The European Commission recently introduced a draft of the revised EU ETS Directive which, among other things, proposes that 100 % of ETS revenues should be used for environmental measures. We welcome this idea but we’re also sceptical about how the ETS revenues are used in the Czech Republic. Therefore, we have prepared an analysis mapping the use of ETS revenues in Czech Republic and sent it to the European Commission as an input for the recent public consultation. The main conclusions are presented below.
Czech law states that 50 % of ETS revenues has to be used for environmental measures, which are enumerated in the ETS Directive. For 2021 the Czech government decided to cap this share at CZK 8 bn. (EUR 310 mil.), the rest of the revenues are considered income to the state budget. In case ETS revenues are higher than CZK 16 bn. per year, as predicted for 2021, there is potential for non-compliance with the ETS Directive, which requires at least 50 % of ETS revenues to be earmarked for climate-related projects.
Information about projects supported from ETS revenues is not publicly available, we assume that some of the means flows into the state budget and aren‘t used for environmental measures. Furthermore, ETS revenues dedicated to the Ministry of Industry and Trade, are used for continuous operating support for photovoltaic projects from the 2010s, which does not have any incentivising effect for the energy transformation. This support would have been paid anyway.
This spring, the European Commission's ETIP SNET platform released a study on the impact of energy communities on the grid. The analysis was followed up in August by the major pan-European CIGRE conference, where study authors discussed their findings with energy experts, including scientists and grid operators. They concluded that well-structured energy communities could benefit the grid if supported by the regulatory framework and other market participants.
The study on the sustainability disclosures of 100 influential companies from high-impact sectors provides an early reflection on the general readiness for businesses in the EU to meet the expectations of the upcoming EU sustainability rules and standards. Our report contributes to identifying the main challenges, as well as to highlight emerging good practices.
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