Energy clusters vs energy cooperatives – which model to choose for your business?

1. The legal framework for community energy in Poland

Polish law distinguishes between two operationally viable models of local energy generation and management: the energy cooperative and the energy cluster – both regulated by the Act of 20 February 2015 on renewable energy sources (i.e. Journal of Laws 2024, item 1361, as amended; hereinafter: the RES Act). Both models were thoroughly modified by the amendment to the RESA of 17 August 2023 (Journal of Laws 2023, item 1762), effective from 1 October 2023, which for the first time introduced tangible financial benefits for their participants. An energy cooperative partly corresponds to the EU concept of a renewable energy community under the RED II Directive (2018/2001), whereas a cluster has no direct equivalent in EU law. The choice of model directly affects energy costs, available fee exemptions and organisational requirements.

2. Energy cooperative – legal nature, restrictions and support mechanism

An energy cooperative, as defined in Article 2(33a) of the RES Act, is a cooperative within the meaning of the Act of 16 September 1982 – Cooperative Law (i.e. Journal of Laws 2024, item 593) or a farmers’ cooperative within the meaning of the Act of 4 October 2018 on Farmers’ Cooperatives (Journal of Laws 2018, item 2073), whose business consists of the generation of electricity, biogas, agricultural biogas, biomethane or heat in renewable energy installations, as well as their trading and storage – exclusively for the own needs of the cooperative and its members.

A key feature of an energy cooperative is its legal personality. The cooperative is subject to dual registration – in the National Court Register (KRS) and in the KOWR register – although only entry in the KOWR register entitles it to benefit from support mechanisms (Article 38f(2) of the RES Act). At least 10 natural persons or 3 legal entities are required to establish it. The cooperative is subject to three significant restrictions:

• it may operate exclusively within a rural or urban-rural municipality (limited to a maximum of 3 neighbouring municipalities);
• it must cover at least 70% of its members’ annual energy needs from its own production – although cooperatives that applied for inclusion in the register by 31 December 2025 were able to benefit from a reduced threshold of 40%, retaining it permanently;
• it must not exceed 10 MW of electrical power, 30 MW of thermal power and 40 million m³ per year for agricultural biogas.

The support mechanism is based on a discount system – in accordance with Article 38c(3) of the RES Act, the cooperative settles accounts with the obligated supplier at a ratio of 1 to 0.6. This system ensures the predictability of settlements regardless of market price fluctuations. This is supplemented by exemptions from the RES levy, the cogeneration levy, the capacity levy and the variable component of distribution charges. Generation in installations with a capacity of up to 1 MW is also exempt from excise duty. A significant restriction is the ban on selling energy to entities outside the membership group – a cooperative that breaches this ban loses its financial privileges and is treated as an energy company, required to obtain a licence.

3. Energy cluster – structure, scope and financial benefits

An energy cluster (Article 2(15a) of the RES Act) is a civil law agreement covering cooperation in the generation, consumption, storage or sale of electricity, heat, cooling or fuels produced in RES installations or in cogeneration units. The cluster does not have legal personality – it constitutes a cooperation agreement; in the absence of legal personality, it is represented by a designated coordinator who concludes agreements with the DSO and acts on behalf of the cluster in legal transactions. From 1 October 2023, a condition for establishing a cluster is the participation of at least one local government entity or a company controlled by it (Article 2(15a) of the RES Act). A cluster may operate within a single municipality, a single county or a maximum of three directly neighbouring municipalities.

A cluster is not subject to limits on installed capacity or any minimum self-consumption threshold, making it a particularly suitable solution for entities with high energy consumption. Clusters registered with the Energy Regulatory Office (URE) benefit from an exemption from the RES and cogeneration charges for energy settled within the cluster. The key mechanism involves discounts on the variable component of the distribution charge, depending on the level of local balancing – ranging from 5% at 60% self-consumption to 25% at full balancing. This mechanism is temporary and comprises two stages: Stage I – until 31 December 2026 (requirement: at least 30% of energy from RES and coverage of 40% of the cluster members’ annual demand), stage II – from 1 January 2027 to 31 December 2029 (requirement: at least 50% of energy from RES and coverage of 50% of demand on an hourly basis). The provisions governing both phases have already been incorporated into the RES Act via the 2023 amendment; however, in accordance with Article 48 of that Act, the entire support scheme does not apply until the European Commission issues a positive decision on compliance with state aid rules – such a decision has not yet been made.

4. Regulatory barriers and practical challenges

In the case of energy cooperatives, the main barrier is dual registration with the National Court Register (KRS) and the National Register of Agricultural Cooperatives (KOWR), as well as the need to adjust the capacity of renewable energy installations to the consumption levels of the cooperative’s members, as required by the condition of 70% coverage of own needs. The number of registered energy cooperatives is growing rapidly – the KOWR register currently includes over 680 entities.

In the case of an energy cluster, the difficulties are of a different nature. In the absence of legal personality, all legal acts are performed by the coordinator or individual members in their own name. Furthermore, the mandatory participation of local government units means that the pace of cluster formation depends on the decisions of local authorities. The fundamental problem remains the lack of a Commission decision on the compliance of the support scheme with state aid rules – until such a decision is issued, the distribution discount mechanism does not apply. Currently, the URE register includes only 12 registered energy clusters.

5. Criteria for selecting a model for an entrepreneur – what to look out for

The choice is determined by four variables.

1. Location – an entity in an urban municipality can operate exclusively as a cluster.
2. Scale – the absence of power limits within a cluster meets the needs of entities with high energy demand; an energy cooperative is the appropriate solution for small and medium-sized enterprises with moderate consumption.
3. Formal requirements – a cooperative requires a formalised corporate structure and must meet the self-consumption condition; a cluster is simpler organisationally but requires the involvement of the local government.
4. Risk profile – quantitative settlement within the cooperative shields its members from current fluctuations in energy prices on the wholesale market; the benefits of the cluster depend on the completion of the notification procedure with the European Commission.
5. Summary

An energy cooperative and an energy cluster are complementary instruments serving different needs. A cooperative – stable, with legal personality and a predictable billing system – is the optimal choice for small and medium-sized enterprises in rural areas. A cluster – flexible, with no capacity restrictions, and open to cogeneration – meets the needs of entities with high energy demand and businesses operating in urban municipalities. The successful implementation of either model requires professional legal and energy consultancy. The regulations are complex, regulatory practice is still evolving, and the financial benefits of clusters depend on the ongoing notification procedure with the European Commission.