Czech solar feed-in prices remain unchanged as Constitutional Court rejects senators’ proposal

Feed-in prices and annual green bonuses for solar power plants will remain unchanged this year. The Constitutional Court (ÚS) rejected a petition from a group of senators seeking to overturn one line in the Energy Regulatory Office’s (ERÚ) price decision. They say the prices are too low and do not guarantee a return on investment. The issue concerns a specific group of solar power plants with an installed capacity of more than 100 kilowatts that were connected to the distribution grid in January and February 2011. The senators estimate that no more than 50 operators are affected.

Although the Constitutional Court rejected the petition, it also stressed that price regulation for photovoltaic power plants must be set in the coming years so that, ultimately, the statutory guarantees of a return on investment within 15 years and a reasonable profit within 20 years are met. Senator Hana Žáková (STAN) therefore considers today’s ruling a success in essence.

„It was stated that the ERÚ must ensure a 15-year return on investment for owners of photovoltaic power plants. That is what we have been seeking all along. The people I represent have been fighting for their rights for more than 12 years. For 12 years, they have subsidised their photovoltaic plants with income from other activities, whether farming, carpentry workshops and so on. For us, this decision is a major step forward,“ Žáková told ČTK.

She now wants to initiate talks between the plant owners and the ERÚ on how feed-in prices should be set going forward. She expects them to rise.

The Constitutional Court also said that, when reviewing the content of a price decision, it does not act as a higher-instance pricing authority that assesses the accuracy of mathematical calculations for a particular year. That is within the ERÚ’s remit. Whether the authority’s decision met the statutory guarantees cannot be determined from the price decision for a single year, but only over the full 15-year period in terms of return on investment, or the 20-year period in terms of a reasonable profit.

The senators’ original petition challenged the 2021 price decision, which applied to the following year. They sought to overturn the line setting a feed-in price of 6838 crowns per megawatt-hour and green bonuses of 5568 crowns for plants commissioned in 2011. The senators said the authority had failed to take account of the plants’ specific status, which was guaranteed by a transitional provision in the law. The Constitutional Court judges discontinued proceedings on this part of the petition.

Since a new price decision by the regulatory authority took effect on 1 January 2023, the senators updated their petition. They now sought to overturn the line setting this year’s feed-in price at 6975 crowns and the green bonus at 3101 crowns. The Court rejected the petition. A new price decision is expected to apply next year, setting a feed-in price of 7115 crowns and a bonus of 4072 crowns for this group of plants.

The ruling was decided by the full bench, with Radovan Suchánek as the reporting judge. The Court announced the ruling in the Chamber of Deputies’ main hall, in the presence of all 14 Constitutional Court judges currently serving. This is a new practice introduced after Josef Baxa took over as president of the Court. Previously, plenary rulings were usually announced only by the Court president and the reporting judge.

At the turn of 2010 and 2011, feed-in prices for electricity from solar power plants fell significantly. According to the senators’ petition, investors who failed to obtain licences for their projects before the end of the year were not seeking the full support available in 2010. They did, however, want the ERÚ to „correctly set the specific investment costs for the group of affected generating plants and the corresponding level of support, so as to achieve the return on investment prescribed by law“.