Czech ministry to review whether energy suppliers set appropriate customer advance payments

The Ministry of Industry and Trade (MPO) will examine whether energy suppliers are setting customer advance payments in line with expected energy consumption and prices, that is, whether suppliers are abusing advance payments. Prime Minister Petr Fiala (ODS) said this after yesterday’s government meeting. People should not pay more than 30 percent of their income for housing, or 35 percent in Prague, including all charges such as for water or energy, he said. The prime minister expects the MPO to report the first results of its checks on the level of advance payments as early as next week.

„Citizens will pay a maximum of 30 percent of their income for housing, or 35 percent in Prague, including energy charges. The state is prepared to reimburse all housing costs above 30 percent of their income through housing allowances,“ Fiala said.

He also confirmed that the government wants to approve the form of the energy-saving tariff by the end of August. According to Fiala, a large number of customers are now receiving newly set advance payments.

„We have signals from the field that, for some households and supply points, the advance payment is very likely not in line with expectations, is not adequate and has been set higher,“ Labour and Social Affairs Minister Marian Jurečka (KDU-ČSL) said today.

According to him, suppliers can thus improve their cash flow. He said it was not possible for advance payments to be abused at this time.

The state paid out more than five billion crowns in the first half of this year to help households through housing allowances and extraordinary immediate assistance, Jurečka said.

Fiala said that the Czech Republic has sufficient gas supplies for the winter. According to him, the state has taken all steps to prevent the most catastrophic possible scenario. He mentioned, for example, filled gas storage facilities, gas purchased for state material reserves and securing capacity at a terminal for liquefied natural gas (LNG) in the Netherlands. The Czech Republic has leased capacity at the Dutch LNG terminal for up to one-third of its annual gas consumption and will be able to use it during the coming heating season. However, the government says consumption savings will also be needed.

Under the energy-saving tariff, the government wants to provide people with a contribution as partial compensation for higher energy costs. Households will receive support this year through their electricity contracts. The government will provide ten billion crowns in aid this year and distribute a further 30 billion next year, through individual commodities, meaning separately in bills for electricity, gas and heat. The proposal is now in the interministerial consultation process, with individual institutions having until Monday to submit comments. The specific amounts of support are not yet known.