Financial Directions for Renewable Energy Sources Investments as a Support for Sustainable Development Policy—Examples of Polish Cities

Abstract

The EU’s cohesion policy envisages using renewable energy sources (RESs) to realize sustainable development and reduce urban air pollution. In Poland, investments in this area are gradually being made by cities of different sizes, which is the subject of this study. One of the essential tools for implementing this policy is the Regional Operational Programmes (ROPs), under which it is possible to obtain funding for RES investments. Given the high energy needs of cities, such investments are important. A desk research method, qualitative project analysis, and quantitative analysis were used. The authors made inferences based on the data obtained. The authors analyzed all projects financed by the ROPs 2014–2020 implemented since 2014 by Polish cities to use RESs. The beneficiaries selected were local government units. The type and size of RES installations implemented in cities and the relationship between city size and investment characteristics were identified. To date, such research has not been conducted, filling a gap. The results make it possible to determine the directions and scale of financing RES investments in cities of different sizes in Poland, which was considered this study’s primary objective. This study showed that the size of the city determines the type of RES investments. In addition, it showed that the smaller the city, the lower the percentage of projects implemented on their own and the higher the percentage of projects implemented within a cluster or functional area.

1. Introduction

The first ideological mention of sustainable development appeared in the 1987 report Our Common Future, which defined the concept in a brief and laconic manner as development that meets the needs of the present generation without compromising the ability of future generations to meet their own needs [1]. Analyzing various definitions and attempts to identify and understand the concept of sustainable development, many researchers have identified the basic dimensions within which development is to take place as economic, social, and environmental. This development is understood to entail the deliberate and purposeful alignment of economic growth, environmental stewardship, and the fulfillment of human needs, which collectively shape the quality of life [2]. In the context of sustainable urban development, it is imperative to consider the institutional and spatial dimensions [3,4,5]. Each facet of urban sustainability must be accelerated without encroaching upon other dimensions. If any harm is sustained in one sphere, compensatory measures must be implemented.

Currently, cities are confronted with numerous challenges in each domain. However, in light of the pressing global climate change issue and the imperative for the implementation of a pro-environmental EU policy, it is crucial to acknowledge cities as entities with the capacity to exert a substantial, both positive and negative, influence on this matter (a focal point of researchers worldwide) [6,7,8,9]. Cities report a substantial demand for energy. Therefore, they must implement RESs as much as possible and reduce negative environmental impacts [10]. Urban areas are also characterized by high levels of air pollution, which negatively affect the well-being and health of the inhabitants [11]. The transition to renewable energy sources is of significant importance due to their potential to reduce greenhouse gas emissions, enhance energy efficiency, and promote environmental sustainability. For over three decades, there has been an emphasis on the detrimental human impact on the environment and climate [12,13]. Increased energy demand and consumption in both developed and developing countries is recognized as one of the primary factors influencing climate change. A pivotal step in achieving sustainable development is the investment in renewable energy sources (RESs). The implementation of renewable energy sources (RESs) has been identified as a key strategy for mitigating CO2 emissions, which are a primary contributor to global warming [14,15]. Furthermore, the adoption of RESs has been demonstrated to facilitate a degree of energy independence and decentralization of energy sources [14,15]. These actions are of paramount importance in achieving the seventh global sustainable development goal (ensuring access to affordable sources of stable, sustainable, and modern energy for all), as outlined in Agenda 2030 [16]. Furthermore, the deployment and development of renewable energy sources contribute indirectly to other global goals identified in the document, particularly in the context of combating climate change, including Goal 11—sustainable cities and communities, and Goal 13—action on climate change, which implies the need to reduce greenhouse gas emissions by promoting renewable energy sources. The European Union’s actions for the deployment of renewable energy are closely linked to the implementation of the concept of sustainable development and are a key element of the European Union’s climate and energy policies, as indicated by numerous scientific articles and policy documents [17]. In addition to Agenda 2030, another significant document delineating future directions for energy and economic development and transformation is the European Green Deal [18], which establishes novel targets for Member States, emphasizing the importance of clean energy [19].

The scientific community has identified climate change and the achievement of urban sustainability as a process. Consequently, the principles of sustainability and adaptation to climate change are of paramount importance to ensure that communities can thrive in a sustainable manner in terms of the environment, society, and the economy. Initiatives undertaken in this regard apply to both rural and urban areas. In the context of urban areas, the emphasis is often placed on the development of sustainable and eco-friendly cities, with various aspects of urban functioning being given consideration [20,21,22,23]. It is important to note that climate change adaptation measures are not mentioned as a separate and independent public task but are treated as a set of deliberate and intentional actions closely linked to the tasks of the city as a basic unit of local government [24].

While policies focused on the development of renewable energy are primarily the domain of the country and the region, their implementation also occurs at the local level, particularly at the municipal level, through additional programs and instruments [25]. In Poland, cities have the capacity to mandate or advocate for the adoption of renewable energy sources, thereby generating demand and streamlining the implementation of renewable energy solutions (RESs). This process is intricately interwoven with both national and EU policies, which serve as the guiding principles for member states’ internal policies at the regional and local levels.

It is noteworthy that the European Union boasts some of the world’s most rigorous environmental policies, which is reflected in the provision of financial support to member states for activities falling within the purview of these policies [26]. Poland is a notable recipient of financial assistance from the European Union, with a significant portion of its investments in renewable energy sources being facilitated through EU-provided funding. In accordance with EU policy, a substantial proportion of funds is allocated to urban areas. Globally, it is estimated that cities account for approximately 70% of energy demand and should thus be recognized as pivotal actors in the decarbonization of the energy generation sector and the transition to a low-carbon economy [27].

A seminal document that influences the shape and direction of policy towards cities is the Urban Agenda for the European Union [28], also known as the Amsterdam Pact. This was ratified by urban policy ministers from EU member states in May 2016 and in the 2019 Ministerial Declaration. The document is entitled ‘Towards a common framework for urban development in the European Union’. It identifies priority topics for cities to pay attention to, among them climate adaptation. The Urban Agenda for the EU is also recognized as a boost to a number of international agreements and the implementation of Sustainable Development Goal 11 of the 2030 Agenda for Sustainable Development, which calls for ‘inclusive, safe, resilient and sustainable cities and settlements’ [28]. It also identifies potential sources of funding for renewable energy investments and contributes to supporting and improving traditional, innovative, and user-friendly sources of urban financing at the appropriate institutional level, including from the European Structural Funds (point 5.2. of the Amsterdam Package). Paragraph 26 underscores the necessity to engage urban and regional authorities, the European Commission, the European Parliament, the Committee of the Regions, and the European Investment Bank while adhering to the principle of proportionality. In terms of renewable energy sources, the document clearly indicates a need for a structural change in energy systems in urban areas of Member States in the long term, i.e., a transition to renewable energy and energy efficiency, including an increase in local renewable energy production (point 8, page iii) [29]. The Amsterdam Pact identified potential sources of funding for investments in renewable energy sources (RESs), including the structural funds and investment funds.

The Leipzig Charter (2020) [30] further elaborates on current urban policy challenges and strategic goals, underscoring the necessity of upgrading infrastructure networks and enhancing energy efficiency. Furthermore, the Leipzig Charter (2020) [30] indicates that a significant factor in reducing greenhouse gas emissions and accelerating adaptation to climate change is the provision of climate-neutral energy and renewable resources [30].

In their discussion, Bórawski et al. [31] explore the potential of renewable energy sources in facilitating the transition towards a low-carbon economy. It is asserted that the advancement of renewable energy sources will be predominantly driven by the evolution of solar power and photovoltaics.

The necessity to implement a low-carbon economy is emphasized in the European Union’s cohesion policy. Between 2007 and 2013, as part of ongoing EU policies, the European Regional Development Fund (ERDF) and the Cohesion Fund allocated a total of EUR 18.5 billion to initiatives supporting the low-carbon transition. These funds were allocated for the development of renewable energy sources, the enhancement of energy efficiency, the development of clean urban transport and the establishment of cycling infrastructure. It is envisaged that this momentum will be sustained and intensified in the subsequent programming period (2014–2020) [EU Cohesion Policy 2014–2020]. In order to effectively implement the objectives of cohesion policy, Member States and regions should direct their investments towards the process of transforming the economy in a low-carbon direction [32].

The conceptualization of future urban development ought to be founded on the tenets of sustainable development, with consideration for a global perspective. It is evident that there is a paucity of cooperation between cities with disparate financial resources. Consequently, matters pertaining to environmental protection, sustainable development, and the low-carbon economy frequently become marginalized [33]. In addition to the implementation of modern and innovative pro-environmental solutions at the local level, cooperation, exchange of experience, and openness to cooperation with other urban centers are also important elements of effective urban transformation [34].

The urban dimension was of significance in the 2014–2020 period within the context of EU cohesion policy, as evidenced by the allocation of more than 115 billion euros in ERDF resources to urban areas. Furthermore, over EUR 17 billion from the ERDF was allocated directly to integrated strategies for sustainable urban development [35]. In Poland, the National Urban Policy 2023 (preliminary study of 2015) is the document that defines the direction of urban development in Poland, taking into account sustainable development and energy and environmental challenges. Conversely, the Low Emission Economy Plan is a pivotal document in the implementation of RES investments. This document is pivotal in the process of applying for funding from the Regional Operational Programme of a given province [36].

As [7] observes, while cities may emerge as leaders in achieving sustainability and implementing RES investments, they bear direct responsibility for a mere 5% of total urban emissions. However, cities play a pivotal role in shaping urban policies, strategic actions, and spatial planning to address and adapt to climate change and implement sustainable development solutions [37]. This is because carbon-intensive energy systems are the cause of high urban air pollution [38,39,40], and more than half of the world’s population lives in cities, so energy consumption in these areas is crucial for decarbonization [27]. A plethora of studies have been conducted worldwide on the feasibility of renewable energy sources (RESs) and the identification of their energy potential in urban areas [38,39,40,41,42]. In Germany, the examples of a medium-sized city (Ludwigsburg) and the Ostfildern district demonstrate that solar technologies have the highest potential for decentralized renewable energy supply [43]. Conversely, Sarralde’s research on the potential for renewable energy in urban areas demonstrated an inverse relationship between urban density and the potential for renewable energy production [44]. Rigter also highlighted the heterogeneity in the potential for renewable energy sources, which is contingent on the unique characteristics of each city [45]. Irrespective of a city’s resources, there is a need for instruments that can empower and facilitate the utilization of renewable energy sources [27]. These instruments should be designed with consideration for the diverse users of the city, including households, businesses, institutions, and local authorities.

A report on the low-carbon and energy efficiency of Polish cities, prepared by the Institute for Urban Development, indicates that cities were already preparing for the implementation of a low-carbon economy even before 2014. All voivodeship metropolitan and regional and sub-regional cities had low emission economy programs prepared (or with a different name, but thematically corresponding to them), while among local cities, around 25–30% had such a program. Furthermore, functional areas were found to have a program to implement a low-carbon economy. This suggests a satisfactory level of preparation for the implementation of low-carbon economy assumptions in Polish cities [46]. Nevertheless, the production of energy was not the most significant challenge in terms of transferring towards a low-carbon economy. Instead, it was positioned as one of the urban priorities following the transformation of construction and transport [46].

In Poland, cities have their own budgets administered by the local government, but the possibility of using external funding sources provides an opportunity to realize investments in adaptations to climate change and counteracting its negative effects. In the case of the EU, funds utilized under the ROPs, and the implementation of projects are subject to both city and regional policy. This funding source enabled the provision of support for renewable energy measures between 2014 and 2020, a period which forms the subject of the present study. The rationale behind the selection of this instrument and research period pertains to their status as the most substantial financial resources for renewable energy infrastructure during the period of greatest intensification in these investments. Consequently, it is of interest to ascertain the direction and scale of financing RES investments in cities of varying sizes in Poland, which was identified as the primary objective of this study. The implementation of the proposed study will address a significant research gap, as the extant body of knowledge does not indicate any differences in financing RES investments between groups of cities of different sizes. In order to achieve the aforementioned objective of this study, the following were identified: forms of applications submitted by municipal entities, recipients of energy produced from RESs, the size and type of RES installations, and level of financing obtained from Regional Operational Programs. The directions of RES investments were identified with regard to the size of the city, indicating the existing dependencies.

The following hypotheses were adopted in order to achieve the research objective:

• The size of the city influences the number and type of investments directed toward renewable energy production;
• The type of RES investments implemented does not depend on the size of the city;
• The manner of applying for financial support for RES investments does not depend on the size of the city and most often takes an individual form (cities most often apply on their own and do not form various partnerships in order to acquire funds). Both the research assumptions and results were confronted with the assumptions of cohesion policy at the EU level and in Poland, as well as with the hitherto scientific output in this area. The Amsterdam Pact, the Urban Agenda for the European Union [28], the National Urban Policy 2023 [47] on planning the development of Polish cities, and the Low Emission Economy Plan [48] were used as a point of reference.

The utilization of RESs is a subject of particular importance for countries undergoing an energy transition, such as Poland, and as such, research in this area is developing [49]. However, these studies are not yet comprehensive or exhaustive, and as such, it is reasonable to detail them by analyzing the proposed issue. The implementation of RESs in cities is becoming an important thread in the scientific discussion on the energy transition in Poland and can serve as a reference point for countries and regions that are also implementing such policies.

In the context of Polish cities, studies have been conducted to identify investments in RESs and the barriers and factors affecting the implementation of such measures. However, these studies primarily focus on specific cities or a limited group of them [50,51,52,53,54,55,56]. There is a paucity of research indicating how support for RES use is shaped in all Polish cities and whether it varies depending on the size of the city. This article addresses this research gap.

2. Materials and Methods

The fundamental research assumption was to analyze the financial support provided by the EU for RES investments in all Polish cities during the previous programming period. This study encompassed all Polish cities that received EU structural funds for investments related to solar, geothermal, wind energy, and biomass (288 cities). For this study’s objectives, cities were grouped according to their size using the classification employed in the Concept of National Spatial Planning until 2033 [57], which is taken into account in various policies in Poland, including the following city size classes: I 250–500,000 inhabitants; II 100–250,000 inhabitants; III 50–100,000 inhabitants; IV 20–50,000 inhabitants; V less than 20,000 inhabitants.

The allocation of support funds (i.e., EU funds) to these cities was determined through competitive selection processes for investment projects, which were conducted within the framework of regional operational programs (ROPs). The selection of projects for analysis was constrained to those with a direct focus on the construction of RES installations, excluding initiatives of a different nature (e.g., thermal modernization of buildings and development of sustainable transport). The research was conducted through the analysis of source documents, as well as numerical data for the following categories of RES co-financing: type of applicant, type of cooperation, type of energy recipient, type of RES installation by capacity, and type of RES source. Furthermore, the manner in which local government units apply (individually, in agreement with other cities, within a cluster, or within a functioning integrated territorial investments (ITIs)) was identified, which required the appropriate aggregation of data by grouping a set of individual units into corresponding categories.

The resource for the quantitative data was a spreadsheet provided by the Ministry of Funds and Regional Policy, containing data for all projects implemented in Poland and financed by European funds. The information database contained 103,558 projects implemented in Poland during the 2014–2020 programming period. Of these, only those whose applicants were cities (1194) were selected [58], followed by those that were directly related to investments in RES installations acquiring solar, wind, biomass, and other types of renewable energy (e.g., heat pumps). The subject of the analysis was a spreadsheet containing a package of 10,166 pieces of information on 391 completed projects. The analysis criteria were related to cities by size and type of beneficiary. In order to enhance the analytical rigor and substantiate the findings, the descriptions of projects that met this study’s criteria were examined. This qualitative information enabled the identification of RESs implemented in the project and the specification of mixed sources (e.g., solar and wind energy in one project).

The research procedure involved the utilization of descriptive statistical analyses. Indicators of the magnitude and structure of the allocation of support measures for RES investments were calculated and analyzed using different analytical approaches. A comparative approach was adopted, utilizing analytical techniques. The results of the calculations were visualized in the form of graphs to visualize potential correlations (radar, pie, and bar charts). Based on the information on the investment projects studied, final generalizations were made.

The results of this research are limited to those trends and directions that have been implemented under the ROPs in different groups of cities. Notwithstanding, it is the most significant instrument of support for RES investments in Poland, which renders the obtained results largely illustrative of the studied phenomenon and enables the generalization of regularities and the formulation of conclusions.

3. Results

From a research point of view, it was important to determine the share of cities implementing investments in RESs in the distinguished groups. Therefore, it was determined what percentage of cities in a given group participated in implementing ROP projects (

Table 1. Share of cities that implemented projects in RESs by city size groups.

City Size Group	Population (Thousand)	Number of Projects Implemented on in Cities	Total Cities (Number)	Cities Making Investments in RESs (%)
I	250–500	12	6	100%
II	100–250	41	26	100%
III	50–100	37	47	79%
IV	20–50	78	90	87%
V	under 20	223	805	28%

Source: own elaboration using data of statistical information. Area and population in territorial section in 2023 [59].

).

In each of the large (group I) and medium (group II) cities, at least one project financed from the ROPs to implement RES installations was implemented. On the other hand, the least investments in RESs were visible in cities with the smallest population in group V, for which the percentage of cities that received financing was 28%.

From the research perspective, it was important to identify the application form and answer whether the cities applied as individual beneficiaries or whether they sought forms of cooperation with other local government units or implemented projects within a functioning cluster or urban functional area (MOF). Cities apply for EU subsidies for RES investments 71% on their own and 12% as part of an agreement with other cities. In the context of smaller units engaging in cooperative endeavors within clusters and FUEs, this phenomenon is primarily influenced by the enhanced potential for these units to actualize RES investments. One of the forms of financing RES investments in Functional Urban Areas (FUAs) was Integrated Territorial Investments (ITAs). Integrated Territorial Investments (ITAs) are an instrument of the territorial approach to development in EU countries introduced in 2014. The idea behind them is to ensure that all groups of development actors are involved in working together to solve problems affecting selected areas, including urban functional areas [59]. Therefore, for MOF applicants, the largest share of projects was financed using the ITA financial instrument. A total of 16% of the projects were implemented within the framework of ITAs, and only 1% were cluster-funded projects. Analysis of the data shows that the type of beneficiaries varied according to the size of the city. Large cities tended to implement projects on their own and within the FUA In contrast, the smaller the city, the greater the share of projects implemented in cooperation with another local authority (Figure 1).

The type of support that cities receive indicates that the larger the city, the higher the share of RES investments that are earmarked for public purposes. Their direct recipients were most often public administration facilities. In smaller territorial units, however, umbrella projects aimed at the inhabitants dominated. Analysis of the content of projects indicated that in cities in groups IV-VI (up to 100,000 inhabitants), there were also investments in which both public administration institutions and inhabitants were the energy recipients. Such projects did not occur in large cities due to the different specifics of city operations (Figure 2).

For the purposes of this study, all projects were analyzed in terms of the size of the RES installation, thus distinguishing between power plants, energy farms, and micro-installations (energy production capacity of up to 50 kW) (Figure 3).

As the applications for funding treated power plants and farms identically (as was evident from the analysis of the qualitative data), they were classified into a common group.

This research demonstrated a positive correlation between the size of the city and the implementation of projects involving investments in photovoltaic (PV) power plants and farms. Micro-installations were the most prevalent type of installation, irrespective of city size, accounting for over 90% of all projects analyzed in cities in groups III-VI. In the case of large cities, this percentage was lower at 83% (Figure 4). This observation may be indicative of a correlation between the magnitude of the city and its energy demand. This is due to the fact that large cities account for a higher percentage of investments in higher capacity RES installations than is the case in all other city groups. In addition, the primary consumers in these cities were public administration institutions, which resulted in installations being concentrated in their vicinity or within accessible areas with substantial surface area, such as in suburban regions. A further distinguishing factor pertains to the energy generation capacity of these installations, which has been observed to exceed that of installations supplying energy to residential consumers.

From the perspective of the research methodology, it was considered worthwhile to ascertain whether there existed a statistical significance between the size of the city and the nature of the investment undertaken for the purpose of renewable energy production, which was financially supported by the ROPs. The regression analysis commenced with the determination of Pearson’s linear correlation coefficients between the characteristics y1 (biomass) to y6 (windmills) and the population. The correlation coefficients were then determined for the entire population of towns (391 sites) and for each group of towns by size (groups I–V).

The ensuing results, in conjunction with the critical values of the coefficients, are presented in

Table 2. Critical values of linear correlation coefficients.

	Biomass (y1)	Solar Collectors (y2)	Mixed Sources (y3)	pv Panels (y4)	Heat Pump (y5)	Windmills (y6)	Critical Values
I	0.00	0.00	−0.12	−0.48	0.00	0.00	0.59
II	−0.21	0.26	0.01	0.12	−0.14	0.10	0.42
III	−0.05	0.32	−0.07	−0.15	0.06	0.00	0.38
VI	0.16	−0.16	−0.05	−0.01	−0.11	−0.15	0.25
V	−0.03	−0.08	0.12	0.37	0.16	−0.01	0.14
all cities	0.03	−0.04	0.17	0.30	0.07	−0.02	0.11

Source: own elaboration.

.

It can thus be concluded from the preceding analyses that a significant linear relationship exists between the total urban population and variables y3 (mixed sources) and y4 (PV panels), as well as for the group of localities (municipalities) with up to 20,000 inhabitants and variables y4 (PV panels) and y5 (heat pump).

On this basis, an attempt was made to determine linear regression models for each pair of characteristics. In each of these models, the unknown (explanatory) variable was the number of inhabitants of the locality, and the dependent (explanatory) variable was, respectively, y3 (mixed sources) and y4 (PV panels) for the whole population, and y4 (PV panels) and y5 (heat pump) for localities up to 20,000 inhabitants.

A consideration of the provenance of RESs reveals that projects financing investments in photovoltaic panels accounted for the highest proportion. This trend was observed to be independent of the size of the city, with the highest share of these investments recorded in large cities (90%), where only one in ten investments was based on another energy source. Another notable investment category was mixed energy installations, which were not exclusively present in the largest cities. These investments incorporated a combination of different installations, primarily photovoltaic panels, and a heat pump. This combination was frequently utilized in instances where the beneficiary of the project was a city, with the energy consumers being city residents (umbrella projects). The implementation of such projects was predominantly observed in smaller municipalities. The integration of photovoltaic panels and a heat pump facilitates enhanced energy and heat autonomy for residents, particularly those residing in single-family dwellings, thereby underscoring their status as a favored form of renewable energy investment (RES). Investments relating to windmills, which accounted for the smallest share of total investments (0.01%), occurred only in the smallest towns. A similar situation applies to biomass as an energy source, but these were implemented in the second and fourth groups of cities (Figure 4). This phenomenon can be attributed to the spatial structure of urban areas, as windmill installations necessitate substantial land areas and are subject to numerous restrictions under the USTA of 20 May 2016 on wind power investments (Article 4(1)). These restrictions permit their location primarily in suburban or small city areas characterized by a substantial undeveloped land percentage. With regard to biomass, it is also an energy source specific to rural areas and small towns due to the need for space for the cultivation and/or storage of organic matter [60,61].

Analysis of the level of project funding by city size group (I–V) and type of beneficiary (city only or various forms of urban unit partnership) showed that the share of funding varied by both city unit size and type of beneficiary (

Table 3. Share of EU funds in the value of projects implemented in different groups of cities.

Group of Cities	Individual Projects				Joint Projects (Within a Cluster or FUA)
	Financial Support of EU (%)
	20–40	41–60	61–80	81–100	20–40	41–60	61–80	81–100
I	8%	42%	8%	42%	0%	56%	44%	0%
II	3%	17%	17%	63%	0%	17%	31%	53%
III	0%	6%	14%	80%	0%	22%	55%	23%
IV	0%	17%	18%	65%	0%	26%	46%	28%
V	1%	15%	33%	52%	0%	24%	29%	47%

Source: own elaboration.

).

Cities applying individually received more financial support, especially group III cities (50–100,000 inhabitants), than in projects whose applicants were cities within a functional area or within clusters or agreements. In this case of projects, in city groups III and IV, no project received the lowest subsidy of 20–40%.

4. Discussion

Rigter [45] emphasizes that the potential for RES development varies according to factors such as population density, climate, and development prospects. Consequently, implementation strategies must be tailored to the individual needs reported by cities. Analyses of this issue in relation to city size yielded analogous insights. The demand for energy is contingent on the city’s population. The correlation between population density and energy demand is well-documented [44,61]. Consequently, large cities are characterized by different climate change issues and will have different energy demand trends than small cities. However, irrespective of the size of the city and its characteristics, it has the opportunity to support its budget by obtaining funding to implement RES projects from European Funds, including ROPs [55].

Under the ROPs 2014–2020, Polish cities could obtain support for investments in solar, wind, geothermal, and biomass energy. The majority of investments were directed towards the installation of photovoltaic panels, a trend that has also been observed in cities across Europe and worldwide. In Germany, solar technologies are considered to have the greatest potential for decentralized renewable energy supply [7]. Additionally, it was highlighted that central biomass power plants account for the largest share of energy demand, but this is determined by additional factors and climatic conditions, as confirmed by a study by Havrysh et al., who showed that PV installation is more cost-effective than crop production and energy harvesting in semi-arid climatic zones [62]. Results also indicate a similar trend, with the percentage of projects implemented for investments in installations obtaining energy exclusively from biomass amounting to 4% of all projects. This energy source occurred concurrently in so-called mixed-source projects, i.e., in conjunction with other renewable energy sources, and in this case, the percentage was marginally higher (5% of all projects). Svirenko’s research focused on identifying the potential of biogas, and he claims that biogas from municipal landfills can provide up to 5% of a city’s total annual energy supply [63]. Biogas can be a good alternative to conventional energy sources in cities, and this area can be further explored. An analysis of the projects in question shows that there have been no investments in this energy source that have been funded by the ROPs. This may be influenced by the fact that the initial construction costs of biogas installations are approximately seven times higher than, for example, photovoltaic panel installations, assuming the same energy output is produced.

Barragán-Escandón et al. carried out an extended study on the types of RESs using Ecuador as an example, and the results show different preferences for using an energy source depending on the background of the consideration: environmental, economic, or social aspects [9]. For the economic criteria used by the authors, photovoltaic, hydroelectric, and landfill gas technologies were rated better, while combustion and energy from biogas were the least preferred. Similar results were obtained in the present study, which shows that the most significant number of projects involved photovoltaic technologies. This is the most uncomplicated installation with the fastest return on investment.

The cities with less than 20,000 inhabitants had the lowest percentage of projects. On the other hand, in cities with 20,000–100,000 inhabitants, the average level of support for the investments discussed was 83%. The nature of the installation requested is contingent upon the size of the urban unit. It is evident that as the urban unit increases in size, there is a corresponding rise in the proportion of farm and power plant projects. This finding further supports the assertion that there is a close correlation between a city’s population and its energy demand [63,64,65,66,67]. This correlation is further substantiated by the finding that the increased energy demands of a city necessitate investment in large-scale energy production facilities. The size of a city determines its functions and the public administration facilities present. In large cities, characterized by a plethora of cultural, sports, educational, and other public facilities and public administration, there is a proportionally higher share of projects financing RES investments precisely for these facilities. Notably, the primary applicant for these projects is the local government, not the facility’s administration. This finding suggests that cities are implementing measures to realize a low-carbon economy and that they are responsible for investing in this area. This finding further supports the hypothesis that the magnitude of a city’s population directly correlates with the scale of investments made in producing energy for public purposes.

Furthermore, the report ‘Cities as the key to energy transition’ highlights a disparity in information between smaller and larger cities [65]. Smaller cities encounter constrained access to financing for energy efficiency projects, attributable to a paucity of capacity and knowledge on how to raise funds. In response to this challenge, the EUCF initiative was established in 2019 to assist smaller cities in identifying sustainable energy projects and developing action plans for financing and implementing projects, including those focused on renewable energy sources (RESs). However, the full impact of these initiatives is yet to be realized, as they are scheduled for completion after the conclusion of the present programming period. It is important to note that energy demand varies according to the size of the territorial unit and is differentiated by the type of energy source. As Poplawski observes, projections of energy raw materials utilized for electricity production, extending until 2030, indicate a decline in the share of coal as an energy source, with a concomitant increase in larger territorial units and a decrease in smaller ones ([63] p. 9).

The nature of the investment may be contingent on the intricacy of the energy production and generation process, thereby conferring a distinct advantage to the implementation of photovoltaic panels over biomass energy generation, as evidenced by the proportion of projects allocated to each type of investment. Consequently, the extant results (research conclusions) should be regarded as a preliminary framework for the direction of RES investments in cities of varying sizes across Poland, thus serving as a foundation for subsequent in-depth analyses. In order to ascertain the conditions for the implementation of RES investments as part of adaptation to climate change, it would be advisable to conduct qualitative research, including in-depth interviews with experts and city mayors.

Cities primarily undertake the implementation of RES installation projects autonomously. However, a discernible correlation exists between the size of the territorial unit and the implementation strategy, namely whether the projects are executed individually or in collaboration with other cities. It is evident that the smaller the territorial unit, the higher the percentage of projects implemented in cooperation with another city within a cluster or functional area and the lower the percentage of those implemented autonomously. This study indicates that the form of application determines the level of co-financing, with cities that receive support in cooperation with others within a cluster or functional area having to contribute more to projects than cities that implement projects independently. The most pronounced disparities in this regard were observed among the cities in Group III (50–100 thousand). This phenomenon is consistent with the broader trend observed in financing other investments from EU funds, particularly those classified within functional areas and utilizing ITI [68].

It was observed that the larger the city, the more significant the proportion of public-purpose projects through investments in public administration facilities. Notably, residents of large cities did not directly benefit from municipal investments in renewable energy sources. This is a positive trend, indicating a desire on the part of local government units to invest in RES installations on public facilities to reduce operating costs. Investments in RESs translate into direct benefits for city residents and local governments through implementing installations for public buildings [63]. In contrast, smaller cities (groups IV and V) benefit from the possibility of implementing projects to support residents in the transition to renewable energy sources. The survey results indicate that the predominant installation type, irrespective of city size, was micro-installation, accounting for a higher percentage of installations with greater capacity and constituting 13% of all projects in Group I, encompassing the most significant cities.

In consideration of the category of RES energy source, solar thermal and photovoltaic panel installations exhibited predominance, irrespective of the urban size. However, the diversity of these sources was most evident in the smallest cities, where a wide range of installations were present. A noteworthy observation is that many of these projects were classified as ‘mixed’ projects, indicating the implementation of installations utilizing diverse energy sources, such as photovoltaic panels and heat pumps.

The survey demonstrated that RES investments, financed from the ROPs, are implemented in Polish cities with varying intensity, with this intensity being related to the size of the city. While cities primarily implement projects autonomously, cooperative endeavors are evident, particularly among cities with 100,000 to 250,000 inhabitants. In such cases, a significant proportion of investments in RESs are within the functional area to which the cities belong. This is a positive trend, emphasizing that support for RES investments is also obtained within the functioning of the MOF [34]. The National Urban Policy document underscores the significance of intra-urban cooperation for enhancing resource efficiency and promoting sustainable development ([12] p. 100). The 2014–2020 programming period was a time when it was envisaged that the urban dimension would be strengthened, and that the concentration of interventions would be mainly in urban areas ([12] p. 66).

The National Urban Policy 2030 provides fundamental directives on promoting renewable energy and enhancing energy efficiency within urban areas. The document indicates that cities will lead in the transition to a low-carbon economy, using RESs as a key component. To this end, cities are encouraged to support energy cooperatives, energy clusters, and the development of prosumer systems, especially in the residential and public building sectors. The findings of the conducted studies corroborate these developments; however, in the context of MOF cooperation between cities, studies demonstrate that projects implemented individually constitute a more significant proportion of the total. Furthermore, the document emphasizes the need for photovoltaic installations, biogas plants, geothermal energy-based systems, and other forms of RESs in city public buildings. This commitment is further evidenced by implementing projects funded by the European Funds, particularly in major urban areas [12].

The EU Urban Agenda explicitly supports the development of RES investments in cities, indicating the need to integrate renewable energy sources. The document meticulously enumerates the available funding sources, including EU funds such as the European Regional Development Fund (ERDF), the Cohesion Fund, and Horizon Europe, and EU financial mechanisms such as the European Investment Bank and the Connecting Europe Facility. Additionally, it highlights national instruments that can assist cities in their energy transition. A detailed analysis of a significant source of funding, European funds, confirms the importance of this source in creating opportunities to develop RES investments and support a sustainable low-carbon economy in cities [11].

Notwithstanding the fact that the subject of the analysis was not the price formation conditions in the energy market in Poland, but rather the identification of the relationship between the size of the city and the type of renewable energy implemented in cities against the background of the possibility to subsidize RES installations, it is nevertheless worth noting the specificity of the energy market in Poland and the rare occurrence of negative energy prices. The Polish energy market is distinct from those of other European countries, such as Germany, in terms of energy sources, with Poland retaining a significant reliance on hard coal as an energy source. Despite a considerable decrease in its utilization, this energy source remains a pivotal component of the Polish energy sector, contributing to a certain degree of energy stability. The occurrence of negative electricity prices in Poland is infrequent, and when it does occur, it is of a very limited nature. The supply of energy is prioritized by the most cost-effective power plants. Currently, the sequence in which energy is supplied is as follows: renewable energy sources (RESs), lignite and hard coal-fired units, and finally, the most expensive of these, gas-fired units. The inclusion of the most expensive sources in the system is determined by the size of the current electricity demand and atmospheric conditions, which affect the level of energy production from RESs. It is observed that an increase in energy demand, coupled with a decline in RES-generated electricity, results in the entry of increasingly costly power plants into the system, thereby exerting a direct influence on price. In practice, the price of energy sold on the exchange is determined by the price offered by the most expensive unit operating in the system at any given time. In the context of Polish energy market conditions, the principle of marginal pricing dictates that the energy price is predominantly influenced by coal-fired or gas-fired power plants. Consequently, the occurrence of negative prices in Poland is infrequent. The high energy demand in urban areas and their intricate spatial structures are of particular significance in this regard.