Page 1

Cleantech

Cleantech INCINERATORS €9bn market on the rise

CLIMATE CHANGE The end is nigh

SPRING 2014

GREEN BUILDING Directory

SPRING 2014

7 Tips For Building Upgrades l The Brussels Jackpot l Clean Coal Dreams l New RES Law Redux


The world of tomorrow needs answers that last. That’s why we’re building them today, with customers all over the world.

It’s why we’re designing our technology to last longer and use fewer resources. It’s why we’re helping our customers reduce their CO2 emissions. And it’s why we’re pioneering new answers with one of the world’s largest environmental portfolios. As a result, we were just named the best in our business sector by the Dow Jones Sustainability Index. And recognized as the top company overall by the Carbon

Disclosure Project, the world’s largest independent database of corporate climate change information. Yet we’d never claim to have all the answers. That’s why we’re working with 190 countries. Thousands of cities. Tens of thousands of companies. In energy, industry, infrastructure and healthcare. We’re working with the world today to create answers that last for the world of tomorrow.

siemens.com /answers


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Siewierz Jeziorna,

Cleantech EDITOR IN CHIEF

Poland’s first

Wojciech Kość

PUBLISHER

sustainable

Parker Snyder

city

ART DIRECTOR Ola Foryś

KEY ACCOUNT Maja Sobieszczak

WRITERS Jan Biernacki, Magdalena Dembińska, Monika Walencka

PHOTOGRAPHY Climate Change, EBRD, European Commission, IISD Reporting Services, MAU Mycielski Architecture & Urbanism/Alta SA, Michał Kotas, Kacper Kowalski/FORUM, Krakowski Holding Komunalny, Ministry of Environment, Photopin, Szymon Szcześniak, Tacit, UNFCCC, Vestas, Wikimedia Commons

EDITORIAL CONTACT

Wojciech@cleantechpoland.com (+48) 602 458 099

ADVERTISING CONTACT Parker@cleantechpoland.com (+48) 517 469 881

GENERAL REQUESTS info@cleantechpoland.com

OFFICE MANAGER Jadwiga Figura jadwiga@cleantechpoland.com

PRINTER Drukarnia BELTRANI Ul. Śliwkowa 1 31-982 Kraków

PUBLISHED BY Cleantech Poland LLC ul. Krucza 51/31 00-022 Warsaw, Poland

4 | CLEANTECH | SPRING 2014

Dear Colleagues, Along a highway north of Kraków, 10 minutes from the Katowice airport, lies an idyllic hillside that leans ever slightly into a lake. Headlong under construction is phase I of Poland's first sustainable city, a mixed use development called Siewierz Jeziorna. By springtime, a few detached houses and condominiums should be fit for occupancy. Siewierz Jeziorna is the vanguard of sustainable development in Poland. Alta SA, the developer, has changed the typical design paradigm by involving the local community from the start. This issue of Cleantech describes a few of the trends connecting business and the environment. What’s the main idea? People want to live, work and play in harmony with nature. The Siewierz Jeziorna master plan is a good example. It was developed by the architect Maciej Mycielski, under the leadership of developer Robert Moritz, president of Alta SA. Siewierz Jeziorna will host a cleantech business park and lakeside recreation opportunities. There will be a church atop a hill, a clock tower and pocket parks - which aid in spontaneous, unplanned interaction. Years from now, Siewierz Jeziorna could be regarded as a visionary project spearheaded by a team of far-sighted urbanists at work in the Polish countryside. Yours truly, Parker Snyder Director


OPINION BY WOJCIECH KOSC

New realities

stifle ambition Facts and figures speak for themselves. The world seems re-united in dodging action to reduce humans’ imprint on increasingly fragile natural environment.

THOSE LOBBYING FOR a decisive action on

the shape of the support framework for the renewable energy sector were flabbergasted by the government’s new idea that development of new renewable capacity will be based on auctions, where companies will bid to pay the lowest price per MW. The three-year debate about a system of feed-in tariffs differentiated by technology type and installations size went down the drain. From a political point of view, one has to congratulate the Polish government. Dodging the issue for more than three years, Poland’s approach to energy policy has gone from being backward to mainstream in the EU. Recent climate and energy proposals from the European Commission are more appropriate for “current economic and political realities,” the Commission said in late January. “There is a need to progress towards a low-carbon economy which ensures competitive and affordable energy for all,” the Commission also said, as if copying from the Polish leaders who have been saying the same for years now.

Poland’s energy policy went frombackward to mainstream in just three years. Now it fits current realities

"New realities" means that the EU will have a new target for renewable energy of 27 percent by 2030. How this target will be achieved is not clear because there will be no binding national targets. As for climate-related ambitions, the Commission proposes to cut carbon dioxide emissions by 40 percent by 2030, relative to 1990. This will comprise a 43 percent emissions cut in sectors falling under the EU’s emissions trading scheme (EU ETS) and 30 percent reduction in non-ETS sectors. These cuts are relative to 2005. Europe is only a part of what seems to be a global move towards less ambitious climate action. During last year’s UN climate conference in Warsaw, Japan reduced its emissions targets, while Australia repealed its carbon tax. The conference itself has been criticized for watering down climate action as well (though it rather was a price paid for the process to move on). Finally, cleantech investment figures are falling. The total value of private equity, venture capital and development capital investments in global cleantech companies declined by 50 percent last year to USD 8.35 billion, according to Bureau Van Dijk, a business intelligence firm. If you’re in the environmental business or advocating environmental policy, you’re probably feeling that you’ve been making two steps backward for every step forward. That’s hardly progress at all.

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PARTNERS

To become a partner for the magazine, please contact the publisher The American Chamber of Commerce (AmCham) is a business organization that serves and promotes its member companies. AmCham fosters positive relationships with the government and promotes the free market spirit for the benefit of business. Ul. Emilii Plater 53, 00-113 Warsaw www.amcham.com.pl

Cleantech Poland (CTP) is a media and consultancy company for sustainable business. CTP connects capital to technology in Poland’s conversion to a low carbon economy. The Cleantech magazine is part of a portfolio which includes the Shale Gas Investment Guide. Ul Krucza 51/31, 00-022 Warsaw info@cleantechpoland.com

PwC PwC provides cleantech companies with services in assurance, advisory and tax & legal. A global services company, PwC has been in Poland for 20 years. Locally, there are 46 partners and more than half of employees are female. Al. Armii Ludowej 14, 00-638, Warsaw www.pwc.pl

SSW SSW provides comprehensive tax and legal advisory services. SSW, whose main practice areas are energy and natural resources, counts the world’s largest energy companies as clients. Rondo ONZ 1, 00-124 Warsaw www.ssw.pl

DTZ is a property services company, providing occupiers and investors with end-to-end property solutions, global and local market knowledge, forecasting and trend analysis. ul. Złota 59, 00-120 Warsaw info@dtz.pl

6 | CLEANTECH | SPRING 2014


CONTENTS 32

p/11 INDICATORS p/16

TRENDING p/22 CLEAN DIRTY POWER: energy from waste p/28 POLAND'S clean coal dreams p/30

Bidding for capacity:

death of RES? p/32

42

Climate Change: the end in sight

p/4 0

Green Building Section / 4 1 INTERVIEW

Alan Colquhoun, DTZ / 4 2 Energy efficiency

in buildings / 4 4 Upgrade or be

downgraded / 5 0 EU funding

up for grabs

p/56 Green Building Directory

p/4 Letter from the Publisher p/5 OPINION:

stifled ambitions

p/74

COP19: a pictorial p/74

p/8 Photo Essay

PORTRAIT

Pavel Antonov

toxic beauty

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PHOTO ESSAY BY K AC P E R KOWA LS K I / FO R U M

Colored streams of sludge, waste residues from chemical production, make their way between trees at the Police chemical factory's waste dump in north western Poland. The Police facility, part of the large chemical conglomerate Azoty Group, is one of European leaders in production of inorganic fertilizers and titanium white. The company claims to have spent about â‚Ź2.5 million for environmental protection on average in recent years. Kacper Kowalski's series of aerial photographs showing the impact of industry on environment earned him 2nd prize (stories) in Nature category in this year's World Press Photo contest.

8 | CLEANTECH | SPRING 2014


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|9


www.pwc.pl

Turning advice into action

It is the people at PwC, our team of advisers, who make our firm unique. PwC’s services and industry experts are able to offer a unique experience through our fully integrated approach and by leveraging our extensive network.

© 2014 PwC. All rights reserved. PwC refers to the companies associated in the PricewaterhouseCoopers International Limited (PwCIL), each member of which is a separate legal entity and does not act on behalf of PwCIL or other member firms.


I ND I CA T O R S -1CAPACITY GROWTH

R E N E WA B L E S I N P O L A N D wind

other RES

5.040

4,500 3,000

+321 % 1.569

1,500 0

2008

2009

2010

2011

2012

2013

 Current support scheme has resulted in high growth of renewable energy capacity in Poland. Major developments consisted of wind technology, mainly in the northern part of the country.

SOURCE: ENERGY MARKET AGENCY

6,000

EDITOR'S VIEW

MW

FORECAST

N E W C A PAC I T Y 2 01 5 - 2 0 2 0

%

wind

biomass

other

FORECAST

COST OF SUPPORT 2015-2020 60

PLN BN

50.4

45 30

22.7

15 0

EXISTING

NEW SYSTEM

 The target cost of support scheme forecasted by the Ministry of Economy remains highly ambitious. The amount shows the forecasted value and shall not be perceived as maximum amount of support.

E N E R G Y A N D C E R T I F I C AT E S certificates

PRICE, PLN PER MWH

electricity

350 300

281.8

267.1

253.3

250 200

201.4

197.2

150 2009

2010

2011

2012

SOURCE: MINISTRY OF ECONOMY, ASSESSMENT OF NEW RES LAW IMPACT.

83 %

SOURCE: CERTIFICATES BASED ON MINISTRY OF ECONOMY REGULATION IMPACT ASSESSMENT, ELECTRICITY PRICES BY ERO.

11 %

 The new support scheme for energy from renewable sources favors cost efficiency, therefore wind technology is clearly the winner. Biomass capacity developments are doubtful as these units would be forced to deal with fuel cost volatility while maintaining fixed electricity sale price formula. Other technology types, such as PV, will continue to play a minor part in the mix.

SOURCE: MINISTRY OF ECONOMY, ASSESSMENT OF NEW RES LAW IMPACT.

6%

WOJCIECH KOSC E D I T O R I N C H I E F, C L E A N T E C H

It's a rather unimpressive credibility that the Polish government has in terms of proposing timeline for the establishment of a solid and predictable support scheme for renewable energy. So much time has passed, however, since the debate on the issue originated in 2010 that the current proposal, based on bidding for capacity, should get kudos simply for being there, even if what the government proposes is far from an ambitious program to get the renewable energy sector to a sustainable growth and give it a stronger position in Poland's future energy mix. As it happens, the proposal will mostly favor cost effective technologies like wind. To some lobbyists from the renewable sector, it doesn't make much sense. OK, some growth will be there and some new jobs will be created, they say. But a better growth, more jobs and more added value to the economy would be created if there were incentives for all technology types and all installation sizes. A diverse and distributed sector will pay off because it will increase Poland's energy security that's at risk if the centralized approach continues, these pro-renewable voices claim. The government is having hardly anything of these arguments. Renewable energy will only play auxiliary role in the Polish energy mix, not more than the EU requires, which is 15 percent of overall energy consumption in 2020. Bidding for capacity was actually found to hinder growth in many EU countries, another piece of evidence that the good times for renewable energy in Poland are over, at least for the time being. This section was prepared by PwC, the world’s leading consultancy company. Authors: Jan Biernacki (p.15, 17); Magdalena Dembińska, Monika Walencka (p. 18).

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I ND I CA T O R S -2EXPERT GUEST Now that it is decided that the government will support renewable energy via auctions where companies will reverse-bid on price per MW, Cleantech asked an expert about the implications of the proposed system.

JAN BIERNACKI

Senior associate at PwC's Energy Group. Mr. Biernacki's expertise is energy from renewable sources.

ing changes in support scheme. Do you think that the auction system is well suited to advance market development? The auction scheme has all it takes to allow new renewable capacity in Poland, yet there are still several challenges. The main one stands before the Energy Regulatory Office (URE) that will be responsible for organising the auctions, which will give URE many new responsibilities and obligations to handle. Concerning question marks - we do not know what to expect in terms of reference prices. Risk of setting them on too low level seems virtual but time will tell.

H E S A I D I T. . .

 What do you think will be the

effects of auction based system of support for the renewable energy sector ? The main issue about the auction system is limited room for new renewable projects. Previous scheme, based on green certificates, allowed any renewable energy installation to receive support, investors did not need to care about other projects (as long as there was a shortage of certificates), as they were not competing directly. Auction based system changes all that. Preparing better projects than competitors, negotiating prices with turbine suppliers becomes more important than ever because only the best projects will be able to offer competitive bids. Therefore the most important effect of the new system is that it is going to be harder for the investors. Some of them might find the new system unattractive and withdraw. Still, someone's lost opportunities will create new ones for others, as there are many investment funds interested in our market due to upcom-

12 | CLEANTECH | SPRING 2014

“Preparing better projects than competitors, negotiating prices with turbine suppliers becomes more important than ever because only the best projects will be able to offer competitive bids� Should there be separate auctions for each renewable technology (like PV, wind, or biogas) or let everyone bid together? I do not think one can say whether there exists any "should" or "should not". Separating the auctions is a matter of decision. It is possible to choose either a desired RES mix or let every technol-

ogy compete. If we choose the former, we agree that the costs of the support scheme will rise. Additionally, separating the auctions could become a huge burden for the URE, as every year it would be obliged to decide what capacity for each technology should access the market and it is hard to find a good justification for these decisions. In case of allowing competition, one can expect lower costs, as the most effective technologies and projects ultimately win. For now, the authorities decided for the competition option, as the priority of the new support scheme is to optimize costs. Which renewable energy sector has in your opinion best prospects for growth in Poland in the next 18-24 months? I expect that development of new capacity in the next 18-24 months will consist of projects aiming at entering green certificates scheme as we will still have to wait until the notification process of the proposed new support scheme to the European Commission is finished. Historically, the most dynamic growth of capacity in Poland was in the wind sector. I don't expect this to change. In a longer perspective, I don't expect that there will be other technology more competitive than wind, therefore this sector will continue to thrive. Other technologies don't seem to present sufficient conditions for significant development. Cost of PV has diminished significantly over recent years, but still not sufficient enough to allow noticeable developments in this technology in Poland. The potential challenger for wind might be biomass technology, yet I would find it troublesome to have a 15-year fixed electricity contract determining the income and at the same time accepting volatility of biomass prices on the market.


I ND I CA T O R S -3Prime Minister Donald Tusk, January 2014

"We want the Polish economy to produce as much energy from renewable sources as possible to meet international requirements. At the same time we want energy production costs to be socially acceptable and guarantee competitiveness of the energy industry" deputy economy minister Jerzy Pietrewicz, September 2013

"We've been deceived for a long time now, as representatives of the government led by Donald Tusk have been trying to convince the general public that renewable energy isn't a good solution for our country and its economy" environmental NGOs in open letter to Mr. Tusk, January 2014

sources: Prime Minister's Office, Reuters, Climate Coalition

4

10

49

 Production structure relies on coal. Current large capacity in construction (2 combined cycle gas turbine units over 400 MW each and a 1075 MWe hard coal unit) do not signify a large shift in terms of change of production structure.

35

Lignite

Hard coal

RES

SOURCE: ENERGY MARKET AGENCY

2

%

Other

Gas

R E N E WA B L E S P R O D U C T I O N

BY TYPE %

60 45

57.3%

57.7%

59.9%

27.2%

17.8%

12.1%

15.5%

24.5%

28.0%

2010

2011

2012

52.0%

30 15 0

15.1% 32.9%

2013 Jan-Nov Hydro

Biomass, biogas, cofiring

Wind

 Biomass is main source of renewable energy in Poland. Large use of this fuel prompted developement of many businesses relying on production and transport of biomasss. However, many large energy producers have withdrawn from contracts for biomass purchase, as the price of green certificates slumped in 2013.

CO - F I R I N G I N SYST E M P OW E R P L A N T S

EXCL. CHP TWH

7,4

8 6 4

SOURCE: ENERGY MARKET AGENCY

"As regards Poland’s energy policy, it's good that we didn't adopt the law on renewable energy sources, in the effect of which we would have too much of too expensive power compared to the actual needs"

BY SOURCE

ENERGY PRODUCTION

4,1

5,0

5,9 3,5

2,7

2 0

2008

2009

2010

2011

2012

2013 Jan-Nov

 While biomass in total retained its large share in production, Poland has experienced shift from co-firing to biomass dedicated units (including the 205 MW biomass unit in Połaniec, on of the world's largest). As the price of green certificates slumped in 2013, co-firing in system power plants largely diminished and they switched to coal as fuel. The range of future oversupply of green certificates will largely depend on decisions on co-firing.

SOURCE: ENERGY MARKET AGENCY

T H E Y S A I D I T. . .

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I ND I CA T O R S -4CO2 EMISSIONS

POLAND

Carbon Emissions (without LULUCF) in 2012

8.4 tCO2 /capita

Poland, % of EU emissions

8,6 %

Kyoto Protocol target

6%

Emissions reductions

29%

EMIS SIONS BY REGION

2012

Global emissions (EU)

11%

t CO2/capita in EU

7.4

Global emissions (US)

16 %

t CO2/capita in US

16.4

Global emissions (China)

29 %

t CO2/capita in China

7.1

SOURCE: JRC

SOURCE: KOBIZE, JRC

Energy use (kg oil equivalent) per $1 GDP (PPP)

POLAND'S EMISSIONS 1,00

0,20

0,80 0,70

0,15

0,60

0,10

0,50 0,05

0,40 0,30

SOURCE: UN STATISTIC DIVISION - MILLENNIUM DEVELOPMENT GOALS DATABASE

0,00 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Change due to energy efficiency improvement

Carbon intensity toe/2012 $m

CARBON INTENSITY  Globally, most reduction (92%) in carbon intensity can be attributed to improvements in energy efficiency, while only 8 percent through a shift towards cleaner energy mix. Improving energy efficiency is essential to reduce carbon intensity, however efficiency measures typically result in a rebound and there is a limit to which we can cut energy use per unit of GDP.

Change due to improvement in fuel mix

395 390 385 380 375 370 365

2007

2012

SOURCE: KOBIZE

FOSSIL FUELS AND INVESTORS

GT CO2

 As early as in 2011, the world had spent over a third of its 50-year

carbon budget of 886 Gt CO2 (amount of emissions that can be released without increasing the odds for global temperature growing more than 2째C by 2100), leaving 565 Gt CO2 that is "safe" to burn. The proven reserves owned by companies and governments are equivalent to 2,795 Gt CO2, which means that only 20% of those reserves can be burned without the global temperature growth spinnig out of control. If global economies seek to tackle the climate change seriously, then up to 80% of declared reserves should become stranded and their valuation reduced five-fold. SOURCE: CARBONTRACKER.ORG

14 | CLEANTECH | SPRING 2014

Carbon dioxide emissions

0,25

0,90 Energy use

 Between 2000 and 2010 Poland demonstrated large increase in efficiency of economy as both energy use and CO2 emissions (per GDP unit) diminished by 28% and 25%, respectively. Major reductions were due to energy efficiency but further improvements in that area may be limited. Future decrease of energy use and CO2 emissions will be more challenging and could require large investments into both energy efficiency solutions and low-emission or no-emission energy sources.

Carbon dioxide emissions (CO2), kg CO2 per $1 GDP (PPP)

800 Gas

600 385

Oil

319.13

37.34 Remaining global carbon budget

400 200 370

0

Coal

389.19

Listed carbon budget


If an investor decides to change the capacity of wind turbines related to planning permissions - does that also mean that the investor is bound by the provisions of planning permission documentation, which specify the power of a wind turbine?

PHOTO: PWC

ADVERTORIAL

MACIEJ KRUS, PH.D. AT TORNEY AT LAW, DAWID TRELA, JUNIOR AS SOCIATE, S SW LAW FIRM

Installing a Larger Turbine?

W

ind farms' planning permission documentation establishing the conditions of land development often stipulates the specific capacity of wind turbines to be used in the development.

According to Article 59 of the Spatial Planning and Land Development Act as of the 27th of March 2003, planning permission concerns the establishment of land development conditions and refers to land management and development.

Any stipulation in the planning permission documentation concerning the precise capacity of wind turbines is not legally binding and is incapable of producing legal effects. Thus, if an investor increases or decreases the power of wind turbines, the initial planning permission remains valid and it is unnecessary to apply for its amendment. This view has been approved in case law. For instance, the Regional Administrative Court (RAC) in Warsaw, in its ruling of 19th January 2012 (file no. II OSK 2075/10), held that the issuance of a planning permission constitutes an initial step in the investment process and, consequently, its provisions should not concern the technical specifications of the investment but rather shall determine, taking into account land management, whether a particular investment may be undertaken in a given area. According to the RAC, the technical conditions of an investment are to be deter-

Accordingly, it should specify the location of an investment and the intensity of land exploitation, rather than defining the technical parameters of the investment itself.

“If an investor increases or decreases the power of wind turbines, the initial planning permission remains valid”

This leads to the question as to whether or not an investor may increase or decrease the power of such turbines without needing to apply for an amendment of the conditions of planning permission. In other words, is the wind turbine capacity specified in the planning permission documentation binding for the investor?

mined in the building permit, which is required at a later stage in the investment process. While the provisions of planning permission documentation laying down the technical parameters of wind turbines do not produce legal effects, it must be stressed that other provisions of the planning permission must be complied with in the event that the investor decides to change the capacity of wind turbines. Moreover, in such cases, the investor is bound by the requirements of the decision governing the investment’s environmental conditions. However, provided that the above-mentioned conditions are fulfilled, the investor is not required to apply for an amendment of the planning permission documentation in case of changing the capacity of wind turbines.

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CLIMATE CHANGE

TRENDING

THE DIRTY 90 VANISHING €5 BILLION Poland’s energy and heat sectors are concerned that a looming change in how the European Union funding is disbursed could cause that about €5 billion of possible funding would become unavailable. EU funds in Poland are distributed via so-called Operational Programs and, on the regional level, through Regional Operational Programs. The change in how these funds are available to projects is that the European Commission guidelines for the use of funds in 2014-2020 consider such help as distorting internal markets and at odds with the EU’s long term plans to create a unified and competitive energy market across the 27-nation bloc. To date, Poland has used the EU funding to upgrade old power and heat installations to meet the ever tightening EU environmental norms and tackle, for example, emissions of SO2 and NOx, particulate matter, invest in renewable energy generation, and modernization of heat distribution networks. Reduced EU funding will also result in slowdown of development of cogeneration, according to the Polish Heat Chamber of Commerce, an industry lobby group.

A peer reviewed study by geographer Richard Heede published in the journal Climate Change has determined that around ninety entities are responsible for two-thirds of the man-made emissions since the dawn of the industrial revolution. Mr. Heede’s study titled "Tracing anthropogenic carbon dioxide and methane emissions to fossil fuel and cement producers, 1854-2010," issued in late 2013, asks policy makers to consider the role of the fossil fuel producers in determining climate policy. Mr. Heede seeks to define historic emissions through the responsibility of the institutions that have mined and refined fuels (supply side) rather than the end-users (demand side). According to Mr. Heede, these “carbon majors” include 50 investor-owned companies, such as Chevron and Exxon-Mobil, 31 state-owned companies, such as Saudi Aramco and Pemex, and 9 government-run industries in the former Soviet Union, China and other countries. To draw these conclusions, Mr. Heede spent eight years combing through publicly available data. By his account, the top ten carbon majors include ChevronTexaco, Exxon-Mobil, BP and Royal Dutch Shell, along with government-run industries in the former USSR, China and Poland, as well as the nationally owned Saudi Aramco, Gazprom and the National Iranian Oil Company.

30 Nov

1 Nov 2013 26 Nov

27 Nov

18 Dec

31 Dec

GM poplar trees show China's Guangdong bioenergy potential: announces kick off of world's second largest Dutch study carbon market Poland government extends public help program for RES until Graphene production starts in June 2014 Poland; global market estimate: $675m in 2020 16 | CLEANTECH | SPRING 2014


WIKIMEDIA COMMONS

EUROPE’S 7TH PELLET PRODUCER According to 2013 data from the European Biomass Association (EBA), Poland rose to the position of Europe’s seventh biggest pellet producer in 2012, when it manufactured 410 million cubic tonnes of the fuel. The use of pellets as a source of energy grew by 137 percent in Poland between 2008 and 2012. Pellets are a biomass fuel produced from wood waste. Poland’s vast wood resources, growing on close to nine million hectares, or 28.8 percent of the country’s area, provide grounds for further growth of pellet manufacturing, according to the EBA. From the consumers’ side, pellet is becoming a fuel of choice because of its price. Pellets are 50 percent cheaper than oil and about 20 percent cheaper than gas. Europe-wide, the consumption of pellets was 14 million tonnes in 2012. There are more than 500 pellet-manufacturing companies in Europe, with leading markets being Sweden, Denmark, Austria, Italy, and Germany. Europe-based production of pellets amounted to 11.2 million tonnes in 2012, with the rest covered by imports, making Europe world’s bigger importer of the fuel.

GERMANY PLANS TO CUT FITS BY A THIRD

PHOTOPIN

Feed-in tariffs for electricity production from renewable energy in Germany could be cut by a third to an average of €0.12 per kilowatt hour by 2015, according to a draft plan from economy and energy minister Sigmar Gabriel, ENDS Europe reported. The plan would cap newly installed capacity in the onshore wind and photovoltaic sectors at 2,500 MW each annually. Offshore wind capacity would grow to 6,500 MW by 2020. A cap of two new farms per year would then apply until 2030. Feed-in tariffs will be reduced further once these capacity thresholds have been reached. In line with the German coalition agreement, renewable energy producers will have to directly sell their output via the European Energy Exchange. The obligation would apply for installations of more than 500 kilowatts. This threshold would be lowered to 100 kW in 2017. In their coalition agreement, CDU and Social Democrats agreed to limit the share of renewables in electricity production to 40-45 percent by 2025, increasing to 55-60 percent by 2035. The plan would come into effect on 1 August.

1 Jan 2014

8 Jan 10 Jan 16 Jan

NFOSiGW earmarks €250m in funding for RES and energy efficiency

17 Jan

17 Jan

Poland proposes law to ban wind farms closer than 3 km to houses and forests

Fracking threat to water supplies overplayed: UK think tank study

First community relocated under climate change program in Fiji

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| 17


TRENDING

VESTAS

Vestas, a Danish wind turbine producer, will furnish turbines for a 40 MW project in northwest Poland built by the Spanish developer Taiga Mistral. The Ostaszewo wind farm is held by the SPV Nowotna Farma Wiatrowa owned by the parent Taiga Mistral. The Vestas contract covers the purchase, delivery and installation of the manufacturer's V110 turbines with a nominal rated power of 2MW. Vestas has orders totaling some 950 MW in the US market, but this is their first purchase order for the turbine in Europe. The contract also includes a 15-year service agreement, for a project which is expected to be built in Q4 of 2014. In Poland, the wind market has slowed as of late. From year on year doubling, the Polish wind market added several hundred MW in 2013, for an installed capacity of nearly 3 GW. Private investors are waiting until the forthcoming RES law - which may eliminate the current support system based on certificates of origin - is passed into law.

21 Jan 17 Jan

MICHAĹ KOTAS

VESTAS V110 DEBUTS IN EUROPE

NUCLEAR POWER IS BACK IN CEE Polska Grupa Energetyczna (PGE), a power utility, announced a search for financial and technology partners to fund, build and operate two new nuclear power blocks, the first to go online by 2025. Marek Woszczyk, CEO of PGE and the former head of the energy regulatory authority, said, "We now have the period of searching for a partner to provide the technology and a partner to participate financially." Mr. Woszczyk's announcement comes at a time when the Polish government has bounced back to favoring nuclear power, in the midst of an electricity demand cycle that is raising prices as old capacity threatens to go offline. Poland is the only Central European country that never had a nuclear power plant. An attempt to develop a facility in Ĺťarnowiec failed in early 1990s (abandoned site pictured above). With exception of Germany, other countries of the region, like Hungary, seem to favor nuclear power as a large power source that provides stability to the power grid, emitting a negligible quantity of emissions in carbon constrained Europe.

29 Jan 21 Jan

EU member states making good progress to renewable energy targets: Commission UK to introduce auction based system of subsidies for RES to reduce costs 18 | CLEANTECH | SPRING 2014

29 Jan

31 Jan

Record 1,567 MW of offshore wind capacity goes online in 2013: EWEA PGE starts 1,800 MW coal-fired plant in Opole


PHOTOPIN

EU UNVEILS CLIMATE GOALS In February, the European Commission released a proposal regarding the EU's climate and energy policy to 2030, coming ahead of an March summit where these goals should be decided. The Commission wants to proceed with an overall binding emissions reduction target of 40 percent from 1990 levels, as well as an EU-wide binding target of at least 27 percent of energy from renewables. Regarding energy efficiency (the third pillar of EU climate policy) a proposal is soon to be forthcoming, according to Connie Hedegaard, the EU climate commissioner. The emissions target will be binding at both the EU and national level; each member state will receive a target that gives consideration of its contribution to emissions reductions. The renewable energy target will be binding at the EU level but not at the national level, giving countries such as Poland - which has postponed legislation for several years - a nod that they will not be required to meet minimum production quotas. "Our 40 percent is inline with science as it puts us right on track to meet our 2050 goal of cutting emissions by 80-95 percent," Ms. Hedegaard wrote in The Guardian in February.

DOW OFFSETS OLYMPIC EMISSIONS

EUROPEAN COMMISSION

Dow, the Midland Michigan based chemical company, is the official carbon partner of the Sochi 2014 Winter Olympics. The carbon partner reduces the games' carbon footprint by funding abatement programs or by partnering with third parties. To offset the games, Dow implemented energy efficient and low-carbon projects related to infrastructure, industry and agriculture. The emissions reductions were verified by ERM, a consultancy. ERM verified that the offsets exceeded 360,000 tons of carbon dioxide, the estimated direct carbon footprint of the games, which includes among other impacts the emissions related to travel, accommodation and operations. In an interview during COP19 in Warsaw, George Hamilton, vice president of Dow’s olympic operations said, "Business has a role to play in combating climate change. Since Dow is leader in an industry that impacts everyone, everyday, we wanted to do our part." Dow worked with partner Offsetters to achieve certain carbon reductions, including "air sealing buildings to enhance energy efficiency, technologies to enhance energy efficiency of industrial processes, or low-weight and high-strength materials for structural integrity and durability of civil infrastructure.”

5 Feb 31 Jan

1 Feb

3 Feb

January wettest winter month in the UK in 250 years: Oxford University

Fukushima to use 100% renewable energy by 2040

EBRD launches $100m sustainable energy lending framework in Ukraine

UK carbon capture industry could be worth £35 billion: CCS Association

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| 19


COP19 PRESIDENT KOROLEC PUSHES BACK Marcin Korolec, the president of COP19 and former minister of the environment of Poland, called on the EU not to make binding targets on climate and energy without a global consensus. "Otherwise [the EU] will repeat the failure of Copenhagen, when the unilateral actions of Europe were not met with a response from others," Mr. Korolec wrote in a statement on the ministry of environment's website, as reported by Reuters in early February Mr. Korolec said that the EU should not make its pledges, or "contributions," to reduce emissions until the first quarter of 2015. Contributions by countries "in a position to do so" are likely to form the foundation of a global climate deal which is planned for Paris in 2015. The EU is divided on whether bold action is needed to prod other nations to set ambitious climate targets. The EU climate commissioner Connie Hedegaard spoke in support of setting targets as soon as possible, while the EU's energy commissioner Guenther Oettinger publicly criticized the bloc's advance proposal. Mr. Oettinger said those who expected "the EU plan to save the world were arrogant or stupid."

Feb 10 Feb 6

DEBT FOR WIND PROJECTS, EBRD The European Bank of Reconstruction and Development (EBRD) will provide €22 million for a wind farm located in Poland. The Orla located project will install 15 Nordex manufactured turbines series N100 with a 2.5 MW capacity for a 37.5 MW installed net capacity; phase one of 22.5MW phase is planned to be finished in December 2014. EBRD renewables coordinator Grzegorz Zieliński said the bank was supporting the Orla wind farm to increase the capacity of renewable energy in Poland. The EBRD funding in 2014 is beneficial as developers have had a difficult time arranging debt in a market that lacks confidence in the future of wind energy in Poland. Adam T. Ofek, a board member of the investor, said, "We are delighted to have the opportunity to add further projects to our growing portfolio of wind farms, which would not be possible without the EBRD's involvement. This is a significant milestone in our wind farm investment programme."

EBRD

MINISTRY OF ENVIRONMENT

TRENDING

Feb 12

Feb7 Europe’s competitiveness only slightly determined by energy prices: economists

European Parliament paves way for backloading to take effect by April 20 | CLEANTECH | SPRING 2014


External insulation can improve a building’s energy performance, but can promote mold and fungicide growth because these walls don’t dry out as quickly as uninsulated walls. Dow’s new microbial control products can help.

PHOTO: DOW

ADVERTORIAL

PAUL WOOD, DOW MICROBIAL CONTROL

Why do wet walls grow mould?

E

uropean contractors are using types of external cladding insulation systems called ETICS to reduce energy loss from buildings. Consider that the exterior walls of poorly insulated buildings tend to dry quickly, quickly due to heat transmission through the wall. However, well insulated and better performing exterior walls stay wet longer. The outer layer - consisting of paint, plaster/ stucco, render and sparkle - dries less quickly when compared to normal systems. This is because there is less heat transfer. Because the coating stays wet for longer periods of time this leads to rapid carbonation. As the pH drops, micro-organisms will colonise the surface more easily. Additionally, if the system contains a fungicide or algicide which is not leach-out stable, this will lead to more rapid disappearance of the active substances from the coating, again leading to early mould and fungal colonisation of the exterior coating.

FUNGICIDES AND ALGICIDES Why should a contractor use fungicides or algicides? From the consumers point of view, these products maintain a good looking exterior and stop the premature discoloration of painted façades and surfaces. In addition to the undesirable colour changes, damage to the substrate can occur, weakening the building over time. Paint and plaster blistering and flaking can occur as well as partial damage to masonry, concrete, sandy limestone, fibrous cement, concrete roofing slabs and joints, giving rise to failure of the coating. Damp, shaded, north facing elevations of buildings with overhanging trees are usually where the most prevalent microbial growth is observed. In high summer in Central Europe, one cubic metre of air often contains more than 20,000 fungal, algal and lichen spores. DOW SOLUTION There are very many products in terms of fungicides, algicides and combination products. Reading the technical

descriptions of the various biocide formulations available can be very confusing. The Biocidal Products Regulation from September 1, 2013 has severely limited the choice of actives available for this application. To meet the demands of contractors looking to control mould and fungi, Dow Microbial has developed a Polymer Shielded Technology. This is a patented process whereby active ingredients are imbibed using a pure acrylic polymer. This technology has been shown to significantly slow-down the initial “burst“ of leach-out which can occur when the coating is initially applied and subjected to natural weathering. This new product meets the requirements of an active, such as stable over a wide range of PH, no discoloration, easy to disperse and handle, in addition to being cost effective. This article has been condensed from Mr. Wood's technical paper. Mr Wood would like to acknowledge Dr. Thomas Koehler and Nathalie Knabe from Dow Microbial Control.

WWW.CLEANTECHPOLAND.COM WWW.CLEANTECHPOLAND.COM | 21

| 21


WASTE TO ENERGY

Clean dirty power Investment in “clean” energy like wind or solar may be going south in Poland, but there is a sector that's thriving. It's getting energy and heat from the dirtiest residues that we leave behind. BY WOJCIECH KOSC

22 | CLEANTECH | SPRING 2014


PHOTOPIN

WWW.CLEANTECHPOLAND.COM

| 23


WASTE TO ENERGY IT’S HARDLY RELEVANT these days to talk Poland in the context of its past as a centrallyplanned state owned economy. The quarter of a century that has passed since 1989 has changed Poland very thoroughly. But not completely. If you’re willing to find a palpable proof that the legacy of the old times’ is still lingering, drive to outskirts of a city like Kraków.

There, an overflowing landfill site is an example of the primary mode in which Poland handles municipal waste. Truck after truck go through landfill gates, dumping increasing amounts of municipal waste, a testimony to a lifestyle that’s increasing consumption. A walk in many neighborhoods in Poland will reveal that the infrastructure to sort out and recycle

waste is becoming standard. But what municipal waste cannot be recycled is simply landfilled. Across Poland, the landfilling rate is as much as 73 percent, according to a September 2013 report on municipal waste in Central and Eastern Europe (CEE) and Greece by CMS, a law firm. In 2010, each person in Poland generated on average 315 kilograms of municipal waste. That

TA C K L I N G W A S T E D U M P S MAJOR WASTE TO ENERGY INSTALLATIONS UNDER CONSTRUCTION IN POLAND

Gdańsk

WASTE TO ENERGY INSTALLATION (YEAR OPERATIONAL)

Olsztyn Szczecin (2015)

Poznań (2016) WARSZAWA

Konin (2015) Łódź

Lublin

Wrocław

Katowice

Rzeszów Kraków(2015)

 Poland landfills close to three quarters of its municipal waste, but this has to be reduced to 35 percent by 2020. With limited time and only one existing huge waste to energy facility, the market for these installations will now experience nothing short of a boom. Contractors, take note. Also, waste to energy market isn't all about large urban areas (though biggest project will certainly be located there). Poland's 2479 communes will have to get organized as well to meet the EU requirements about landfilling reduction. Typically, communes, particularly those in rural areas, will form a group so that their joint stream of municipal waste is attractive for investors to offer development of incinerators.

LOCATION

Waste treatment capacity (tonnes/year)

Electricity generation capacity (MW)

Heat generation capacity (MW)

Operational

Cost

Białystok

120,000

5-7.5

n/a

2015

80.21

Bydgoszcz

180,000

n/a

n/a

2015

104.94

Konin

94,000

5

18

2015

91.79

Kraków

220,000

8

35

2015

200.3

Poznań

210,000

15

34

2016

173.9

Szczecin

150,000

14

58.4

2015

171.23

24 | CLEANTECH | SPRING 2014

(€m)

SOURCE: CLEANTECH POLAND

Białystok (2015)

Bydgoszcz (2015)


A LOT O F G RO U N D TO COV E R LANDFILLING RATES (%) IN EU-27

Municipal Total municipal waste waste treated, generated, kg per person kg per person

Municipal waste treated, %

502

486

38

22

25

15

Belgium

466

434

1

37

40

22

Bulgaria

410

404

100

-

-

-

Czech Republic

317

303

68

16

14

2

Denmark

673

673

3

54

23

19

Germany

583

583

0

38

45

17

Estonia

311

261

77

-

14

9

Ireland

636

586

57

4

35

4

Greece*

457

457

82

-

17

1

Spain

535

535

58

9

15

18

France

532

532

31

34

18

17

Italy*

531

502

51

15

21

13

Cyprus

760

760

80

-

16

4

Latvia

304

304

91

-

9

1

Lithuania

381

348

94

0

4

2

Luxembourg

678

678

18

35

26

20

Hungary

413

413

69

10

18

4

Malta

591

562

86

-

7

6

Netherlands

595

499

0

39

33

28

Austria*

591

591

1

30

30

40

Poland

315

263

73

1

18

8

Portugal

514

514

62

19

12

7

Romania

365

294

99

-

1

0

Slovenia

422

471

58

1

39

2

Slovakia

333

322

81

10

4

5

Finland

470

470

45

22

20

13

Sweden

465

460

1

49

36

14

United Kingdom*

521

518

49

12

25

14

SOURCE: EUROSTAT, 2010. 0 (ZERO) EQUALS LESS THAN 0.5%, "-" INDICATES A REAL ZERO.

Landfilled Incinerated Recycled Composted EU27

 There is no CEE country that landfills less than 50 percent of its municipal waste. While some of the "old" EU member states still landfill around half of their municipal waste, there is no shortage of countries that have curbed their landfilling to achieve rates between 0 and 3 percent. Where will Poland be in 2020?

is changing, however, albeit late. Pressure from the EU for member states to reduce the amount of landfilled municipal waste is having Poland step up efforts to make up for insufficient infrastructure, waste to energy facilities in particular. TRAILBLAZING PROJECTS At the moment in Poland, six waste to energy installations are under way, their combined cost at about €828 million and capacity of almost

million tonnes annually. These investments are taking place in major cities of Białystok, Poznań, Kraków, Bydgoszcz, and Szczecin, as well as in a smaller town of Konin. The projects are set to go online in 2015 and 2016. These are deadlines that can hardly be moved because there are cities, like Kraków, where landfills are about to reach their capacity while the EU regulations disincentivize construction of new ones as the direction of the regulations is

that less and less municipal waste will be landfilled. Typically, these waste to energy investments are projects from municipality owned waste management companies and are financed in 30-50 percent from the EU funds via the so-called Operational Program Infrastructure and Environment. Since municipal waste management companies are public entities, the waste to energy facilities are developed via public tenders. The six projects under way will pave the way for many more by 2020, the year by which Poland is required by the EU Landfill Directive to reduce the amount of landfilled waste to 35 percent of the 1995 level. These projects attracted a number of bidding companies, both Polish and international, for example Italy’s Termomeccanica Ecologia (in consortium with Astaldi), Posco (Korea), Keppel Seghers from Belgium, Cespa from Spain, or France’s GDF Suez.

Overflowing landfill sites are still the primary mode in which Poland handles municipal waste CONTRACTORS, TAKE NOTE A similar situation is occurring in the rest of the CEE economies, where landfilling is rampant: Slovenia’s lowest landfilling rate in the region, 58 percent appears outrageous in comparison to the EU leaders Belgium, Denmark, Germany, the Netherlands, Austria and Sweden, where the same rate is between 0 and 3 percent. 

WWW.CLEANTECHPOLAND.COM

| 25


SOURCE: PHOTOPIN

WASTE TO ENERGY installations are still in very early pre-feasibility study - stages, there will be tenders happening in the next 12-24 months. According to another report on the municipal waste management in CEE, published in 2011 by Deloitte, a consultancy, the most advanced waste to energy projects in Poland at the moment are: Łódź, pop. ca 700,000 (capacity 200,000 tonnes annually; cost €202 million, 39 percent provided by EU funding); Gdańsk, pop. ca 400,000 (capacity 250,000 tonnes; cost €127 million, 55 percent to be provided by EU funding in the 2014-2020 perspective); Koszalin, pop. ca 100,000 (capacity 120,000 tonnes; cost €95 million, 49 percent provided by EU funding).

• • • Still a common sight

According to a 2011 Ernst & Young report on municipal waste management in so-called EU-11 (CEE and Greece), the regional market for these installations could be worth €8.9 billion by 2020, with as many as 49 waste to energy plants in plans. Apart from Poland, Romania stands out as a market that will be developing fast by the end of this decade. According to the Ernst and Young report, ten waste to energy installations will be built in Romania by 2020, at a cost of €1.8 billion. Other CEE countries are expected to build 25 waste to energy installations, at a cost of €4.6 billion, by 2020. Bulgaria and the Czech Republic will build 6 installations each, according to Ernst and Young. Hungary will build three, Slovakia three and Lithuania two. Latvia, Slovenia and Estonia will build one installation each. With its population of 38 million and several large cities, Poland will be the largest CEE market, however. The currently ongoing six projects are just the start. According to Polish regional waste management plans that

26 | CLEANTECH | SPRING 2014

each of the 16 Polish regions (known as voivodships) are required to prepare and carry out, the final number of waste to energy installations in Poland could be as big as 20-27 roughly the number of major urban centers in the country. These larger projects will be typically investments from publicly owned municipal companies. However, according to one contractor, who wished to remain anonymous as he's looking to play a role in the upcoming tenders, there will be no shortage of waste to energy companies trying to capitalize on the requirement to curb landfilling in smaller locations. "There's going to be many business opportunities in the coming years for waste to energy specialists," he said. The timeline for all of these facilities is not defined yet. “Municipalities are waiting for the details of the 2014-2020 EU funding financing perspective,” says Katarzyna Sosnowska, a lawyer specialising in waste to energy market at CMS. Even if many of the waste to energy

“In order to meet the EU landfilling reduction targets, you need infrastructure. The situation in Poland in 2014 is as it was in 2013 and 2010 – just one small waste to energy plant in Warsaw” Aleksander Gabrys, Ernst & Young WHY THE RUSH? This rush towards building waste to energy plants owes to the growing time pressure on the CEE countries to comply with the EU targets of reduction of landfilled waste. The EU Landfill Directive specifies that member states must achieve (or


SOURCE: KRAKOWSKI HOLDING KOMUNALNY

Kraków is going an extra mile to give its incinerator looks

must have achieved) a reduction in landfilled biodegradable municipal waste to 75 percent by 2006, to 50 percent by 2009 and to 35 percent by 2016. However, those states that in 1995 landfilled 80 percent or more of their municipal solid waste were granted the right to move each of the directive’s deadlines back by four years. Bulgaria, the Czech Republic, Poland, Romania, Slovakia and Slovenia took advantage of this possibility, their targets now being 2010, 2013 and 2020. As for Poland, says Aleksander Gabryś, co-author of the Ernst & Young report from 2011, these targets were almost certainly missed for a simple reason. “In order to meet the EU landfilling reduction targets, you need infrastructure. The situation in Poland in early 2014 is as it was in 2013 and 2010 – just one

small waste to energy plant in Warsaw. Without new installations, targets are virtually impossible to meet,” Mr. Gabryś said. WHERE IT CAN GO WRONG The EU pressure to reduce landfilling, availability of funding and the government’s drive to ensure affordable energy appear a perfect environment for waste to energy facilities going online one after another. However, says Ms. Sosnowska, the installations better be economically sustainable or they will become a burden on municipalities’ finances that will not be easy to alleviate by, say, raising waste management fees for local residents. This has to do with how much waste a facility will be guaranteed to receive each year, the threshold being 100,000-120,000 tonnes of municipal waste annually, she says.

Thus, there’s a concern about the project in Konin, a town of 60,000 people, where annual capacity of just below 100,000 tonnes is provoking questions about the project’s sustainability. How the Konin installation will fare will be a litmus test for many projects in smaller urban areas that are still mulling how to go about their landfilling reduction obligations. Other risk factors include municipalities delaying waste to energy projects until last minute as landfilling remains the cheapest option. There also is the NIMBY - not in my backyard - attitude on the part of local residents and some green organizations that could paralyze development. Finally, until the new law on the renewable energy makes it through the parliament, it will not be clear if and how much support energy and heat from waste to energy installations will receive.

WWW.CLEANTECHPOLAND.COM

| 27


COAL AND EMISSIONS

Clean coal or

hot air?

Unless environmentalists seize power in Poland, there’s little to indicate that coal will go away as a staple energy source anytime soon. Can its emissions intensity be reduced at least?

PHOTOPIN

BY WOJCIECH KOSC

THE BIGGEST NEWS recently

that had to do with the Polish coal didn’t actually concern coal. In January 2014, Poland confirmed its ambitions to develop nuclear power. Two plants, 3000 MW each, will go online in one of preselected locations in northern Poland, the first plant by 2024, the second one in 2035. According to analysis of Poland’s long term energy mix, published in 2013 by the Department of Strategic Analyses (DAS), a body working for the Prime Minister’s office, the nuclear option is the only feasible one if Poland wants to reduce its CO2 emissions at an - arguably - agreeable cost. There are questions, however, if Polska Grupa Energetyczna (PGE) will be able to raise €9.5-14.3 billion of financing for the nuclear project. Apart from being the leader of the nuclear project, PGE is also involved in the €2.6 billion

28 | CLEANTECH | SPRING 2014

“We could use the underground gasification of coal to produce energy in small 20-30 MW installations, but this is of course not the required scale yet” Krzysztof Stanczyk, Clean Coal Technology Center project to build a coal fired power plant in Opole. Without nuclear power, coal will likely remain Poland’s chief energy source. In the DAS analysis, the con-

tinued use of coal forms the basic scenario for Poland for decades to come (see chart). If this is the case, the issue of emissions from this fossil fuel comes to the fore. Krzysztof Stańczyk is a professor of chemistry and environmental engineering at the Central Mining Institute and head of research at Clean Coal Technology Center (CCTW). CCTW is a research and development unit based in Katowice, the main city of the Polish coal mining hub in Upper Silesia, southern Poland. There, the pres sure to find ways to have burning of coal for energy less emissions intensive is felt in particular. Mr. Stańczyk says that some technologies to reduce emissions from coal are pretty much available now. “We’re talking on-the-ground installations that could gasify coal in facilities of capacity of 400-500 MW,” Mr. Stańczyk said.


H E R E T O S TAY

2014

2020

2025

2030

2035 2040 2045 2050 2055 2060

Hard coal

Small hydropower

Lignite

Onshore wind

Natural gas

Offshore wind

Biomass, no co-firing

Gas-fired cogeneration

Biomass co-firing with coal

Coal-fired cogeneration

Agricultural biogas

Imports

SOURCE: DEPARTAMENT ANALIZ STRATEGICZNYCH PRZY KPRM

50

100

150

200

250

BASIC SCENARIO OF POLAND'S ENERGY MIX BY 2060

0

Coal gasification is a process that turns organic or fossil based carbonaceous materials into carbon monoxide, hydrogen and carbon dioxide. This is achieved by reacting the material at temperatures exceeding 700 °C, without combustion, with a controlled amount of oxygen and/or steam. The resulting gas mixture is called syngas, from synthesis gas or synthetic gas. For on-the-ground coal gasification installations, coal will still have to extracted and fed to reactors, but work is under way, however, to eliminate actual extraction and work to turn coal into gas directly in the seam. “We could use the underground gasification of coal to produce energy in small 20-30 MW installations, but this is of course not the required scale yet,” Mr. Stańczyk said. When asked about carbon capture and storage (CCS), Mr. Stańczyk is skeptical. “First of all, I think it’s better to use CO2 to produce, for example, carbamide or polycarbonates, rather than dump it underground in huge amounts to uncertain consequences,” Mr. Stańczyk said. There also is a move towards reduced emissions from coal use via building new coal fired power plants. “New technologies allow to burn coal with with CO2 emissions reduced by 30 percent in comparison to old technologies. If all new power plants are developed using new technologies, emissions from greenhouse gases will drop significantly,” said Maciej Kaliski, head of mining department at the ministry of economy, as quoted by specialist coal industry paper Trybuna Górnicza in January 2014. But according to Michał Wilczyński, former chief geologist and deputy minister of environment in the 1990s, burning coal for energy is slowly but unmistakably becoming a thing of the past. “The Polish economy is using less and less coal as it’s becoming more efficient. Coal production is falling, also under

 This chart from the Department of Strategic Analyses, a body working for the Prime Minister's office, shows so-called economic scenario of how Poland's energy mix will shape up long term. Polish government hopes that development of two nuclear power plants by mid 2030s will reduce the role of coal and be effectively cheapest way to reduce emissions. However, questions persist whether Polska Grupa Energetyczna, the company leading the nuclear project, will be able to secure €9.5-14.3 billion needed to execute it. At the moment, the economic scenario appears more likely to take place.

pressure from cheaper imports,” Mr. Wilczyński said. There’s also pressure from the EU to curb emissions and end public help for non-profitable coal mines. Finally, Mr. Wilczyński adds, there are direct environmental effects of coal mining and burning of coal, like deterioration of air quality that is having a negative effect on human health. “The money paid into coal and coal fired energy generation sectors, as well as health costs, are not part of the equation, therefore coal can pass as cheap

energy source,” Mr. Wilczyński charged. “If you want to have a clean coal fired energy generation, the industry needs to tackle issues like getting rid of mercury and arsenic from the process, engage in proper handling of ashes, sewage and CO2, reduce aerosols output or water use,” Mr. Wilczyński said. The problem is, he adds, these issues are not being tackled effectively, either because further research and innovation are needed or their cost is prohibitive.

WWW.CLEANTECHPOLAND.COM

| 29


ENERGY POLICY

A green fig leaf After a three-year debate, the Polish government now has a wholly new idea for a support scheme for renewable energy. Critics say it will kill the market it’s supposed to strengthen. PHOTOPIN

BY WOJCIECH KOSC

THE ONGOING SAGA of Po-

land’s failure to pass a renewable energy law is sometimes given as an example of Warsaw’s lack of a clear energy policy. That isn’t true: the policy has never been clearer. The government finally seems to know what they want. In the fall of 2013, a new proposal was tabled that - according to the renewable energy sector - lay the previous three-year debate to waste in the name of meeting the government’s current fundamental of an energy policy that mandates energy must be produced as cheaply as possible. Polish officials, including the prime minister Donald Tusk, have said repeatedly over the last several months

30 | CLEANTECH | SPRING 2014

that Poland will take its energy from coal first of all, with second priority to shale and nuclear, with renewables as an auxiliary source. In line with this, the new proposal - that was scheduled to go to the parliament in January and enter into force in the second half of 2014 - stipulates that companies will bid for the right to develop renewable energy. The cheapest offer will win and will become a guaranteed price for the winner for the next 15 years (see box for the proposal’s basics). According to the government, the new system is more market-based and will ensure that the state won’t carry the burden of top-down fixed feed-in tariffs, as seen in the Czech

Republic, for example. According to the ministry of economy, which is overseeing the work on the new proposal, the system will help Poland save PLN 4.5 billion by 2020 in the costs of having to support renewables and meet its 15 percent 2020 target of renewable energy’s share in total consumption. The proposed system is a far cry from what used to be in the works. Between 2011 and late 2013, the sector had been anticipating a system that differentiated support for renewable energy on the basis of type and size, effectively promoting smaller, perhaps more expensive installations. The support was tied to market price of green certificates. Under this - now


NUTS AND BOLTS OF THE AUCTION SYSTEM l The auction model assumes that

contracts for the sale of a certain amount of energy from renewable sources be awarded on a reverse auction basis (bidding prices down) for a period of 15 years. l The basic criterion for the selection

of projects would be the price per MWh of electricity generated, which may not exceed reference price set by the Energy Regulatory Office l Energy producers would be

required to sell the contracted amount of renewable energy at a determined price, even if the market price is higher. l Only projects that meet specific

quality requirements provided in the regulation, e.g. those having connection terms, environmental approval and financing, would be allowed to participate in the auction. l In addition, the auction will only

cover installations employing technology not older than four years.

abandoned - proposal, solar PV and offshore wind were expecting to receive the highest support. In the case of some solar PV installations, for example, the value of green certificates would be multiplied by a factor of almost 3. While the auctions system may have some potential in bringing down the cost of support for renewable energy, the government’s assumption that it will help Poland achieve its national target is made a little flaky by the experience of other EU states. In the EU, the auction system is currently operating in Hungary, Latvia and the Netherlands, and was also employed in Ireland, Italy and the UK. In the UK, the auction-based sup-

port system remained in place from 1990 to 1998. “[Under the auction regime], the electricity price continued to decline in each subsequent auction round and, consequently, new investments were characterized by low technological diversity – the majority of projects to receive the support were wind and landfill gas projects," a November 2013 report on wind energy market in Poland by TPA Horwath, a law firm, noted. In Hungary, Latvia, and the Netherlands, the application of the auction system damaged these countries’ progress towards their national renewable energy targets in 2020, according to TPA Horwath. “A conclusion from the analysis of the impact of the tender model in other EU countries is therefore such that this model is not suitable to regulate the RES market at early stages of its development, as it puts a damper on its growth,” said Wojciech Sztuba, partner at TPA Horwath and co-author of the report. “Bidding prices down will favor technologies that are least capital intensive, where investment in innovation is disincentivized. We’d rather see auctions carried out within “baskets” of particular renewable

“Bidding prices down will favor technologies that are least capital intensive, where investment in innovation is disincentivized” - Michał Siembab, Polish Chamber of Commerce for Renewable Energy

technologies,” Michał Siembab, director general of the Polish Chamber of Commerce for Renewable Energy told Cleantech. “Without innovation, the proposed system promotes no added value. There’s only a short term economic gain of affordable energy that doesn’t support job market, industrial production and so on,” Mr. Siembab said. “The government is scaring Poles with energy bills going up because of renewables while at the same time it has been supporting coal-fired energy production with enormous money from the budget. The same is with nuclear energy,” goes the argument of a group of business and environmental organizations presented in an open letter to the Polish Prime Minister Donald Tusk in January 2014. The letter was signed by the Climate Coalition, a group of green NGOs, the Polish Foundation for Solar Development, and several other organizations. In a rather uncommon move for a prime minister, Mr. Tusk even took the floor in the parliament in January only to defend the government’s position on renewables. “It’s good that we didn’t pass the renewable energy bill [in the previously proposed form]. We would end up with too much of too expensive energy,” Mr. Tusk said. After three years of dodging the EU in terms of implementing a new support framework for renewables, the Polish government is currently seeing that an opportunity is arising not to worry about renewable energy too much anymore. Support schemes are falling throughout the EU and there’s a discussion in the 27-nation bloc about relaxing long term emissions and renewable energy targets and making them non-obligatory. For better or for worse, Poland finally appears to have chosen a path in terms of an energy strategy.

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CLIMATE CHANGE

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The end in sight The Warsaw COP was not a disaster as NGOs claim; neither was it an indisputable success. But it restored trust in the process and moved the world’s most complicated and politically charged negotiations forward before they go to the wire in Paris.

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BY WOJCIECH KOŚĆ

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CLIMATE CHANGE FOR TWO WEEKS in November

2013, the National Stadium, one of Warsaw’s newest attractions, became a world of its own. The United Nations took control of the venue to carry out the 19th Conference of the Parties (COP19) to the UN’s Framework Convention on Climate Change. Once past the heavily guarded gates and through the security check, one was quickly convinced that no other issue was more important than climate change. Three months on, humanity’s response to climate change isn’t less relevant than it was in November. For example, as rain and flood continue to ravage the UK, the British government is under pressure to ready a policy to do something about climate change’s consequences. "In 2012 we had the second wettest winter on record and this winter is a one in 250-year event. If you keep throwing the dice and you keep getting sixes then the dice are loaded. Something is going on," Ed Miliband, leader of the opposition Labour Party, told The Guardian in February 2014. Extreme weather also left a mark on the Warsaw conference early on, when the Haiyan typhoon made landfall in the Philippines, killing at least 6,000 people and displacing 6 million. Philippines negotiator Yeb Sano addressed the COP19 opening plenary referencing Haiyan. Mr. Sano called the climate change “madness” that needed to be stopped before it got too late. By some measures, it’s already too late. According to the most recent report from the Intergovernmental Panel on Climate Change’s Working Group 1, which analyzed scientific data on the causes and effects of climate change, there has never been bigger certainty that climate change is man made. Nor has there been a bigger need to agree on a global legally binding treaty to curb greenhouse gases emissions in order to prevent the global temperature from rising more than 2 degrees

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Durban Platform co-chairs Kishan Kumarsingh (left) and Artur Runge-Metzger

Celsius compared to the pre-industrial era. Otherwise, extreme weather events will be the new norm. ALL EYES ON WARSAW The Warsaw conference was the first in a series leading up to 2015, when, during COP21 in Paris, parties are supposed to agree a binding global treaty, to take effect in 2020, that will slow down climate change. COP20, taking place in Lima, Peru, in December 2014, should result in a draft of

the text of the treaty. But it was in Warsaw when the basics of how to move on with the process were expected to be forged. The Polish presidency of the COP, led by the then minister of environment Marcin Korolec, had three main objectives ahead of the conference as it got underway in November. The first one was to agree on a socalled road map to Paris. The road map would specify, which measures countries would use to address green-


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Agnieszka Kozłowska-Korbicz is the head of the GreenEvo project

house gases emissions and when these measures would be implemented. These efforts were originally described as “commitments” and would be the staple of the global deal to be agreed in Paris. Separately, Parties were also to advance discussion on so-called pre-2020 ambition in order to avoid the gap in climate change action before the global agreement is decided. The second objective was to agree on what financial resources would be made available for climate change

mitigation and adaptation. This included the initial capitalization of the Green Climate Fund, a new financial vehicle to support tackling climate change in the developing world. The third objective concerned the establishment of a loss and damage mechanism to address negative consequences of climate change, such as the aftermath of the Haiyan, in developing countries. Other items on the agenda included agreement on the final technical de-

tails of the UN program to reduce deforestation and forest degradation in developing countries (REDD+). A revival of the UN Adaptation Fund, an on-the-ground initiative to fund projects in developing countries that are parties to the Kyoto Protocol to adapt to climate change effects was also an item to be decided. So was establishment of a new market mechanism to complement the currently functioning Joint Implementation and Clean Development Mechanism. 

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CLIMATE CHANGE With almost 200 countries negotiating, it was clear from the start of the COP that the end result will have to be either some sort of compromise or a complete failure. ROAD MAP TO PARIS The road map to Paris was a separate strand of the talks, carried along in the Ad Hoc Working Group on the Durban Platform for Enhanced Action (ADP), created during the 2011 summit in South Africa. The ADP’s mandate is to adopt “a protocol, another legal instrument or an agreed outcome with legal force under the Convention applicable to all parties at its twenty-first session (December 2015) and for it to come into effect and be implemented from 2020.” In other words, a globally binding climate change treaty. The important part of the ADP negotiations was to get parties prepare their national commitments before Paris so as not to lose time and be able to finalize the shape of the global deal with all the particulars as scheduled. Until the last day of the Warsaw meeting, the draft text of the decision talked about initiating or intensifying “domestic preparations for their intended nationally determined commitments” – what and how much they will do reduce emissions – and communicate them “well in advance of the twenty-first session of the Conference of the Parties (by the first quarter of 2015 by those Parties in a position to do so) in a manner that facilitates the clarity, transparency and understanding of the intended commitments.” The strong reference to “commitments” suggested that there would pressure on the developing nations – but also Poland – to communicate concrete plans to reduce emissions in just over a year from now. The compromise decision on the ADP strand of the talks, however, reflected these reservations from part of the delegations and was eventually loos-

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A look at the COP19 venue, the National Stadium in Warsaw

ened. Parties are now “to initiate or intensify domestic preparations for their intended nationally determined contributions, without prejudice to the legal nature of the contributions.” The change provoked some interpretations that “contributions” could be anything – from nationally binding emissions reductions plans to any non-binding, related actions of little effect. The Polish ministry of environment disagrees with such interpretation of the adopted text. “The criticism of replacing “commit-

“The outcome [on climate finance] was a compromise that left developing countries licking their wounds with a new round of promises for scaled-up finance” Yeb Sano, negotiator, Philippines

ments” with “contributions” isn’t understandable. Some negotiators pointed to the fact that in the current system [of climate change action], ‘commitments’ only concern the developed nations so if a decision was adopted that referenced commitments, it would not, in fact, apply to the developing nations,” said Paweł Mikusek, spokesman for the Polish ministry of environment. “Parties weren’t ready to determine the legal status of these contributions, but it’s undoubtedly a success of the Warsaw COP that actions from both developing and developed nations will be considered together from now on,” said Mr. Mikusek. According to Oleg Shamanov, Russia’s lead negotiator, the change was in fact needed so that at the end of the conference, a step forward on this part of the process could be announced at all. “Let’s not overestimate the change in wording too much. It’s a compromise text but it did move the process forward and a legally binding global climate change treaty never disappeared from sight,” Mr. Shamanov told Cleantech. What’s progress for some parties is, however, taking a step backward for others, with a potential to derail the


SHOW THE MONEY The issue of long term finance, in theory, should have been built in Warsaw on the developed economies’ pledge to raise $100 billion a year by 2020 in funding to help developing nations cope with adverse effects of climate change (excluding loss and damage). This would provide a strategic change in the way the developed world would funding climate change action, because in the years 20102012, the resources provided were just $10 billion. The adopted decision text has not brought about much in the way of materializing this financial support. The decision “urged” developed countries to raise the amount in question from a variety of sources, but offered no strong phrasing for the funds to be public, for example. Similarly, no concrete deadline was established for the initial capitalization of the Green Climate Fund, through which a significant amount of the pledged $100 billion is set to go. The talk throughout COP19 was that it “must happen” in 2014, but that appeared rather a going rhetoric from the developed economies. The European Commission, however, remains optimist. “In October 2013 the Green Climate Fund’s Board set out a roadmap to raise finance for the Fund, which was noted by the COP in Warsaw. The GCF board is working hard to ensure that all arrangements are in place to enable its capitalisation and we understand that Parties are preparing to be able pledge for the fund once this is done. Our expecta-

“In 2012 we had the second wettest winter on record and this winter is a one in 250-year event. Something is going on" Ed Miliband, leader of UK Labour Party tion is that it will be fully operational in 2014,“ the Commission’s press office said. Mr. Sano is skeptical. According to him, the issue of climate finance was one where COP19 “failed miserably”. Even Poland’s ministry of environment is aware of the shortcomings about climate finance. Mr. Mikusek says that the financial outcome of the conference was “far from ideal”. That said, Mr. Mikusek goes on to defend the outcome, by saying that the Polish presidency worked hard before the conference and if not for this, the issue of finances would have IISD REPORTING SERVICES

process. “This shift from laying down “intended nationally determined contributions" instead of "commitments" points to a weakening of the climate regime, and in the context of the backtracking of many rich countries on their commitments, this may lead us towards a slippery slope,“ Mr. Sano told Cleantech.

Marcin Korolec, president of the COP

ended in a shameful failure. “Climate finance negotiations are very difficult in the times of economic crisis and increasing financial needs for climate adaptation and emissions reduction in poorer countries,” he said. “Also, developed nations were called upon to pass a growing amount of financial resources, from 2013 on, for the goal of mobilizing USD 100 billion annually from various sources, public and private, by 2020,” Mr. Mikusek also said. But this is what irks Mr. Sano in particular. “The outcome was a compromise that left developing countries licking their wounds with a new round of promises for scaled-up finance. Developing countries were united in calling for a pathway towards 2020, which would have necessitated a midterm target of around USD 70 billion by 2016, representing a clear roadmap with milestones. [But] developed countries cannot care less and rejected any idea of a milestone,” Mr. Sano said. He is joined in criticism by Client - Earth, an environmental NGO and law firm. “No payments have been scheduled so there is little chance for 100 billion dollars fundraising goal to be meet in 2020. The discussion on private funds and a contribution to the fund from additional market financing mechanism has only started, which means that it’s very unlikely that in 2014 GCF will be fully operational,” said Ilona Jędrasik, media and policy officer at ClientEarth. LOSS AND DAMAGE By contrast to little progress on long term finance, arguably the Warsaw summit’s biggest achievement is the establishment of a mechanism to address loss and damage “associated with impacts of climate change, including extreme events and slow onset events, in developing countries that are 

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CLIMATE CHANGE

NGOs announce walk out from COP19, the conference's arguable most controversial moment

particularly vulnerable to the adverse effects of climate change,” according to the adopted text. The decision to establish a mechanism during COP19 was made at COP18 in Doha, Qatar, but it still took until dying hours of the Warsaw conference for the Parties to work out a compromise text of a decision on the issue. The developing countries were unhappy with the proposed text establishing the loss and damage mechanism as part of the Cancun Adaptation Framework instead of establishing it as a standalone solution. This, in turn, was a no-go for the United States that claimed loss and damage

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“Parties’ trust in the process was restored and we’re much closer to adopting a new agreement in 2015” Paweł Mikusek, Poland’s ministry of environment

was an integral part of mitigation and adaptation. The US also feared that creation of a loss and damage mechanism as separate from mitigation and adaptation would “eventually lead to an explosive conversation on compensation in future climate talks that may scuttle the 2015 global agreement on emissions reductions,“ Center for American Progress website noted on November 20. The compromise text proved a success in that the Warsaw mechanism on loss and damage was indeed established, but, much to the disappointment of developing countries, the only concession that the US would make was that


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the mechanism would undergo a review during COP22, tentatively scheduled to take place in Senegal in 2016. “Again, we are the ones who have to bend backwards,” Mr. Sano commented immediately after the compromise text was adopted. “It was insisted strongly by developing countries that the mechanism must be standalone, based on the context that loss and damage is more than adaptation and that the Cancun Adaptation Framework had failed to mobilize the necessary resources and actions,” he now told Cleantech. “Indeed, the decision to review the mechanism by 2016 was a huge com-

promise and another manifestation that developing countries are more willing to move the process forward," Mr. Sano said. But it appears that for now, most parties are happy that the mechanism was created at all. “What is crucial is that the mechanism was set up and given an executive committee that is going to be staffed with relevant experts to guide the implementation of its functions. This will enable the discussions to move to concrete actions to be undertaken by the mechanism, which will be to the benefit of all. The review is important to check whether it has fulfilled its expectations and change its mandate if needed," the Commission said. OTHER OUTCOMES COP19 also completed methodological work that will allow implementation of an important program to reduce emissions from deforestation and forest degradation (REDD+). The conference also revived the Adaptation Fund with $100 million, even if amidst complaints that this was nothing in comparison to $100 billion needed in climate finance and pledged by the developed economies. The only item of relative importance to have fallen off the table in Warsaw was the creation of a so-called new market mechanism, to complement

Joint Implementation and Clean Development Mechanism. It will be taken up during 2014. Hosted as it were by coal-loving Poland – a fact brought up by NGOs throughout the conference – COP19 certainly didn’t end up a failure. Far from it. Yet, such was the nature of the compromise decisions adopted that the COP results yield easily to very diverse interpretation. Change of “commitments” to “contributions”, watering down the issue of climate finance, and buying time about the loss and damage mechanism will haunt the negotiations until Lima and possibly Paris. Or, at least, will come back in the rhetoric of developing nations and NGOs. “Nonetheless, there is still room for optimism, as nothing is agreed until everything is final in 2015 in Paris. There is still a chance to salvage this process,“ Mr. Sano said. Poland’s ministry of environment is understandably much more sanguine about the results. “The adoption of texts that reflected positions of all Parties in an open and transparent manner took place for the first time after years of controversial COPs. Parties’ trust in the process was restored and we’re much closer to adopting a new agreement in 2015,” said Mr. Mikusek.

CLIMATE CHANGE TALKS: STAY TUNED Between the COPs, intense work is going on, preparing ground for annual COP showdown, coming up this December in Lima, Peru. The nearest talks will concern ADP and will take place on March 10-14 in Bonn, Germany. In June, also in Bonn, the UNFCCC’s subsidiary bodies on implementation of the Kyoto Protocol (SBI) and on scientific and technological matters related to the Convention and the Kyoto Protocol (SBSTA) will meet; so will ADP for a continuation of its March session. With regard to subject matter - the global agreement on climate change - parties will be working on guidance for national contributions and how to strengthen global emissions reduction before 2020, the year when the global agreement comes into effect.

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GREEN BUILDING A revolution is coming to the construction sector. By 2020, all new buildings will have to be, as the European Commission puts it, "almost zero net energy". This not particularly precise definition will be enough, however, to drive greening of the industry responsible for 40% emissions globally. In Poland, commercial real estate is leading by example.

CO N T E N T S l P41 Alan Colquhoun, DTZ l P42 Energy Efficiency in Buildings: more effort needed l

P44-47 Tech Solutions You Should Use l P50-51 The Brussels Jackpot: EU Funding l P52-53 Cosmopolitan Luxury l P54 Marek Paczuski, DTZ l P56 Green Building Directory with Savills

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INTERVIEW

A VESTED INTEREST IN GOING GREEN DTZ

Real estate never dug its heels in opposition to environmental thinking. While some elements of the ongoing move towards green are disputable, the overall course is full steam ahead, says Alan Colquhoun, managing director CEE at DTZ, a real estate services firm. INTERVIEW BY WOJCIECH KOŚĆ

What’s driving developers to build green? I don’t want to say that it’s only being driven by occupiers, but they’re the starting point and the market responds. Then you get into the position, where - whether you’re an occupier or investor looking to buy - it always becomes a box ticking exercise that you need to do, otherwise you’re going to fear for the long term value of the asset. That’s how these issues of buildings’ sustainability and environmental qualities are taking hold and that’s a good thing. Why have environmental trends taken hold so well in real estate, and not other industries, which seem to be doing all they can to slow down the move towards a sustainable and environmentally friendly way of doing business? This is because the vested interest in real estate is to get an occupier and not holding onto the status quo. In other industries, the obvious one being coal, the amount of investment these industries would have to go through in order to adapt to the pressure of environmental regulations and expectations is huge and probably crippling. These kind of vested interests don’t exist in realestate. There’s still a room for improvement,

of course, and work should be done to get those improvements done. In particular, this would be adoption of new technologies reducing energy use in a building or new construction techniques reducing energy consumption and emissions during construction.

If you’re marketing your property product as class A niche, you have to have it certified”

How crucial is certification for the parties involved in real estate business: developers, occupiers, investors? It’s being required as standard, sometimes without fully understanding the different certification levels,

which is a shame. But I think that certification is already at the stage where multinationals or large national organizations - I imagine a Polish bank here - consider it a socially responsible thing to do and it’s driving a lot of decisions in terms of renting office space. If you’re marketing your product in the class A niche then you have to have it certified, otherwise relevant box won’t be ticked and the interest in the product will be less. So even if it’s not crucial at the moment, it’s certainly heading toward the “crucial” end of the importance scale. What kind of influence do core funds have on the property market as a whole, with their bias toward paying top dollar for low-risk properties, which are typically certified these days? At the moment, core funds are very important. You can see how yields are being compressed for the type of product these funds are after. They're being very active on the market at the moment. As a result, yields are heading back towards pre-crisis levels: they’re back at six percent level now and there are grounds to say that they will get below six percent soon. It will lead to environmental certification becoming more important still.

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EFFICIENCY IN BUILDINGS

GOOD JOB,

TRY HARDER

It might not grab as much attention as, say, the frenzied global climate change talks, but construction sector means a lot in the struggle to reduce emissions globally. Poland has a lot to be proud of in that respect, but challenges remain.

THEY’RE BIG AND THEY contribute to climate change a lot. Not coal fired power plants or planes. Buildings are everyday’s life very fabric and they often pass as neutral to the environment, yet it’s the construction and real estate sectors that are responsible for up to one third of global emissions of greenhouse gases and consume 40 percent of energy globally, according to the UN. In other words, if one curbs buildings’ energy use and emissions’ output, it’s one of key steps towards tackling climate change so that the global temperature growth is limited to just 2 percent by 2100, compared to pre-industrial era. Unlike many other industries, the real estate and construction sectors have hardly sat back. On the contrary, there are many examples where real estate developers and construction contractors have taken leadership. These companies are coming up with energy efficient products, and are already talking about zero net (or close) energy properties being the next step. The latter will actually be a legal

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requirement as at the end of 2020. Still, it’s secondary if the green drive is real estate and construction sectors’ own initiative, a response to occupiers’ demands or legal obligation. What counts is, according to Alan Colquhoun, head of CEE at DTZ, a real estate services company, that sustainability is in the construction and property sectors’ best interest. “The vested interest in real estate is to get an occupier and not holding onto the status quo. In other industries, the amount of investment these industries would have to go through in order to adapt to the pressure of environmental regulations and expectations is huge and probably crippling. These kind of vested interests don’t exist in real estate,” Mr. Colquhoun said (see entire interview, page 41). A good example of what Mr. Colquhoun refers to is what’s been taking place in commercial real estate sector in Poland for a few years now. Virtually all new office buildings in the pipeline in Poland are certified, mostly to BREEAM or LEED upper standards. Developers like Skanska are open about the next step in the process:

PHOTOPIN

BY WOJCIECH KOŚĆ

delivering buildings that are close to zero net energy use (they use as much energy as they produce, via, for example, solar panels or ground heat pumps). This in turn, will get the sector close to the EU requirement from 2010 that by end of 2020 all new buildings must be “almost zero net energy use”. Other property sectors - retail, logistics and residential - are seen embracing sustainability trends as well. According to data from United Nations’ Sustainable Buildings and Climate Initiative (SBCI), Central and Eastern Europe (CEE), of which Poland is by far the biggest real estate market, has managed to curb emissions from buildings very well. The emissions grew very little in the 1990s and early 2000s during the boom for


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construction shortly before and after most of CEE states joined the European Union. The SBCI’s forecast until 2030 is that these emissions will remain flat at worst, undoubtedly an effect of the sustainable standard taking hold, either via certification systems like BREAM or LEED or by improving overall construction standards. As Polish real estate contributes to neutralize at least some of the sneer that Poland gets from other countries as an emissions-heavy economy, some challenges lie ahead still. In terms of building stock, it’s first of all the existing old stock that’s nowhere near sustainability standards. In Poland, CO2 emissions in kilograms per usable floor area exceed 100, while top three European countries in that respect, Norway, Sweden,

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100

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 The usual west-east division between energy efficient economies doesn't apply in case of how buildings fare in terms of CO2 emissions. While Norway and Sweden occupying top spots isn't surprising, Bulgaria in the top ten certainly runs counter to the not-so-green image of the country. Down at the bottom linger as diverse economies as Luxembourg, Ireland, Poland and the Czech Republic, where most effort to green real estate sector will be needed.

and Switzerland, are at 6, 16, and 22, respectively (see chart). On the users’ side, there’s a need to overcome habits and tendencies that comprise users’ everyday experience with buildings. For example, ignoring small energy saving opportunities. The second challenge is poor awareness of consumers, building managers, construction companies, politicians about the benefits of improving energy efficiency in buildings. Finally, there are obstacles on the policy level. Slow process of drafting local legislation is slow, insufficient enforcement of standards, and lack

SOURCE: BUILDING PERFORMANCE INSTITUTE EUROPE, EUROSTAT, 2011

CO2 EMISSIONS (KG) PER SQM OF USABLE FLOOR AREA

of detailed guidelines and incentives for energy efficiency investments are main problems on this level. “That some market leaders are doing a good job in terms of sustainable property products doesn’t mean it has penetrated everywhere. There are other cities than Warsaw in Poland and there the barrier isn’t even the lack of information, but persisting wrong information about costs required to launch and execute an energy efficiency or sustainable building project,” said Tomasz Augustyniak, managing director of Go4Energy, a sustainability consultancy.

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TECH SOLUTIONS

UPGRADE OR BE DOWNGRADED

Feeling the heat from the competition closing in on your best tenants who don’t like halogen lighting in elevators anymore? You will want to invest in some tech upgrades on your property. BY WOJCIECH KOŚĆ

If you’re an owner or manager of a building delivered in the last couple years, chances are that state of the art energy efficiency solutions are in place. Your job is to make them run smoothly to the maximum of their energy-saving potential. But what if your job is to manage a building with outdated energy systems that preceded interest in building green? Now it’s still fairly new and likely well leased, but you’re up against the running time: in five years from now you will have to charge smaller rents, your top tenants will move and the yield on your building will go up unless you close the gap in how energy is used on the premises. Below are seven solutions that you should consider.

1. Elevators The energy efficiency of elevators (or lifts) can be improved in a number of ways. First of all, efficient hoisting can replace conventional traction 2-speed or hydraulic technology to achieve 50 to 70 percent better operational efficiency, according to the manufacturer KONE. A smart traffic control system can reduce waiting and journey time, a solution that starts with a simple change: passengers choose their destination before they enter the lift so that a lift is as-

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signed to them. Once in motion, energy released by the lift could be recovered, saving 20 to 35 percent of energy. Typically, lifts aren’t used all the time, so they could go into a

standby mode at night or during less busy times during the day. Finally, a no-brainer: LED lighting can provide up to 80 percent of energy savings in comparison to halogen lighting.

2. Green sockets Office equipment like computers, printers, photocopiers, or coffee machines can account for 15 to 30 percent of the total electricity consumption of an office building. And their standby consumption outside office hours can be quite considerable. Their share of the energy consumption of the building will be even higher after the mandatory areas of consumption - heating, air conditioning, ventilation and lighting - have been optimized. Green sockets, as offered by Legrand, for example, could be a solution. For office equipment whose power supply is switched off at nights and weekends, the annual saving is â‚Ź500. These special circuits are iden-

tified by the green color of the sockets, controlled by a time switch installed either in the electric panel, or directly on the socket unit. This system enables the sockets to function at certain times. By switching off their power supply, for example from 8 pm to 7 am and during weekends, a 25 percent saving can be made.

3. Building management, online A Building Management System (BMS) is what many energy efficient buildings have as in-built and reportedly indispensable features. But can you do without a BMS? Yes, thanks to a solution that lets you analyze energy consumption in the building online, without a BMS. The solution from Schneider Electric, known as EnergyView Online, is a web-hosted

remote energy monitoring service that eliminates the need to install servers or software on site. The service can either be linked to existing meters or new meters via an Internet gateway. According to Schneider

Electric, you can save 2 to 4 percent off your utility bills by adapting building operations to actual use patterns and by 2 to 5 percent by optimizing equipment use and avoiding unnecessary investments.

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4. Clampdown on HFCs/HCFCs

Chlorofluorocarbons (HFCs) and hydrochlorofluorocarbons (HCFCs) have been gases commonly used as refrigerants in a number of applications such as air conditioning or heat pumps. However, both HFCs and HCFCs are being subject to existing or proposed international agreements, such as the Montreal Protocol, that will have them largely phased down from use by 2045. A solution to replace them is natural refrigerants, as proposed by Danfoss. The company has been committed to introduce natural refrigerants, such as CO2, ammonia, or some hydrocarbons, for their low global warming potential or heat transfer properties.

In the case of hydrocarbons R290 (propane) and R600 (n-butane), there also is a factor of low evaporating temperatures without overheating the compressor when used in heat pumps.

5. Remove oil from your cup Perhaps indirect, but still worth a mention. Ubiquitous plastic materials in offices are typically made from raw materials derived from petrochemicals. But plastics could also be made from renewable biomaterials, according to Sulzer, an industrial solution provider (including for oil and gas industry). Sulzer, in cooperation with a strategic partner, has developed a novel and cost-effective polymerization technology to produce highquality bioplastics. The starting material is lactide, which is produced through the fermentation of sugar. With its substantially improved thermal stability, the

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new product endures temperatures of up to 200 degrees Celsius. The product is useable in many applications, such as cups and packing materials.


6. Cool data You don’t need to be NSA to recognize the importance of keeping data in place where risk of losing it minimal. This is especially true of Poland where data centers and other data processing facilities are one of the main drivers of demand for office space. According to research by Emerson Network Power, data center energy usage and found that cooling systems — comprised of cooling and air movement equipment — account for 38 percent of energy consumption. Cooling system technologies exist that can substantially slash costs from the data center electricity bill. Economizers and supplemental cooling systems are two such technologies. In many locations, economizers

can be used to allow outside cool air to complement data center cooling systems and provide “free cooling” during colder months, while supplemental cooling systems bring cooling closer to the source of heat, reducing the amount of energy required for air movement.

7. Phase change materials In development from companies like BASF, phase change materials (PCMs) are materials that can absorb heat, store it and release it later. How does it work? In BASF-developed Micronal PCM, there are microscopically small plastic spheres with a wax storage medium. When the temperature rises, the wax

melts and the phase-change material absorbs heat. When the temperature drops, the wax solidifies, and heat is emitted. Owing to their microencapsulation technology, PCMs can be integrated into the most diverse of construction materials, lending them their properties.

In general, it makes financial sense to invest in energy efficiency, driven in part by the regulatory pressure coming from the EU. By end of 2020, all new buildings in Europe must be “Nearly Zero-Energy Buildings”, as prescribed by the 2010 version of the EU Directive on the Energy Efficiency of Buildings (EPBD). The meaning of “nearly zero” is determined by each member state independently. The directive requires buildings to undergo certain energy efficiency upgrades if the value of the renovation exceeds 25 percent of the value of the building.

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OPENS

2014

Sustainable city POLAND’S FIRST

WARSAW

SIEWIERZ JEZIORNA

KATOWICE KRAKÓW

POLAND’S FIRST sustainable city is being built along a lake midway between Częstochowa and Katowice. Siewierz Jeziorna will be a live, work, play development, built by Alta S.A. Phase I of construction will include 1300 apartments over 44 hectares. Siewierz Jeziorna will be anchored by a business park for cleantech companies, offering over 90,000 sqm (968,752 sq ft) of commercial space along the Warsaw-Katowice highway (DK1). The sustainable city will rest on three principles of sustainable construction: energy efficiency, renewable energy and microgeneration. The investor, Alta S.A., a Warsaw stock exchange listed company, has an asset value of €75 million. Over the last three years, Alta S.A. has grown its net income 50% year on year.

“Based on Disney Celebration and Prince Charles’ Paundbury in Great Britain, Siewierz Jeziorna will promote sustainable human habitats. It’s new urbanism for Poland.” - Joanna Wis-Bielewicz Sustainability Manager

MIXED USE COMMUNITY CLEANTECH BUSINESS PARK 1300 RESIDENTIAL UNITS 90,000 SQM COMMERCIAL HOTEL AND CONFERENCE CENTER DAY CARE & ELEMENTARY SCHOOL PLANNED CITY CENTER LAKESIDE MARINA WALKING PATHS & BIKE TRAILS MASTER PLAN FOR SIEWIERZ JEZIORNA

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DEVELOPERS

WELCOME Live PHASE I MASTER PLAN IN足CLUDES 1300 HOUS足ING UNITS DETACHED, SEMIDETACHED AND URBAN VILLAS TOGETHER WITH LOCAL SERVICES AND PUBLIC AMENI足TIES CITY CENTER AT SIEWIERZ JEZIORNA

Work THE CLEANTECH BUSINESS PARK IS WHERE START-UP COMPANIES ARE SUPPORTED BY KNOWLEDGE AND CAPITAL. WHERE LOCAL COMPANIES BECOME PROFITABLE IN THE INTERNATIONAL MARKETS. CLEANTECH PARK AT SIEWIERZ JEZIORNA

Play THERE ARE OVER 16 HECTARES OF PARKS, WALKING PATHS AND BIKE TRAILS, INCLUDING A LAKESIDE MARINA, AN ECO FARM, AND HORSE STABLES

CONTACT JOANNA WIS-BIELEWICZ SUSTAINABILITY MANAGER INVESTOR, ALTA S.A. UL. ZIELNA 37 00-108, WARSAW WWW.SIEWIERZJEZIORNA.PL TEL: (+48) 22 338 66 20

LAKE AT SIEWIERZ JEZIORNA

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EU FUNDING

THE BRUSSELS JACKPOT

The government is still fine tuning details of how the EU funds will be distributed from 2014 to 2020. According to the draft plan, energy efficiency in buildings could receive a hefty €1.5 billion (about PLN 6 billion). BY WOJCIECH KOŚĆ

CONNECT THE DOTS: buildings are the chief source of emissions, the European Union claims to be a leader in fighting climate change, and a new EU budget was approved recently. The conclusion is that if you’re a property owner or a developer, there should be public funds available to improve the energy efficiency of your property. An important point to make is that these programs are helping individual owners or owners of public buildings improve their environmental performance. In the commercial real estate sector, thanks to pressure from occupiers and investment funds, developers have managed to get to a point where almost all new buildings in the office sector are going green. Real estate isn’t however all commercially developed buildings for rent. The residential sector in particular is one still lacking a universal approach from developers or individual builders that would help reduce energy consumption. So what’s available? The govern-

50 | CLEANTECH | SPRING 2014

ment is still working out the details, but a draft proposal on how the EU financial resources will be distributed across main areas, known as Operational Programs, has been made public. It seems certain that from the overall amount of €82.5 billion in EU funding that the EU’s financial budgeting plan has earmarked for Poland, the biggest part - over €27.5 billion - will go to the so-called Operational Program Infrastructure and Environment. Within the program, around €1.5 billion (around PLN 6 billion) is slated to go to so-called “priority axis 1” that is focused on energy efficiency that includes many projects that have to do with buildings. Funds will be available for thermal modernization of buildings and a special attention will be given to “deep modernization”. Deep modernization will go beyond mere coating buildings with a layer of styrofoam, but also investing in high efficiency heating sources and

overhauling heat distribution systems. The latter are key in the struggle against still widespread local coal fired boilers or even coal fired heaters in flats, where poor quality coal is typically fed, resulting in serious air pollution with particulate matter, one of main causes of respiratory diseases. Funds will also be available for replacing windows and doors as well lighting for products that have better thermal insulation characteristics and use less energy, replacing HVAC systems, application of weather automation and building management systems, and installation of renewable energy sources in building (with a possibility to sell excess energy to the grid). EU funds will come handy as owners or building managers will prepare to invest in energy efficiency as well, because design work and energy audit of buildings are eligible for financing. Final allocation of funds should be approved by the government at end of June 2014 latest.


PHOTOPIN

€1.5 billion (PLN 6 billion) is slated to fund energy efficiency improvements, including many projects that have to do with real estate”

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RESIDENTIAL

COSMOPOLITAN LUXURY Michał Borowski, previously the main architect of Warsaw and now the president of the developer Tacit, quotes the Roman Vitruvius: a structure must exhibit three qualities: solidness, usefulness and beauty. His architect Helmut Jahn would agree. BY PA R K E R S NYD E R

THE COSMOPOLITAN Twarda 2/4, a residential high-rise, will go online in June 2014. The 44 story building, designed by the renowned German-American architect Helmut Jahn, is the project of Tacit Development Polska JS, a Polish developer. The Cosmopolitan, according to Michał Borowski, is unique for Warsaw. "The luxury apartments are bought by customers fully-fitted. The marble for instance, was shipped in from Italy in five colors," Mr. Borowski said in a recent interview. To control for quality, Tacit hired several finish contractors and gave them each an apartment to finish. Only those whose work was well done were retained. "It was blood, sweat and tears. After one year, we have four teams and each knows what we want," Mr. Borowski said. Tacit had to take time to teach clients that it’s better to let the devel-

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oper finish their apartment. "You don't clean your own teeth. You don't do surgery on yourself. But for some reason, customers insist on doing the finishes on their own." The process involved more education than is typical of a real estate transaction; Tacit took six to eight months to close on a customer. Although green building features aren’t a primary aspect of the project, Mr. Borowski recognizes that the density and proximity of a high rise residential tower give it an environmental benefit. Plus a building of this quality simply must be efficient, with or without being officially certified. He has chosen instead to focus on delivering a premium product. "If someone is buying today, they can make their own choices. You can have white or glass or a type of veneer. It's open choices. But by June, we are opening the building with all of the apartments ready." A range of sizes

I'm happy to say that our aim and target is to protect the capital we can handle from our owners in the perspective of ten years” Michał Borowski, Tacit

among the 250 apartments should meet the needs of most luxury buyers, including at least one who plans


TACIT

to buy the entire floor, about 750 square meters. Mr. Borowski, speaking about Cosmopolitan Twarda 2/4, says there are no competitive projects in Warsaw for those with these requirements: luxury residential, city center, easy to rent, in a range of sizes. (Tacit apartments begin at 53 square meters).

The Polish developer is competing in a narrow segment of the residential market - the luxury segment. Only a few projects are in the same ballpark, such as Morskie Oko, Menolly, Foksal - and if it ever gets finished - the Orco project known as Złota 44. Prices at the Cosmpolitan begin at around €5,000 a meter (22,000 PLN per square meter).

Mr. Borowski says the typical buyer is a family living in Żoliborz, Śródmieście, Mokotów, or outside Warsaw, who wants to buy an apartment in the city center, perhaps as an investment. "I'm happy to say that our aim and target is to protect the capital we can handle from our owners in the perspective of ten years".

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COMMENT

HIGH ON THE AGENDA

Strong investment market will push buildings’ green features further up the agenda, says Marek Paczuski, director, capital markets, DTZ. INTERVIEW BY WOJCIECH KOŚĆ

of occupancy and rents. Certification is of lower importance, but it can come into play. For example, some environmentally conscious tenants, quite often global corporations that are always in demand as occupiers, prefer or even have to lease space in green buildings.

“ DTZ

Green certification keeps gaining importance with investors”

New real estate projects (mostly office) are now certified in BREEAM or LEED almost as standard. How widespread is the certification requirement in investment funds' acquisition strategies? The trend is that green certification is keeps gaining importance with investors. There are different types of property investment funds in terms of their risk/reward profiles. The most risk averse are so-called core funds, which are looking for the highest quality products with low risk profile and are ready to pay the most aggressive prices or, in other words, are

54 | CLEANTECH | SPRING 2014

ready to accept lower returns. Certified buildings fall very much in focus for these core funds. Ultimately, how important is certification in a funds' assessment of properties to buy? Is it a primary factor, on par with lease terms or location? The primary goal of an investor is to generate satisfactory returns, and these are simply the function of rental income and sale price upon exit. Location is definitely one of the key factors attracting or discouraging potential tenants to a particular building, directly affecting the level

Will owners of older buildings with strong fundamentals choose to certify, for instance, through LEED for existing buildings? As long as they remain attractive enough for tenants, I can imagine they are not going to be certified. In the long run, however, such buildings may need to offer lower rents to secure satisfactory occupancy. How did CEE real estate investment market perform in 2013 versus 2012 and what's the outlook for 2014? Year 2013 appeared to be really strong with the volume of investment transactions in CEE exceeding €6 billion, which is more than 50 percent increase year on year. Poland remained the major regional market with a share of above 50 percent in the CEE, followed by the Czech Republic with about 20 percent share. In 2014 we think that the value of the investment transactions may end up at similar levels taking into account available funds and investors’ strong interest in some Western European property markets as well as in selected CEE markets


Siemens’ solutions underpin many key sector of the Polish economy: from power generation to healthcare.

PHOTO: PWC

ADVERTORIAL

Siemens:

Technology Frontrunner S iemens has been present in Poland for over 130 years. The company’s Polish branch, Siemens Sp. z o.o., was established in 1991. It offers the widest portfolio of products and services in areas such as industrial automation and drives, building automation, energy efficiency, rail and road transportation, power generation, transmission, and distribution, healthcare diagnostics and therapy.

Siemens has become one of the pioneers in setting technological standards in different sectors of the industry and of the infrastructure. The company is a responsible and valued employer and an active participant of social life in Poland. With expertise in many fields the company promotes technologies that ensure efficient use of natural resources and makes every effort to reduce environmental pollution. The company established numerous competence centers for various technologies, which act also globally using Polish located know-how and experience.

Siemens’ Energy division covers solutions and products related to power generation both from conventional and renewable resources: complete power plants, steam and gas turbines, onshore and offshore wind farms, generators, automation and engineering services, transmission and distribution of electricity, with a focus on high and medium voltage systems and their components as well as solutions for gas compression stations. Our greatest success last year was the signing of a contract for the construction of an integrated gasification combined cycle plant for PGE Elektrociepłownia Gorzów. The project comprises construction of an integrated gasification combined cycle plant with supporting installations and facilities (full EPC/turn-key) and 12-year maintenance for the gas turbines. The rated electric capacity of the new plant is 138 MW net and its fuel efficiency rating is 83.93% net for cogeneration at full load operation.

Another success last year was the signing of a contract with Polish Energy Partners for 2 wind farms in northern Poland (in total 29 SWT-2.3-108 turbines, 2.3 MW each, with a combined installed capacity of 66.7 MW). The agreement covers also 5-year service period. Siemens has long cooperated with PSE, Poland’s power grid carrier, which ordered from us a complex delivery of phase shifters to be installed on crossborder grids. The contract implies a range of works such as design, construction, delivery, and commissioning of phase shifters on the Polish-German border. Siemens is active in energy efficiency projects. It leads projects in Karczew, Radzionków, Sosnowiec, Warsaw, and Wołów, supporting local authorities in reducing the energy consumption. After the first year of project operation in Radzionków, savings on heating power amounted to 54% and 39% on electric power.

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GREEN BUILDING

DIRECTORY In association with Savills, Cleantech presents the forthcoming certified office space pipeline in Poland. Apart from basic data about each project, the directory lists the main green features of each building that could weigh upon companies' lease decisions. As the supply is growing, tenants have now best 12-18 months to pick space from the rising tide of new developments.

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A4 BUSINESS PARK Developer: Echo Investment Location: Katowice Total GLA (m2): 9,000 Green Building Certification: BREEAM Interim (I phase), phases II and III under certification preparations Planned completion: Q1 2014 Consultant: Not available Major tenants: Not available

GREEN FEATURES l infrastructure, amenities for bikers l water leaks detection system l 30% energy use reduction

ALMA TOWER Developer: UBM Polska Location: Kraków Total GLA (m2): 10,400 Green Building Certification: LEED CS Platinum pre-certified Planned completion: Q2 2014 Consultant: Not available Major tenants: Alma Market, KrakChemia, Vistula Group, Gastromall

GREEN FEATURES l CO2 reduction of 30% l water use reduction of 40% l energy use reduction of 25% l 6 parking spaces for LEVs* l daylight access in entire building

ART NORBLIN Developer: CAPITAL PARK Location: Warsaw Total GLA (m2): 64,000 Green Building Certification: BREEAM Planned completion: Q4 2016 Consultant: Buro Happold Major tenants: Piotr i Paweł

GREEN FEATURES l waste to energy for heating l very easy access to public transit l 21 electric cars charging points l infrastructure, amenities for bikers l zoning of heating/cooling/lighting systems

ATRIUM 1 Developer: Skanska Property Poland Location: Warsaw Total GLA (m2): 16,300 Green Building Certification: LEED PLATINUM Planned completion: Q4 2013 Consultant: Not available Major tenants: Skanska Property Poland, G4E

GREEN FEATURES l geothermal heating/cooling l PV panels l cooling beams l gray and rain water usage l LED lighting l FSC**-certified wood

BARTYCKA (1ST PHASE) Developer: PHN Location: Warsaw Total GLA (m2): 68,685 Green Building Certification: in preparation Planned completion: 2016; 2nd phase 2017 Consultant: Not available Major tenants: Not available

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GREEN FEATURES l none specified

*low emissions vehicles ** Forest Stewardship Council


BUSINESS GARDEN POZNAN Developer: SwedeCenter Location: Poznań Total GLA (m2): 1st phase 42,000 Green Building Certification: LEED Gold Planned completion: Q4 2014 Consultants: AF, WSP, FSD, CMT, Arcade, Apexa Major tenants: Not available

GREEN FEATURES l cooling beams l green roofs, reduction of heat island effect l rain water use l infrastructure, amenities for bikers l energy efficient lighting, heating

BUSINESS GARDEN WARSZAWA Developer: SwedeCenter Location: Warsaw Total GLA (m2): 2nd phase 57,000 Green Building Certification: LEED Gold Planned completion: Q1 2016 Consultants: AF, WSP, FSD, IBS, CMT, Arcade, Revensa Major tenants: Not available

GREEN FEATURES l energy efficient lighting, heating l cooling beams l green roofs, reduction of heat island effect l infrastructure, amenities for bikers l rain water use

BUSINESS GARDEN WROCŁAW Developer: SwedeCenter Location: Wrocław Total GLA (m2): 30,000 Green Building Certification: LEED Gold Planned completion: Q1 2016 Consultants: AF, WSP, FSD, Akustikon, IBS, Arcade, Apexa Major tenants: Not available

GREEN FEATURES l energy efficient lighting, heating l cooling beams l green roofs, reduction of heat island effect l infrastructure, amenities for bikers l rain water use

DOMANIEWSKA Developer: PHN Location: Warsaw Total GLA (m2): 28,000 Green Building Certification: BREEAM Very Good Planned completion: Q3 2015 Consultant: Arcadis Major tenants: Poczta Polska

GREEN FEATURES l advanced HVAC systems

EUROCENTRUM OFFICE COMPLEX Developer: CAPITAL PARK Location: Warsaw Total GLA (m2): 69,186 Green Building Certification: LEED CS GOLD Planned completion: Q2 2014 Consultants: PRC / Arup, Tebodin Poland Major tenants: Unilever, Imtech Polska, Tebodin, Qumak, CEPD Management (Pelion SA), Randstad Polska

GREEN FEATURES l rain water use l locally sourced construction materials, FSC-certified wood l reduction of heat island effect l infrastructure, amenities for bikers l 22 electric cars charging points

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PHOTOPIN

“Only three buildings totalling 52,000 sqm were added to the Warsaw office market in Q4 2013, which took the modern office stock to 4,113,000 sqm. The largest building delivered to the market was Plac Unii, with over 41,300 sqm of office space ”


FOKSAL Developer: PHN Location: Warsaw Total GLA (m2): 3,271 Green Building Certification: BREEAM Very Good Planned completion: Q2 2014 Consultants: Portico Project Management, Cushman&Wakefield Polska, Grontmij Polska Major tenants: Not available

GREEN FEATURES l green roof l VRV* HVAC technology

GALERIA AMBER Developer: Echo Investment Location: Kalisz Total GLA (m2): 33,500 Green Building Certification: BREEAM Interim Planned completion: Q1 2014 Consultant: Not available Major tenants: E.Leclerc, Helios, H&M, New Yorker, Wojas, Reserved, C&A, Deichmann, Kazar

GREEN FEATURES l infrastructure, amenities for bikers l water leaks detection system l energy use reduction of 30%

GARDEN PLAZA Developer: SGB FORTUNE MA Location: Warsaw Total GLA (m2): 8,520 Green Building Certification: BREEAM Planned completion: Q2 2014 Consultant: Buro Happold Major tenants: Not available

GREEN FEATURES l zoned HVAC, lighting systems l facade with high insulation l infrastructure, amenities for bikers l green waste management l daylight access in entire building

GREEN DAY Developer: Skanska Property Poland Location: Wrocław Total GLA (m2): 15,900 Green Building Certification: LEED GOLD Planned completion: Q1 2014 Consultant: Skanska Property Poland/G4E Major tenants: Credit Suisse

GREEN FEATURES l daylight control l freecooling, fan coils l high efficiency heat recovery l FSC-certified wood l low VOC**-content materials

GREENWINGS OFFICES Developer: OKRE Development, Greenwings Offices Location: Warsaw Total GLA (m2): 10,810 Green Building Certification: BREEAM Very good Planned completion: Q2 2014 Consultant: SECO Poland branch

GREEN FEATURES l zoned heating, cooling, lighting

systems l infrastructure, amenities for bikers l high quality of indoor air

*variable refrigerant volume **volatile organic compounds

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GRÓJECKA OFFICES Developer: OKRE Development, OKRE Grójecka Location: Warsaw Total GLA (m2): 7,390 Green Building Certification: BREEAM Planned completion: Q4 2015/Q1 2016 Consultant: not available Major tenants: not available

GREEN FEATURES l low VOC-content materials l water saving system l grey and rain water usage l infrastructure, amenities for bikers l temperature control in each room

KAPELANKA Developer: Skanska Property Poland Location: Kraków Total GLA (m2): 30,000 Green Building Certification: LEED GOLD Planned completion: Q2 2014 Consultant: Skanska Property Poland/G4E Major tenants: Not available

GREEN FEATURES l freecooling, fan coils l high efficiency heat recovery l FSC-certified wood l daylight control l low VOC-content materials

KAROLKOWA BUSINESS PARK Developer: Asbud Location: Warsaw Total GLA (m2): Office: 12,503; Retail: 2,568 Green Building Certification: BREEAM Planned completion: Q2 2014 Consultant: Gleeds Major tenants: Not available

GREEN FEATURES l green roof l daylight access in entire building l energy efficient HVAC l heat recovery ventilation system

MALTA HOUSE Developer: Skanska Property Poland Location: Poznań Total GLA (m2): 14,800 Green Building Certification: LEED PLATINUM Planned completion: Q2 2013 Consultant: Skanska Property Poland/G4E Major tenants: Franklin Templeton ,Ciber, Skanska SA

GREEN FEATURES l daylight control l freecooling, fan coils l high efficiency heat recovery l FSC-certified wood l low VOC-content materials

METROPOLIS Developer: Echo Investment Location: Poznań Total GLA (m2): 73,300 Green Building Certification: W trakcie uzyskiwania BREEAM Interim Planned completion: H1 2015 Consultant: Not available Major tenants: Not available

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GREEN FEATURES l infrastructure, amenities for bikers l water leaks detection system l energy use reduction of 30%


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PHOTOPIN

“ Vacancy rates rose by nearly 0.8 percentage points to 11.7% in Q3 2013. The vacancy rate in central locations stood at 10.6% compared to 10.5% at the end of Q3 2013, while in non-central locations it was at 12.2% (11.1% in Q3 2013) ” | 63


NC3 Developer: ECI Location: Warsaw Total GLA (m2): 6,121 Green Building Certification: BREEAM Very Good Planned completion: Q4 2015 Consultant: Hill International Major tenants: Not available

GREEN FEATURES l energy sourced from renewables l daylight access in entire building l energy use reduction of 30% l LED lighting l grey and rain water usage l electric cars charging points

NETTUNO Developer: Bouygues Immobilier Polska Location: Warsaw Total GLA (m2): 20,330 Green Building Certification: BREEAM Very good Planned completion: Q4 2015 Consultant: ARUP, Fort Polska Major tenants: Not available

GREEN FEATURES l optimised facade design l fan coils l LED lighting l energy gains from lift operation

OXYGEN PARK Developer: Yareal Polska Location: Warsaw Total GLA (m2): 18,400 Green Building Certification: BREEAM Very good Planned completion: Bldg A: completed, Bldg B: Q4 2013 Consultant: GRRES Major tenants: Merck, Sodexo

GREEN FEATURES l energy use reduction of 11% l 100% renewable energy l infrastructure, amenities for bikers l electric cars charging point l quatquodi idebit aut

PARK ROZWOJU Developer: Echo Investment Location: Warsaw Total GLA (m2): 32,000 Green Building Certification: BREEAM Interim, BREEAM In-Use planned Planned completion: Q2 2015 Consultant: Not available Major tenants: Schneider Electric

GREEN FEATURES l infrastructure, amenities for bikers l water leaks detection system l energy use reduction of 30%

PRIME CORPORATE CENTER Developer: Golub GetHouse Location: Warsaw Total GLA (m2): 20,148 Green Building Certification: BREEAM Very Good Planned completion: H2 2015 Consultant: Not available Major tenants: Not available

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GREEN FEATURES l LED-lit facade l energy efficient HVAC systems l heat recovery system l daylight access in entire building l sunblinds preventing overheating


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PHOTOPIN

“ Take-up in Q4 2013 reached 115,100 sqm, which boosted the total figure for 2013 to the record level of 633,200 sq m (up by around 4% on 2012’s level) ” | 65


PHOTOPIN

“ New leases (78,650 sqm) accounted for 68% of all deals, with pre-lets making up almost 42% (33,700 sqm). Renegotiations and extensions accounted for 31% of all transactions, which was a similar figure to that in Q3 2013 ”

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PROMENADY EPSILON ZITA Developer: Vantage Development Location: Wrocław Total GLA (m2): 22,110 Green Building Certification: LEED Gold Planned completion: Q1 2015 Consultant: Arup, SNC Lavalin, Imtech, Buro Happold itd Major tenants: Not available

GREEN FEATURES l none specified

Q22 Developer: Echo Investment Location: Warszawa Total GLA (m2): 50,000 Green Building Certification: BREEAM Planned completion: Q1 2016 Consultant: Not available Major tenants: Not available

GREEN FEATURES l infrastructure, amenities for bikers l water leaks detection system l PV panels l energy use reduction of 30% l electric cars charging points

RONDO DASZYNSKIEGO Developer: Skanska Property Poland Location: Warsaw Total GLA (m2): I phase 20,000 Green Building Certification: LEED PLATINUM Planned completion: Q1 2016 Consultant: Skanska Property Poland/G4E Major tenants: Not available

GREEN FEATURES l freecooling, fan coils l high efficiency heat recovery l FSC-certified wood l daylight control l low VOC-content materials

ROYAL WILANÓW Developer: CAPITAL PARK Location: Warsaw Total GLA (m2): 36,700 Green Building Certification: BREEAM Planned completion: Q3 2015 Consultant: Grontmij Polska Major tenants: PIOTR I PAWEŁ, ERBUD

GREEN FEATURES l water/energy efficiency l infrastructure, amenities for bikers l minimized impact on plot’s biodiversity

SHOPPING AND ENTERTAINMENT CENTRE SUKCESJA Developer: Fabryka Biznesu Location: Łódź Total GLA (m2): 51,292 Green Building Certification: BREEAM Planned completion: 2014 Consultant: Not available Major tenants: Piotr i Paweł, Reserved, Mohito, Cropp, House i Sinsay, Helios, Rossmann, Avans, Pure Health & Fitness, Top Secret

GREEN FEATURES l heat pumps l LED-lighting l green roof l rain water usage

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SOBIESKI BUSINESS PARK Developer: Arkady Sobieskiego Location: Warsaw Total GLA (m2): 8,150 Green Building Certification: BREEAM Very Good Planned completion: Q4 2014 Consultant: Tebodin Major tenants: Not available

GREEN FEATURES l energy gains from lift operation l grey water usage l infrastructure, amenities for bikers

STAWKI 2 (1ST PHASE) Developer: PHN Location: Warsaw Total GLA (m2): 34,000 Green Building Certification: Not available Planned completion: phase 1 Q4 2015; phase 2 Q1 2019 Consultant: Hill International Major tenants: Not available

GREEN FEATURES l none specified

SYNERGY BUSINESS PARK Developer: Ghelamco Location: Wrocław Total GLA (m2): 70,000 Green Building Certification: BREEAM Planned completion: 2015/2016 Consultant: Grontmij Major tenants: Not available

GREEN FEATURES l none specified

THE PARK WARSAW Developer: AIG/Lincoln Polska Location: Warsaw Total GLA (m2): Overall: 110,000, 1st building 10,838 Green Building Certification: BREEAM Excellent Planned completion: Bldg 1 2013, bldg 2 2014 Consultant: BCHF Major tenants: Qloc, Cenega Poland, Johnson Controls International, Perfetti Van Melle Polska

GREEN FEATURES l energy efficient external lighting l submetering of energy use l rain water usage l zones lighting, heating systems l low VOC-content materials

TIMES II Developer: UBM Polska Location: Wrocław Total GLA (m2): offices 17,000, services 2,500 Green Building Certification: certyfikat LEED CS Planned completion: Q3/4 2015 Consultant: Not available Major tenants: Not available

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GREEN FEATURES l CO2 reduction of 30% l water use reduction of 40% l energy use reduction of 25% l infrastructure, amenities for bikers


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PHOTOPIN

“ The largest deal in Q4 2013 was the pre-let signed by KPMG for 8,300 sq m in the Gdanski Business Centre office building developed by HB Reavis ”

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TRYTON Developer: Echo Investment Location: Gdańsk Total GLA (m2): 22,000 Green Building Certification: BREEAM Interim Planned completion: H1 2015 Consultant: Not available Major tenants: Not available

GREEN FEATURES l infrastructure, amenities for bikers l water leaks detection system l energy use reduction of 30%

WEST GATE Developer: Echo Investment Location: Wrocław Total GLA (m2): 16 000 Green Building Certification: BREEAM Interim (trwa proces) Planned completion: Q4 2014 Consultant: Not available Major tenants: Not available

GREEN FEATURES l infrastructure, amenities for bikers l water leaks detection system l energy use reduction of 30%

WARSAW SPIRE Developer: Ghelamco Location: Warszawa Total GLA (m2): 100,000 Green Building Certification: BREEAM Planned completion: Q2 2015 Consultant: Grontmij Major tenants: Frontex

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l none specfied

NEW SUPPLY, NET ABSORPTION AND VACANCY RATE 1,000s of sqm

400

15%

320

12%

240

9%

160

6%

New supply (m2) 80 Net absorption (m2) Vacancy (%) 0 * forecast

3% 2008 2009 2010

2011

2012

2013

2014* 2015*

0%

MAJOR PIPELINE OFFICE PROJECTS SCHEDULED FOR 2014 BUILDING

Office area (sq m)

District

Developer

Gdański Business Center I

49,000

North

HB Reavis

Eurocentrum Office Complex I

38,700

South West

Capital Park

Warsaw Spire I

20,000

City Centre

Ghelamco

Nimbus

19,500

South West

Immofinanz Group

SOURCE: DTZ, SAVILLS, WARSAW RESEARCH FORUM

AT A G L A N C E  Here’s a snapshot of how the Warsaw office market has been shaping up in recent months. Warsaw is Poland’s biggest office market in terms of volume, take-up and investment transactions. As developers keep adding new supply of office space, vacancy rates are set to keep growing throughout 2014 and well into 2015, which is forecasted to be the first year since 2011 that will see new supply and net absorption of space decrease. At the moment, prime headline rents in the city center are at €22-23 per sqm/month and € 14-14.75 per sqm/month in Mokotów, the city's main office hub.

GREEN FEATURES


Rising supply levels cause vacancy to grow; landlords need to offer attractive packages of incentives to attract tenants.

SAVILLS

ADVERTORIAL

BRIAN BURGES S, MANAGING DIRECTOR

Growing demand

for NEWER generation

and greener office space in Warsaw

A

ccording to Savills' latest Warsaw office market research report, the supply of modern office stock in the city exceeded 4.1 million sq m at the end of 2013 and is expected to reach 5.0 million sq m within the next three years. Almost 300,000 sq m of new supply came onto the market in 2013 with a further 643,000 sq m currently under construction. This growing supply pipeline, Savills notes, will support the ongoing high demand for office space in Warsaw where take-up totalled 632,500 sq m in 2013, reflecting a 5% growth year-onyear, and is predicted to reach 600,000 to 650,000 sq m in 2014. Tomasz Buras, head of office agency at Savills Poland, says that “development activity in Warsaw has increased significantly over the past 12 months to meet growing demand for office space. In the

City Centre in particular over 260,000 sq m of new office space is under construction with circa 46% of this is scheduled to be delivered this year.” The majority of lettings in 2013 were for new office space, with a high percentage (24%) of pre-lease transactions. The share of renewals and renegotiations remained relatively low (below 30%), which is evidence that occupiers are keen to move to newer generation, often greener buildings. Whilst total take-up reached a record high in 2013, Savills research shows that net absorption was low in this period at only 155,000 sq m, which is nearly 20% below the long term average. This led to an increase in the average office vacancy rate in Warsaw to 11.7%, reflecting a growth by 300 bps year-onyear. The report suggests that the increased development activity will lead

to further rise in vacancy levels to approximately 14% by year end, assuming that the absorption will be in line with its long term average. Surprisingly, vacancy in the Mokotów district, the largest non-central business district in Warsaw, is expected to decline from over 12% at the end of 2013 to circa 8% by the end of 2014. In terms of rents, prime headline rents currently stand at between €22 €23 per sq m/month in Warsaw City Centre and at between €14 and €14.75 per sq m/month in non-central locations, reflecting a 14% and 6% drop year-on-year respectively. Savills anticipates that especially effective rents will be pushed down further over the next 24 months. This is due to the rising supply levels causing vacancy levels to also rise so that landlords need to offer attractive packages of incentives to attract tenants.

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PICTORIAL

COP19: a new hope? When close to 10,000 delegates descended on Warsaw’s National Stadium in mid November to lay foundations for a global climate change treaty in 2015, the expectations were high, but doubts persisted: can Poland pull it off? It did. Some said the outcome was watered down by compromise texts on loss and damage or the road map to closing negotiations in 2015, but, as one delegate told us, “there is still room for optimism and a chance to salvage this process.” BY WOJCIECH KOSC

Delegate going through a day's summary

COP President Marcin Korolec facing the media

Tight security testified to the politically charged nature of COP19

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COP-branded apples


Relief and round of applause as COP's just come to an end Live-blogging from the negotiations

SOURCE: MINISTRY OF THE ENVIRONMENT

Chairman of IPCC Dr Rajendra K. Pachauri: very little time left to stop climate change

Lounging in the wee hours of the day A very warm November in Warsaw had some delegates bike to COP

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PORTRAIT

BY WOJCIECH KOŚĆ  P H OTO: PAV E L A N TO N O V

Pavel Antonov Budapest today, Riga tomorrow. Activist, journalist, campaigner, musician - and all that with an environmental twist. Meet Pavel Antonov, one of those rare figures in the environmental field that have left their mark across entire CEE.

Man with a mission

It’s often embarrassing to be introduced as a journalist, because of the popular view that it’s all about making more money and power for the already rich and powerful. Similarly, an activist is often suspected these days in pushing for wealthy donor agendas, rather than public interest. Not to mention politicians… Yet, I remain optimistic: I believe that my children will live in a better world: cleaner, healthier, ultimately greener, but also freer, more equitable, tolerant, less oppressive. This is where I see my mission, and I believe I am making it happen, bit by bit every day.

What are you working on now? I’m trying to set up a small independent virtual newsroom in Bulgaria with BlueLink.net, where young and active journalists will be able to practice honest journalism, in defense of public interest and democracy. Nature protection is one of the important components. I’ve also been working to limit tobacco smoking in Bulgaria for the past four years.

CEE in 1990 and now The EU has made all the difference. Our countries now belong to a world-leading entity in the environment protection policies and vision. We have quality standards that are much higher than what was in place 25 years ago. All we need to do is implement them, and take them further, so that we don’t secure business as usual for our large polluting energy sectors and other technologically obsolete industries.

Why play Let It Be at a campaign event? Music helps creativity. It also helps me recharge my energy and remain positive. And music – popular and classical alike – offers a great potential for successful public communication, use it where you can!

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This year’s edition of Poleko: more space, more visitors, more business.

PHOTO: POLEKO

ADVERTORIAL

October: direction Poleko

T

he Poleko environmental protectio trade fair in Poznań (October 14-17) is a great opportunity to present your offer, exchange experience, meet with clients and get acquainted with new trends and technologies on the market. Poleko’s last year’s edition was abound in events dedicated to specialists - around 50 conferences, workshops and training courses were held. Over 17,000 visitors from 28 countries longing for the newest information about the market and products arrived to Poznań. “The Poleko trade fair is visited by a very large group of specialists: representatives of local governments, departments of environmental protection and municipal services management in city halls, communes, or military units, representatives of waste treatment, storage and processing plants, sewage treatment plants, power distribution companies, combined heat and power plants, and also representatives of municipal services companies, companies providing green areas mainte-

nance services, logistics centers or public transport company managements”, says Michał Hempowicz, Poleko’s director.

of 12 000 m2. Additionally, the hall will have access to conference and congress centre (pavilion 15), where conferences and lectures will take place.

This year, the organizers plan to extend the exhibition by new segments of the market: army and airports and landing fields.

NEW LOCATION Exhibitors this year will find a new layout of the Poleko pavilions that will facilitate finding complementary offers from particular industries Pavilion 6A – Recycling Room and Recycling Forum Pavilions 5 and 5A – municipal technology and waste treatment Pavilion 8 – water, air, noise and vibrations, climate Pavilion 8A – consulting and environmental protection institutions, scientific and research and developmental units, Ecological Town Pavilion 7 – Clean Energy Room and Clean Energy Forum Pavilion 7A – offer of exhibitors of the GMINA Fair of Products and Services for Local Governments and DWORZEC Local and Regional Public Transport Exhibition.

Additionally, changes brought about by last year’s implementation of the waste disposal law wil be reflected in new exhibition areas for PSZOK (Sorted Waste Collection Points), RIPOK (Regional Municipal Waste Treatment Facilities), as well as conferences for professionals responsible for the organisation of tenders and economic governance in communes. The conference part of the Poleko trade fair will also feature events dedicated to water, noise and revitalization. A new service pavilion 8A has been adapted to building modern storied stalls (up to 10 m height) nd increased the exhibition floor space in the socalled „Four-pack” to a gross amount

More information available on the website: www.poleko.mtp.pl

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Cleantech is about the links between environment and business. This issue features a look at the emerging waste-to-energy market, an overvie...

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