The transport sector in Poland is currently facing a number of serious challenges. The vast majority of the fleet consists of aged internal vehicles powered with fuel, and the market share of zero-emission vehicles is still below that of most European Union Member States. However, the potential of Polish electromobility is very significant. According to forecasts, in 2025, Polish roads will be able to handle up to 317,000 electric vehicles. However, it is necessary to introduce appropriate legislative changes and implement an effective system of co-financing zero-emission transport.

The transport sector is responsible for as much as 24% of total greenhouse gas emissions in Poland.  Based on the EEA data, in the years 1990-2017, emissions from this sector in Poland increased by as much as 206%, with the average in the European Union at 28%. Smog is also an increasingly serious problem in Polish cities. According to the IQAir data from 2019, as many as twenty-nine Polish cities are among the hundred European cities most polluted by PM 2.5 dust. In addition, Poland is the fourth most polluted country of PM 2.5 in the European Union.

At the same time, diesel road transport causes the fact that the permissible noise standards are generally exceeded. According to the data of the State Chief Inspectorate for Environmental Protection, in 2018 the noise level on 92% of Polish roads exceeded 60 dB during the day, and on 85% roads - 55 dB at night. Furthermore, the need to carry out a multidimensional transformation in the energy sector is one of the greatest challenges in Poland. As much as 80% of electricity generated in Poland is obtained from coal. This is the highest share of this type of energy in the European Union. In turn, the coal-fired power plant in Bełchatów is the largest single emitter of carbon dioxide in the territory of the Community.

At the same time, the Polish share of energy from renewable sources is low. It amounts to 12.2%, while 19.7% is the average value in the Member States of the European Union. The share of energy from renewable sources is lower only in five Member States than in Poland. The particularly important fact is that the Polish government has not yet set a date for abandoning conventional coal energy. Despite the fact that the schedule for closing selected mines until 2049 is in force, it does not include all facilities of this type. In addition, further development is planned. 

Zero-emission transport in Poland is in the initial stage of development. The domestic automotive market has been dominated by vehicles with conventional propulsion for many years. A large part of these vehicles are old diesel ones. In the last three years, only slightly more than 1/3 of the vehicles sold on the Polish market were new (36% each in 2018 and 2020 and 37% in 2019). In addition, Poland is the largest importer of used vehicles in the European Union. Since 2000, approximately 16 million such vehicles have been imported to Poland from abroad. What is crucial, is that the average age of imported vehicles is gradually increasing. While in November 2001 it was 7.4 years old, in November 2020 it was already 11.89 years, which is a historic record. 48% of the vehicles were equipped with diesel engines (IBRM Samar data). So far, Poland has not introduced effective measures against the import of used vehicles. Despite the plans to increase the excise duty released in 2020, they have not been substantiated so far. 

As a consequence, Poland has one of the oldest vehicle fleets in Europe. Based on the ACEA data, the average age of passenger cars in Poland is 14.1 years, while in the European Union the average is 11.5 years. Only in 7 EU Member States is the average age of passenger cars higher than in Poland. The same applies to commercial vehicles. The average age of delivery vans in Poland is 13.6 years, while in the EU - 11.6 years. The average age of such vehicles is higher than in Poland only in 5 EU Member States. 
Poland is the European centre of heavy road transport. It has the largest lorry fleet in the European Union, 98% of which are diesel-powered. The Polish truck fleet accounts for 18.5% of the entire fleet of such vehicles in the EU. The situation is similar in the bus segment. Our country has the largest fleet of buses in the European Union, 97% of which are equipped with diesel engines. The Polish fleet accounts for 17.7% of the entire EU bus fleet. In this context, the fleet of electric vehicles is still small.

According to the "Electromobility Meter" launched by the Polish Alternative Fuels Association (PAFS) and the Polish Automotive Industry Association (PAIA), 19,671 electric passenger cars were driving on the Polish roads at the end of January 2021, 52% of which were fully electric vehicles (BEV, battery electric vehicles) - 10,294 units, and the rest, plug-in hybrid electric vehicles (PHEV) - 9,377 units.  The fleet of electric vans and trucks amounted to 864 units, while the fleet of electric mopeds and motorcycles reached 9,025 units at the end of January. At the same time, 442 electric buses were operating in Polish cities. As the number of EVs increases, the charging infrastructure is also developing. At the end of January, there were 1,395 publicly accessible charging stations for electric vehicles in Poland (2,711 points). 33% of them were fast DC charging stations and 67% were slow AC charging stations with a power less than or equal to 22 kW. The development of zero-emission transport in Poland accelerated particularly strongly last year in spite of the COVID-19 pandemic and the serious crisis on the automotive market. There were a number of records for the sale of electric vehicles. In 2020, 9,879 electric vehicles (increase by 140% y/y/), 322 electric trucks and vans (increase by 13% y/y) and as many as 201 electric buses (increase by 253% y/y) were registered. The network of generally accessible infrastructure increased by 353 stations (826 points). However, it is worth noting that Poland is still far from the European leaders in electromobility, especially considering the size of the domestic automotive market despite significant percentage increases, in terms of the number of passenger and EV van registrations.  

Opportunities, barriers, challenges

The development of zero-emission transport in the Polish reality faces a number of barriers, both of an economic and legal nature.  Despite the steadily falling prices and the fact that some BEV models are more cost-effective in terms of purchase costs than their combustion counterparts in the premium segment, the amounts to be spent on electric vehicles remain higher than in the case of conventionally driven vehicles. The differences are particularly visible in relation to vehicles from popular segments. The high purchase costs should be considered the decisive reason for the low share of BEV and PHEV on the Polish automotive market. Importantly, apart from the pilot programmes from 2020, Poland has not introduced a financial support system for electric vehicle buyers so far, which, in many European Union Member States, is one of the basic factors stimulating the development of electromobility.

The lack of subsidies is particularly important in the context of the absence of tax incentives (not counting the symbolic exemption/reduction of excise duty and higher depreciation charges) or the bonus-malus system assuming higher fiscal burdens for highest-emission vehicles. In addition,  there are still legislative and administrative barriers in Poland, independent of economic factors, which adversely affect the pace of development of zero-emission transport despite the fact that the act on electromobility and alternative fuels has been in force since February 22, 2018. One can distinguish among them the longest procedures in Europe for connecting charging stations to the power grid. The connection time by the Distribution System Operator - depending on the conditions of a given location - can last from 3 months to even 3 years. As a result of lengthy procedures, the pace of expansion of generally accessible charging stations is much slower than in many European countries. In addition, the residents of multi-family buildings in Poland have great difficulties in obtaining approval for the installation of a charging point on parking spaces belonging to them due to the fact that there are no dedicated legal regulations. The general principles are interpreted by governing units as the approval to install a charger to be beyond normal management and requires the approval of the majority of owners. This makes the whole process protracted and seldom successful.

Furthermore, Poland has still not transposed into the domestic legal order the provisions of Directive (EU) 2018/844 of the European Parliament and of the Council, which introduce (e.g. in relation to multi-family residential buildings with more than 10 parking spaces) the obligation to install sewer infrastructure (for electric cables), in all parking spaces, to connect charging points for electric vehicles at a later stage. In order to identify and remove these obstacles, the Polish Alternative Fuels Association is implementing the "White Book of Electromobility" project. Seven working groups were established: for Taxes and Tariffs, for Public Infrastructure, for Building Infrastructure, for Local Government Support, for Market Support and Promotion, and for Hydrogen Technologies Support, within the PAFA initiative. The operation of the working groups focuses on developing proposals for appropriate legislative changes, the introduction of which will accelerate the development of zero-emission transport in Poland.

The problem also involves low social awareness in the field of electromobility.  Based on the PAFA report "New Mobility Barometer 2019/2020, as much as 86% Poles admit that their knowledge of  charging electric vehicles is not sufficient. Only every 10th respondent could distinguish between charging connectors and list the types of available stations. 74% of respondents did not know how a plug-in hybrid differs from a classic hybrid. 79% of respondents declared a lack of knowledge or insufficient knowledge about the costs of using EVs, 77% - principles of operation of vehicles of this type, and 65% - knowledge of privileges and support systems. 93% of people who are not EV users are not able to indicate the location of the chargers in their city. With a view to increasing public awareness in the field of electromobility, the PAFA and the National Centre for Climate Change initiated the campaign aimed at educating about electric vehicles. This is the first in Poland and one of the most comprehensive initiatives in Europe for the development of zero-emission transport. Several dozen entities and institutions active in the field of electromobility in Poland were involved in the project, including the automotive concerns: BMW, Daimler, Nissan, Volkswagen and Toyota, the infrastructure sector: ABB PKN ORLEN and Nexity. The partners involved: PKO Leasing, Arval, Garo, GO+EAuto, GreenWay, Volvo, LOTOS, Energa Grupa ORLEN and LeasePlan. The campaign was held under the patronage of the Ministry of Climate and Environment, the Ministry of Development, Labour and Technology and the Ministry of Infrastructure. In addition, the campaign is under the patronage of numerous embassies, including the Netherlands, Great Britain, Sweden, Israel, Germany, and the chambers of commerce and several dozen local Polish governments.

In June 2020, the Ministry of Climate and the National Fund for Environmental Protection and Water Management announced the launch of three new pilot electromobility support programs in order to dynamize the Polish zero-emission transport market. According to the announcements, their total budget would amount to almost PLN 150 million. The first call for proposals under the implemented support instruments started on June 26 and ended on July 31, 2020. The budget for the "Green vehicle - co-financing the purchase of electric passenger cars (M1)" was set at PLN 37.5 million. The co-financing covered the purchase of completely electric (BEV) vehicles, brand new passenger cars of the M1 category. The conditions of the first call for proposals assumed that the purchased vehicles could not be used for business activities within the meaning of EU competition law, including agricultural activities. Furthermore, they could not be entered into the register of fixed assets used in business activities. Support was provided in the form of grants, the maximum value of which is PLN 18,750, or 15% of eligible costs. The upper vehicle price limit covered by the support was set at PLN 125,000.

According to official information, the sum of funds reserved for another program, "Hummingbird - taxi good for the climate - pilot", amounted to PLN 40 million. The instrument was dedicated to micro, small and medium-sized enterprises with a license to transport people in road transport. The support covered the purchase or leasing of new electric vehicles (BEV) of the M1 category and the purchase or installation of a charging point with a power of up to 22 kW. Co-financing was granted in the form of subsidies (up to 20% of eligible costs, not more than PLN 25,000) or loans (up to 100% of eligible costs). The maximum eligible cost of purchasing or leasing one electric vehicle together with the cost of purchasing and installing one charging point could not exceed PLN 150,000.

"eVAN - co-financing the purchase of an electric delivery vehicle (N1)” was another program announced by the National Fund for Environmental Protection and Water Management. In addition to the purchase or leasing of all electric vans of the N1 category, this instrument also provided for subsidies for the purchase of a 22 kW charging point. The budget of the program is set at PLN 70 million. The subsidy when purchasing or leasing an electric van is a maximum of 30% of eligible costs, but not more than PLN 70,000.

Due to the pandemic situation and insufficient adaptation to the market realities, the pilot programmes of the National Fund for Environmental Protection and Water Management did not significantly increase the sales of electric vehicles in Poland.  The results of the PAFS industry survey conducted among 200 entities from the entire electromobility value chain made it possible to obtain information on the factors limiting the popularity of support programmes among potential beneficiaries and the rules for granting funding that respondents would expect. For example, the respondents indicated the largest disadvantages of the "Green Car" programme as the too-low amount of the subsidy, the maximum purchase price of a subsidized vehicle, too-strict requirements for obtaining a subsidy (minimum annual mileage of 10,000 km, the need for proper marking of the vehicle, etc.) and unclear possibility of obtaining a subsidy in the case of a vehicle owned by the crediting bank.

The National Fund for Environmental Protection and Water Management launched an electromobility support programme called "Green Public Transport", in addition to the instruments providing for the co-financing of electric vehicles. The first call for applications started on January 4 and ended on January 18, 2021, after the planned allocation for subsidies of the total amount of PLN 1.1 billion was exhausted. Additionally, PLN 200 million was made available for loans. In the first call for proposals, the level of co-financing was 80% of the eligible costs of purchasing electric buses and trolleybuses, and in the case of hydrogen buses - 90%. The group of beneficiaries of the NFEPWM programme includes organizers and operators of public collective transport, including local governments. In addition, rural and urban-rural municipalities were co-financed from the "Kangaroo" programme, under which PLN 60 million was allocated for the purchase of 40 electric school buses. In this case, the maximum amount in the form of a subsidy was set at 95% of eligible costs. The amount of support depended on the size of the commune and the amount of income per capita. In the case of a loan, the subsidy is 100% of eligible costs. "Kangaroo" is to be implemented in 2020-2023.  

There have been no co-financing programs for the expansion of the generally accessible infrastructure in Poland so far. The situation is to change due to the regulation of the Minister of Climate and Environment on detailed conditions for granting public aid for infrastructure for charging electric vehicles and infrastructure for refuelling hydrogen. The draft of new regulations, which was published on December 18, 2020 on the website of the Government Legislation Centre, provides for co-financing the creation of new points with a capacity of up to 150 kW or increasing the power of points to 150 kW. The total subsidies for generally accessible infrastructure will amount to 50% of eligible costs, with an extension to 75% for communes below 100,000 inhabitants. According to the project, up to PLN 800 million will be allocated to support the construction of charging infrastructure in Poland, PLN 100 million of which will be allocated next year. PLN 300 million is to be spent in 2022, and PLN 400 million in 2023. The project provides subsidies for entrepreneurs, local governments, as well as cooperatives and housing communities.

In addition to the need to introduce appropriate legislative changes, the optimized support system is the key to accelerating the development of Polish electromobility. The forecasts included in the PAFS report "Polish EV Outlook 2020" were the basis for a realistic scenario assuming the introduction of subsidies in the form of subsidies from the National Fund for Environmental Protection and Water Management in an increased amount compared to the pilot programmes launched in 2020, the Polish fully electric car park (BEV) in 2025 can count approximately 317,000 units. It will be almost twice as small without such support. By optimizing financial incentives, in 2030 the cumulative number of BEV registrations would exceed 955,000 units. In 10 years, up to 1.6 million electric vehicles could be driving on Polish roads, including plug-in hybrids (PHEV), the park of which in Poland is forecasted by the PAFS in 2025 at over 204,000 units, and in 2030, 653,000 units. Infrastructure development will also be dynamized. According to the PAFS analyses, up to 48,000 public charging points for electric vehicles can be created in Poland by 2025.  The PAFS estimates the potential of private infrastructure at 85-110 thousand points.

Author: Jan Wiśniewski, Polskie Stowarzyszenie Paliw Alternatywnych