Commission approves State aid to support construction of nuclear power plant in Czechia

The European Commission has approved, under EU State aid rules, a Czech support measure for the construction and operation of a new nuclear power plant in Dukovany in Czechia.

In March 2022, Czechia notified the Commission of its plan to support the construction and operation of a new nuclear power plant in Dukovany, with an electricity generation capacity of up to 1200 MW. The nuclear power plant is expected to be commissioned in 2036 for trial operations, while commercial operations are planned to commence in 2038. The plant will have an operating lifetime of 60 years and is planned to be decommissioned in 2096. Dukovany is already the site of an existing nuclear power plant.

The beneficiary of the measure is Elektrárna Dukovany II (‘EDU II’), a fully owned subsidiary of the ČEZ Group, the only nuclear power plant operator in Czechia. Czechia plans to grant direct price support in the form of a power purchasing contract with a State-owned Special Purpose Vehicle (‘SPV’). The contract will ensure stable revenues for the nuclear power plant for a period of 40 years. The beneficiary will also benefit of a subsidised State loan to cover a majority of the construction costs and a protection mechanism against unforeseen events or policy changes that may make the realisation of the project impossible.

Executive Vice-President in charge of competition policy Margrethe Vestager said: “Czechia will support the construction of a nuclear power plant in Dukovany. The Commission’s role is to ensure that the State aid proposed is targeted, proportionate and does not unduly affect the EU energy market. During our investigation Czechia has modified the initial measure and submitted substantial commitments. This has allowed us to approve the aid.”