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Cheaper energy for SMEs – but for who exactly?

Micro, small and medium-sized enterprises have time until November 30th, 2022, to declare their status to take advantage of cheaper energy from December 1st, 2022. Prior to submitting a statement, entrepreneurs should analyze their status.
Maria Matyka
Senior Corporate Services Consultant

The Act on Maximum Energy Prices

The so-called Law on Maximum Energy Prices (the "Act") has been in force since November 4th. On the basis of this Act, a template for declarations submitted by authorized entities has already been published.

Micro, small or medium-sized enterprises (“SMEs”) should submit the indicated declaration by November 30th, 2022 in order to take advantage of lower statutory energy prices.

This declaration is voluntary and must be submitted to the energy supplier. It will enable an entity to benefit from a maximum energy price of 785 PLN/MWh until the end of 2023.

Who can expect to pay lower prices?

Definition of an SME according to the Entrepreneurs' Law

The Act defines an SME, to the extent of which it consumes energy for its core business needs, by referring to the provisions in the Entrepreneurs' Law. The status of an SME is verified in terms of the number of employees and the financial data of the entrepreneur (annual net turnover from the sale of goods, products and services, and financial operations, or the sum assets in its balance sheet). The criteria for defining an SME, according to the Entrepreneurs' Law, are:

Tabela PL

The entrepreneur should meet the criteria specified above in at least one of the preceding two fiscal years.

Definition of an SME according to EU legislation

Micro, small and medium-sized enterprises are also defined by EU legislation. Accordingly, the SME category includes companies with less than 250 employees and an annual turnover of less than EUR 50 million, or an annual balance sheet sum of less than EUR 43 million. The limits on employment and financial data are therefore consistent with regulations of the Entrepreneurs' Law. The key difference in defining an SME in EU law relates to the consideration of the examined entrepreneur's connections with other entities.

In the case of a company which is part of a larger capital group, it may be necessary to submit the number of employees and financial data of related entities and consider the limits in context of the sum of these factors.


A small Polish company, which is part of a multinational group, may qualify as an SME in the absence of considering ties with other companies within the group, and at the same time exceed the limits of employment and financial data once those related companies are taken into consideration.

Justification for the aforementioned definition of micro, small and medium-sized enterprises is the conviction that SMEs are primarily differentiated from larger businesses by their limited access to investment funds and higher liquidity risk. Therefore, they require significant protection. In the case of a formally small company, which, however, is backed by companies with a much larger scale of operations, the indicated factors simply do not exist.

Legislator's mistake or intentional action?

Within the meaning of the Act on Maximum Energy Prices, does a small and medium-sized enterprise constitute a different entity from a small and medium-sized enterprise within the meaning of regulations applicable in  the European Union, including within the series of instruments implemented by Polish regulations and financed both with Polish and EU funds?

The justification of the Act does not provide guidance in this regard. According to press reports, the Ministry of Climate and Environment indicated that relying in the Act only on the definition from the Entrepreneur's Law was intentional. The Ministry indicates that the energy price aid should not discriminate against any entity due to it being part of a capital group. Does this resolve the dilemma for entrepreneurs affected by this issue?

Inconsistencies of the regulation in question with the system of state aid that has been built for years within the entirety of the European Union may certainly be worrying. Particularly, the introduction of a breach in the definition of SMEs appears to be directly incompatible with Council Regulation (EU) 2022/1854, which allowed for a temporary extension to SMEs of the possibility of public intervention in energy pricing.

On one side, the introduced solution is aimed at protecting a wide range of entrepreneurs and minimizing the effects that may be associated with a drastic increase in the costs of business operations. On the other hand, the uncertainty in which group entrepreneurs find themselves may give rise to business risks. It is necessary to introduce urgent changes in law, or a resolution of the indicated dilemma in a more convincing and legally relevant way than via press reports.

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