Czech Ministry of Industry and Trade prepares energy act amendment to improve market oversight

The Ministry of Industry and Trade (MPO) is preparing an amendment to the Energy Act. The amendment is to include proposals submitted to the ministry by the Energy Regulatory Office (ERÚ) to address the energy crisis and improve oversight of the energy market. Industry Minister Jozef Síkela (STAN) told reporters today. The situation of people in the supplier of last resort (DPI) emergency regime is also expected to improve.

According to Síkela, an analysis is still lacking of why last year 15 percent of energy customers ended up in the DPI regime. He said the situation was unique across Europe. Síkela wants to determine whether the government or the energy regulator failed. Without a thorough analysis, he said, it will be difficult to establish measures for the future.

The ERÚ has submitted several dozen proposals to the ministry intended to prevent a similar situation from recurring. Síkela did not want to comment on specific proposals so as not to compromise the regulator's independence. According to him, the energy regulator should draw up the proposals in the form of draft legislative provisions, but must first consult them with experts. Once the Energy Act amendment is ready, some of the measures are to be included in it.

According to Síkela, the energy regulator currently has no information indicating an imminent threat in the energy market similar to last year's collapse of energy group Bohemia Energy, when 900,000 customers ended up in the DPI regime. A number of other suppliers subsequently ceased operations.

The Energy Regulatory Office is proposing, for example, an increase in the share capital of energy supply companies, as well as mandatory insurance for them. The insurance payout would, for a predetermined period, cover the difference for consumers between prices in the supplier of last resort (DPI) emergency regime and the prices charged by their original supplier. Another proposed option is an obligation for ongoing certification or regular audits for all suppliers.

For the DPI regime, the proposals include the option of an accelerated exit from the regime to a standard supplier, with the consumer potentially being taken over by the new supplier retrospectively from the start of the DPI regime. There is also discussion of an option under which the regulator would set DPI prices directly. These prices are currently subject to substantive regulation.