Czech Senate seeks to remove checks on some solar power plants from Energy Act

The Senate wants once again to remove individual checks on the profitability of some solar power plants from the Energy Act. Today, the upper house approved an amendment proposed by its Economic Affairs Committee as part of the bill known as Lex Gas, which aims to speed up permitting for new combined-cycle gas power plants. The changes could shorten permitting processes by up to five years, as gas-fired power plants are expected to provide sufficient capacity to generate electricity as coal is phased down. The bill will be reviewed again by the Chamber of Deputies, which rejected an almost identical Senate amendment three months ago.

The Senate amendment concerns individual profitability checks for photovoltaic power plants commissioned in 2009 and 2010. Originally, the checks were to apply to plants with a capacity of 30 kilowatts or more. The version of the Lex Gas bill passed by the Chamber of Deputies narrows their scope to plants with a capacity above 145 kilowatts. The government expects the individual checks to save money that the state spends on supporting energy sources.

Zdeněk Nytra (ODS) and Hana Žáková (STAN) unsuccessfully proposed approving the Lex Gas bill in its original wording; 20 of the 72 senators voted in favour. Nytra warned, among other things, that if the Senate returns the bill to the Chamber of Deputies, it could be shelved as the end of the parliamentary term approaches. “That would be the worst-case scenario,” the senator said. Žáková argued that the issue was one of energy security.

The removal of individual profitability checks for some photovoltaic power plants was championed in particular by Miroslav Plevný (for STAN), chair of the Senate’s Economic Affairs Committee, who called the checks pointless. He warned of legal disputes and arbitration.

Unless permitting processes and subsequent investment in gas-fired power plants are significantly accelerated, the Czech Republic may not generate enough electricity to meet demand in the coming years, according to Industry and Trade Minister Lukáš Vlček (STAN). Gas-fired power plants are also expected to play a key role as backup capacity capable of stabilising variable output from renewable sources, according to the bill’s sponsors, a group of MPs led by Vlček.

The bill stipulates that investors in gas-fired power plants must state in their authorisation application which supplier they expect to select for the plant. Applicants must also comply, during construction and maintenance, with requirements relating to the state’s security interests, as set by the Ministry of Industry and Trade.

Under the bill, the Energy Regulatory Office could, in cases of urgent need and in the public interest, require a holder of an electricity generation licence to generate electricity beyond the scope of that licence. The sponsors justify this on the grounds that the high share of coal-fired power in electricity generation creates a risk that the uncontrolled shutdown of coal-fired plants could threaten the reliability of electricity supplies. A generator subject to this obligation would be entitled to compensation for its losses or a reasonable profit.

The bill also bans the use of so-called energy dumpers. These devices convert surplus electricity into heat that is released into the atmosphere, and are used mainly when electricity prices are low.