Czech Republic to receive a further 73 billion crowns from the EU for energy and transport investment

The Czech Republic will receive a further nearly 73 billion crowns from the EU Modernisation Fund for investment in energy and transport. The government will use the money to finance renewable energy sources, modernise district heating and make public transport greener. The Ministry of the Environment (MŽP) announced this yesterday. The grants for the Czech Republic have now been approved by the European Investment Bank and the European Commission. The country has so far received 267 billion crowns from the fund.

“The Modernisation Fund is a key tool for achieving our goals in modernisation and energy independence. The approval of a further nearly 73 billion crowns is an important milestone for the Czech Republic. These funds will not only boost the development of renewable energy sources in manufacturing businesses and households, as well as in district heating, but will also contribute to the long-awaited modernisation of public transport,” said Environment Minister Petr Hladík (KDU-ČSL).

According to the ministry, the government will use the largest share of the newly approved grants—more than 32 billion crowns—to finance renewable energy sources. The ministry plans to use a larger portion of this money, around 20 billion crowns, to support the construction of new photovoltaic power plants on family homes and apartment buildings under the New Green Savings programme. A further 12 billion will go to solar power plants at business sites. According to the ministry, the investments should result in facilities with a capacity of more than 2.11 gigawatt-hours and reduce carbon dioxide emissions by 1,819 kilotonnes.

The new funding for making public transport greener amounts to 22.4 billion crowns. The government is expected to use most of it to modernise electric- or hydrogen-powered rail vehicles for regional passenger services. The investments will also go towards purchasing new vehicles for urban public transport, including battery- or hydrogen-powered buses, trolleybuses and trams to replace conventional bus routes.

The government will distribute further funding among projects aimed at saving energy and decarbonising industry and district heating. “In district heating, we have secured 12.5 billion crowns for four major investment projects, while three projects in manufacturing have been awarded investment support totalling six billion crowns,” Hladík noted. According to Petr Valdman, director of the State Environmental Fund of the Czech Republic, the supported district heating projects will reduce carbon dioxide emissions by 658 kilotonnes a year and save 8,019 terajoules of energy from non-renewable sources annually. Industrial projects are expected to cut emissions by 64 kilotonnes a year and reduce final energy consumption by 772 terajoules annually.

The Modernisation Fund was established by the European Commission to help speed up the shift away from coal combustion and reduce greenhouse gas emissions. It is funded by EU revenue from the sale of emission allowances. Thanks to high allowance prices, the Czech Republic is expected to have up to 500 billion crowns available from the Modernisation Fund by 2030. The funding is channelled through the State Environmental Fund of the Czech Republic and will be allocated gradually through ten grant programmes supporting low-carbon technologies, the modernisation of energy systems and improved energy efficiency.