Proposal would cut subsidies for renewable energy sources
In a draft proposal that goes completely against the anti-nuclear and pro-renewable energy tide in Europe, the Industry and Trade Ministry has suggested boosting nuclear energy capacity to meet 80 percent of domestic energy demands by 2060, while removing coal mining limits and phasing out some renewable energy sources altogether.
While ministry representatives insist the Czech Republic will still be on track to meet low emissions targets set by the European Union, the three scenarios outlined in the draft energy policy statement appear to have been formulated with financial concerns at the top of the priority list. Expensive renewable energy sources would be put on the back burner and oil and gas imports reduced, while mining for cheaper coal would likely expand.
“Individual energy sources are being discussed with regards to their impact on the GDP and competitiveness of the Czech Republic,” said Jiří Sochor, a ministry spokesman. “These are the only credible criteria. The Czech energy sector does not need ideology; it requires a rational state energy concept. Current ideological discussions in some states are one thing, their longevity is another thing, and our reality is yet another completely different thing.”
The ministry is currently refusing to release the draft, which is still being revised, and would not provide solid descriptions of the scenarios in the proposal. According to Reuters, which obtained a leaked copy of the draft, the ministry forecasts domestic electricity consumption will increase to around 80 terawatt hours (TWh) from the current 49 TWh.
To meet the growth in demand, the proposal calls for building new nuclear reactors in addition to the six currently in operation and two new reactors already planned, and the expansion of nuclear plants could put the Czech Republic on track to become an even bigger electricity exporter. In the most extreme scenario, nuclear capacity would reach 18.69 gigawatts (GW) by 2060, up from the 3.78 GW now. Analysts are skeptical that an increasingly anti-nuclear Europe will buy it – or even stand for it.
The amount of energy capacity detailed in the proposal “implies huge export ambitions,” said Jan Palaščák, CEO of Amper Stock Market, an electricity trading firm that focuses on renewable energy. The fact that the country’s state-owned energy company ČEZ operates the two existing nuclear plants is also a fact not lost on the proposal’s critics.
The costs of creating a sufficient international transmission system will be put on domestic consumers, he said, and in the end, it’s possible there won’t be enough demand for the electricity.
Following the meltdown of the Fukushima Daiichi plant in Japan, safety concerns have escalated, and an explosion at a French nulcear power plant Sept. 12 that killed one and injured four will likely add to the worry. Germany has closed eight of its nuclear plants and plans to shutter the rest by 2022. Leaders say they don’t want or need the nuclear-derived electricity for long because of plans for renewable energy development and reduced energy consumption. Austria, another neighbor, passed a law earlier this year banning the import of electricity from nuclear power and already supports 70 percent of its capacity with renewable energy sources.
“We have to respect the situation of other countries, and Germany and Austria don’t want this. There will be a lot of pressure from both those governments and the European Union to stop the building of new nuclear power plants,” said Michal Šnobr, an energy analyst at J&T Investment.
The plan also raises environmental concerns. Parts call for drastically reducing the use of some renewable energy sources, while two of the scenarios call for raising coal mining limits. Divesting in renewables at a time when nuclear is unpopular in Europe could drive an increase in coal power, said Stephen Tindale, an associate fellow at the Centre for European Reform in London.
“Germany is going to be less supportive, and the economics will look more in favor of coal than developing nuclear power,” Tindale said. “The pressure will be on the Czech government to allow more coal to burn.”
One version of the proposal would completely eliminate subsidies for solar energy, a source the government says has become unaffordable due to a boom in solar plants.
“Some scenarios outlined in the updated State Energy Concept … take into account the fact that without hefty state subsidies, solar power at its current technology level is not a viable and profitable source of energy [for investors],” Sochor said.
Solar advocates counter that the plummeting technology prices are an incentive to keep solar energy in the country’s future energy mix, and that the costs of emissions from coal use and for developing nuclear plants will outweigh the costs of investing in renewable energy.