More than CZK 21 billion to flow to Czechia from the Modernisation Fund; only Romania to receive more

At the start of the week, the European Commission disbursed a total of three billion EUR to Member States for energy sector modernisation and support for the transition to renewable energy sources. The funds were raised from the proceeds of selling emission allowances, which were allocated to the so-called Modernisation Fund. The European Union will send a total of 835,2 mil. EUR, i.e. more than 21 billion CZK, to the Czech Republic. 

Emissions trading is frequently criticised because it increases energy prices. This is certainly true for electricity prices, as the price of an emission allowance is largely reflected in the wholesale electricity price.

However, the Czech Republic derives one important benefit from emissions trading. Through the Modernisation Fund, it receives funding from the EU EU ETS emissions trading system to modernise its energy sector and transform it towards renewable energy sources.

The European Union has already disbursed more than 13 billion EUR through the Modernisation Fund. A total of 10 Member States were eligible to access the fund's resources until the start of this year. Their number was expanded this year to include Greece, Portugal and Slovenia following the revision of the European directive on emissions trading.

In the current Modernisation Fund disbursement round, the Czech Republic received the second-largest amount of funding after Romania. The largest share went to support the installation of photovoltaic systems in households. This amounts to a total of 500 mil. EUR, more than half of the 835 mil. EUR disbursed by the European Union in this round. Another significant item is 230 mil. EUR, provided to improve energy efficiency and achieve energy savings in the residential sector.

ČEZ to build hundreds of MW of photovoltaic power plants thanks to the Modernisation Fund

Thanks to funding from the Modernisation Fund, a number of large solar power plant projects have been, or will be, developed. Construction of these projects is now expected to begin after several years of stagnation caused by the absence of operational support for photovoltaic power plants. Although operational support for photovoltaic power plants has still not been introduced, projects are being developed thanks precisely to the Modernisation Fund.

According to publicly available data, ČEZ has the largest number of projects set to receive support from the Modernisation Fund. According to calculations by Ekonomický deník, these comprise 24 projects with a total installed capacity of 720 MW.

ČEZ's largest project is expected to be a power plant called FVE Prunéřov I. It is expected to have a capacity of 243 MW, with the European Union contributing approximately one billion CZK through the Modernisation Fund.