August 16, 2013 / 12:16 PM / 6 years ago

Czech house votes to curb growth of solar power subsidies

PRAGUE, Aug 16 (Reuters) - The Czech lower house voted on Friday to end support for renewable power plants that start operation after Jan. 1, 2014, in the latest effort to curb subsidies that have saddled businesses and consumers with higher electricity prices.

The proposal, which has yet to be approved by the Senate and signed by the president, does not affect solar, wind, hydro and biomass operations that connect to the grid before the cut-off date.

The new law will also require renewable companies to reveal their ownership to obtain support. The amendment was designed to clamp down on abuse of the generous subsidies by firms with unidentified owners, following media speculation that politicians have also benefited.

“This says that whoever wants ... to apply for support, then they must submit very clearly who is the owner of these business entities,” said Milan Urban, a Social Democrat lawmaker who is the party’s expert on energy issues.

Subsidies have helped the Czech Republic become one of Europe’s biggest solar nations but have also ratcheted up electricity prices for consumers and businesses.

In 2013, renewable power plants are expected to get subsidies of around 44 billion crowns, or roughly 1.1 percent of this year’s estimated gross domestic product, paid partly by consumers and the state budget.

Czech lawmakers in 2010 approved a 26 percent tax on solar plants that had started in 2009 and 2010 to reduce the drain on government revenue. The measure was set to expire at the end of 2013, but under the proposed law the tax will continue at a lower rate of 10 percent on solar power plants that started up in 2010.

The new law also sets a ceiling of 495 crowns ($25.27) per megawatt-hour on the price consumers will pay as part of their electricity bill, down from a current 583 crowns per MWh.

Due to this measure, the overall costs of feed-in tariffs will remain the same, but the state will increase its share of the total by 4 billion crowns from 11.7 billion in 2013, according to a government estimate. (Reporting by Jan Korselt; editing by Jane Baird)

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