In Poland, the main source of financial resources for activities in the field of environmental protection are the environmental funds on national, regional and local level. In 1994, for example, the funds covered 41% of all expenditures for environmental investments, 31% came from enterprisesÕ own resources, 19% from commune budgets and own resources from society, only 5% from state budget and 4% from foreign assistance. Most of the investment was assigned for water and air protection: 47,1% and 44,3% respectively. In 1995, 425 million zloty (USD 175 million) were spent on air protection by the National Fund alone. As a result of these expenditures and, of course, other policy measures, SO₂, particulate, NO_x and CO₂ emissions decreased significantly during the last years.

According to the author, the establishment of three new special, preferential credit lines were a crucial point for the development of programs for efficient energy use. These lines were created by the Bank of Environmental Protection, which manages the funds and credit lines on behalf of the National Fund. These three credit lines cover projects for:

• exchanging the existing commune lighting systems into energy saving ones;
• energy saving investments related to central heating and hot water;
• reducing emissions of flue gas through adjustment of combustion engines to gas fuel.

Special credit lines for investments in renewable energy sources are still lacking, deplores the author.

In 1992, Bank Handlowy S.A. as the first Polish bank signed the UN declaration "Banking and Environment". In 1994, 13 other commercial banks followed. For the author this made a lot of additional environmental investments possible. These banks started to include environmental risks into standard credit risks assessment and committed themselves to introduce the principles of pro-environmental investments into their practice. As a result, more credits for environmental investments were granted while some credits were not given to institutions whose activities would cause harm to the environment. For major investments in the environmental field they gave credits jointly, so-called consortia credits. Some of these banks started cooperation with regional (voivodship) funds, which enabled special preferential credit lines on the regional level. The author considers the participation of commercial banks as a very important development in financing air protection policy.

Another important source of (co-)financing in Poland is the EcoFund which manages the resources from debt-for-environment swaps which were granted to Poland by the United States, Switzerland and France (note of the editor: also Sweden and Norway since 1997). According to the author, in 1994, the EcoFund administered 8.7 million USD, in 1995 27,5 million USD with a similar amount in 1996. In 1995 one third of the resources were assigned for investments in the field of climate protection (energy efficiency and saving, renewable energy sources) and in the same year 22% of the revenues supported projects for reduction of transboundary transport of air pollutants, especially installations to reduce sulfur and NO_x emissions in power and industrial plants and hard coal desulfurization.

The author criticizes that investments are still mostly used for "end-of-pipe" technologies instead of sustainable ones aiming at energy-efficiency, production of energy from renewable sources, reduction of transport needs of the society, supporting public transport, coal/gas fuel switch etc. For example, an installation for flue gas desulfurization decreases SO₂ emissions only and causes problems with managing the produced waste, whereas investing in energy-efficiency reduces other pollutants such as NO_x and CO₂ as well. The author states that simple measures for reducing air emissions are already exhausted in Poland, considering that the positive trends in air pollution were slowing down during 1994 - 1996. Simple measures for emission reduction were connected with economic recession and initial changes in production structures. Only sustainable technologies will make sure that the growth of the economy will not be coupled with a growth of emissions in the coming years, the author says.

As investments are needed to develop a market for energy-efficient equipment in Poland, also tax reductions have to be provided. The reduction could be introduced for a limited time (e.g. 7 - 10 years) and only for equipment produced in Poland, the author suggests.

Apart from issues discussed above, the report covers the whole range of tools for air protection policy: it deals with political declarations, legal and economic instruments, foreign cooperation, and, includes a chapter on different air pollution scenarios for Poland and the role and place of NGOs within the Polish air protection policy.

Karaczun, Zbigniew M.: Report - Policy of Air Protection in Poland, Part IV 01.01 1994 - 31.12.1996, Institute for Sustainable Development, Warsaw 1997, 142 pages, price PLN 12.90 (ca. USD 4). Institute for Sustainable Development, ul. Lowicka 31, 02-502 Warszawa, Poland. Tel: +48 22 646 05 11, Fax: +48 22 646 01 74