Czech industry ministry prepares new measures against solar power companies to curb renewables costs

A further wave of clampdowns on Czech solar power and other renewables companies is in the wind. But the companies, cast as villains and profiteers for the high subsidies paid out of electricity bills, have powerful allies and the proposed bill is getting a tough ride.

Photo: Miloš TurekPhoto: Miloš Turek If it were a blockbuster crime or mystery novel, the twists and turns in the Czech solar industry saga would be hard to beat.

Alleged murder threats to the boss of the energy regulator Alena Vitašková; she herself accused in court aiding some of the bad guy solar energy barons to make millions; mysterious faking of solar panels to make them pass as more productive; and US spy satellite photos of solar plants to show their state of development.

The sun, it seems, never sets on the continuing, rather sorry, tale of tens of billions of crowns a year that could probably have been better spent. The latest chapter is focused on a highly controversial proposal for a new energy law which has been hatched in the Ministry of Industry and Trade under Jan Mládek. The news was announced as the main story on the daily Dnes on September 24.

The minister, it seems, believes that the burden of supporting electricity produced from renewables, mostly solar, should be shifted away from heavy industry and onto small and mid-sized consumers and households. There is also the latest move in many against solar power companies with the idea that for different types of production should be capped at a credible level given their capacity.

The Czech regulator suspects that some companies have been boosting their renewable power earnings by falsifying their electricity production figures to unbelievable levels given the shy and hesitant character of the sun when passing above the Czech countryside. Some solar companies may have added extra panels or secretly upgraded their existing ones to boost electricity production, it adds.

Perhaps they might also be following the ruse uncovered by Spanish power regulators, which found that solar companies had installed run of the mill power generators to produce extra electricity and pocket the high extra rewards for ‘green’ power. Anyway, the rewards calibrated according to normal solar panel output and average Czech sun performance are seen as a solution to this possible fraud.

The proposed new energy law is not, however getting an easy ride. Hundreds of amendments have been proposed to it and it has not yet progressed through the government’s legislative council, a sort of clearing house where proposals are sifted before they go onto the weekly Cabinet meeting. That looks as though it could make it difficult to get the new law in place for the start of 2015, as Mládek would apparently like.

And it seems that the solar companies are not alone in their opposition. Some of the many banks which made sizable loans to the solar companies to get them started and operational are also, it seems, are now worried that the profitability of the firms is now endangered and the hundreds of millions in outstanding loans owned to them could also be threatened.

If the latest moves force some solar companies to the wall then the banks will not be that happy taking over their assets and joining the ranks of the so-called solar barons. It is appearently a mantle they will find difficult to shake. Solar power companies say the clampdown and uncertainty in the industry means that potential foreign buyers of Czech solar plants have already been scared off and that there are no buyers out there.

According to Czech solar power lobby CZEPHO, the sector is already in crisis thanks to the windfall taxes, cuts in support, and curbs put on companies in recent years. Hardly any new solar capacity has been built in the Czech Republic this year, it says.