“You cannot keep the grid together without coal now, neither in three years, nor in five,” Tykac said. “The government must offer some solution and it is not up to me to come up with it.” — Reuters
PRAGUE: Czech lignite coal-fired plants will be running at a loss from 2026 but remain indispensable for the national grid for some time and the government needs to tell the sector soon if it will provide aid to keep them operating, a major investor says.
Pavel Tykac, the Czech billionaire owner of the Sev.en company that has bet on investments in lignite plants and mines near the end of their lifespan, told Reuters that necessary spending on maintenance meant he needed to know by the end of the year whether they would run a few years longer.
The spread between the cost of power contracts from 2026 and carbon allowances that coal-based producers must buy has shrunk to single or low double-digits in euros per megawatthour.
Rising supplies from renewable resources mean coal plants operate fewer hours per year, which reduces emissions but raises the burden of their fixed costs.
“As the number of hours we are in the money gets smaller, spreads from 2026 show that it is out of the question that we will make profit,” Tykac, whose net worth is US$8bil (RM35.6bil) according to Forbes, said in an interview.
Like the rest of the European Union, Czechs are phasing out coal, but Tykac said there were several thousand hours per year when coal plants will be needed – especially in winter when demand is high while solar and wind plants may not produce much.
“You cannot keep the grid together without coal now, neither in three years, nor in five,” Tykac said.
“The government must offer some solution and it is not up to me to come up with it.”
State aid will be complicated as it is not acceptable for coal-fired plants, Tykac said, but there may be some ways through long-term purchase contracts or otherwise to ensure the necessary plants will operate until they are not needed.
The Czech government plans to shut down coal plants by 2033, but Tykac said this would happen much sooner unless the government stepped in.
The country relies on coal, mostly lignite, for about 40% of its electricity output and is a net exporter.
This will change as coal plants gradually close, and there is small capacity in gas plants.
Imports are possible but may not be sufficient due to various grid capacity bottlenecks, and there may also be lack of output under unfavourable winter weather conditions in the region, Tykac said. — Reuters
