Coal and gas development still a possible future in Czech Republic

In the Czech Republic, as in other Central and Eastern European countries, national energy companies for decades have driven dependence on coal and are now promoting themselves as key players for a gas-based energy transition. These companies have been building coal-fired power plants and mines for years thanks to the financial support of banks and insurance groups, including Assicurazioni Generali. Generali still invests 368 million $[1] in the coal sector and in the past, in the Czech Republic, it insured the Počerady coal power plant, one of the most polluting in Europe. A few days before Generali’s Shareholders’ Meeting, Radek Kubala, campaigner at the NGO Re-set, tells us how the plans of these companies represent an obstacle to a just energy transition in the Czech Republic and inquiries about the role that banks and insurance companies will play.

Russian aggression in Ukraine has disrupted not only the normal lives of people in Ukrainian cities, but also the perspective of energy transformation in whole Europe. Many states in the European Union are still dependent on Russian gas and oil, and the beginning of the war put a spotlight on the fact that this dependency can be toxic. Moreover, most of the EU states discussed the end of coal and in that process, they have counted with Russian gas as transition fuel.

The Czech Republic is among the countries which acquire most of their gas from Russia. This fossil fuel flows through the pipelines stretched over Slovakia and Germany, and it gets stored in storages operated by corporations like EPH. However, gas is not the main energy source in the Czech Republic as approximately 80% of energy are generated from coal and nuclear sources.

Nevertheless, the country also started preparing the coal phase-out. After years of protests of various environmental NGOs and climate grassroot movements, the Government created the Coal Commission, and thorough discussions about the end of most dirty fossil fuel became one of the most important ongoing public debates. After some rigmarole, the new Government decided that coal phase out will be scheduled for year 2033.

In the light of this decision, the biggest energy corporations in the Czech Republic started to imitate the strategy of most western fossil giants and came up with the plan to switch from coal to gas. Major Czech energy company, such as ČEZ that is partly owned by the state, create new plans for their internal energy transition that rely on building new gas capacity mostly in heating sector.

Owned by oligarch Pavel Tykač, Sev.en energy is the second biggest energy corporation in the Czech Republic and operator of the dirtiest Czech power plant Počerady. They do not want to stay behind, and Tykač said in various interviews he sees future of his company in gas. One of his considered options is to rebuild Počerady from coal to gas, or build a new big gas power plant in the Počerady area. It is very symbolical as the Počerady plant is one of the main priorities for the Czech climate movement and it can become the most visible symbol of coal to gas transition in the country.

Sokolovská uhelná, the third biggest energy company in the Czech Republic, already started their reconstruction of the Vřesová coal power plant into a big gas power plant. Their plan is to continue in transition of their coal assets into gas assets. Furthermore, there is also the EPH energy company owned by Czech oligarch Daniel Křetínský which is one of the biggest gas transporter and producer in whole Europe. EPH is one of the main owners of gas pipelines and storages in Central and Eastern Europe and also one of the biggest coal companies in Europe. This company is not very present in the Czech Republic, but they are active in proposing new gas infrastructure as it supports their profits relying on gas transportation from Russia.

The beginning of the war shook with the decarbonization plans in whole Europe, which also applies to the Czech Republic. Some politicians started to question the Czech coal phase-out date as one of the top priorities for domestic politics is to decrease gas dependence on Russia as soon as possible. The Minister of industry Josef Síkela contemplates about the opportunity to build a new gas pipeline to connect the Czech Republic with possible new LNG terminals in Poland, Germany or Slovakia.

Faster energy transition based on energy efficiency, building insulation and development of renewables are also in game. Almost all politicians count with new nuclear blocs in the Dukovany power plant, but this plan is down the road yet – it would take years and will not help us in the current situation. Also, new nuclear will be expensive and dangerous.

To sum up, the gas boom is still high possibility for the Czech energy future. Most likely, it will not be gas from Russia, but possibly LNG from other states. Prolonged use of coal can be also a real scenario, while fast energy transition into clean energy and savings are also in the picture. One of the main actors that will decide the next steps in Czech energy policy will be banks and insurers. Will they support fossil juggernaut, or will they boost clean future?

[1] The data, as of 01.01.2022, was compiled by ReCommon based on financial research conducted by Profundo B.V (

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