claiming it stands to lose hundreds of millions of dollars (euros) after the EU country reneged on its commitments to build wind farms.
Between 2005 and 2015, Invenergy built 11 wind farms in Poland, investing “hundreds of millions of dollars of equity capital to develop and construct the projects,” the group said in statement on April 24.
They had been agreed as part of strategy to slowly wean Poland off its heavy reliance on coal and increase the share of renewables in its energy mix.
But the current new government under the right-wing Law and Justice (PiS) party is more favourable to the coal industry and has put the brakes on the renewables drive.
Last year, it pushed through legislation limiting existing subsidies for wind farms and imposing tight restrictions on the construction of new ones.
Critics, including Invenergy, argue such measures make it virtually impossible for wind farms to turn a profit or for new ones to be built.
Invenergy accused Warsaw of initiating “a series of coordinated actions intended to terminate or avoid obligations under the Invenergy contracts and destabilise the broader renewable energy environment for investors.”
It said its 11 eleven wind farms remain operational but were not profitable. And it was putting further wind farm projects in Poland on hold.
Invenergy said it was forced to turn to international arbitration after “multiple Polish state-controlled entities openly disregarded final and binding decisions by the Polish courts, including the Supreme Court” that have ruled in the company’s favour.
Neither the prime minister’s office nor the energy ministry were immediately available for comment.
Both the current right-wing government and previous administrations have based their energy policy on plentiful domestic coal and taken little action to invest in or promote renewables to mitigate heavy pollution.
Smog from coal has spiked to record levels nationwide in recent years, with experts estimating there are some 50,000 premature pollution-related deaths per year in the country of 38 million people.
Poland is set to host the UN’s COP 24 international conference on climate change late this year.