2020-07-23
A chance to soften the Polish onshore wind distance law? The CJEU gave grounds for contesting the controversial 10H rule

The Court of Justice of the European Union (CJEU) ruled on the distance restrictions for locating wind farms introduced by the Wind Farm Investment Act. In the judgment the CJEU has provided a basis for contesting the 10H rule, which is considered to be the cause of unintended slowdown in development of wind power in Poland.

The Polish courts are to verify whether the regulations violate EU law and if they are found to infringe the proportionality principle, shall not be applicable. Depending on the outcome, we might see the liberalization of the restrictions, which has been expected by the industry for a long time.

In 2017 a preliminary question was referred by the Provincial Administrative Court in Kielce. On 28 May 2020 the CJEU issued a ruling on the distance law, giving grounds to challenge the 10-H rule and leaving it up to the national courts to check whether the regulations on distance limits have slowed down the development of wind energy in Poland (Eco-Wind Construction case, C-727/17). If Polish regulations are found to be inconsistent with EU law, they should not be applied by courts and administrative authorities in accordance with the the precedence principle.   

The dispute arose against the background of the Wind Farm Investment Act, which entered into force on 16 July 2016 and determines the conditions and mode of location, construction and operation of wind farms. The Act establishes two distance standards, according to which wind power plants may be located in the vicinity of other, existing or planned residential buildings at a distance not less than 10 times their height.

Wind power farm location standards are based solely on its total height, omitting, among others, the used technology, turbine power, generated noise and vibration. Such regulation does not reflect the actual scope of the installation's impact on the environment, and therefore doubts are raised as to the sense of assessing the environmental impact of investments in wind farms.

It is estimated  that the provisions of the distance act excluded from investment activities about 99% of the area of Poland, and the rate of growth of new capacities has decreased several dozen times. In the judgment, the CJEU pointed out that at the hearing before the Court, the Commission stated, and was not contradicted by the Polish Government, that in the period from 2012 to 2016, that is to say, the period directly preceding the adoption of the Law on wind turbines, the capacities of installed wind turbines amounted to between 760 megawatts and 1 000 megawatts per annum, whereas, for the years 2017 and 2018 respectively, after the adoption of that law, those installed capacities did not amount to more than 12 megawatts and 6.7 megawatts per annum respectively.

In a long time, industry organisations have been calling for derogation from the 10H rule, indicating that the provisions are too restrictive and abridge municipal corporations of their competence to carry out spatial planning. Meanwhile, in Germany in mid-May 2020 the governing coalition reached a compromise on the location of onshore wind farms, which allows this part of renewable energy to develop again. According to the regulations introduced in Germany, decisions on the distance between new windmills and the nearest buildings will be within the competence of the German States and therefore enable local decisions on new investments.

The motive for referring to the CJEU for a preliminary ruling was the doubts of the Provincial Administrative Court in Kielce concerning the compatibility of the provisions establishing the 10H rule with EU law, in particular with:

- Directive (EU) 2015/1535 of the European Parliament and of the Council of 9 September 2015 laying down a procedure for the provision of information in the field of technical regulations and of rules on Information Society services,

- Directive 2006/123/EC of the European Parliament and of the Council of 12 December 2006 on services in the internal market,

- Directive 2009/28/EC of the European Parliament and of the Council of 23 April 2009 on the promotion of the use of energy from renewable sources and amending and subsequently repealing Directives 2001/77/EC and 2003/30/EC.

In the ruling, the CJEU left it up to the Polish courts to check whether the introduction of distance standards for the location of wind turbines and leads de facto to a limitation on the trade in wind generators.

As a result of a request from the Provincial Administrative Court in Kielce to interpret the provisions of Directive 2015/1535, the CJEU indicated that the requirement to maintain a minimum distance between the location of wind power plants and residential buildings should not be regarded as a technical regulation which is subject to the obligation to notify the European Commission in the light of the provisions of the Directive 2015/1535, if there has been no significant decrease in the use of wind turbines in connection with its introduction. The free movement of goods within the EU is connected with the ban on introducing quantitative restrictions between member states. According to Directive 2015/1535, technical regulations leading to the introduction of quantitative restrictions should be notified to the European Commission before they enter into force. Failure to comply with this obligation results in the ineffectiveness of these provisions for entities.

The Polish courts are competent to assess the functioning of the wind turbine market and verify whether the adopted measures are necessary and proportionate, i.e. they do not go beyond what is appropriate and necessary to achieve the legitimate objectives pursued by the regulation. Under EU law, if there is a possibility to choose from a greater number of appropriate measures, the least restrictive should be applied, and the resulting disadvantages must not be excessive in relation to the objectives pursued.

The CJEU required the national courts to assess whether the 10H rule was a necessary and proportionate requirement in the light of the RES targets set in Directive 2009/28/EC on the promotion of the use of energy from renewable sources. National provisions on energy production from renewable sources should be proportionate and necessary. In the CJEU's view, the provisions of Directive 2009/28/EC do not preclude legislation requiring a minimum distance between wind power plants and residential buildings (the 10H rule) if such legislation is necessary and proportionate in the light of a mandatory national overall target binding the Member State. In the case of Poland, the target is to achieve a share of energy from renewable sources in gross final energy consumption in 2020 of 15%. Making their assessment, the Polish courts should take into account the fact that the distance standards are limited to wind power plants only, excepted other forms of electricity generating from renewable sources, such as photovoltaic installations or biomass.

As a result of the CJEU ruling, the Provincial Administrative Court in Kielce is obliged to verify whether the provision introducing the 10H rule is a technical regulation and whether its establishment in the Polish legal system leads de facto to a limitation on the trade in wind generators, and thus in introduction of quantitative restrictions. If the national courts consider these provisions to be a technical regulation subject to the notification obligation and this obligation has not been fulfilled, then the distance standards should be ineffective against the individuals.

The Provincial Administrative Court in Kielce will also assess the necessity and proportionality of introducing the 10H rule. If the provisions of the distance are considered unacceptable under the Directive 2009/28/EC, they should not be applied in accordance with the precedence principle.




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