HN: Brussels to back billions in grants for Czech solar operators

In the coming days the European Commission should greenlight state support for green energy in the Czech Republic to the tune of more than CZK 40 billion, a move that will be greatly welcomed by the owners of solar panel farms, Hospodářské noviny reported on Thursday.

Photo: Miloš Turek

Solar power producers and the operators of wind turbines have been on tenterhooks for nearly a year as they waited on the decision. The deadline is the end of this month and there has been feverish activity surrounding the matter recently, the business daily said.

However, a member of the Czech negotiating team in Brussels told Hospodářské noviny that agreement had finally been reached. The European Commission is set to approve the subsidies within the next fortnight.

All renewable energy sources built in the Czech Republic between 2006 and 2012 will be eligible for the support.

The head of the Energy Regulatory Office, Alena Vitásková, who decides on the pay-outs, had repeatedly stated that without backing from Brussels they would constitute unauthorised state support – so the power producers in question wouldn’t get a thing.

Ms. Vitásková told Hospodářské noviny that there had been numerous reports in the last two years that Brussels was about to greenlight the grants and that she hoped the latest news was actually true.

The energy regulator said, however, that her officials would not sign off on the subsidies until the documentation was in front of them. Indeed, they have prepared two scenarios: one under which the money is paid out and one under which it isn’t.

The news will come as huge relief to all those who produce energy from renewable resources, including households with a small number of solar panels on the roof, private companies and investors, and farmers who have built biogas plants.

Photo: European Commission

Virtually all of those who have got into the green energy production game are dependent on subsidies, Hospodářské noviny said. The state gives them up to 14 times more for the power they produce than the actual market price.

Without support, thousands of companies would go bust and this would have a knock-on impact on banks, which have lent hundreds of billions to green energy producers.

The European Commission began supporting green energy as a means to combat the effects of climate change.

This led a Czech government headed by Mirek Topolánek of the Civic Democrats to draft a law in 2006 promising generous support for those who invested in environmentally-friendly energy sources.

Few investors would have put their money into the costly construction of solar, wind and biogas plants if it were not for the grants.

However, problems set in in 2009 and 2010 when the cost of solar panels plummeted. Legislators did not lower subsidies in reaction to this, leading to a “solar boom”, Hospodářské noviny wrote.