Why do Polish gminas create energy clusters and what benefits do they get from it? How can spatial planning give an impetus to community economic development and reduce unemployment? Where to buy organic products from local farmers and why are food cooperatives becoming popular in Poland?
These three stories are about how local government and people’s initiatives have changed Poland. Once upon a time, Poles learned from their European counterparts and successfully implemented their experience. And now, during the third study visit, Ukrainian communities studied the experience of their neighbors and searched for partners for cooperation among their Polish colleagues. In order to develop and bring people back home, even in times of war. The study visit was organized jointly with the Jerzy Regulski Foundation in Support for Local Democracy under the USAID DOBRE Program.
Polish energy clusters – the way to a decentralized energy system
In 2016, energy clusters began to appear in Poland after the adoption of renewable energy legislation. These are local initiatives aimed at producing, distributing, and consuming energy at the regional level. Currently, there are more than 100 energy clusters in Poland. They are created on the basis of civil law contracts between various participants, including companies, research institutes, local governments, and even individuals. The clusters work to make the regions energy-independent. Another important point is that, in line with EU requirements, they are switching to low-carbon energy sources and gradually abandoning the use of fossil fuels such as coal, oil, and gas. After all, the EU plans to fully switch to green energy and eliminate carbon emissions by 2050.
The Płońsk Energy Cluster was created on the initiative of the Płońsk urban gmina. It includes the Płońsk urban and rural gminas, municipal heat and power utilities, waste management, roads and bridges of Płońsk, the Płońsk Housing Cooperative, and a steel structure manufacturing company. Over the past two years, the cluster has also been joined by the Załuski gmina and a private biogas plant located in the village of Skarżyn.
“First of all, when we created the cluster, we wanted to provide those who are part of it with electricity and heat at a lower cost through the use of renewable energy sources such as biogas and solar energy. At the same time, the environmental component was important to us, as the transition to renewable energy sources allows us to reduce our dependence on fossil fuels such as coal and gas and improve air quality,” said Mr. Yaroslav Osiak, Chairman of the Płońsk Energy Foundation.
By the way, biogas is produced in Płońsk at a closed landfill from garbage waste. A large waste processing plant operates here and supplies raw materials. In addition, biogas is also produced at the local wastewater treatment plant. Biogas is used to power a diesel engine, which produces heat and energy.
What are the benefits for cluster members?
First, cluster members pay less for energy consumption thanks to using renewable energy sources and more efficient management. This is also very important for the residents of the Płońsk gmina, as the price of electricity and heat is the lowest in the region. And it has not increased significantly over the past two years. If in Warsaw one gigajoule of heat costs one hundred zł, in Płońsk it costs about 40 zł. In this way, the city commune cares about the comfort and quality of life of its residents. And the companies that are cluster members receive cheaper energy for their own needs.
Second, cluster members contribute to reducing CO2 emissions and improving the environmental situation in the region. Partial refusal to use coal also helps avoid the high costs associated with purchasing special carbon certificates. By the way, in 2020, the Płońsk gmina reduced its carbon emissions by 40 percent compared to 1990, while EU legislation required 20 percent.
Third, the cluster members are energy independent from external suppliers, as they are able to provide their own energy. This makes them less vulnerable to changes in the energy market.
Fourthly, energy clusters have the opportunity to receive financial support from the state and the EU, especially if they are engaged in the development of renewable energy sources. The Płońsk cluster also participates in international projects such as ENTRAIN, which aims to improve air quality and use renewable energy for heating.
Energy clusters play an important role in developing a decentralized energy system in Poland and introducing green energy technologies.
How spatial planning gave impetus to economic development in Grodzisk Mazowiecki
The Grodzisk Mazowiecki urban gmina, located 30 kilometers from Warsaw, is an example of successful investment attraction and creation of conditions for large and small businesses. Interestingly, the unemployment rate in the gmina is almost half that of the overall Polish rate. How did they manage to achieve such economic development?
Thirty years ago, Grodzisk Mazowiecki was losing residents, had a high unemployment rate, a low level of services, and a declining economy. European colleagues, to whom the gmina’s representatives traveled to learn from their successful experience, advised them first of all, to give people jobs. “If you want residents not to protest or express their indignation, just provide them with jobs. This is an effective and simple method,” said the European colleagues.
So, in the early 90s, the authorities actively promoted Grodzisk Mazowiecki abroad to attract foreign companies to its territory and create new jobs. At first, this seemed unrealistic, because investors had to be offered favorable conditions. And not only an attractive price for land, but also convenient logistics and developed communications. Then, the first investors came to the gmina – an American company that produces chips and a Danish company that produces cells for batteries.
But in order to develop the territory and attract investment systematically, in 2003, Grodzisk Mazowiecki started spatial planning.
“We identified three industrial zones. One is in the city itself, where there were already enterprises, and the second is in the field, not far from the highway. The third small zone is on the border with the city of Żyrardów, and it is still the slowest developing. 2003 was the year when the gmina divided the territory. Zones for agricultural activities, construction of private and apartment buildings, and industrial development were envisaged. Spatial planning is a tool that gave an impetus to the development of the gmina,” shared his experience Mr. Tomasz Krupski, head of the Grodzisk Mazowiecki gmina.
It was important to equip the industrial zone located in the field, which had no communications. The community invested its own funds and installed water, sewerage, gas, and power networks there. It was the moment when the authorities were thinking about future development.
“When I came to power, we were completing a large project to develop an industrial zone. Today, large enterprises are already operating there. And we receive millions of zlotys in taxes from this, and the funds that were invested by the community at the time have returned to us,” said Mr. Tomasz Krupski, head of the Polish gmina.
The head of the gmina admits that for the first time the budget of Grodzisk Mazowiecki exceeded half a billion zł. Most of it, more than 100 million zł, is personal income tax revenue. Every year, they hold campaigns to encourage residents to register in Grodzisk Mazowiecki. After all, people mostly pay taxes where they are registered. However, according to the Polish laws, a person can pay taxes in the city where he or she works.
“Every year I hold a campaign: “Register in Grodzisk”! That is, I tell people to register here. If you register, we will have more money in the budget for development. We hold various contests and lotteries. And it helps. There is a so-called card of a resident of Grodzisk. You get a card if you are registered and pay taxes here. People can get discounts on certain things. But about 10 percent of the gmina’s residents do not pay taxes. Unfortunately, these are the richest people,” admits Mr. Tomasz Krupski.
By the way, the 20 thousand residents who have such a card enjoy various discounts, and thus entrepreneurs increase their customer base.
Constant communication with representatives of large and small businesses is essential for the gmina, and they hold meetings with them twice a year. They discuss problems, and joint projects and develop plans for the future development of the territory. Separately, a special coworking space has been opened in one of the municipal buildings for small businesses. Here, you can work for free, conduct an interview, or meet with partners. The coworking space is equipped with furniture and office equipment, and you can also enjoy coffee or tea.
The gmina has also taken on the role of an intermediary in the sale of land owned by private individuals, as it has created and is replenishing the database of free land on the territory. And if a potential investor approaches the authorities, they are provided with information about such land plots. By the way, gmina representatives can also advise on the value of such land. But this is the end of the gmina’s functions. Then investors negotiate directly with those who want to sell the land. By the way, the investor recently signed an agreement with 56 owners of small plots.
And one more advantage for investors. The municipality is part of the Łódź Economic Zone, which provides preferences for investors. They pay only 50 percent of income tax for ten years. The condition: one million zł of investment for small businesses, 100 million for large ones.
Business support and systematic communication with investors have brought good results. Currently, 30 companies operate in the gmina. The unemployment rate in the gmina is 2.6 percent, while the overall unemployment rate in Poland is 5 percent. Job fairs are held here twice a year. During these events, several dozen employers find workers.
The gmina continues to make ambitious plans and look for ways to become energy independent.
Cooperatives in Poland: how does it work?
There are about 50 cooperatives in Poland. One of the oldest is in Warsaw. It was established in 2013. The Dobrze (pol. good) Food Cooperative has a legal status, although it started as a non-governmental organization. It brings together designers, lawyers, architects, farmers, and representatives of various professions, more than 300 people. The Dobrze Cooperative is an example of a community that supports the ecological production and sale of local quality products.
Cooperatives in Poland operate on the principles of wholesale purchases. That is, there is a group of people who want to buy food directly from farmers or small entrepreneurs. They have a database of farmers who sell milk, cheese, vegetables, and fruit. Once a week, the farmers bring their orders and collect the money.
“When we founded the NGO, we already knew that we wanted to open a store. We were looking for premises in the central part of Warsaw. Since we were working for the Association, we were able to rent it on preferential terms. The premises were very inconvenient because they were in the basement. Now we are planning to open a third stationary store and an online store,” says Mr. Denis Gerard, a cooperative’s board member.
The stores of the Dobrze cooperative are vegetarian. There are people among the members of the cooperative who eat meat, but they buy it elsewhere. The stores primarily sell fresh fruits, vegetables, dairy products, various beans and cereals. In addition, the assortment includes tea, coffee, condiments, and sauces that are certified as eco-friendly. However, the preference here is for goods and products that can be purchased from local farmers.
“On the one hand, it is important for us to provide quality products at a reasonable price to Warsaw residents. On the other hand, we want to take into account the interests of farmers. If you run an ecological farm and do not use pesticides or chemical fertilizers, then the harvest is usually smaller. In addition, farmers need to invest in an environmental certificate. That‘s why we ensure farmers are fairly compensated for their work,” the cooperative’s board member emphasized.
How is the price of products formed? The price of goods is set based on the actual costs of their production. More than 60 percent of the cost of, for example, vegetables or fruits is returned to the farmer. This is much more than in conventional supermarkets. Profit is also important for a cooperative, so they learn to balance. There must be profitability to continue operating and paying salaries to employees who work in the stores.
To maintain a trusting relationship with farmers, representatives of the cooperative visit them, communicate with them, and learn their farming methods. And, by the way, they often help them.
“At the end of May, we helped a farmer who works alone to plant pumpkins. We planted a lot of pumpkins. And we have already received pictures of the harvest from her. We have 12 varieties of pumpkins that we have never seen before. We will definitely go to pick them,” says Mr. Denis Gerard, a member of the cooperative’s board.
To join the cooperative, you need to pay 100 zł. These are non-refundable funds. One of the conditions for joining the cooperative is to be on duty in the store. Everyone has to do three hours of duty a month for free. The main job on duty is receiving goods. But there are other types of work. For example, mothers who take care of small children sew bags for the products of the cooperative’s stores at home.
An important aspect of the food cooperative’s work is education. The cooperative organizes various educational events and supports environmental initiatives. Their main goal is to popularize the use of organic products, support local producers, and share the cooperative’s experience in Poland and beyond.
Why is it important to organize study visits to Poland for local government representatives?
USAID Project Manager, Local Government and Decentralization Advisor Mr. Marat Kyurchevsky:
“The study visit was informative and well organized by our Polish partners together with the DOBRE and UCMC teams. In my opinion, the event was very successful and versatile; we touched upon topics in various areas in which the USAID DOBRE Program works and which are relevant to Ukrainian communities. These include economic development, strategic planning, integrated spatial planning, service improvement, and the economic direction of cooperatives. There is an ongoing discussion in Ukraine about comprehensive plans and spatial planning. This is the basis for future economic development and investment attraction. Of course, when there is a war in our country, communities are in different situations. For example, those on the rear are more ready for this, and we help them develop comprehensive plans. And in communities in the conflict zone, USAID DOBRE is actively working with them to develop recovery plans. And this is exactly the kind of planning document that also has an economic development component. It was very useful for our communities to look at the level of development of small and medium-sized businesses in Poland. A specific example is the cooperative we visited, where they buy from farmers and sell environmentally friendly products. I think such ideas can be implemented in Ukraine as well.”
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The USAID Program, “Decentralization Offering Better Results and Efficiency” (DOBRE), is a nine-year program, implemented by Global Communities and funded by the United States Agency for International Development. DOBRE has worked closely with 100 consolidated communities (CCs) in ten Oblasts of Ukraine to help them realize the benefits and meet the challenges brought by decentralization. DOBRE provides technical and material assistance to CCs to help them govern openly and accountably and meet the needs of their citizens; and supports citizens’ active engagement in decision-making and policy making. DOBRE’s support encompasses strategic planning; spatial planning; financial management; public service delivery; local economic development; capacity building; good governance practices; and gender- and youth-responsive policies.
In the period 2022 – 2025, DOBRE will be working directly with at least 60 CCs of Ukraine to help them cope with the consequences of the war, recover and rebuild, and resume their trajectory of positive, sustainable development. Partners with Global Communities in the DOBRE Program Consortium include the Ukrainian Crisis Media Center; the Foundation in Support of Local Democracy, and the Malopolska School of Public Administration at the Krakow University of Economics, Poland.