Feed-in tariff (Act on the promotion of the use of renewable energy sources)
Updated: 17.06.2016
Author: Ursula Melicherova
Please note: In August 2013, the Czech Parliament amended Act No. 165/2012 (Regulation No. 310/2013) which de facto abolished the feed-in tariff scheme for all technologies except small hydro by the end of 2013. New PV installations and biogas plants are only being supported if put into operation before 31 December 2013 (§4 par. 10 Act No. 165/2012). Wind, hydro, geothermal or biomass plants put into operation before 31 December 2015 will be eligible for support (Transitional provisions no. 1 and 2 Act No. 165/2012).
In the Czech Republic, renewable electricity generation from plants up to 100 kW (30 kWp in case of PV or 10 MW in case of hydro power) is supported through a feed-in tariff. Plant operators may choose between a guaranteed feed-in tariff and a green bonus paid on top of the regular electricity price achieved in the market (see also "Premium Tariff"). Every electricity producer may make this choice once a year (§ 8 par. 2 Act No. 165/2012). Responsible for the payment of the feed-in tariffs are the “mandatory purchasers” selected by the Ministry of Industry and Trade. To be able to enforce their claim for the feed-in tariff, plant operators are obliged to conclude an agreement with the grid operator.
Eligible technologies
In principle, the feed-in tariff scheme applies to almost all renewable electricity generation technologies. However, there are some restrictions (§ 4 par. 4 Act No. 165/2012).
According to the latest amendment to Act No. 165/2012 (Regulation No. 107/2016), newly constructed renewable energy plants with a maximum capacity of 100 kW, with exception of small hydro power plants, are eligible for the feed-in tariff under condition that they are put into operation before 31 December 2015 (Transitional provisions No. 2 Act No. 165/2012). I addition, requirements for minimum efficiency of energy use do not apply for geothermal, solar, wind and hydropower energy plants (§ 4 par. 4 Act No. 165/2012).
| Wind energy | Eligible under following conditions: - The maximum capacity must not exceed 100 kW (Transitional provisions No. 2 Act No. 165/2012).
- Process equipment, mainly rotor and generator shall not be older than two years (number 1.9.1 Price Decision of the Energy Regulatory Office No. 9/2015).
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| Solar energy | Eligible under following conditions: - Only installations on rooftops or façades are eligible and the maximum capacity must not exceed 30 kW (§ 4 par. 5d Act No. 165/2012).
- The installation must have been put into operation until 31 December 2013 (§ 10 Act No. 165/2012).
- Only one installation per rooftop or façade is eligible (§ 4 par. 5d Act No. 165/2012)
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| Geothermal energy | Eligible under following conditions: The maximum capacity must not exceed 100 kW (number 1.9.1 Price Decision of the Energy Regulatory Office No. 9/2015). |
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| Biogas | Eligible under following conditions: - The electricity has to be generated in a CHP plant using biogas from more than 30% of other crops than herbage and crops from targeted growth on arable land. It should also secure the efficient use of at least 50% of the primary energy generated by the biomass from which the biogas is produced (§ 4 par. 5 c Act No. 165/2012).
- The installation must have been put into operation until 31 December 2013 (§ 4 par. 10 Act No. 165/2012).
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| Hydro-power | Eligible up to a maximum capacity of 100 kW (Transitional provisions No. 2 Act No. 165/2012). |
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| Biomass | Eligible under following conditions: - The electricity has to be generated in a CHP plant (§ 4 par. 5 b Act No. 165/2012).
- Only pure biomass firing in new electricity generating plants is eligible (number 1.7 Price Decision of the Energy Regulatory Office No. 9/2015).
- The maximum capacity must not exceed 100 kW (Transitional provisions No. 2 Act No. 165/2012).
- The installation must have been put into operation until 31 December 2012 (Transitional provisions No. 2 Act No. 165/2012).
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Amount
The amount of payment differs for every source of energy. The tariffs listed below are excluding VAT (General information – Price Decision of the Energy Regulatory Office No. 9/2015).
| Wind energy | From 1 January – 31 December 2010: CZK 2523 (€88) per MWh. From 1 January – 31 December 2011: CZK 2468 (€82) per MWh. From 1 January – 31 December 2012: CZK 2 414 (€ 73) per MWh (No 1.9 Price Decision of the Energy Regulatory Office No. 9/2015) |
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| Solar energy | From 1 January 2014, the feed-in tariff for new PV installations has been abolished. Tariffs for PV installations put into operation until 31 December 2012 are as follows: From 1 January – 31 December 2010: CZK 13801 (€511) per MWh for installations with a capacity of up to 30 kW. From 1 January – 31 December 2010: CZK 13692 (€507) per MWh for installations with a capacity above 30 kW. From 1 January – 31 December 2011: CZK 8280 (€306) per MWh for installations with a capacity of up to 30 kW. From 1 January – 31 December 2011: CZK 6517 (€241) per MWh for installations with a capacity between 30 to 100 kW. From 1 January – 31 December 2011: CZK 6073 (€ 225) per MWh for installations with a capacity above 100 kW From 1 January – 31 December 2012: CZK 6669 (€ 247) per MWh for installations with a capacity of up to 30 kW. (number 1.10 Price Decision of the Energy Regulatory Office No. 9/2015) The feed-in tariff for PV installations put into operation between 1 Jan 2010 and 31 Dec 2010 is subject to a tax of 10% (§ 18 a Act No. 165/2012). Exception: Installations with a capacity of up to 30 kW (§ 17 Act No. 165/2012). The tax applies to all electricity generated from 1 Jan 2014 (§ 14 Act No. 165/2012). |
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| Geothermal energy | There are still no price definition for geothermal |
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| Biogas | From 1 January 2014, the feed-in tariff for biogas plants has been abolished. Tariffs for biogas plants put into operation before 31 December 2012 are as follows: - Landfill and sewage gas: CZK 2794 (€ 103) per MWh
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- Biogas plants put into operation by 31 December 2011: CZK 4120 (€152) per MWh
- Biogas plants put into operation by 31 December 2012: CZK 3550 (€ 131) per MWh
- Combustion of mine gas from closed mines: CZK 2794 (€ 103)
(number 1.8 Price Decision of the Energy Regulatory Office No. 9/2015). Biogas plants using anaerobic fermentation: - Put into operation until 31 December 2012 and simultaneously producing and effectively using thermal energy: CZK 4120 (€152) per MWh
- Put into operation between 1 January and 31 December 2012 and not producing thermal energy CZK 3550 (€ 131)
(number 1.8 Price Decision of the Energy Regulatory Office No. 9/2015) |
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| Hydro-power | - Small and reconstructed hydro: CZK 2652 (€ 9.1) per MWh if put into operation by 31 December 2012
(number 1.6 Price Decision of the Energy Regulatory Office No. 9/2015) Small hydro at new locations: - CZK 3388 (€ 125) per MWh by 2010
- CZK 3313 (€ 123) per MWh by 2011
- CZK 3453 (€ 128) per MWh by 2012
(number 1.6 Price Decision of the Energy Regulatory Office No. 9/2015) - Small hydro at existing locations: CZK 2652 (€ 98) per MWh if put into operation from 1 January 2005– 31 December 2012
(number 1.6 Price Decision of the Energy Regulatory Office No. 9/2015) |
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| Biomass | The amount of the tariff varies according to the technology used: - Pure biomass firing plants at new locations: CZK 2630- - 4580 (€ 97-169) per MWh
- Pure biomass firing plants at existing locations: CZK 1460 - 2830 (€54-104) per MWh
- Pure biomass firing plants: CZK 2530 - 3900 (€94-144) per MWh
(number 1.7 Price Decision of the Energy Regulatory Office No. 4/20132014) |
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Addressees
Eligible party: The persons eligible for the purchase of electricity exported to the grid are the producers of electricity from renewable sources (§ 8 par. 2 Act No. 165/2012).
Obligated party: The “mandatory purchaser” is obliged to purchase the entire amount of electricity eligible for support (§ 10 par. 2 Act No. 165/2012). The mandatory purchaser will be selected by the Ministry of Industry and Trade from electricity trading licence holders (§ 2 u Act No. 165/2012).
Procedure
| Process flow | If a given plant operator chooses to be supported through the feed-in tariff, he shall conclude a contract with the grid operator. |
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| Competent authority | The scope and amount of the promotion of electricity from RES shall be defined by the Energy Regulatory Office (§ 4 par. 7 Act No. 165/2012). |
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Degression
The Energy Regulatory Office determines the feed-in tariffs for the individual technologies used for the generation of renewable electricity for the calendar year to come (§ 12 par. 1 Act No. 165/2012)
The Energy Regulatory Office has to ensure that the simple return of investment period shall reach 15 years (§ 12 par. 1 a Act No. 165/2012) and the profit rate for one unit of electricity from RES is stable from the day of the commissioning until the end of the eligibility period; including an annual inflationary adjustment of 2%. This does not apply on biogas, biomass and biofuels (§ 12 par. 1 b Act No. 165/2012).
Cap
In the year in which the plant was put into operation, the feed-in tariff shall not exceed CZK 4,500 (approx. € 164) per MWh (§ 12 par. 6 Act No. 165/2012).
Eligibility period
The tariff for all eligible technologies is statutorily guaranteed for 20 years. Hydro-energy plants are exempt from this rule, as their tariff will be paid for 30 years (Regulation No. 296/2015).
Distribution of costs
| Consumers | In principle, the grid operators are obliged to bear the costs of the feed-in tariff scheme. In practice however, they pass on the costs arising from the support of renewable electricity generation to the end users. |
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| Distribution mechanism | Consumers – Grid operators. The costs arising from the feed-in tariff scheme are borne by consumers through a surcharge (“příspěvek na obnovitelné zdroje”) added to the electricity price. This surcharge was lowered through the latest amendment of Act No. 165/2012 and set at a maximum amount of CZK 495 (approx. € 18) per MWh (§ 28 par. 5 Act No. 165/2012). Grid operators – Market operator. The transmission and distribution grid operators are obliged to reimburse the market operator all expenses for the transmission and distribution of electricity in order to cover the costs associated with the support of electricity (§ 13 par. 1 Act No. 165/2012). Market operator – Mandatory purchasers. The market operator is obliged to pay the mandatory purchaser the difference between the feed-in tariff and the hourly market price as well as an additional price according to the amount of electricity obligatorily purchased from the RES plant operators (§ 13 par. 2 Act No. 165/2012). Mandatory purchasers – RES plant operators. The mandatory purchasers are obligated to reimburse the plant operators for the electricity they feed into the grid (§ 10 par. 2 Act No. 165/2012). |
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