The Origins of Power Market Regulations in Poland

Abstract

Providing energy security, defined as the situation where the economy can cover both the current and long-term consumer demand for fuels and energy in a technologically and economically reasonable manner, while being compliant with environmental protection requirements, constitutes one of the basic obligations of the state towards its citizens. Undoubtedly, energy security in the context of electricity is mostly understood as the security of supply, i.e. the capability of the power system to ensure the security of operation of the power grid and to balance the supply of electricity with the demand for this type of energy. It primarily depends on the availability of sufficient power generation sources, that is on the sufficient generation capacity. To ensure the continuity and stability of electricity supply to all end consumers in Poland in the medium- and long-term perspective, the Polish Ministry of Energy commenced drafting regulations on the power market at the beginning of 2016. These efforts have been aimed at causing an incentive effect in order to encourage making investment and modernisation decisions and to discourage decommissioning of the existing generation sources which determine the security of operation of the National Power System.