* Decision would help CEZ
* Carbon credit auction to help fund solar costs
(Recasts, adds details, background)
PRAGUE, Nov 25 (Reuters) - The Czech Industry Ministry
opposes a proposal to reduce the allocation of free CO2 credits
to industry in 2013, a deputy minister said on Thursday, which
could benefit state-controlled utility CEZ <>.
Under the current plan, companies are due to get 70 percent
of available credits for free in 2013, and 30 percent will be
auctioned off. The proportion of auctioned credits is due to
rise to 100 percent in 2020.
But the government is considering a proposal to increase
from 2013 the percentage of credits that are auctioned in order
to raise money to offset a rise in electricity prices coming
from the expansion of solar power plants, which sell electricity
to the grid for high regulated prices.
Deputy Industry Minister Tomas Huner told Reuters on the
sidelines of an oil conference, however, that the ministry was
against changing that allocation in 2013.
"We would like to solve (the solar issue) from other
resources," Huner said.
"We want 70 percent given for free and the other 30 percent
auctioned off in 2013, and gradual transition to 100 percent
auctioning (in 2020)."
Earlier in November the Czech Republic halved feed-in
tariffs for solar plants opening from 2011 and approved new
solar and carbon taxes to deal with a solar boom, which
threatens to send home and business power prices soaring.
Parliament pushed through a 26 percent tax on solar power
revenue and another tax charging generators 32 percent of the
value of carbon emissions permits granted to them -- originally
for free -- in 2011 and 2012 to raise funds to cap power hikes
at 5.5 percent. The solar plant tax is for three years.
The new tax on the credits given to electricity generators
as part of an EU scheme to limit emissions of greenhouse gases
and combat climate change would mainly burden majority
state-owned CEZ, central Europe's biggest power producer.
The Czech Republic, a country of 10.5 million people, was
the third-biggest solar nation in Europe last year in terms of
new installed capacity due to an investment boom sparked by
generous feed-in tariffs.
In 2010, installations have accelerated ahead of cuts in the
feed-in tariffs. By Nov. 8, the installed capacity was 1,034
megawatts, and energy regulator ERU estimated the number could
hit 1,700 MW by the end of the year.
If this happens, the government plans to tap state coffers
to keep power price increases in line.
(Reporting by Roman Gazdik, writing by Jason Hovet and
Michael Kahn, Editing by Jane Baird)
