Chunks of a Ministry of Environment–piloted bid to reward Czech power companies, primarily state-controlled ČEZ, with free carbon emissions allowances in return for investments in cleaner electricity production have been rejected by Brussels officials with another problem stemming from concerns that Czech bid will excessively boost ČEZ’s market position.
Ever since the Czech government pushed through a retroactive 26 percent tax on solar companies’ profits at the end of 2010 to stem an ongoing solar power boom the threat of a massive law suit has loomed large. Now, 11 foreign investors, all members of the International Photovoltaic Investors Club (IPVIC), have told the Ministry of Finance that within six to eight weeks they will file a lawsuit against the Czech state.
The not-so-sunny Czech Republic is fourth in the world for its solar power capacity thanks to over generous grants in the past which sparked a boom. Now the Energy Regulatory Office (ERÚ) wants to curb any chance of any similar renewable El Dorado at the expense of the taxpayer with a ban on virtually all new support proposed from 2014.
A north-south pipeline to connect a liquid natural gas (LNG) sea terminal in Poland with the Czech Republic and Slovakia has been labeled a priority energy project agreed by the EU’s energy ministers. The Czech Energy Regulatory Office, however, says the project may not be viable and even says it’s possible the projected LNG terminal in Poland will not be completed.
Just as the previous Czech government gambled (and lost) on solar subsidies, the Cabinet of Prime Minister Petr Nečas (Civic Democrats, ODS) is pressing ahead to secure a green future regardless of the cost (in more ways than one). The proposed ‘green bonus’ for biomethane of up to Kč 4,000 per MWh will undermine the competitive position of natural gas in relation to far-less environmentally friendly fossil fuels, the Energy Regulatory Office head says.
A bill on public tenders setting lower limits for tenders to be published and to be competitive was voted through the lower house of parliament on Friday with 101 votes in favor. A last minute change included the obligation for subcontractors of important tenders to be declared after the deal is signed. Sector specific opt-outs to the rules for energy companies and utilities have been maintained, for now.
The recently installed Czech energy regulator has got into a fight with some of the country’s biggest energy companies by attempting to change rules allowing them to duck normal competitive tenders for contracts within the regulated parts of the sector, mainly gas and electricity distribution and transport. The existing set-up means some power giants can even give business to daughter companies without problems.
ČEZ chief Martin Roman is expected to officially announce his resignation on Thursday and be replaced by Daniel Beneš, the current ČEZ board of directors vice-chairman. According to Czech Position’s sources, he signaled the move months ago. Regardless, Czech PM Petr Nečas reportedly wants the new boss of ČEZ to fully concentrate on the planning of the expansion of the Temelín nuclear power plant.
Energy Regulatory Office (ERÚ) chief Alena Vitásková says she is concerned that an article about her published in the weekly Euro, owned by Czech billionaire Petr Kellner’s PPF Group, could be part of a strategy by the investment firm to blackmail her. She says it cast doubt upon her independence and transparency in her new post while giving the impression the main aim was to “gain leverage” over her.
For a third week the government didn’t manage to decide who will head the Energy Regulatory Office (ERÚ). The government’s hesitation is sending a very bad signals to the market because it is fueling speculation that the new chairman of the powerful energy watchdog will be chosen under pressure from lobbyists.