Czech government to lay out plans for state energy trader

Published: 19.09.2022 Related countries:  Czech Republic Czech Republic, Germany Germany

Soaring energy prices in Europe are endangering business and households.

The Czech government will lay out plans next week for a state energy trader to procure supplies for schools, hospitals and other public institutions ahead of winter as prices soar, Industry Minister Jozef Sikela said on the 4th of September.

He did not say how long it would take to establish the state trader, but that it would be ready to procure energy for public institutions for the new year.

"I will start an agency very quickly, and the first task of this agency will be to buy energy for the public sector," he said during a discussion on a television news program."On Wednesday, I will inform the government about the steps we have prepared and we will choose one of the options, which we will then formalize. I prefer the fastest option, namely the establishment of an agency."

Europe's electricity costs have soared since Russia curbed gas supplies to Europe, sending prices of the fuel sharply higher. Russia said on Friday one of its main gas supply pipelines to Europe would stay shut indefinitely.

Power prices were already scaling new records almost daily, with Germany's benchmark contract breaching 1,000 euros per megawatt hour for the first time last month, leaving governments scrambling to protect households and businesses.

Sikela also said he had approved applications from Czech investment group EPH and Sev.en Energy for loans to help cover margin requirements.

The Czech government said in July it would help state-controlled CEZ to finance electricity and gas trade before the peak demand winter season via a credit agreement worth up to 3 billion euros ($2.99 billion).

Sikela did not specify the amount of the aid for EPH and Sev.en, which are owned by Czech billionaires Daniel Kretinsky and Pavel Tykac respectively.

Delivered by CzechTrade Canada
Source: Reuters