Czech PV industry could be ‘screwed’ by regulator

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A national renewable energy target of 13% by 2020 could also be missed, according to the trade groups. Image: wikimedia user: ŠJů.

Renewable energy could become “extinct” in the Czech Republic if the energy regulator refuses to approve payments to wind, solar and biomass plants, and the country will face legal challenges, trade groups have warned.

PV Tech has received a joint statement from the Czech Photovoltaic Industry Association (CZEPHO) and the Alliance for Energy Self-Sufficiency. The two groups said that they will visit representatives of the European Commission’s Directorate-General for Energy today, following reports that the Czech Energy Regulatory Office (ERU) may refuse to pay for electricity from renewable generators next year.

Wind, biomass, solar, hydroelectric and biogas plants connected between 2006 and 2012 will not receive feed-in tariffs (FiTs) or ‘green bonuses’ if ERU continues to refuse to issue an obligatory pricing decision which would ensure the payments are made next year.

The ERU’s chief, Alena Vitaskova, was quoted by the Czech news agency Ceske Noviny earlier this week as having told a television discussion programme that the country was paying out premiums unfairly. The regulator apparently complained that the scheme to support renewable energy had not been officially ratified by the EC.

However, CZEPHO and the clean energy alliance said not only that the EC question had been resolved once last year when the commission “assessed the new Czech Renewables Support Act of 2012 and found that the support scheme established by it contributes to meeting EU energy targets without inappropriately violating the competition rules of the Single Market”; the two groups also said they had already received assurances in November from the EC’s DG Competition representatives that the country’s renewable support schemes did not violate European law.

Additionally, Ceske Noviny news agency reported that Czech energy and industry minister Jan Mladek said solar taxes introduced in 2011 had already dealt with the matter of high returns being paid to renewable generators from the public purse.  

‘Screwed’

Even veterans of Czech solar who in the past couple of years have seen their industry attacked by politicians, the regulator and the press, including previous threats of retroactive support cuts, appear to be shaken by the extremity of the latest steps. One source who did not wish to be named said that if the situation continued as it was the domestic PV industry would be “screwed”.

The CZPEHO-headed joint statement said the vast majority of those installations affected, around 22,000 out of 25,000 in total, are solar, including large power plants and domestic rooftops. As of the end of 2014, the country had around 2.1GW of cumulative installed PV capacity.

The industry groups also said that some €5.6 billion (US$6.16 billion) in loans given to fund the facilities would be jeopardised, while towns and their facilities including hospitals and critical infrastructure could also suffer.

A national renewable energy target of 13% by 2020 could also be missed, which could incur EU penalties.

CZEPHO director Veronica Hamáčková said the regulator had “overstepped its boundaries” and called on the European Commission to intervene if necessary.

“Independent legal analyses clearly demonstrate that by not granting aid for renewable energy, the Energy Regulatory Office has overstepped legal boundaries. The Energy Regulatory Office's arbitrary interpretation of the law must come to a quick stop,” Hamáčková said.

“The European Commission should promptly begin looking into the situation in the Czech Republic, where EU processes are being intentionally abused to damage renewable energy projects”.

The Alliance for Energy Self-Sufficiency’s Marek Lang said the saga could cause “irreparable damage” to the country’s reputation for attracting investment.

“The current obstructions that the Energy Regulatory Office has created by refusing to issue the obligatory pricing decision continuing support for renewable energy source will cause irreparable damage to the Czech Republic's image as a state with a secure investment climate and the rule of law. By not continuing the legally binding support, the cracks that formed in investor trust in the Czech state after retroactive solar levies were adopted in recent years will only grow larger.”

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