Changing the Way Laws Are Made: How the Polish Parliament Gave me an Ulcer

   Mark Twain observed that people who love sausage and respect the law have never seen either being made. A remark which seems to apply with enormous validity to the Polish legislative process.

   While I have followed some legislation here in the past, I have been buried in the new renewable energy law deliberations, obfuscations, and incoherence for over two years. As part of the renewable energy sector and a lawyer by training, I have been wrapped up in the technical details, the policy scheme, and the impact of it all on our sector. But I also have to comment on the process itself, which is about as dysfunctional as a democracy can be. It is a chilling thought to realize that the people of Poland have entrusted their future and their children's to such a flawed and corrupt process.


   The most striking comparison to what I observed and often participated in while a lawyer in Washington DC for twenty five years, is the secrecy employed here. Taking their lessons from the former Russian and Nazi occupiers, the Polish politicians view each occasion of public exposure of their legislative work product as an abhorrent incident to be minimized and dreaded. Working on the RES bill for three years, they provide "consultation" periods of two weeks or so on complex documents, which have been prepared with enormous gaps, uncertainties and bogus assumptions.

   The "hearings" that are held are perfunctory and mostly spent on the committee members own statements, which display an appalling lack of preparation and knowledge of the most basic facts. The testimony of experts is deemed adequate if it consumes a few hours out of a process that has taken years. The only explanation has to be that learning the facts in order to make a better decision on the design of the law is not a priority of the process. Indeed, members of Parliament in Poland serve only as a means of recording the tally of their party's strength in the last election. Independent judgment or even feedback on the matter at hand seems to be the exception that may be more theoretical than anything else. Maybe they could be replaced by "chits" awarded to the parties and then tossed on the table as votes.

   The preparation of the legislative packages back in the ministries reflects pretty much the same mindset. Despite appearing in probably a hundred public meetings, the officials on the Ministry of Economy have seldom provided answers to any questions that were more than "talking points" issued before they left for the meeting from higher up. I am sure that their definition of a "good meeting" is not a dialogue that advanced mutual understanding of the issues, but something more like a recital where they got away with only reading a set piece. While sometimes called "debates" by the sponsors (including organizations in which I was in a leadership role), I know what a debate is and these exchanges are anything but that.

  So the various iterations of the RES law have come and gone, emerging out of darkness for brief periods in daylight, when they are again consumed by darkness and stealth. If we can draw as analogy, they seem like plastic wind-up toys that get primed and set upon the floor, only to hit a wall and back up for another blind approach to yet another wall.  The walls here being the unexpected reality that they meet when they emerge for their brief periods of trial by error.

   Under all of it is something more forbidding and malicious, however. The most powerful special interests, here the state-owned power companies, get to work in the dark, whether through their owner, the Treasury Ministry, or through the Prime Minister's office itself. So there is an agenda under the public appearance of chaos. The agenda with RES has been to maximize the system to the benefit of state-owned companies. The public mantra is to save consumers money, but the support advocated (for co-firing and old hydro) has the most impact of consumer end prices of anything on the table. People just pay more for the same electricity that was produced anyway. No new capacity is added, even though Poland critically needs all the new capacity it can get. [Studies show that about half (or more) of the money spent in support of new RES capacity comes back in lower costs of energy via competition and other market factors].* In the same vein, elaborate efforts were made to restrict RES producers from selling their electricity directly to consumers.Not to save consumers money, but for the opposite effect, to limit competition with state-owned companies. The auction mechanism is now proposed, but not to save money in lower support costs (which can or cannot happen based  on past experience)**, but to provide the optimum procedure for the huge state-owned companies to compete for RES support and lock out private competition.

   There is an Orwellian twist to this exercise, demonstrating that words do not always have the same meanings. As Lenin observed, a lie told a thousand times becomes the truth. If this sounds harsh, then think of the situation as a big scale case of Stockholm syndrome. The captives (Poles) have taken on the attributes of their enemies ( the Soviets and the Nazis). Leadership grew up in a world where the government could say anything and ignore the facts on the ground. There was no fact checking, no free press, and no way to contradict them. Which all sounds a lot like where we are today.

   The Prime Minister can say offhandedly that Poland cannot afford expensive wind projects (when they are 6000 MW of the RES that his Government submitted to Brussels as their plan for 2020) and when the energy that he likes actually cost more. [ According to a 2013 U.S.Energy Information Agency report, on levelized total life cycle costs, wind is $86/MWhr, conventional coal $100 and advanced coal - advocated by  the Government- $123/MWhr. New nuclear plants go for $108/MWhr.].  No one immediately questions this when he says otherwise (although in the US or UK he would have been forced to issue a "clarification" or retraction within 24 hours).

   All the political parties enjoy the same immunity for fact checking and accountability. So every leader is free to say dumb things on Polish energy and not fear contradiction or embarrassment. A comfortable parity, but hardly one that promotes good public policy.

   How would an American lawyer who has been involved in U.S. legislation change things?

   First, there should be an advisory committee of all the stakeholders in RES. They should meet periodically and the government ministry personnel should be forced to sit there, listen and take notes. All draft proposals should be routed through the committee and it should be public in all its meetings. I sat on a similar committee for the United States Congress when it revised the waste regulatory scheme and the waste cleanup program.

   Second, there should be real hearings with real experts testifying to Parliament. Open, public, and announced in advance. About ten times more time than was actually devoted to this legislation would be a minimum. Politicians can take this time out of the time that they now use for speeches (which are almost devoid of factual content by contrast).

   Third, "consultation" should not be a last minute deal given only a few days. Each round of deliberation should be open to public comment, even drafts and partial proposals.

   Fourth, there should be a free and active press. I just threw that one in because it is important in the long-run for a healthy democracy and it is obvious not a tradition in Poland. Obviously no one can orchestrate a more aggressive press. Maybe the very conservative libel laws in Poland should be reevaluated? That is, of course, another topic.

   It has been frustrating to be a participant in this vastly imperfect process to say the least. I have always been harsh of law-makers in general. They are never selected in any country for their ability to make policy or their knowledge and experience. That Poland as a young democracy has more problems than older systems is no surprise. I will undoubtedly grow old here waiting for one of the political parties to get enlightened and actually start trying to give Poles the freedom and democracy that so many Poles fought and died for in the past.

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* See Klein, "Renewable Energy at What Cost," Georgetown University, thesis (2012).
 
** The Dutch experience with a reverse RES auction indicates that it creates more uncertainty for investors and reduces participation, which also can increase prices or require much higher reference prices to induce bidders to participate. See Rabobank, “An Outlook for Renewable Energy in the Netherlands,” June 2012.  




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