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European Commission refers Poland to the Court of Justice over legislation against EU climate objectives

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The European Commission is referring Poland to the Court of Justice for allowing energy intensive businesses to be exempted from excise duty on coal and gas.

Common EU energy tax rules require businesses that benefit from such exemptions, if they have introduced environmental or energy efficiency improvements, to go beyond what is required by binding EU instruments such as the EU ETS.

However, Polish legislation does not call for such a level of energy efficiency. These rules favour highly polluting activities, and hence run against EU climate objectives. This generates major distortions of competition within the EU.

In fact, under Polish legislation (and contrary to EU law), certain energy products, such as coal and gas, used by energy intensive businesses that fall under the European Emission Trading Scheme are exempt from excise duty.