EU criticizes ‘retro’ solar tax

Minister Kocourek refutes EC’s arguments against the 26 percent solar energy tax, claims it will spur investment

Čestmír Klos 7.3.2011

EU Energy Commissioner Günther Oettinger and EU Commissioner for Climate Action Connie Hedegaard have sent a letter to the Czech Minister of Industry and Trade Martin Kocourek (Civic Democrats, ODS), expressing concern about the “retroactive” nature of the new Czech law on solar energy, which introduces a 26 percent tax on energy produced by photovoltaic plants connected to the grid in 2010 and 2009.

The server has published excerpts from the letter, and Kocourek has reportedly sent a reply. Hedegaard and Oettinger are concerned that the new tax on solar energy that came into effect this year will have a negative impact upon investment into alternative energy in the Czech Republic, and result in the country failing to fulfill its commitment to raise its share of alternative energy produced to 13 percent.

According to the Kocourek’s spokesman, Pavel Vlček, in his response the minister refuted the commissioners’ concerns, arguing that the tax on solar energy will have a positive impact on investment in alternative energy; before the introduction of the new tax, photovoltaic energy had an unfair advantage and thus now other alternative energy sources will become more competitive.    

In their letter the commissioners recognize the right of the Czech Republic to adjust the conditions for the alternative energy market. Nevertheless, they express concern that the new law is retroactive. In his response, Kocourek denied that this is the case: “The deduction [of taxes] will not apply to electricity produced in the past; therefore, it’s not possible to speak about a legally unacceptable retroactive provision,” quoted Kocourek as saying in his letter.

Hedegaard and Oettinger also expressed concern that similar taxes could be introduced for other alternative energy sources and that the Czech policy may be adopted by other EU countries.