Weronika Pelc, Marek Dolatowski

Investors may review expert reports on the effect of electrical connections

The Court of Competition and Consumer Protection has broken the power companies’ monopoly on information about the condition of the power grid in proceedings seeking a connection to the grid.

The Energy Law in Poland, as amended on 8 January 2010 (Journal of Laws Dz.U. 2010 No. 21 item 104), shifted the obligation to prepare an expert report on the effect of a grid connection from the investor in the generating unit to the power company to whose grid the generating unit is to be connected. This change was intended to streamline the process of issuing conditions for grid connections.

Whether or not the amendment has achieved its stated purpose, an unexpected effect of the amendment was to limit investors’ access to expert reports prepared by grid operators. Power companies operating distribution and transmission systems regard the information contained in the reports as a trade secret and thus prohibit investors from reviewing them, even though the expert reports are crucial for determining whether the technical and economic conditions for connecting the generating unit to the grid exist or not.

The President of the Energy Regulatory Office upheld the position of power companies on restricting investors’ access to expert reports in disputes over the existence of conditions for connection or seeking a contract for connection to the grid. The Court of Competition and Consumer Protection had taken the same view when ruling on appeals from orders issued by the energy regulator in proceedings before the Energy Regulatory Office.

However, on 25 September 2012, in Case No. XVII Amz 18/12, the Court of Competition and Consumer Protection departed from its earlier line of precedent on this issue and set aside an order by the President of the Energy Regulatory Office denying an investor access to the expert report. The court held that there are no legal grounds to refuse a party to a proceeding before the energy regulator access to the file in the proceeding on the basis of a trade secrets reservation by the power company with respect to the full content of the expert report on the effect that the proposed connection of the source would have on the grid. Nor did the court find any basis in the Administrative Procedure Code to limit access to the file, and more specifically did not identify any significant state interest that would justify restricting the investor’s review of the expert report.

It remains to be seen whether the court has permanently changed its position on the issue of the investor’s access to the expert report on the effect that the connection will have on the grid. The ability to review the expert report will enable the investor to dispute its findings, and thus should encourage investments in new sources of power generation in Poland.

Weronika Pelc & Marek Dolatowski, Energy Law Practice, Wardyński & Partners