Russian gas imports: Czech Republic and Slovakia scramble to find alternatives | Business | Economic and financial news from a German perspective | DW
Czech and Slovak households have been using natural gas as an energy source for decades. Until recently, many viewed gas as an affordable, reliable, and relatively environmentally friendly way to keep their homes warm.
Almost all the gas used in the Czech Republic and Slovakia comes from Russia. But ever since Moscow launched its war on Ukraine, the EU has been pushing to drastically reduce imports from Russia.
However, this represents a serious challenge for the Czech Republic and Slovakia. How will people heat their homes? And how will their industries manage without gas?
Czech households have been asked to increase their advance payments for gas deliveries next year. They are significantly higher than in the past. It is clear that the cost of gas is increasing considerably. Czechs and Slovaks living in small single-family homes face advance payments of €200 to €300 ($214 to $321) a month – sums that low-income households struggle to afford.
And it could get worse.
“It would be very difficult to store European gas reserves if Russian gas deliveries ended before the summer, because it would be impossible to catch up with 40% of Russian gas overnight,” the Czech security czar said. energetic Vaclav Bartuska.
“Germany, the Czech Republic and other countries face a similar problem, even though private households and critical infrastructure sectors would be the last to see their gas supply cut off.”
Vaclav Bartuska is in charge of Czech energy security
Booming heat pumps
Countless Czech homes are now considering installing heat pumps. Running such a heating system is currently 20 to 30% cheaper than using gas. Heat pumps also have the advantage over other alternatives such as coal or wood, which have become 20% and 60% more expensive respectively.
Heap pumps are also in demand because they are partially subsidized by the Czech state. Low-income households may see almost all of the costs covered by the state, but no more than €4,000 ($4,290).
Czech companies installing the heating systems report an increase in demand compared to last year. Many are already booked months in advance.
Heat pumps like these are also installed by German owners
“After Russia invaded Ukraine, we saw a dramatic increase in interest in heat pumps; demand has increased almost tenfold compared to last spring,” said Marek Blaha, who runs the one of the country’s leading heat pump companies, IVT Tepelna cerpadla, at the information portal idnes. .cz. Each year, his company installs thousands of systems.
Bartuska says providing enough electricity to run them should be no problem. “The Czech Republic always produces more electricity than it uses; we export around 10 to 12 terawatts–hours of electricity each year”, explains the energy expert.
In Slovakia, the situation looks much more complicated. While the state has announced a subsidy program for households wishing to install heat pumps and the interest is substantial, the funds promised are anything but. “Only 15 million euros ($16 million) have been made available, and without state support most households cannot afford the initial cost,” says Ronald Izip, editor-in-chief of Trend, a Slovak business magazine.
That explains why, he says, most households still stick to gas to heat their homes.
Ronald Izip runs Trend, an influential business publication
Thermal insulation is essential but expensive
Equipping homes with better thermal insulation is another way to reduce heating costs. But both countries suffer from a lack of companies that produce such insulation, which means prices are high. Even when subsidies are available, households face costs of tens of thousands of euros each.
Czech economist Lukas Kovanda, a member of the government’s economic advisory council, says installing a heat pump is currently more cost-effective than hastily installing thermal insulation. “Buying a heat pump can save you from the potential side effects of installing insulation, such as mold, which can develop when the wrong type of polystyrene insulation is installed,” says Kovanda.
The Czech Ministry of the Environment has nevertheless set up a special program to help the poorest households to at least partially insulate their homes. “The program is designed to help residents insulate roofs, attics, exterior walls or replace certain windows or doors,” says Environment Minister Anna Hubackova.
“The goal is for people to be able to easily apply for money, without having to fill out complicated forms,” she says. So far, 40 million euros ($42 million) have been allocated for this program.
The Slovak government is also pushing for households to install thermal insulation.
“The Isolation Campaign is receiving 500 million euros ($536 million) from the EU recovery plan; the program will start in September and the Slovak people are expected to show great interest in the program “, says Ronald Izip.
Heat pumps offer good value for money, says Lukas Kovanda
Is nuclear the solution?
None of these measures can compensate for the sharp increase in energy costs, let alone compensate for a possible ban on the import of Russian gas. This is why Czech and Slovak legislators are betting on existing nuclear power plants and considering the construction of new reactors.
“The state should get to the root of the problem and direct its energy and financial resources towards the construction of new nuclear power plants,” says Czech economist Kovanda.
The Czech Republic plans to build new reactors generating some 2,400 megawatts of electricity by 2036. Slovakia, which has been building two new 940-megawatt reactors at the Mochovce nuclear power plant since 2008, plans to put them in service later this year. or in 2023.
This article was originally written in German.