How to break Czechia's dependence on Russian gas

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Coping with an immediate suspension of Russian gas supplies

According to research conducted by economic think tank Bruegel, thanks to record-breaking imports of liquefied natural gas (LNG) since the beginning of the year [3], Europe is indeed capable of collectively managing without Russian gas supplies for the coming months [4].

The various gas supply scenarios developed by Bruegel [5] begin on 1 March 2022, when Europe’s storage reservoirs were filled with 320 terawatt-hours (TWh) of gas. The EU’s average monthly gas demand was set at 240 TWh during the summer months and 440 TWh in March. It was assumed that gas imports from North Africa, Norway, and Azerbaijan, as well as LNG imports, would remain stable at their maximum capacities of 120 TWh/month and 140 TWh/month (drawing close to terminal limits) respectively.

On the basis of these figures, Bruegel forecast that, if imports from Russia stopped altogether, Europe would probably be able to last until autumn 2022 without experiencing severe shortages. However, the EU’s remaining suppliers would not be able to refill its reservoirs before winter. Without further measures leading to a reduction in annual consumption by at least 400 TWh, including replacement by other energy sources, we would be out of gas by February 2023.

Europe can rapidly reduce consumption with the assistance of crisis measures

According to Bruegel, the implementation of certain exceptional measures to cut EU gas demand would achieve a reduction of up to 800 TWh over the coming year, far beyond the 400 TWh required, as follows:

• Reduction of consumption in the industrial sector: 170 TWh
• Energy refurbishment and reduction in consumption in the buildings sector: 30 TWh
• Installation of photovoltaics: 30 TWh
• Installation of heat pumps: 30 TWh
• Postponement of the shutdown of nuclear reactors: 120 TWh
• Increased production of coal and heating oil: 360 TWh

As these measures would undoubtedly lead to energy price hikes, further actions to cushion the blow of rising costs would be needed. These should specifically target households and companies.

In summary, dealing with the crisis scenario provoked by a sudden end to Russian gas imports would be highly demanding and cost-intensive. However, it could be managed without the devastation of the European economy, its citizens freezing in their homes, or electricity blackouts, if the following conditions are met:

1. Achievement of the highest possible level of gas imports into Europe.
2. Coordinated distribution of gas throughout Europe.
3. Application of energy saving measures and rapid replacement of gas by other energy sources.
4. Availability of financial compensation for households and companies.

A strategic approach to Czech independence from Russian gas

As outlined above, the main focus of an emergency strategy is securing and distributing alternative gas supplies and providing consumers with financial support to offset price rises. In contrast, a more sustainable, strategic approach would be built around the third pillar: energy saving measures and the use of alternative – in particular renewable – energy sources. While such measures, for example the energy refurbishment of buildings, have a relatively minor effect over the short term, they have far greater potential if applied systematically over a longer time span.

Clearly, gas has a broad range of applications. These include domestic heating and electricity production, but also industrial use for both energy and non-energy purposes, for example as a feedstock in fertiliser production. As it is not possible for this analysis to address all of these sectors, the recommendations outlined below focus in particular on the critical realm of heating in the buildings sector and on ensuring energy supplies.

1) Reducing heat usage in the buildings sector

The heating and daily operation of buildings accounts for 40 per cent of the EU’s overall energy consumption, as well as 36 per cent of greenhouse gas emissions connected to the combustion of fossil fuels for energy purposes [6].

According to the Long-Term Strategy for Building Renovation in the Czech Republic prepared by trade association alliance Šance pro budovy (“Give Buildings a Chance”), final energy consumption in the buildings sector could be reduced by between 27 and 100 petajoules (PJ) [7]. For the sake of comparison, in 2015 the consumption of gas by individual households for heating purposes (not including that used by combined heat and power plants) was around 83.2 PJ according to the Czech Statistical Office’s energy consumption survey (ENERGO) of that year [8].

According to the most ambitious scenario, it could be possible to reduce heat energy consumption in the buildings sector by 100 PJ by 2030. That is the equivalent of a third of the gas imported from Russia (290 PJ) [9].

Measures to achieve this could include priority gas supplies for combined heat and power (CHP) plants, as well as the introduction of a tariff system to motivate consumers to reduce gas consumption.

2) Replacement of gas boilers with more efficient, renewables-based energy sources

An important, easily implemented measure would be the withdrawal of support for the installation of new gas boilers through the national boiler subsidy system (commonly called kotlíkové dotace). There is no point in supporting a heating system for which we will be unable to secure a sufficient fuel supply in the future.

When it comes to the construction of new houses, residential architects should avoid gas boilers. On the contrary, they should prioritise low-energy houses (ideally ones that meet the Passive House standard). In the case of houses with existing gas boilers, owners should certainly be encouraged to invest in quality thermal insulation. However, the main focus should be on securing alternative, sustainable heating sources which strengthen the energy self-sufficiency of our homes. Producing energy to cover one’s own consumption (including heat accumulation for thermal energy batteries) and selling the surplus back to the grid for others to use reduces not only our dependence on fossil fuels, but also our energy bills.

Biomass is currently used in the Czech Republic to produce 64.6 PJ of heat for individual households [10]. According to a 2021 study entitled Energetická revoluce (“The Energy Revolution”) [11], it could be possible for local boilers to produce an additional 10 PJ by 2030. By the same date, heat pumps, electric heating in well-constructed houses, and solar thermal water heaters could be capable of producing 40 PJ more heat that at present. Solar water heaters also save on gas by heating water, especially in summer. The overall growth potential in clean sources for domestic heating is therefore 50 PJ by 2030. That is equivalent to around 17 per cent of the gas imported from Russia.

In order to fund this transition, more money must be allocated to energy- and cost-saving programmes such as Nová zelená úsporám (New Green Savings). And we must not forget households on lower incomes. Programmes supporting measures such as thermal insulation and the installation of solar roofs must be adapted so that they are also accessible to economically disadvantaged households.

3) A new plan for the transformation of the heating industry

Most importantly, the construction of new gas-fired power and heating plants should be limited. Current support mechanisms facilitate the transition of CHP plants from coal to gas [12], [13]. A better option would be the high-efficiency use of local brown coal, for instance until 2033, the end date of the coal phase-out given by the Czech government. This extra time could be used to reduce heat consumption in the buildings sector and promote the development of renewable heat sources. Obsolete conventional coal-fired power plants must be shut down as soon as possible to provide CHP plants with longer-term access to local coal reserves.

Biomass is used to produce 26.4 PJ of heat within Czech industry and CHP plants [14]. A larger-scale solution to the gas issue would be to increase domestic biomass production. This would require the development of a new concept for agricultural land use.

An advanced decarbonisation scenario featured in Energetická revoluce [15] suggests that CHP plants and heating plants could produce up to 40 PJ more energy by 2030.

According to a model put forward by the Coal-free Czechia 2030 initiative, a further 15 PJ could be generated by large-scale heat pumps in the same timeframe [16] in order to replace coal in CHP plants. A similar approach could be adopted to reduce gas consumption in gas-fired CHP and power plants. Furthermore, the energy potential of waste heat in the Czech Republic, according to the calculations of J. E. Purkyně University in Ústí nad Labem and the National Center for Energy Saving, is 40 PJ per year.[17]

Another option would be to build local biogas plants throughout the Czech Republic, to be powered by organic waste. In total, such an initiative could generate around 2 PJ of biomethane for the production of heat or electricity.[18]

The Chamber of Renewable Energy Sources, an umbrella organisation for Czech trade associations representing the different renewables sectors, estimates that by 2030 there could be up to 10 more small CHP plants (with an average installed performance of 40 MWt and 5 MWe), and 20 more heating plants (10 MWt) that use geothermal energy. This would be contingent upon state support. In total, geothermal energy could produce up to 6.5 PJ more energy by 2030.

4) Stepping up the local clean energy production

Clean energy from local renewable sources can replace gas in the production of electricity and heat. Production from renewable sources is the cheapest form of energy generation and it enables users – in the form of households, settlements, or companies – to partially cover their own consumption.

We need an ambitious plan for the development of renewable energy sources. By 2030 it should be possible to cover at least 31 per cent [19] of our overall energy needs (electricity, heating, cooling, and transport) using renewables.

We need to establish efficient support for solar and wind energy. The government decree on supported energy sources must be amended to include solar energy on the list of energy sources that will receive operational support over the next three years, and to increase the number of wind farms receiving support.

Community- and settlement-based energy generation capacities must be developed. A new energy law must be introduced which allows the development of communal renewables-based projects with low administrative burdens, as well as the sharing of electricity within public networks.

Recommendations to the Czech government for immediate implementation

• Actively participate in European efforts to secure replacement gas supplies and fill reservoirs to ensure that European countries can make it through next winter.
• Establish a targeted social assistance programme to guarantee that all households can afford to pay their energy bills.
• Launch an awareness-raising campaign focusing on the measures that individual households and companies can take in order to be prepared for a winter without Russian gas.
• Step up investments into domestic thermal insulation and solar roofs, and make subsidies available to low-income families.
• In cooperation with trade associations, increase the capacity of the construction sector to conduct energy renovations.
• Exclude gas boilers from the boiler subsidy system (kotlíkové dotace); the funds saved could be used to subsidise heat pumps and pellet boilers. Support the use of solar water heaters.
• Use the State Energy Policy (SEP) of the Czech Republic to penalise the inefficient use of coal in condensing power plants. Secure sufficient coal to cover the needs of combined heat and power (CHP) plants as a bridging measure during the energy transformation.
• Modify the Czech Waste Act to ban the landfilling of biodegradable waste and introduce stricter waste separation obligations.
• Support the use of waste heat and the development of geothermal and hydrogen production projects.
• Add photovoltaic power plants and additional wind farms to the 2022-2024 operational support plan (the government decree on supported energy sources).
• Finalise and push through a new energy law to facilitate: (i) the establishment and operation of energy associations comprised of citizens, towns, and companies; (ii) the sharing of electricity via a distributional framework.
• Prepare a new energy concept focused on the overall decarbonisation of the power industry, the reduction of gas consumption, and the maximal utilisation of energy savings and renewable energy sources.
• Actively work to strengthen European cooperation on energy matters. The importation of gas and oil from Russia, plagued as it is by risks and insecurities, could be substituted by imports of clean energy or synthetic gases produced using renewables in EU states.

This is an abridged version of a text published by Hnutí DUHA – Friends of the Earth Czech Republic on 4 March 2022.

[1] https://ec.europa.eu/eurostat/statistics-explained/index.php?title=File:Net_imports_of_energy,_in_selected_years,_2010-2020_v4b.png

[2] Foreign trade statistics, Czech Statistical Office: http://apl.czso.cz/pll/stazo/STAZO.STAZO (code KN8 for gas is 27112100).

[3] https://www.bruegel.org/publications/datasets/european-natural-gas-imports/

[4] https://www.bruegel.org/2022/02/the-kremlins-gas-wars/

[5] https://www.bruegel.org/2022/02/preparing-for-the-first-winter-without-russian-gas/

[6] A Renovation Wave for Europe – greening our buildings, creating jobs, improving lives; Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee, and the Committee of Regions, The European Commission, 14 October 2020.

[7] Long-Term Strategy for Building Renovation in the Czech Republic, Šance pro budovy, May 2021.

[8] The consumption of fuel and energy in households, Czech Statistical Office, Prague 2017.

[9] Foreign trade statistics, Czech Statistical Office: http://apl.czso.cz/pll/stazo/STAZO.STAZO (code KN8 for gas is 27112100).

[10] Bufka, A., Veverková, J., Modlík, M. Blechová-Tourková, J.: Obnovitelné zdroje v roce 2020, Ministry of Industry and Trade 2021. (“Renewable Sources in 2020”).

[11] https://www.hnutiduha.cz/sites/default/files/publikace/2021/10/energeticka_revoluce.pdf_0.pdf

[12] Under a draft regulation proposed by the Czech Ministry of Industry and Trade, the state will help to fund the construction of 3,000 MW of gas-fired heating and powerplants. It will also subsidise conventional and CHP plants, both coal- and gas-fired, for each tonne of CO₂ produced while generating heat: around 1,500 Czech koruna per tonne at the current emission permit price. Planned support for wind power plants is only 290 MW. Subsidies for photovoltaics are not included. Minister of Industry and Trade Jozef Síkela is under public pressure to support solar energy: https://www.hnutiduha.cz/aktualne/stovky-lidi-zadaji-ministra-sikelu-o-rozvoj-fotovoltaiky-stejne-jako-prumysl-obce

[13] https://www.businessinfo.cz/clanky/modernizacni-fond-se-rozjizdi-naplno-na-transformaci-teplarenstvi-z-nej-pujde-64-miliardy/

[14] Bufka, A., Veverková, J., Modlík, M. Blechová-Tourková, J.: Obnovitelné zdroje v roce 2020, Ministry of Industry and Trade 2021. (“Renewable Sources in 2020”).

[15] https://www.hnutiduha.cz/sites/default/files/publikace/2021/10/energeticka_revoluce.pdf_0.pdf

[16] https://ember-climate.org/wp-content/uploads/2020/11/Report_Ember_Coal-free_Czechia_2030.pdf

[17] http://www.portalodpadnihotepla.cz/

[18] https://profesis.ckait.cz/dokumenty-ckait/tp-1-23-1/#literatura-7

[19] This proposed pledge of 31 per cent would nevertheless lie below the European target of 40 per cent.