Electricity sharing in Czechia represents a relatively recent but increasingly popular phenomenon. With the implementation of the regulatory framework that enables the formation of Energy Communities (ECs) starting in July 2024, 20 ECs have already been established. In addition, the law also activates the possibility of energy sharing by “an active consumer”. What does the existing regulatory framework entail, and what challenges does it encounter?
According to the Elecricity Data Center (EDC), over 12,000 individuals registered for electricity sharing in the first three months since this option opened in July 2024. In the first 100 days of electricity sharing, people shared 750 MWh of electricity, which would cover the consumption of approximately 2,300 Czech households.
The existing legislative framework in the Czech Republic permits two forms of energy sharing: one by an active customer and the other through energy communities. In the first case, power plants are managed by active customers who produce and distribute (share) electricity. These are typically households, businesses, and municipalities. This type of sharing is set up by registering with the Electricity Data Center (EDC) and enables customers to share electricity with up to 11 grid connection points (EANs).
A sharing group can comprise several power plants and consumption points from different active customers. For instance, it may involve a city's consumption point along with its contributory organizations. The sharing arrangement made up solely of active consumers has no territorial restrictions and is limited only by the maximum of 11 grid connection points between which electricity can be shared.
ECs are associations of members with agreed rules for sharing produced electricity, established through mandatory registration with the Energy Regulatory Office (ERO). In this framework, power plants are either run by the energy communities themselves or by their individual members.
ECs can be organized as cooperatives, associations, or similar structures like limited liability companies, with a maximum of 1000 participants per sharing group. Until July 2026, energy sharing is restricted to three neighboring regions (municipalities with extended powers) or the capital city of Prague.
There are two types of energy communities: the Civil Energy Community (named “energy community” by the Czech Energy Law) and the Renewable Energy Community. The former can generate electricity both from renewable and other sources whereas the latter operates exclusively based on renewables but besides electricity, it can produce heat and gas as well.
The Electricity Data Center (EDC) serves as the main hub for overseeing data related to electricity sharing. It gathers and analyzes data regarding electricity usage and generation. It assesses whether sharing has taken place by using information from electricity meters.
Every consumption and delivery location participating in electricity sharing is required to have a smart meter installed. These meters assess both electricity consumption and production at 15-minute intervals. The local distributor installs these meters at no cost, with a deadline of three months for installation.
The EDC collects and manages information related to electricity consumption, production, and trading in the energy-sharing framework. Data is transmitted to the EDC on a daily basis. The EDC analyzes this data and distributes it to other stakeholders in the market. It enables rapid communication among electricity distributors, producers, market operators, suppliers, and future flexibility aggregators. However, it is critical to note that such data is not shared with the ECs. It processes large volumes of standardized data in a few minutes, however; yet is still unable to provide them in real-time.
The EDC allocates electricity for multiple consumption points, requiring participants to register in its system. Currently, energy communities use a static sharing method, allocating electricity based on fixed ratios, leading to higher bills. However, groups of up to 50 EANs can utilize an iterative method for more dynamic sharing across five iterations. Groups over 50 EANs must stick to the static method with predefined shares. From July 1, 2026, however, it should be possible to use a hybrid method of electricity sharing.
The current regulatory framework does not allow discounts for energy-sharing participants. Thus, both active consumers and energy communities still have to pay the full electricity distribution fee, although given their status, they end up paying for some services included in the distribution fee structure they do not actually benefit from.
On the other hand, the law does not prohibit introducing such discounts through administrative regulation. Hence, the Energy Regulatory Office (ERO) may introduce them in a new tariff structure for low-voltage levels starting in 2026.
The current regulatory framework has a notable weakness in that it still allows energy suppliers to potentially exploit consumers. Although the updated law removed a clause that permitted providers to alter contracts in unfavorable ways, there is still a need to prevent unfair practices in the energy market and to reinforce the ban on discrimination against energy-sharing participants.
However, as the preparation of the amendments to the current regulatory framework is ongoing, there is hope for a better future embedding of a provision that would ensure the full protection of the consumers. The most desirable format of such a change would be the incorporation of a clause strictly prohibiting the consumer’s discrimination.
A notable challenge within the current regulatory framework is the restriction that limits each consumption point or production facility to connecting with only one sharing group. Exploring ways to revise this limitation could enhance flexibility and promote greater collaboration among different groups.
Join us for our upcoming conference to engage in meaningful dialogue on shaping a sustainable and competitive future for the EU.
Several German ministries led by the Socialist and Green parties have sent a letter to the EU Commission with the objective of rolling back European legislation on corporate sustainability reporting. This legal framework will be applicable to 27 EU Member States as of January 1st, 2025, but German parties, immersed in electoral and political infighting, are using this legislation to promise quick, but dysfunctional solutions.
This study examines the sustainability disclosures of 15 leading financial market participants (FMPs) and 45 associated investment products complying with the Sustainable Finance Disclosure Regulation (SFDR). It provides critical insights into Art. 8 and 9 products’ objectives and methods, highlights key challenges and emerging best practices.
