On Monday 22 December, the European Commission announced the deepening of an investigation into the public support that the Czech Republic plans to grant for the construction and operation of two new nuclear reactors at the Dukovany site in the south-east of the country.
While at this stage the Commission considers the project to be necessary and capable of fostering the development of economic activity, the EU institution nevertheless expresses doubts about the proportionality of the aid package, its impact on competition and its compliance with EU law, particularly as regards the concept of contracts for difference (‘CfD’).
The project involves the commissioning of two nuclear units, each with a capacity of up to 976 MWe, by 2036-2037. It is supported by Elektrárna Dukovany II, which is 80% owned by the Czech state and 20% by ČEZ.
The public support envisaged combines a low-interest state loan covering the entire construction costs, estimated at between €23 and €30 billion, a 40-year two-way Contract for Difference and a risk protection mechanism linked to possible policy changes.
The Commission wants to ensure that the planned public aid does not go beyond what is necessary to make the project viable and that it does not encourage excessive risk-taking by the State. It is also concerned about possible effects on competition, in particular a strengthening of ČEZ’s position on the electricity market. (Original version in French by Bernard Denuit)