Czech Republic: the cessation of support for new renewable facilities

The Czech Ministry of Industry and Trade recently published a draft amendment to the Act on Supported Sources of Energy, Act No. 165/2012 Coll. (the “Amendment”). According to the Amendment, the support of new renewable facilities shall cease from
1 January 2014.

In particular, the following amendments are proposed:

• new solar, biomass, biogas and other renewable plants will no longer be subsidised if the plants do not commence operating before 1 January 2014;
• new wind power plants will no longer be subsidised if (i) the plants do not commence operating before 1 January 2015; (ii) the plants do not conclude a grid connection agreement before 1 January 2014; and (iii) the plants did not receive a building permit before 1 July 2013; and
• new water power plants will no longer be subsidised if (i) the plants do not commence operating before 1 January 2016; (ii) the plants do not conclude a grid connection agreement before 1 January 2014; and (iii) the plants did not receive a building permit before 1 July 2013.

In addition, support for the decentralised production of electricity from renewable facilities will cease from
1 January 2014.

The Amendment was also expected to introduce various new measures affecting existing solar power plants including mandatory checks of the solar plants after ten years of operation and the extension of "solar tax" on the revenues of solar power plants after 2013. Both considerations have not been included in the draft Amendment.

At this stage, the Amendment is being reviewed by government. Relevant governmental bodies may propose changes to the Amendment. The deadline for any further changes is 17 July 2013 following which the Amendment should be sent to the Czech parliament who may also suggest further amendments.