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By ratifying the Kyoto Protocol in 2001 the Czech Republic has committed itself to reversing the damaging effects of climate change. A major element of the Kyoto Protocol is the enhancement of energy efficiency and conservation.

The new Prime Minister Vladimir Spidla said that his government should work out a new privatisation scenario for the energy sector

The Czech government has approved a merger of the Czech national power utility CEZ with eight regional power distribution companies in an effort to make CEZ more attractive for foreign investors and help the company survive tough competition on the European market. However, the opposition has severely criticised the decision, which they say is detrimental to Czech consumers.