COMMISSION STAFF WORKING DOCUMENT Country Factsheet Czech Republic Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK State of the Energy Union
Date: 2015-11-18
Institutions: European Commission, Secretariat-General
Subjects: Czechia, competitiveness, economic and social cohesion, electrical energy, energy policy, gas, innovation, reduction of gas emissions, regional cooperation, single market

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 18.11.2015  SWD(2015) 220 final   COMMISSION STAFF WORKING DOCUMENT Country Factsheet Czech Republic Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK State of the Energy Union  {COM(2015) 572} {SWD(2015) 208 à 209} {SWD(2015) 217 à 219} {SWD(2015) 221 à 243}  
 
 
Towards an Energy Union  
           Czech Republic

Macroeconomic relevance of energy 

IMPORTANCE OF THE ENERGY SECTOR 

The  macroeconomic  importance  of  the  energy  sector  is  particularly  strong  in  the  Czech  Republic 
where it accounts for a higher share of value added and employment than in the EU as a whole. The 
share of the sector in the gross value added has increased further since 2005, whereas the share of 
employment in the energy sector in total employment has decreased.  

Source: EUROSTAT – National Accounts 

According to EurObserv'ER, in 2013, the share 
of  direct  and 
indirect  renewable  energy 
related  employment  in  total  employment  of 
the  economy  in  the  Czech  Republic  was  at 
about 0.3%, below the EU average of 0.53%. 

Source:  European  Commission,  based  on  EurObserv'ER  and 
EUROSTAT 

0.00.81.62.43.24.020052012CZEU27Value added of energy sector% of grossvalue added (total economy)0.000.200.400.600.8020052012CZEU27Employment in energy sector% of total employment 
 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union – Czech Republic 

TRADE BALANCE OF ENERGY PRODUCTS 

Despite being a net exporter of coal and electricity, the Czech Republic has a negative trade balance 
of energy products, mainly driven by imports of oil, and, more recently, gas. This energy trade deficit 
is  higher  than  the  EU  average  and  in  the  past  contributed  to  the  overall  current  account  balance 
deficit (which turned into surplus in 2014). 

Source: EUROSTAT 
Note: Current account balance for EU28 from European Commission (AMECO) 

1. Energy Security, solidarity and trust 

ENERGY MIX 

The energy mix of the Czech Republic has substantially changed in the last 20 years and is now more 
diversified.  It  differs  from  the  EU-28  notably  in  its  higher  reliance  on  coal  and  nuclear  and  lower 
share of petroleum and products and gases. Compared to 1995, the share of renewable energy and 
nuclear  increased  more  than  EU  average  (from  3%  to  7.5%  and  from  8  to  18%  of  the  gross  inland 
energy  consumption  respectively),  while  the  share  of  gases  remained  at  the  same  level.  The  main 
decrease concerns the use of solid fuels (by 14 percentage points).  

Gross inland energy consumption in 2013  

Source: European Commission, based on EUROSTAT  

IMPORT DEPENDENCY 

The Czech Republic has a low import dependency for fossil fuels as a whole, below the EU average. 
However, the Czech Republic has a high import dependency on gas and oil and petroleum products. 

2 

-5-4-3-2-1012CZEU28% of GDPCoalOilElectricityGasC. A. BalanceTrade balance of energy product and currentaccount balance, 2006 -5-4-3-2-1012CZEU28% of GDPCoalOilElectricityGasC. A. BalanceTrade balance of energy product and currentaccount balance, 2014  
 
 
 
 
 
 
 
 
 
Towards an Energy Union – Czech Republic 

Based on Eurostat data, in 2013, 99.9% of imports of gas came, either directly or indirectly via other 
EU Member States, from Russia.1 The combination of a relatively low overall import dependency, but 
of  high  concentration  of  imports  from  a  limited  set  of  countries  translates  into  a  country-specific 
supplier concentration index above EU average. The Czech Republic experiences a significant energy 
trade deficit, expressed in percentage of GDP.  

Source: European Commission, based on EUROSTAT  

2. A fully-integrated internal energy market 

INTERCONNECTIONS 

The interconnection capacity for electricity was 17% in 2014 
for  the  Czech  Republic,  which  is  above  the  2020  and  2030 
targets. However, the increasing share of renewables in the 
energy  mix  calls  for  an  ambitious  investment  in  energy 
infrastructure.  Five  Projects  of  Common  Interest  (PCIs)  in 
the  electricity  sector  aim  to  increase  capacity  at  the 
country's  North-Western  and  Southern  borders  and  would 
address the issues of power flows between Germany, Czech 
Republic, Austria and Slovakia. 

Following  the  implementation  of  reverse  flow  projects, 
security  of  supply  has  substantially  improved  in  the  Czech 
Republic and Slovakia. 

Source: European Commission based on ENTSO-E 
scenario outlook and adequacy forecast 2014 
Note: Reference to 2030 target is based on 
October 2014 European Council conclusions 
stating that "the Commission will also report 
regularly to the European Council with the 
objective of arriving at a 15% target by 2030" 

1  

Top non-EU suppliers table is based on EUROSTAT data. The share of imports from non-EU countries is calculated as 
the  ratio  between  volumes  of  imports  from  that  specific  non-EU  supplier  and  total  imports  (from  EU  and  non-EU 
countries). However, according to the statistics of the National Regulator the structure of the import is 63 % from the 
Russian Federation, 35 % from EU and 2 % from Norway. 

3 

Top non-EU gas suppliers in 2013 (% in total imports)Czech RepublicEuropean Union country[%]country[%]Russia100.0Russia39.0Norway29.5Algeria9.7Qatar6.728%28%97%96%98%100%52%53%82%87%57%65%200520132005201320052013All fuelsPetroleum andproductsNatural gasCZEU28Import dependency 2013 
 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union – Czech Republic 

ELECTRICITY AND GAS MARKETS 

Market concentration index for power generation 
(left) and gas supply (right) (2013) (Herfindahl index – 
10000 means monopoly) 

Sources:ESTAT and European Commission Calculations 

Sources: European Commission based on ESTAT, CEER and 
Platts Power Vision 

The concentration of power generation, in terms of generation capacity, is at the EU average while 
the market concentration on gas is significantly higher than the EU average.  
Wholesale  electricity  and  gas  prices  in  the  Czech  Republic  are  slightly  below  the  EU  average.  In 
September  2012,  the  market  coupling  of  the  Czech,  Slovak  and  Hungarian  day-ahead  electricity 
markets was successfully launched (Romania joined in 2014). Electricity prices for all users decreased 
slightly  between  2008  and  2012.  Increases  in  network  costs  (especially  due  to  incorporation  of 
renewable  energy  subsidies)  were  offset  by  declining  supply  generation  costs.  In  the  same  period, 
gas prices for households rose, driven by increases in energy and supply costs, while between 2012 
and 2014  they experienced  a slight decrease. A moderate decreasing trend  was recorded between 
2008 and 2014 also in the case of gas prices for industrial consumers.    
In  a  context  of  decreasing  retail  market  concentration  the  switching  rates  for  electricity  and 
especially for gas consumers (the latter above the EU average) are relatively high. Czech consumers 
no  longer  only  switch  from  vertically  integrated  incumbents  to  new  suppliers,  but  also  between 
alternative suppliers to obtain the lowest price. Consumer satisfaction2 is below EU average for the 
gas retail market and trust in gas providers is the 4th lowest in the EU.  
The government has approved the National Action Plan for Smart Grids (NAP SG) as a roadmap for 
further  implementation  of  smart  grid  technologies  in  the  Czech  Republic.  According  to  this  Plan,  a 
selective and voluntary roll-out of smart meters is envisaged from 2015 to 2019.  

CONTRIBUTION OF ENERGY TO CONSUMER PRICE EVOLUTION 

Energy prices have contributed positively to inflation until recently. However, since 2013, falling oil 
prices  drive  energy  prices  and  consequently  also  consumer  prices  downwards.  This  trend  is 
observed in both the Czech Republic and the rest of the European Union. 

2  
http://ec.europa.eu/consumers/consumer_evidence/consumer_scoreboards/10_edition/index_en.htm 

10th Consumer Markets Scoreboard (June 2014),   

4 

 
 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union – Czech Republic 

Source:DG ECFIN based on Eurostat 

VULNERABLE CONSUMERS 

Based  on  the  periodical  EUROSTAT  survey  on 
income  and 
three  proxy 
living  conditions, 
indicators  were  used  to  assess  fuel  poverty.  They 
show  that  while  relevant,  the  problem  is  less 
stringent in the Czech Republic than on average in 
the  EU.  However  the  Czech  Republic  still  has  to 
define the concept of "vulnerable customers". This 
is  a  prerequisite  for  identifying  this  group  and  to 
adopting  targeted  measures  to  protect  them,  in 
particular through targeted social policies. 

Source: European Commission, based on on EUROSTAT SILC 

survey 

3. Energy Efficiency and moderation of energy demand 

ENERGY EFFICIENCY TARGET 2020  
(39.6 Mtoe primary energy and 24.4 Mtoe final energy) 

The  Czech  2020  energy  efficiency  target  is 
39.6  Mtoe  expressed  in  primary  energy 
consumption  (24.4  Mtoe  expressed  in  final 
energy  consumption).  If  the  Czech  Republic 
would  keep  the  same  trend  in  primary  and 
final  energy  consumption  as  observed  in 
2005-2013  up  to  2020,  it  will  meet  its 
indicative  national 
for  energy 
efficiency.  

targets 

 Source:  European  Commission,  based  on  EUROSTAT  and  on  national 

energy efficiency targets as notified by the MS under the EED 

ENERGY INTENSITY 

Primary  energy  intensity  in  the  Czech  Republic  has  decreased  at  relatively  fast  pace,  although  in 
absolute terms it remains well above the EU average (more than the double). A high energy intensity 
reduction is also recorded in the industrial sector, i.e. by more than 35% between 2005 and 2013 and 

5 

-20246820052007200920112013% increase on a year earlierNon EnergyEnergyAll itemsCzech Republic : Price evolution & the contribution of energy prices-10123420052007200920112013% increase on a year earlierNon EnergyEnergyAll itemsEU28 : Price evolution & the contribution of energy prices 
 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union – Czech Republic 

significantly higher than the average reduction in the EU28. This is due to a number of factors, such 
as the significant role of industry in the Czech Republic, including heavy industry, and the fact that 
the  Czech  economy  is  still  very  carbon  intensive,  with  a  predominance  of  solid  fuels  in  the  energy 
mix. With respect to industry, improvements in energy efficiency (especially in manufacturing) were 
to a large extent due to shifts towards less energy-intensive sectors.  

Primary energy intensity of the economy  

Final energy intensity in industry 

Source: European Commission based on  EUROSTAT and 

European Commission/AMECO 

Source:  European  Commission  based  on    EUROSTAT  and  European 
Commission/AMECO  

The specific energy consumption by households (per m2 of floor area, climate corrected) decreased 
by 11,6% in the Czech Republic between 2005 and 2013, but it remains above the EU average. The 
specific energy intensity of passenger cars decreased by 4,4% between 2005 and 2010 which reflects 
a more efficient usage, i.e. from the same unit of energy more passengers are transported and/or for 
longer distances.  The specific energy intensity for freight transport decreased slightly between 2005-
2010  (by  1.4%),  i.e.  from  the  same  unit  of  energy  more  goods  are  transported  and/or  on  longer 
distances.  

Final  energy  consumption  per  m2 
residential sector, climate corrected 

in 

Specific energy intensity for passenger cars and freight transport3  

Source:  European  Commission  based  on  
Odyssee database 

Source: PRIMES model background data and estimations based on EU Commission and 
EU MS inputs   

EU  legislation sets  mandatory  CO2  emission  reduction  targets  for  new  cars  and  vans.  By  2021,  the 
fleet average to be achieved by all new cars is 95 grams of CO2 per kilometre. For new vans, the fleet 
average is set at 147 g/km by 2020. 

Source: European Environmental Agency. 2014 values are provisional. 2013 EU average refers to EU-27. 

3  

Statistics  on  energy  demand  for  passengers  and  freight  transport  are  not  available  and  model  estimates  have  been 
used instead. These issues should be borne in mind when comparing energy intensity in freight or passenger transport 
between Member States, which should be regarded as merely indicative. 

6 

 
 
 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union – Czech Republic 

Regarding transport performance, in EU-28 the inland freight modal shares are 71% by road, 17% by 
rail, 7% by inland waterways and 5% by pipelines. The respective inland passenger modal shares are 
82% by private car, 9% by buses and coaches, 7% by railways and 2% by tram and metro.  Compared 
to the European average, Czech Republic reports a higher use of public passenger transport and of 
rail freight transport. 

Modal shares of transport in the Czech Republic 

Source: Eurostat and EU transport in figures 2015. Data refers to 2013. Modal shares based on tonne-kilometres for freight sector and 
passenger-kilometres  for  passenger  sector,  freight  data  based  on  activity  within  country  territory.  Estimates  are  made  when  data  is 
missing.. 

4. Decarbonisation of the economy 

NON-ETS GHG EMISSION REDUCTION TARGET 2020  
(+9% by 2020 as compared to 2005 in the non-ETS sector) 

The  Czech  Republic  has  the  same  level  of 
emissions  in  2014  as  in  2005  (based  on 
2014  approximated  data).  According  to  its 
2015  projections,  the  Czech  Republic  is  on 
track to overachieve its 2020 target, with a 
17  percentage  points  margin  between  the 
projected emission and its target. 

Non-ETS Emissions 
(vs. 2005) 

Projections with 
existing measures 
2020 

Proxy 2014 

Projections/proxy 

target 

-8% 

0% 

+9% 

+2% 

Source:  European  Commission    based  on  EEA.  Based  on  preliminary 
inventory data. 

ESD (Effort Sharing Decision) emissions are the emissions from sectors not 

covered by the EU ETS 

7 

 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union – Czech Republic 

RENEWABLE ENERGY SHARE TARGET 2020 (13%) 

With a renewable energy share of 12.4% in 2013, 
Czech  Republic  is  on  track  to  reach  its  2020 
renewable  energy  target  of  13%  renewable 
energy share in gross final consumption.  

Source: European Commission based on  EUROSTAT 

GREENHOUSE GAS EMISSION INDICATORS 

  The Czech Republic is a very carbon intensive economy.  
  The largest sector in terms of share of total emissions is the power industry (well ahead of 

 

 

the industrial sector) due to the predominance of coal in the electricity mix. 
Industry  plays  a  significant  role  in  the  Czech  economy  in  which  manufacturing  represents 
more than 25 % of value added in 2014 meanwhile this sector creates only 15 % in the EU 
GVA. 
In 2014, the revenues from the auctioning of ETS allowances amounted to EUR 55.7 million, 
out of which 50% is used or planned to be used for energy and climate related purposes.  

Largest Sectors of GHG 
Emissions in 2012 (*) 

Energy/power industry  

Transport 

Industry  

Agriculture (incl. forestry & 
fishery) 

Residential & Commercial 

Waste & others 

Czech 
Rep. 

47% 

13% 

22% 

6% 

8% 

4% 

EU 
Average 

33% 

20% 

19% 

12% 

13% 

3% 

(*)Sectoral breakdown for 2013 data not available. 

GHG Emissions 

EU ETS auctioning revenues in 
2014 (EUR millions) 

Share of EU ETS emissions in 
2013 

GHG emissions/capita in 2013 
(tCO2equivalent) 

Carbon intensity of economy in 
2013 (tCO2equivalent/EUR 
millions) 

Czech 
Rep. 

EU 

55.7 

3205 

52% 

42% 

12.3 

8.5 

825 

328 

Source: European Commission  based on EEA 

ENERGY & TRANSPORT TAXATION 

Energy  and  transport  related  taxes  as  a  share  of  GDP  are  very  close  to  the  EU-average.  The  tax 
burden of transport fuel in relation to GDP is high in the Czech Republic in relation to the EU average, 
even if it has decreased since 2005. On the other hand, taxation on transport vehicles and heat and 
electricity are below average, even though the share of the latter has increased since 2005. 

8 

 
 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union – Czech Republic 

Source: Eurostat 

5. Research, innovation and competitiveness 

RESEARCH AND INNOVATION 

The Czech Republic is near the EU average, above the US and below Japan and South Korea in terms 
of public support share allocated to research and innovation in the field of energy, and environment. 
In terms of intensity of low-carbon technologies patents, the Czech Republic is much behind the EU 
average and main worldwide partners.  

Source: European Commission based on  EUROSTAT   

COMPETITIVENESS 

Real unit energy costs (% of value added) 

The real unit energy costs4 in the Czech Republic 
decreased 
from  2000  having  an  opposite 
evolution  than  at  the  EU  average  but  it  remains 
higher than the EU average and the US.  
lowest 
The  Czech  Republic  has  among  the 
electricity  and  gas  prices  paid  by 
industrial 
customers in the EU. Electricity prices are in line 
with some of the major EU trade partners, while 
gas  prices  remain  significantly  above  US  and 
Canadian prices.   

Source: European Commission 

4  

This indicator measures the amount of money spent on energy sources needed to obtain one unit of value added. 

9 

0.01.02.03.0CZEU-28Energy & Transport related taxes % of GDP, 2005TransportvehiclesTransport fuelHeat &Electricity0.01.02.03.0CZEU-28Energy & Transport related taxes % of GDP, 2012TransportvehiclesTransport fuelHeat &Electricity17.49.58.213.813.28.814.413.78.002468101214161820CZEU27US200020092011 
 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union – Czech Republic 

Source: European Commission based on EUROSTAT and IEA 

6. Post-2020 Energy and Climate Policy Strategy – Czech Republic 

COMPREHENSIVE MEDIUM TO LONG-TERM STRATEGY (post-2020) 
FOR CLIMATE AND ENERGY 

  The Czech Republic has prepared a new long-term comprehensive energy strategy – State Energy 
Policy - that was approved by the Government on May 18th 2015. The strategic time span of the 
State Energy Policy is till 2040, with accompanying analytical and modelling documents till 2045. 
Regular  evaluation  and  possible  updates  are  foreseen  at  least  every  five  years,  based  on  the 
legally binding provisions. 

  According  to  the  State  Energy  Policy,  the  Czech  Republic  plans  to  gradually  decrease  in  a 
substantial  manner  the  share  of  coal  in  electricity  generation  and  substitute  it  primarily  with 
energy  savings  and  secondarily  with  low-carbon  energy  sources  (renewables  and  nuclear)  in  a 
sustainable and cost-efficient manner. The share of nuclear energy in the domestic energy mix is 
expected to reach 25-33% (and 46 – 58 % on electricity generation) by 2040. On the contrary, the 
share of solid fuels on energy would drop from 40% to 32% by 2020 and 11-17% by 2040 (11 – 
21 % on electricity generation).  

  The  Czech  Republic  is  also  preparing  a  draft  Climate  Protection  Policy  as  a  new  Low  Carbon 
Development Strategy which should be presented to the Government in the beginning of 2016. 

NATIONAL TARGETS (especially for 2030) 

Objective, 2030-2040 

GHG reduction  

Targets 
No 

Renewable energy share 

No 

Energy Efficiency / savings 

No 

to 

Comments 
The  State  Energy  Policy  sets  an  indicative  target  to 
reduce CO2 emissions by 40% between 1990 and 2030 
and 
the  economy 
continue  decarbonising 
throughout the State Energy Policy time horizon 
No explicit renewable energy target is set for 2030, but 
a corridor based on the economically efficient potential 
of  renewables  in  the  Czech  Republic  has  been  set 
within the State Energy Policy for 2040 for the share of 
renewables and secondary energy sources in the mix of 
primary  energy  sources  (17  –  22  %)  and  the  share  of 
renewables  and  secondary  energy  sources 
in  the 
electricity generation (18 – 25%). 
No explicit targets, just measures and policy objectives 

10 

 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union – Czech Republic 

7. Regional cooperation 

Czech Republic is involved in cooperation with Visegrad Group countries (CZ, HU, PL and SK) in the 
field  of  energy  policy,  including  gas  market  integration  as  well  as  research  activities  in  the  field  of 
nuclear power (Gen IV rectors). 

The Czech, Slovak and Hungarian day-ahead electricity wholesale markets have been coupled  since 
September  2012,  which  Romania  joined  in  November  2014.  The  price  convergence  between  these 
countries reached 76% after the launch of the market coupling. Cross-border capacity allocation for 
power  transmission  for  German,  Polish  and  Austrian  takes  place  through  Central  Allocation  Office 
GmbH. Capacity allocation with Slovakia is based on long-term nominations.  

To  bring  more  benefits  to  the  customers,  prompt  implementation  of  electricity  day-ahead  market 
coupling  between  the  two  relevant  market  areas,  e.g.  North-West  Europe  and  Czech,  Slovak, 
Hungarian and Romanian market coupling project should be pursued. 

8. Cohesion policy contribution  

The EU Cohesion policy provides for important  investment possibilities to implement energy policy 
objectives  in  the  Czech  Republic  which  will  be  complemented  by  national  public  and  private  co-
financing, aiming at optimal leverage. It also ensures integrated territorial solutions to challenges by 
supporting  capacity  building,  technical  assistance  and  territorial  cooperation,  including  the  Danube 
Region macro-regional strategy in which the Czech Republic takes part. 

Internal  energy  market:  Over  2014-2020,  EU  Cohesion  Policy  will  invest  some  EUR  200  million  in 
smart energy storage and transmission systems for electricity at high voltage, as well as around EUR 
37 million in smart electricity distribution grids in the Czech Republic. 

Energy efficiency: Over 2014-2020, EU Cohesion Policy will invest around EUR 2 060 million in energy 
efficiency  improvements  in  public  and  residential  buildings  and  in  enterprises,  as  well  as  in  high-
efficiency  cogeneration  and  district  heating  in  the  Czech  Republic.  A  further  estimated  EUR  3  040 
million will be invested in supporting the move towards an energy-efficient, decarbonised transport 
sector. These investments are expected to contribute to around 75 000 households with improved 
energy consumption classification and a decrease of around 26 862 000 kWh per year of decreased 
primary  energy  consumption  of  public  buildings,  as  well  as  to  around  100  km  of  reconstructed  or 
upgraded railway lines and 10 km of new or improved tram and metro lines.  

Decarbonisation: Overall, the EU Cohesion Policy investments in the Czech Republic over 2014-2020 
are expected to contribute to an estimated annual decrease of GHG of around 1 105 000 tonnes of 
CO2eq. Over 2014-2020, EU Cohesion Policy will invest some EUR 53 million in renewable energy in 
the Czech Republic. These investments are expected to contribute to around 100 MW of additional 
capacity of renewable energy production. 

Research,  Innovation  and  Competitiveness:  Over  2014-2020,  EU  Cohesion  Policy  will  invest 
significantly  in  R&I  and  in  SME  competitiveness  in  the  Czech  Republic.  This  will  be  based  on  the 
national strategy for smart specialisation. For the Czech Republic, the draft strategy includes a focus 
on  sustainable  and  safe  production  and  distribution  of  electricity.  At  this  stage,  at  least  EUR  153 
million  is  foreseen  for  investments  in  R&I  and  adoption  of  low-carbon  technologies  in  the  Czech 
Republic, but this might increase further in line with the evolving content of the smart specialisation 
strategy. 

11