Tschechische Republik (CZ)

Market LiberalisationEnergy Market Indizes (IEA)National Mix of Energy SourcesRegulatory Office ERUMarket Operator OTEDistribution System Operator (DSO)

The energy market in Czech Republic has been fully liberalized and unbundled, according to the EU Regulatory packets. This has been one precondition for the EU membership in year 2005. The energy markets in Germany, Austria and Poland have been from the beginning a market for energy exports for Czech Republic.

The EU legal unbundlings sectors

  • Production
  • Transport (TSO)
  • Distribution (DSO)
  • Sales

are separated in individual companies in Electricity and Natural Gas market. All customers have free access to supply markets now.

The major energy sources in Czech Republic are:

  • Nuclear energy, utilized in nuclear power plants in Dukovany (1000 MW) and Temelin (2 * 1 700 MW)
  • Natural Gas import via Ukraine
  • Hard coal and lignite in the coalfield in Northern Bohemia with a share of approx. 50%
  • Hydroelectric power along the country’s rivers
  • Renewable Energy based on photovoltaics and biogas

Key energy statistics, 2020

Energy production 986,8288 TJ
Electricity final consumption 66,99 TWh
Total CO2 emissions 84,34 Mt of CO2

Source iea.org

Source: iea.org

Energy Regulatory Office in Czech Republic

The Energy Regulatory Office (ERU) has been established in 2001 by the Czech Energy Act, which defines the principles and the competences of the Office.

  • It regulates prices, more precisely regulated components of energy prices, for which it issues price decisions every year.
  • According to the law, it also sets out support for renewable energy sources through price decisions.
  • It promotes competition in the energy sector.
  • It licenses energy producers, traders and other energy actors, which it then supervises.
  • It protects consumers in the energy market. Therefore, it is the right authority to which the consumer can turn when resolving disputes with his energy supplier or distributor.

For the consumer, the office is determining the regulated components of the energy cost. The ERO issues price decisions that set the regulated components of electricity and gas prices for the following year. Regulated fees mainly cover the costs of development and maintenance of energy systems, in the case of electricity, a significant share is also a contribution to renewable sources, today it is about an eighth of the total price of electricity.

The office is showing on their website www.eru.cz the break-down of total cost of energy for household customers in Electricity and Natural Gas.

Source: www.eru.cz, valid for 2021, simplified chart

*Simplified description of the chart(s): Shades of red are a regulated component, blue shades are an unregulated component of the price; both charts are valid for 2021; this is an expression of average values for (average) households, for a particular consumer the shares will always differ slightly; the charts do not include taxes.

Cost of Electricity for household customer – 2021

  • Commodity cost and Sales (unregulated): 47,75 %
  • Marekt Operator ERU (regulated): 0,32 %
  • System Services by OTE (regulated): 2,56 %
  • Support of renewable energie (regulated): 0,32 %
  • Distribution Services (regulated): 0,32 %

Cost of Natural Gas for household customer – 2021

  • Commodity cost and Sales (unregulated): 70,12 %
  • Marekt Operator ERU (regulated): 0,11 %
  • Distribution Services (regulated): 29,77%

Czech electricity and gas market operator

OTE, a.s., the Czech electricity and gas market operator, (OTE) is a joint-stock company established in 2001.

  • OTE provides comprehensive services to individual electricity and gas market players.
  • OTE commenced organizing trading in the day-ahead electricity market in 2002 and the intra-day and block electricity markets in later years.
  • OTE has been the market operator on the gas market since 2010 including operation of the day-ahead gas market and intraday gas market.

Continuous data processing and exchange required for the accounting and settlement of imbalance between the contractual and actual volumes of electricity and gas supplied and received are among services offered by the OTE to players in the Czech electricity and gas markets, as well as administrative procedures associated with a switch of the supplier.

Key business activities:

  • Evaluation, billing and settlement of imbalances between the contracted and metered electricity and gas supply or consumption,
  • Organization of the short-term electricity and short-term gas market in cooperation with the transmission system operator also the organization of the regulating energy balancing market,
  • Compilation of monthly and yearly reports on the electricity market and monthly and yearly reports on the gas market in the Czech Republic,
  • Compilation of reports on future projected electricity and gas consumption, and on the method of ensuring a balance between electricity and gas offer and demand,
  • Preparation of documents for draft Electricity Market Rules and Gas Market Rules,
  • Ensuring real values of electricity and gas supply and consumption for market participants,
  • Ensuring preparation of load profiles in collaboration with distribution systems’ operators,
  • Drafting of market operator’s business terms for the power sector and for the gas sector,
  • Billing and settlement of regulating energy and balancing gas including billing during emergencies.

Source: www.ote-cr.cz

DSO – Electricity market in Czech Republic

The type and amount of fees are determined by the central state authority in the field of energy market regulation – the Energy Regulatory Authority (ERÚ, úřad). Within a given component, these are the following types of charges:

Distribution fee and reserved capacity. Since liberalisation market participants are entitled to choose their Natural Gas supplier freely, energy distribution remains a regulated and licenced business segment due to the natural monopole of physical Natural Gas distribution networks. The distribution fee covers the cost of transporting gas through the gas pipeline from the transfer stations to the offtake point (i.e. your household). The distribution fee consists of two components: fixed and variable. The fixed component includes a monthly fee, the amount of which does not depend on the amount of gas taken.

While after liberalisation market participants are entitled to choose the electricity supplier freely, energy distribution remains a regulated and licenced business segment due to the natural monopoly of physical electricity distribution lines. The electricity distribution market has been mainly affected by

  • the history of the development of the electricity industry during the communistic area by state owned companies
  • the opening of the electricity market in the 1990’s.
  • the privatisation of the industrial segments of Czech Republic by acquisition of companies by foreign investors
  • legal unbundling due to European legislation

In the Czech Republic, three distribution companies manage distribution

  • ČEZ (blue areas on the map) in the area of,
    • West-Bohemia
    • North-Bohemia
    • East-Bohemia
    • Zentral-Bohemia, except the area of capital city Prague
    • North-Moravia
  • E.ON (red areas on the map) operates in the south of the Republic in the area of
    • South-Bohemia and
    • South-Moravia, and
  • in Prague belongs the distribution network of PRE (white area on the map).

Several small distribution areas are existing within former closed industrial complexes.

DSO – Natural Gas market in Czech Republic

The Natural Gas distribution market has been mainly affected by

  • the history of the development of the Natural Gas industry during the communistic area by state owned companies
  • the opening of the Natural Gas market in the 1990’s
  • the privatisation of the industrial segments of Czech Republic by acquisition of companies by foreign investors
  • legal unbundling due to European legislation

In the Czech Republic, now three main distribution companies are managing the distribution in three areas: distribution for most of the country is provided by

RWE (blue area on the map), represented by licenced Natural Gas DSO GasNet s.r.o., in the area of,

  • West-Bohemia
  • North-Bohemia
  • East-Bohemia
  • Central-Bohemia, except the area of capital city Prague
  • North-Moravia
  • South-Moravia

E.ON, represented by licenced Natural Gas DSO EG.D, operates in the south of the Republic in the area of

  • South-Bohemia and

in Prague and surroundings belongs the distribution network of Pražská plynárenská a.s. (PPAS) (white on the map), represented by licenced Natural Gas DSO Pražská plynárenská Distribuce a.s..