Thursday, 24 April 2014

Activists criticise law on renewable energy, industry hails it

ČTK |
19 August 2013

Prague, Aug 16 (CTK) - Environmentalist groups and solar industry associations in the Czech Republic have expressed criticism of the amended law on renewable sources, approved by the Chamber of Deputies Friday, but representatives of industrial companies have welcomed the bill.

Environmentalists say the law will end support to environmentally friendly production of electricity while maintaining subsidies to burning coal, gas and waste.

In contrast, representatives of industrial companies focusing on energy-intensive production welcome the bill, saying it will help to maintain competitiveness of Czech businesses.

"The law brings no end to subsidised electricity. It only ends support to projects of pure renewable energy for municipalities and households, while it continues to subsidise large companies which operate waste incinerators and coal-fired power plants," Jiri Kozelouh of environmentalist movement Hnuti Duha (Friends of the Earth) said.

"If the law is approved by the Senate too, it will give more power to fossil fuel barons who get billions of crowns from the sale of gas, oil and coal whose prices continue to rise. The law will secure further state subsidies for them, but will complicate the possibility to abandon fossil fuels for families and municipalities," Kozelouh added.

The Alliance for Energy Self-Sufficiency and Czech Photovoltaic Industrial Association (CZEPHO) said in a joint statement that the law aimed to boost the start of production of clean energy will paradoxically turn into a subsidy mechanism for coal and gas burning and for the construction of waste incinerators because of the gradual drop in support to new renewable sources.

Apart from the end of support to operation of new renewable energy sources, the two associations also criticise the extension of the validity of the so-called solar payment for photovoltaic power plants that were launched into operation in 2010.

"Calculations of photovoltaic power plants' economic operation confirm that the current three-year payment, combined with other measures such as the cancellation of tax holidays, has prolonged the period of returnability of photovoltaic power plants to the 15 years guaranteed by the state," CZEPHO head Veronika Knoblochova said.

"There is simply no more room for extending the retroactive steps which negatively affect the conditions guaranteed by the state," Knoblochova added.

In contrast, industrial companies have welcomed the amendment.

The Czech industry pays the highest charges for renewable sources from all European countries, said Tapas Rajderkar, chief executive of steel producer ArcelorMittal Ostrava.

The setting of a limit and a cut in renewable energy surcharges is a positive signal for the Czech industry and the first step in efforts to help maintain its ability to compete, Rajderkar added.

The aim of the bill, which is yet to be debated in the Senate, is to reduce impacts of the support to renewable energy sources on the Czech economy.

The volume of the support will reach Kc44.4bn this year, of which Kc11.7bn will go from the state budget. The rest of the amount will be paid by consumers in electricity prices.

The amendment sets a limit on the surcharge paid in electricity price at Kc495 per megawatt hour as of next year. The fee is Kc583 this year.

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