Examination of Witnesses (Question Numbers
440-450)
Professor Jerzy Buzek and Professor Krzysztof Zmijewski
22 OCTOBER 2008
Q440 Viscount Brookeborough: You have
support from these countries.
Professor Buzek: Yes.
Q441 Viscount Brookeborough: But will
that change what happens?
Professor Buzek: I hope so.
Q442 Viscount Brookeborough: You are
optimistic.
Professor Buzek: It is very difficult
to say. But it is not majority, of course; it is the minority
of course.
Professor Zmijewski: The most important
thing is that this small coalition does not fight against the
goals. All of us, we accept the goals. The discussion is not to
change 20% for 90% or anything like this. We only ask, "Let
us optimise the cost of the process." There are some official
statements quite recently from the European Commission that the
goal is to switch from coal to gas. We ask where it is officially
stated, because in the year 2007 we were told that the goal was
to reduce by 20% emission and the energy mix is absolutely the
secondary thing. If we can improve our energy efficiency, if we
can raise the share of renewables, maybe it is not necessary to
buy more gas from our wonderful neighbours. And we are afraid
of this. Going another way: If we can do that, why not? Why not
do it? That is all. I think it is the big space to find a compromise.
Q443 Viscount Brookeborough: Would you
like to see a European policy, a very, very strong policy with
a compromise towards certain countries? You do not want to water
down the objectives at all.
Professor Buzek: We could have a very
strong policy. We should check each other, because it is very
important in the future. We were also checking it in last year.
We must also say that the ETS was introduced in 2004 but it was
not working very well during the last four years and we are sure
it will be working much better in the future. We want to have
it working in the future, and the ETS diminishing CO2 emissions.
Q444 Viscount Brookeborough: How efficient
is the energy supply compared with Western Europe. How much can
you improve quickly? A number of years ago we had figures in a
different inquiry about Denmark, its GDP going up by 20% and yet
its use of electricity had remained the same.
Professor Buzek: The question you ask
was also connected with the question before: effectiveness and
efficiency, end-use efficiency, are the most important things.
Q445 Viscount Brookeborough: In, for
instance, your housing, how energy efficient is it or is it way
behind?
Professor Buzek: It is much less than
any other country's and we must improve it a lot, and, also, end
production. End-use and production of electricity we must improve.
Professor Zmijewski: In 40% of buildings
in the housing sector, we can increase the efficiency by 40%,
which will increase the efficiency of the sector by 16% in total.
In electricity we can improve by 2% a year.
Q446 Chairman: That is transmission.
Professor Zmijewski: Not only transmission.
It is end-users mostly.
Professor Buzek: It is the main task
for us. It is more important than any other.
Professor Zmijewski: Our calculations
were based on this assumption that we would improve energy efficiency
in the country, because there is no other way to reach the goal.
That is the must.
Q447 Lord Brooke of Alverthorpe: My question
is about carbon leakage. In a sense you have already touched on
this when you were talking about what would happen in Ukraine
and electricity and your other neighbours. Beyond electricity,
are there other areas in which the Polish economy is susceptible
to leakage? Would you say a little bit about that? Who presents
the danger to you? What kind of yardstick, would you use to establish
the extent of it?
Professor Buzek: We can say that if electricity
costs will rise 10%, so for energy- intensive industry it will
be dangerous in Poland. They would like to leave our country,
to go outside to Venezuela or China. They are saying 10% more
for electricity. We have about 30% energy-intensive industry—30%,
so it is a lot—which is very sensitive from the point of
view of carbon leakage. We have, of course, direct and indirect
carbon leakages. Direct is because of emitting CO2. In cement
production it is necessary to emit emissions of CO2, or in steel
production. Except for that, indirect leakages are because of
electricity costs. They are quite different in Poland and in other
countries with a different energy mix. From this point of view,
our energy-intensive industry is very sensitive and they are observing
electricity costs and saying, "Maybe we must leave Poland
because it will not be possible to stand it." Aluminium production
or chemistry, for example, are saying it very, very simple. It
is much easier than for cement, because cement is heavier to transport
than aluminium or chemicals. It is very easy to leave our country.
Also, for the steel industry, we have big factories which are
owned by Mittal and he is saying almost officially, "I'm
going back to Russia. I'm not having an interest to develop my
factories and company in Europe, generally speaking." It
is a danger. If we were going to a benchmarking system it is quite
different. In the energy-intensive industry, the benchmarking
system is giving much more possibility to stay in Europe. Additionally,
the benchmarking system in the electricity sector is giving much
less indirect carbon leakages because of electricity prices for
energy-intensive industries. From both points of view, it is much
better to have a benchmarking system.
Q448 Lord Wallace of Tankerness: One
of the features of the evidence that has come through to us is
just how important the monitoring and reporting and enforcement
would be. I wonder if you would say something about the experience
with enforcing the existing Emissions Trading Scheme and how the
Polish Government looks forward to monitoring and enforcement
post 2013, particularly with regard to the possibilities of greater
harmonisation of enforcement across Europe.
Professor Buzek: It was a really different
system during the last decade, because we were very different
on both sides—I mean old and new Member States—and
influenced much later by the systems and the Emissions Trading
System as well. From this point of view, harmonisation is very
important, but we think that we can also harmonise it. We can
also take into account the energy mix, which is very important
not only for the new Member States, for Eastern and Central European
countries, but also for some countries in, let us say, old Europe,
like Italy or Greece or Germany. I was talking with ENDESA quite
lately in Spain and they are also worrying about that—although
maybe not be such a big extent. The most important issue from
the point of view of harmonisation of the whole problem for the
EU is taking into account energy mix in different EU countries,
because from this point of view we differ very, very strongly.
It is also of some interest, as a matter of fact, in Great Britain,
when I am talking with colleagues in the European Parliament.
For example, in the West Midlands they are saying quite generally
that they are worried about electricity costs in the future and
also about possible carbon leakage. It is not the same in North
England or in Scotland. I feel that colleagues from North England
or from Scotland are not worrying so much about that. But generally
it is probably not as big a problem for Great Britain. It is a
problem for Germany, much bigger than it is for Great Britain,
maybe because the production of electricity from gas is very important.
It is much cheaper. Today it is much cheaper; we do not know in
the future, because gas prices could be very high in a few years.
Q449 Lord Brooke of Alverthorpe: Are
there specific views you have on ensuring that a new scheme is
properly enforced, and that there are no effective means of trying
to get around it right across Europe?
Professor Zmijewski: Might I add something?
We have a unique system in Poland which helps the housing sector
to perform under the Emissions Trading Scheme. It is widely performed
in the country and the drop of the heat consumption is significant.
This experience can be used everywhere. It s not only for this
heating system, it is for every one: state, communal, private,
every one. Announcing it is the British experience of the White
Certificate. The Polish White Certificate system is in the pipeline
at the moment and we used quite a lot of your experience to design
this certificate. The question is: Why is this only in a few countries
like the United Kingdom and Italy and Poland, and not in the 27
Member States? That is a very good system and very efficient.
I can say this because I made all the calculations, so I know
it is very good. Why not do that? It is good for the environment,
it is good for the budget, it is good for society. The question
is: For whom it is not good?—but that is perhaps not the
subject for this hearing. Thank you, my Lords.
Q450 Chairman: I think that is a good
point to stop. There are all sorts of issues we have touched on
and explored and we could have gone on a lot longer. Thank you
very much for helping with our inquiry.
Professor Buzek: Thank you very much
for inviting us and giving us the possibility to explain some
crucial questions from the point of view not only of Poland but
also of the European questions and problems.
Chairman: It has helped enormously. It
has been something very new for us.
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