Date of commissioning – city court in Prague concurs with opinion of State Energy Inspection

​In a nutshell:

For some time now, there has been a conflict between power plant operators and the State Energy Inspection over determining the date of a power plant's commissioning. This date is crucial for determining the level of funding.

​The State Energy Inspection is of the opinion that the date of commissioning is the date of installing the electricity meter. On 30 November 2016, the city court in Prague concurred with this opinion, according to our information. The court ruling is not final, though. An appeal can be filed with the Highest Administrative Court.

The line of reasoning is based on the literal interpretation of item (1.9) of the price decision no. 4/2009, which reads: ”In respect of newly installed power plants, commissioning shall be understood to be the date on which the operator started, under an awarded licence and subject to its authorisation to carry on the licensed activity, to generate and supply electricity to the electricity grid while enjoying support in the form of feed-in tariffs, or first started to generate electricity while enjoying support in the form of green bonuses.”

The State Energy Inspection views 'the enjoying of support' as a separate requirement for determining the date of commissioning and goes on to conclude that installing an electricity meter is a prerequisite. This in turn arises from items (1.2) and (1.3) of the price decision, according to which an operator may enjoy support only in the case of electricity that is metered, which is of course an understandable prerequisite.

Such interpretation is debatable because the Energy Regulatory Office (the author of the price decision) alone  – in its opinion dated 27 October 2010 – sets out arguments regarding item (1.9) of the price decision and the date of commissioning, presents a schedule and does not make the commissioning of a power plant in the meaning of the price decision dependent on enjoying support or installing any electricity meter.

Should this decision become legally binding and be part of the court ruling practice, this could have serious implications for power plant operators whose photovoltaic power plants were commissioned in 2010 but whose electricity meters were installed only in 2011. Photovoltaic power plants installed in 2010 could lose the favourable support and fall under the extremely lower level of funding for power plants built in 2011. This would certainly lead to a question as to how the 2010 opinion of the Energy Regulatory Office should be assessed from the standpoint of state liability.