Czech Republic: Political Discussions about Subsidy Scheme Problems

 Minister of the Environment, Tomáš Chalupa (left) and Martin Bursík (right), the former Minister of the Environment and one of the founders of Zelena Usporam” The Czech subsidy programme Zelena Usporam (Green Savings) is missing between Czech Koruny (CZK) 3 to 5 billion in order to satisfy all the applications already submitted (see news). The current Minister of the Environment, Tomáš Chalupa (left), blamed the founders of Zelena Usporam, saying that the subsidy programme had been steadily facing problems since the very beginning. In response, Martin Bursík (right), the former Minister of the Environment and one of the founders of Zelena Usporam, criticised the current administration of the subsidy programme for having stopped the programme too late - most probably for political reasons. According to Zelena Usporam, it is going to take another few weeks until all of the applications are processed. Until then, no further information will be available on the future of the programme.
Photos: www.radio.cz / www.ct24.cz

 “Former Minister Pavel Drobil was told by the management of Zelena Usporam to stop the programme in October 2010. However, the ministry did not react quickly, but stopped the programme just one day after the second round of the senate elections,” Bursík explained at a press conference organised by Petr Štěpánek, the former director of the State Environmental Fund (Státní fond životního prostředí ). According to Bursík, the delay has caused the current situation, ”in which Zelena Usporam was overwhelmed with applications that caused the lack of funding.” He also says that the programme helped the Czech Republic in times of economic crises by creating or keeping 19,000 jobs.

At the press conference, Aleš Kuták, who was Deputy Minister of the Environment at the time the programme was launched, spoke about the important relationship with Japan, which bought 40 million of Assigned Amount Units (AAUs) over the last two years. “In Japanese culture, long-term trust is very important. We have managed to gain this trust. However, when the current Minister of the Environment stated that the whole programme has no firm base and is full of other imperfections, the negotiations regarding the selling of the rest of Czech's AAUs was stopped immediately.” Instead of preparing a new contract for the sales of the remaining 15 million AAUs, the ministry is spending its time on trying to persuade the Japanese that they are not investing into a risky business. “The later the AAUs are sold, the lower the price,” said Kuták.

Irena Plocková, the former Director of Zelena Usporam, reminded that at the beginning of the programme, an application was processed within 30 to a maximum of 60 days. However, the number of applications has been rising rapidly while the number of employees has stayed the same. In September 2010, the staff of Zelena Usporam has even decreased. It is said that every day, the Czech Post was delivering bags of applications to the programme administrator´s office.

What would be the right solution to this problem? Bursík regards the decision to reduce the number of subsidies as wrong. According to him, the subsidies are supposed to be paid out to successful applicants in full amount from the reserves of the fund. He thinks that the trust of the people who applied for the subsidy should not be cheated on.

In 2013, there is going to be a change in European emission trading: According to Bursík, one half of the profits from that trade is to be used for the continuation of Zelena Usporam or a similar programme. “Investing into energy efficiency is the best way to save CO2, increase the quality of the environment and lower household energy bills at the same time,” says Bursík.

This text was written by Vladislava Adamenkova, a Czech student of international business studies in Vienna, Austria.

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