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New Czech Renewable Energy Policy to Bust the Solar Boom with a 50% Subsidy Cut

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Czech Republic came out with a Renewable Energy Framework which will finish off the Solar Sector in the country if passed in the current form.Czech despite its small size has become the 3rd largest market for Solar Energy in Europe driven by high Feed in Tariffs.These guaranteed electricity rates have led to  a Boom in the country due to IRRs in excess of 30%.The Parliament had already overwhelmingly voted to overhaul the country’s Solar FITs in March.In the new plan submitted by the Czech government to the EU,there are limits imposed on each type of renewables  biomass,solar,wind etc with emphasis given to Biomass Energy.Czech Republic has a EU set  target of 13%  Energy generated from Renewables.Wind and Solar Industry Groups have already started crying blue murder as the proposed FIT in 2011 for Solar will be cut by almost 50%.This will make it almost uneconomical for a solar  installer to put solar panels in the country and  don’t be surprised if you see a 90-95% drop in 2011 Czech Demand compared to 2010.

The whole story of Czech Boom and future Bust is predictable and has already been played out in countries like Spain and Greece earlier.Like Spain,Czech electricity customers might see a 10-15% rise in electricity prices due to the high guaranteed payments to mushrooming solar installations.With the Czech Republic,implementing a Fiscal Austerity program involving pay cuts to public workers and other severe cuts in public expenditure,such huge payments to Renewable Energy seems an unnecessary luxury.Some more thought and preparation by the authorities would have avoided such a Failure.

Czech government adopts plan to rein in renewables – Reuters

The Czech government approved a renewable energy framework plan on Wednesday aimed at curbing the kind of subsidies that have led to a solar boom that ranks as Europe’s third largest.

The plan, adopted late in the day, calls for a cap on tariffs for solar energy of about half the current level and seeks mandatory recycling of old solar panels. It also seeks annual limits on subsidies for wind and solar power.

The legislation came after the combination of a drop in the price of solar panels and high fixed tariffs brought the return on the initial investment for some plants down to as little as three years.


Sneha Shah

I am Sneha, the Editor-in-chief for the Blog. We would be glad to receive suggestions, inputs & comments on GWI from you guys to keep it going! You can contact me for consultancy/trade inquires by writing an email to

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