Govt. passes measures to ease pain of rocketing energy costs

The government has just approved measures aimed at easing the pressure that skyrocketing energy costs are putting on many Czechs. Under the scheme, households will receive an average of CZK 15,000, with almost a third of that sum coming this year.

A lot of people in Czechia are feeling the pinch of soaring prices of gas and electricity – and are bracing themselves for even worse once winter arrives.

Earlier in the week the prime minister, Petr Fiala, said hikes in electricity prices had surpassed even the worst expectations.

On Wednesday his government approved a package aimed at easing some of the economic pain.

Introducing the measures, Mr. Fiala said they were the final form of the cabinet’s Umbrella Against Costliness scheme.

He also said that the Czech government was doing more to help voters cope with inflation than their counterparts in many other countries.

Petr Fiala | Photo: René Volfík,  Czech Radio

“The government has earmarked a total of CZK 177 billion crowns to help citizens. According to an international comparison by the independent institution IFIs [Independent Fiscal Institutions Network], when it comes to degree of assistance to citizens we are fourth in the entire European Union. The help our government has prepared for citizens is massive, targeted and active.”

Mr. Fiala said the measures were tailored to meet the needs of various sections of Czech society.

“The government has produced measures that are targeted and that are to different degrees and are for different population groups. The cornerstone of our assistance is what’s called the Energy Saving Tariff, as well as the forgiveness of charges for renewable energy.”

Indeed the waiver of fees for renewable resources applies not only to households but also to companies and organizations. Like the financial assistance, this takes effect from October.

In terms of what the Energy Saving Tariff will mean for individual families, the minister of industry and trade, Jozef Síkela, elaborated.

“Smaller households with smaller consumption will get roughly CZK 11,000. Mid-sized households will get CZK 14,000 or CZK 15,000. And for those with the highest consumption, for instance with heating pumps, it will be CZK 18,000.”

Czech minister of industry and trade Jozef Síkela | Photo: René Volfík,

The average amount that people will receive is CZK15,000, with the first CZK 4,000 due to arrive this year.

Minister Síkela said households would be able to work out exactly how much aid they will receive via a special online app.

This year the energy allowance will be paid out via electricity contracts, though in 2023 people will receive it through individual utilities, meaning electricity, gas and heat.

Mr. Síkela also told reporters that he would be in favour of a Europe-wide cap on electricity prices. If the EU were to decide on such a path, Czechia would be one of the countries that supported it, he said.

Prime Minister Fiala is due to discuss such a cap with Germany’s chancellor, Olaf Scholz, when he visits Prague on Monday.