ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC102 1035. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
energy storage).
will be active for fewer hours and generate less electricity over
on continuous operation and on low variable costs which com
planning of and investments in the sources with long construc
tion periods.
5.
IMPACT OF ENERGIEWENDE
ON THE CZECH POWER SECTOR
5.1 Energy security and unscheduled
An additional imminent issue complicates the relations between
tricity streaming from Germany through the Czech network (as
well as those in Poland and other states) complicates the secu
rity and economic situation of the transmission system opera
production/consumption regulation and investments in backup
a common European energy market has strengthened these
(predominantly) business trends.
25
This therefore increases the impor
25
large volumes of electricity. Despite the growing investments made by the
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC104 1055. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
These mechanisms differ for various models of market integra
tion and there are intensive negotiations on the European level
Capacity Allocation and Congestion Management CACM).
physical path of least resistance in the line.
1) Unequal distribution of the production and consumption
capacities. Because of the favourable climate conditions
transport the electricity from there to the more southern
industrial centres.
transport the required electricity volumes.
3) Germany’s growing export caused by stable or slightly de
creasing consumption and increasing production. Electric
as well as to the Balkan countries.
by Germany and Austria at the beginning of the common
EU energy market construction with the aim of strength
ening competitiveness and liquidity. The bidding zone is
are no expected weak points which would hinder the
transmission of electricity. The individual bidding zones
(traditionally the individual states) have mechanisms
capacities.
A problematic situation arises when trading large vol
umes of electricity from the north of Germany to Aus
tria and beyond. Germany and Austria made 28% of all
mon bidding zone of Germany and Austria and prob
is transferred through the networks of the neighbouring
countries.
work stability. There are technical limits for network stability
tion of the transport capacity in case of unforeseen circum
because of the more complicated network stabilization. The
frame is provided by the fact that from December 2014 to
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC106 1075. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
tions. This is approximately 2.5 times the costs for the entire
2012/2013 year.
man border. A similar facility is being built at the Röhrsdorf
the models and trade rules which are being created on the EU
CACM and one other).26
Preservation of the common zone is
seen by the aforementioned operators as the fundamental ob
stacle to further market integration in the region.
If the problem is not resolved on the regulatory level it will
be necessary to wait until the German domestic network is
which are able to transport large electricity volumes across Ger
many is crucial for the success of the EW itself. The exigency
increases with the approaching shutdown of the remaining nu
clear sources in 2022 (these sources are generally located in the
central and southern parts of Germany).
The Power Grid Expansion Act (EnLAG – Energieleitung
26
in fact it would be integrally divided.
27
the development of which is absolutely crucial
for EW and therefore should be sped up. This represents a total
of 1855 km of lines.
Energiewirtschaftsgesetz)
established new procedures for network
prepare plans specifying future network development and re
Germany is aware of the exigency of the domestic network
issue and the pressure for development is apparent. Lengthy
it can be expected that development will remain slower than
planned.
5.2 Price signals
– the Czech market is perpetually the recipient of the German
price. In addition to the assumption that price and price expec
tations are the main factors based on which electricity produc
ers in the liberalised markets (such as the Czech market) make
that German Energiewende’s impact on German prices directly
shut down in the Czech Republic.
27
One of them was later removed because it was not necessary.
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC108 1095. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
Tab. 8: Electricity production in 2013 (TWh)
662
5.2.1 Market interconnecting and price convergence
sion grids of the region are mutually interconnected and this
results in the sensitivity of the individual markets to develop
ments which take place in other markets. Czech electricity trade
zone prices which the Czech Republic adopts.
28
of mar
28
Market coupling is the term for one of the steps when forming integrated
regional markets. Based on the coordinated calculation of prices and elec
capacity allocation. The basis is represented by an implicit auction where
given region and reduction of the differences between the electricity prices
signals to create it.
these markets is based on the principle of implicit allocation of
for the following day in all four market areas without the neces
for their transactions.
lation to the price differences. If the price in the Czech Republic
German electricity. This causes an increase of electricity supply
against the demand and the scarcity of electricity on the Czech
of German electricity and consequent price fall will last until
the price difference between Germany and the Czech Republic
is balanced and continued exchange loses its economic attrac
in the Czech Republic motivates merchants to purchase in the
Czech Republic and to sell in Germany until the demand on the
Czech market is weakened by this behaviour to such an extent
which is connected through the same mechanism to the Czech
Republic)29
are in fact the same.
29
Slovakia is also interconnected with the Czech Republic by the formalized
4M MC which makes the trade between both countries easier. The reason
the 4M MC states fully converge only during hours in which electricity de
tant with respect to the total volume consumed – typically during weekends
and at night.
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC110 1115. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
base load
wholesale electricity prices remain low. The low prices are the
chapter 2.1); and low coal prices.
In the environment where conventional sources predominate
this would mean a “seasonal deviation” – the low prices would
put a halt to the investments into new sources and would prod
the shutdown/conservation of those sources which are unprof
itable in the long term; this would lead to a decrease in supply
and to an increase in price. This already happens on the German
development of RES is not intended to shut down the conven
tional power plants but rather to replace them with the renew
to 90 GW of newly installed capacity from wind and solar power
plants by 2030.
This alteration of the production portfolio will probably keep
the electricity price rather low in the coming years. Its growth to
the period in which the electricity price on the German (and
marginal power plants. Coal prices are currently kept low due
to the overproduction on the North American market and low
prices of coal substitutes (namely natural gas). From this point
of natural gas production in the USA which results in higher
Fig. 40: Competition between natural gas and coal.
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC112 1135. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
prices and the subsequent increased demand for an alterna
compete with coal in the European environment (see Fig. 40).
(3) The price of emission allowances will increase or some other
tool for the valorisation of carbon dioxide emissions will be
introduced.
5.2.2 Price volatility
Advancing penetration of the RES into the system also means
the transformation of the price schemes of the electricity mar
kets. The schemes were traditionally build on two basic catego
base load
peak load sources with high variable costs used to cover time
limited periods of higher consumption.
low variable (fuel) costs. The renewable sources have zero varia
ble costs – they only produce electricity when natural or techni
cal conditions permit.30
of RES development will mean that these sources will be able to
satisfy an increasing portion of electricity demand (for a certain
part of the day) – the current per hour record of RES electricity
at 10 to 20% (see Fig. 41).
30
for these prices.
Fig. 41: The share of conventional and renewable sources in total
provides enough space for the current conventional sources to
duction capacity which is not covered by the renewable sources
duction curve and zero variable costs (meaning that the RES
both the real time demand for the capacity which supplements
RES production and the price of this supplementary electricity
will change.
situations in which the RES share of electricity production in
ity of conventional sources (the ability to quickly increase or de
crease the output to balance the variations of RES production).
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC114 1155. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
sources with low capital costs. Lower price predictability and
lower electricity demand will discourage investors from devel
oping expensive (and thus risky) sources. Investments which
there are higher variable costs.
Both these consequences will threaten the position of the
plants is low and the initial investments are high. In a model
where conventional power plants can earn toward their opera
produce electricity almost continuously with only small tech
means to operate them.
investment costs lower investment risk and the possibility of
of price increases during decreased RES production.
5.3 Compatibility of the Czech energy strategy
with the new market situation
This is not a new idea; there was a call in the Czech Republic
plant which was cancelled in 2014 because of doubts about the
new nuclear units at existing nuclear power plant sites with a
necessary for international discussion of the issue.” (Ministry of
solving the problem of investors’ unwillingness to participate in
electricity prices will increase in the future to a level where the
in the form of a “contract for difference” where the difference
between the market price and the price necessary to cover the
costs of the power plant is paid to the operator probably by
the consumer through an increase in the regulated part of the
According to Minister
the energy sector is based on the idea that the currently low
construction of the new sources necessary for future energy
security. The Czech Republic could see a shutdown of a signif
although new capacities would not yet have been built. Accord
ing to Minister
commence the construction of one nuclear block in the Duk
ity of a further extension to two blocks in each locality”. (Czech
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC116 1175. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
5.3.1 Compatibility with EU law
ing for new nuclear power plants is controversial. The Czech
as the EU law sees that as state aid distorting the market.
the state would initiate an increase in the regulated part of the
retail electricity price and transfer this income to the plant op
erator to foster the plant’s competitiveness (similar to how it
currently deals with the renewable energy sources).
ence scheme does comply with the EU law either. When ap
European Commission made it clear that its decision should not
be perceived as precedent for similar ventures elsewhere in the
of making these sources competitive would be carried solely by
those in the Czech Republic.
support of nuclear source development compatible with other
Promote a highly competitive environment in the electricity
of access to the market.
strictions and barriers) has on the price of electricity. If any
on the consumer and does not place the Czech energy sector
at a disadvantage within the Framework of the internal elec
There is a nearly universal rule in the Czech debate that energy
Ensuring essential energy supplies for consumers in normal
EU; the aim is to guarantee the rapid restoration of supply
in the case of outages and also to guarantee full provision
of supplies of all forms of energy to the extent necessary to
keep the economy functioning in “emergency” mode and to
keep the population supplied in any emergency situations.
The Supplementary analytic material of the SEP then outlines
the following indicators for monitoring the progress toward the
1) Emergency reserves of the primary energy sources
2) Development of the expected capacity reserve
energy production)
4) Import share of the particular primary fuels
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC118 1195. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
5) Import dependency (the share of net import on the con
sumption)
countries with better supply security statistics can eventually
be more reliable than the supply provided by domestic produc
a serious blackout threat during the summer of 2015 when the
(SAIDI, minutes)
pendency does not automatically mean a security risk. This is
ple demonstrates. Let’s imagine a European country with the
teristics intuitively correspond with the countries of the for
mer Eastern bloc where there is a strong tendency to consider
dependency on Russian gas import to be a security problem.
sided import dependency (on Great Britain) to be a security
problem.
Fig. 43: Compliance with N-1 formula (2013)
Czech Republic is the exact opposite of Ireland. Despite the
facts that the greatest gas crises of the recent decades (2006
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC120 1215. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
the capacity of direct interconnection with Germany as one of
the Europe’s biggest markets exceeds multiple times the Czech
The fear of import dependency makes even less sense in the
power sector. Because of the laws of physics and the physical
and 5.2.1) the Czech electricity market is an integral part of a
larger regional market. This means that the electricity gener
ated in the Czech Republic is physically present and as well
present and traded in the Czech Republic (see chapter 5.2.1).
Interconnecting the networks and markets has the indisputable
Chap. 1.5.6).
summer 2015 shows that the real threats of supply security are
Remaining Capacity
minus Adequacy Reference Margin as a part of Reliably
Available Capacity. It also adds a regional analysis which
Remaining Capacity minus
Adequacy Reference Margin 31
based
on the best available information on the future development
individual countries are diverse. States such as Austria or Ro
mania will have a more than 20% reserve of reliably availa
Poland and Slovakia will lack the reliable available capacity to
cover peak consumption in the same period. But if we consider
32
the miss
ing capacity from the surplus neighbouring markets is possible.
analysis of generation adequacy; both in January 2025, Scenario B
31
32
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC122 1235. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
Czech Republic and Switzerland may simultaneously re
quire import in the winter period under the assumptions
of Scenario B in 2025. Import from all countries directly
Germany possibly requiring the most import. The total of
whilst there is ample import capacity available on the exter
It is quite surprising how strongly the Czech energy strat
the SEP itself states that “The operability of energy sources is
also almost entirely dependent on broad international coop-
ble
cross-border trade mechanism,” (Ministry of Industry and
Create a regional electricity and gas market in the region
the integration of the internal energy market in the EU and
eliminate all barriers between member states and regions.
Support the rapid integration of the electricity market on
the principle of implicit auctions throughout the Central
and Eastern Europe (CEE) region and its connection with
the stability of the electricity market. Owing to its geostrate
in market integration and the creation and coordination of
market mechanisms and institutions.
Ensure the full implementation of directives and regulations
on the internal market in all EU countries. Particularly as re
Integrate network development (including involvement in
planning the development of European transmission in
5.3.3 Long-term planning
Probably the biggest weakness in the Czech energy strategy is
current and expected electricity market uncertainty. The SEP
trend in energy on the global scale is the high degree of un
certainty concerning future political and economic develop
concerning environmental and climate protection.
The European electricity market is currently at a crossroads.
Further development will focus either on completion of the
market and capacities and creating a separate a mechanism
providing signals for investment. It is not currently clear
what the future model will be like. If this change comes to
next 20 years.
The fundamental problems of the energy market are the
high risks associated with rapid changes in European leg
islation and unstable market signals generated by a num
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC124 1255. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
ber of distortions in the market and the promotion of po
pp. 4–5)
– a method which facilitates decision making in complex and
continuously changing systems (such as the energy sector).
A scenario analysis is typically a set of possible future scenar
ios which attempt to anticipate all possibilities of future de
velopment (one of which will likely occur) with a certain rate
scenario analysis is valuable for decision makers because it
provides enough different future alternatives to both aid in
the development of strategies which will lead to the preferred
scenario and to adapt to the situations outlined in the other
the actualized scenario for a given phenomenon in relation to
33
33
ined phenomenon) can be formulated in which we focus on the market ho
favourable or unfavourable reg
ment will be four scenarios – two for market balance (high supply + high de
+ low demand) and one for a seller‘s market with market tension features
(low supply + high demand). The value of such a scenario set is that it covers
all variants and allows regulators to plan the related policies with respect
to the real development of the issue and the expected consequences of the
particular scenarios.
The scenarios suggested by the SEP fail in doing so. Their
opposes the SEP’s ambition to determine the desirable shares
of individual sources in electricity production – the SEP states
that “
acceptable direction to be taken in the development of the
tion
in the Czech Republic. The corridor concept is therefore
a means of quantifying the possible variability of the results
parameters in the variant.”
uisites) which are the amounts of electricity produced from the
sented by the corridors.
works with internal factors (those originating in the Czech en
ergy policy) while external factors are omitted. These external
electricity markets (not only the Energy Only Market versus
tricity consumption.
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC126 1275. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
Factors missing in the SEP
although in total contradiction with the prerequisites of the
scenarios.
Fig. 45: Energy commodity price according to the SEP
when converted into internationally accepted units34
the price of oil should have risen from US $74 a barrel to US
35
oil was US $79 a barrel; it then rose to US $110 a barrel where it
i.e. US $67 a barrel less than predicted.
interval of US $119–128 a barrel only once. This was in 2008
when it rose from US $115 a barrel in the beginning of May to
a sharp drop to US $34 a barrel at the end of December. Thus
the average price for 2008 reached US $98 a barrel. There have
been two other instances during the past 150 years when oil
ond oil shock in 1979 and between years 2011–2013 when Arab
economic recovery in the United States all coincided. In that
investments into new production capacities but not too high as
to prod the transition to other fuels and thus threaten OPEC
34
Applied average exchange rate for 2014 was 20.75 CZK/US$.
35
the prices have again returned to approximately the same level.
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC128 1295. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
US $100 a barrel over the long term.
“During the preparation of this document, a range of possible
model in order to outline the future development of the energy
sector in the Czech Republic. These scenarios are based on the
balance model. […
possible Czech reactions to one static image of the European
and regional energy sectors in the interval between the years
Tab. 10: Power production corridors by 2040
duced and the remaining load divided between the renewable
sources and gas. The SEP states that “State Energy Policy must
ibility
to promote new technical and economic development.”
5.3.4 Focus on nuclear energy
5.3.4.1
Investment risk related to the construction of new nuclear
requirements of the nuclear industry itself in combination with
the uncertainty of future price levels.
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC130 1315. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
only several percent. It is important to note that whereas fuel
a highly sophisticated engineering product. In the nuclear fuel
powered by four reactors built only for the purposes of the plant.
– Fuel consumption depends less on the power plant output
variation.
It can be deduced from these characteristics that nuclear
advantage over other sources. This is because the source em
ployment merit order mechanism used to satisfy the current
and that the electricity price margin needed to operate the plant
is very low. Therefore in reality the nuclear power plants (price
takers) accept the prices formed by the variable costs of the
for the nuclear industry and renewable sources.
total 88.5 TWh of gross electricity generation will come from
2010 2015 2020 2025 2030 2035 2040
Black
coal
6052.0
coal
23366.2
1130.5 1130.5 1130.5 1130.5 1130.5 1130.5
fuels
RES 10122.3 15125.6
Total
RES) increases between 2010 and 2040 from 39% to 72% of
gross electricity generation (the source development corridors
of the SEP work with an interval of 64–83%). The price takers
lay in the planned withdrawal from the coal energy industry (the
amount of brown and black coal based electricity production is
otherwise play the role of marginal producer pushing the price
higher. The SEP expects that coal and gas prices are to remain
this would correspond to electricity prices of €40–55/MWh.
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC132 1335. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
share in the energy mix in 2040; this is equivalent to the situ
with the construction of the new nuclear blocks and RES devel
compensate for the construction of the new nuclear units.
the new blocks is very uncertain. The SEP itself expects the
price will stay at CZK 1000/MWh in 2020 (€36/MWh accord
riod from 2030 to 2040 the price will stay within the interval
CZK 1700–2000/MWh (€61–72/MWh). (Ministry of Industry
These prices would be too low to commercially build a nu
the “not unreal” contract for difference price; during confer
terval at €90–100/MWh. This price level approximately corre
It is again worth noting that during recent decades base load
electricity prices have only reached a “not unreal” level once.
Asia culminated. These concerns were accompanied by many
with the economic crisis and development of unconventional
natural gas and renewable electricity sources. For the rest of
This means that the electricity price only reached the level
sion and expectations of increased demand surplus over supply.
the Czech energy sector replaces current and expected electric
SEP itself expects wholesale electricity prices of €61–72/MWh.
tiations between the state and the company assigned to building
to ensure the electricity supply for a price which would not bur
the so called mining limits and continue with coal production
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC134 1355. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
and heating plants will be in danger as early as in 2022.” (Patria
coverage of the growing electricity consumption in the Czech
An increase in electricity consumption is expected by the SEP
tify the construction of the new nuclear units. The greatest
nearly 13%.
Tab. 12: Electricity consumption structure (TWh)
2010 2015 2020 2025 2030 2035 2040
10.0 10.3 10.5
15.0
0.0 0.0 0.1 1.2 2.3
But this does not correspond with the development of elec
consumption has remained stable at between 22 and 26 TWh
36
both during the 2001–2006 growth period and the
2006–2013 recession.
Tab. 13: Electricity consumption, total energy consumption and
Year 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
22.3 22.6 26.0 25.3 25.2 22.2 23.6
NA NA 111.6 115.1 100.0 NA
126.1 100.1 103.5 NA
0.6 1.0 1.1 1.2 1.0 1.1 1.2 1.2 1.2
36
The data difference of the SEP and ERO is mainly the result of the different
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC136 1375. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
Total industrial energy consumption has shown a decreasing
55% while at the same time the industry GVA increased by 84%.
(of the whole economy) should decrease by 45% between the
of industry electricity consumption at 13%; this would imply the
growth of industry GVA to a not unrealistic CZK 1.7 trillion in
sumption decrease can to a large extent be assigned to the crisis
The trend of delinking economic (industrial) performance and
energy consumption which is typical for most of the developed
world remains the main uncertainty. While this widely applies
the electrical power intensity of the Czech economy will most
likely follow the same path as the overall energy intensity.
consumption is closely related to the issue of generation ade
quacy. Generation adequacy refers to capacity which is available
peaks.
The
ENTSO-E report warns that only the scenario that counts on power balance in compliance with the SOAF requirements. If
no new system base load sources were to be built beyond those
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC138 1395. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
now under construction, after 2030 the Czech Republic would
lose its ability to cover domestic consumption through domestic
generation.
it derives future generation adequacy based on current infor
mation on production capacity development and shut down.
the sources which have already been approved or constructed.
ably expected. Therefore it is not surprising that in the longer
market “visions” for the year 2030. These are envisaged as the
possible alternatives of market development based on currently
are not prognoses and they do not predict generation adequacy.
2020 and 2050. It is possible to anticipate that one of them will
p. 128)
states that by 2025 it will be necessary to build other sources
apart from those which had been approved or were under con
the year 2025 and beyond. Thus it is not possible to state that
its ability to cover domestic consumption through domestic
generation.”
import enough electricity to cover all peak consumption. Also
ities will emerge during that time.
The new production capacities will of course result from any
are under consideration. It will be impossible to build nuclear
facilities in such a short time (see chapter 5.3.3). The short
optimistic prediction which challenges the 15 year approval and
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC140 1415. IMPACT OF ENERGIEWENDE ON THE CZECH POWER SECTOR
construction period of a nuclear plant. (Ministry of Industry
plete process of nuclear power plant construction are about
20 to 22 years in the Czech environment. Renewable source
They therefore remain at the other end of the construction time
spectrum.
If in the middle of the next decade the generation capacity
the nuclear sources planned for 2032 to approximately 2038
will start up shortly after the investment wave in the 2020s and
ardise their return on investment and increase the likelihood
that power from the new units will end up being exported. After
and its launch was covered by the sources with more operative
power exports are nearly equivalent to the plant’s production.
pect of the nuclear energy industry results not only from its un
precedented long approval and construction time but also from
received state support in the form of contract for difference for a
the renewable sources share of consumption from 50% in 2030
market is going to look.
5.3.5 Summary
It can be concluded that the present Czech energy strategy rep
resented by the SEP is not a suitable instrument for determining
the direction of Czech energy sector development in the com
common European gas and electricity markets (chapter 5.3.2).
The SEP implicitly expects that the Czech state has full control
over the Czech energy industry and therefore it dares to predict
both wholesale and retail electricity prices in the Czech Republic
for the 2015–2040 period as if prices were to be determined by
same applies to the prices of internationally traded commodities
high even by the OPEC countries themselves. The comparison
made for the year 2015 in which the real and SEP predicted
average prices differ by US $67 a barrel proves that it is not
to mention using them as a model for the state’s future energy
needs.
sponsible planning and risk balancing. The scenarios which
ENERGIEWENDE: CURRENT STATE, FUTURE DEVELOPMENT AND THE CONSEQUENCES FOR THE CZECH REPUBLIC142 143
German electricity markets or the share of renewable sources in
the SEP uses these scenarios as to support their decision to base
of lengthy licensing and construction times and public funding
ter 5.3.3); it is the least compatible with the regional market sit
uation (chapter 5.2.2) and potentially contradicts European law
that the market (onto which the new nuclear units are planned
to be placed in 2032 and which will be held with state support
until at least 2057) will probably be totally different than either
tury (chapter 5.2).
The bottom line is that these weaknesses represent logical
beyond 2025) and fundamental internal inconsistencies. The
it urges opening and integrating power markets as much as
countries that reach far better scores in supply reliability than
6.
EUROPEANISATION
implementation does not happen in a vacuum; the German en
ergy sector is a part of European Energy Policy (EEP) and it both
37
political elites have primarily focused on EW implementation
in Germany itself. The EU dimension – implementing the pol
icy in the European context – has been left aside. This is also
demonstrated by the limited progress in this area. Although the
number of sources pointing out the need to integrate EW and
38
the priorities and instruments
of implementation are described only very generally.
use the materials and knowledge from the previous chapters and
37
which the energy policies of member states are created in relation to the
European Energy Policy.
38
The Energiewende – Germany‘s gamble. (2012). OIES.;
Fischer – Geden. Moving Targets. (2014). SWP Research Paper.; Fischer
– Geden. Die Deutsche Energiewende europäisch denken. (2011). SWP Ak
et al.
Beginnings. (2013). OSW Report. Die
Energiewende in Deutschland. (2012).; BMWi 10-Punkte-Energie-Agenda
des BMWi. (2013).; Deutschlands Zukunft Gestalten
– Koalitionsvertrag. (2013) et al.