In the previous article, we highlighted a new European Commission study titled Impact of Communities on the Grid: How Integrated Energy Communities Enhance Grid Flexibility and Support Electricity Market Development, which suggests we should aim to establish fully integrated energy communities. Could we achieve this in Czechia? And what are the paths to this goal? Here, Jan Bakule, a lawyer and energy specialist, explores the options.
Electricity sharing in Czechia is still in its early stages. The amendment to the Energy Act, known as "Lex RES 2", only came into effect on January 1, 2024, and electricity sharing became possible as of August 1, 2024. According to official data from the Electricity Data Center (EDC), in September 2024 alone, a total of 150 MWh was shared, with approximately 4,000 production facilities and 3,500 points of consumption involved. The total number of EDC registration applications has already reached 10,500. The growth of larger communities, however, will be gradual, as sharing currently operates mainly in active customer mode.
Through the Community Energy Union (UKEN), we have worked to ensure that community energy legislation is effective in practice. Thanks to these efforts, Czechia now has a functioning legal framework for electricity sharing, as demonstrated by the data above. With nearly 100 member organizations, UKEN shows that interest in community energy in Czechia is strong.
As we’ve previously discussed, international experience and expert studies show that a key goal for the further development of energy communities in Czechia is to enable communities not only to share electricity but also to provide flexibility (adjusting production or consumption when the grid is unbalanced). Solutions for this can be found at regulatory, technical, and market levels.
Providing flexibility will only be feasible with the introduction of “flexibility aggregation". In the future, such an aggregator will pool individual entities willing to adjust their consumption or production when needed, offering this flexibility to grid operators in exchange for financial compensation.
Currently, we are awaiting the approval of the "Lex RES 3" law, which will introduce this new element into the energy sector. The law is expected to be adopted by Parliament as soon as possible, hopefully by the end of this year.
Afterward, it will be essential to secure the entire system from both technical and data perspectives, which requires the activation of new services by the Electricity Data Center (a joint project by ČEZ Distribuce, EG.D, PREdistribuce, and ČEPS). The target date for this is mid-2026.
From this point, communities should also be able to provide flexibility to the grid operator, for which they would receive appropriate financial compensation. However, combining electricity sharing and flexibility provision must be achieved in the next two years. This will primarily be the responsibility of the Electricity Data Center, which has to implement information systems to enable this combination technically.
There are also market-level barriers to developing energy communities. In Czechia, some electricity traders have even begun to consider penalizing customers for sharing electricity. Therefore, suppliers need to start viewing communities as an opportunity rather than a threat and adopt innovative approaches to utilize their flexibility.
This shift is supported by the fact that traders have transparent access to community consumption and production data via smart metering installed for each member. Suppliers who learn to work with this data early on and predict community energy behavior will lead in this market and gain a whole new customer base. In practice, we are already seeing some progressive electricity traders embrace this concept.
Thanks to the amendment to the Energy Act, Lex RES 3, energy communities will be able to offer their flexibility to aggregators in the future and, if they meet legal requirements, even become aggregators themselves. This is one path energy communities can take to better support the modernization of our energy system.
For communities to be able to engage in this service in practice, they will need the Electricity Data Center to technically enable them (and other participants) to provide flexibility. The market itself, especially electricity traders, will also need to seize this opportunity. Research indicates that the potential of energy communities is significant, and we must learn to fully leverage it.
After 18 hours of negotiations, the European Parliament, Council of the EU and European Commission reached a political agreement this morning on the Corporate Sustainability Due Diligence Directive (CSDDD). The decision was preceded by a four-year long legislative process at European level and builds on national laws in France and Germany.
In the context of the last phase of the negotiations on the Corporate Sustainability Due Diligence Directive (CSDDD), Frank Bold initiated a multistakeholder statement together with the Responsible Business Alliance (RBA) and Shift.
Today, the European Parliament successfully fended off efforts to reject the European Sustainability Reporting Standards (ESRS), a key legislative piece to ensure the effective application of the Corporate Sustainability Reporting Directive (CSRD) and the transitioning efforts in the context of the Green Deal. A majority of 359 Members of the Parliament voted against a motion to reject the ESRS and its replacement with an emptied and diluted piece of legislation.
