Czech Republic: Mandatory energy audits

22.03.2016

The Act on Energy Management was amended with effect from 1 July 2015 introducing a new duty for large businesses to carry out energy audits. Due to harmonization with EU law, these businesses were obliged to carry out their energy audit before 5 December 2015. Such a short period of time resulted in most businesses failing to fulfil this obligation in time. The State Energy Inspection has therefore recently announced that in the first half of 2016 it will not of its own initiative check whether businesses have carried out this obligation. However, if the State Energy Inspection receives information which it has a statutory duty to investigate, it will require that the business under investigation provides either results of the audit or documents that the audit has been commissioned and is being carried out. Otherwise, the business may be fined up to CZK 5 million. What is actually understood under an energy audit and who does the duty to carry out energy audits apply to?

An energy audit, i.e. a written report on the levels of energy use, must be carried out at least once every 4 years  for energy units owned or used by businesses which:

  1. have at least 250 employees, or
  2. have annual turnover of at least EUR 50 million or total annual balance sheet value of at least EUR 43 million, or
  3. own a building or energy unit which consumes more than 700 GJ/year (194 MWh/year), and its total energy consumption within the last two years reached at least 35 000 GJ/year (9 722 MWh/year).

The obliged entity is thus assessed either on the basis of its size, i.e. its financial turnover, or on the basis of its energy consumption. From now on, each business which owns or uses an energy unit, i.e. a unit of technical devices and buildings used to deal with energy, should ascertain whether the duty to carry out energy audits applies to it. If so, such a business should, without undue delay, contact an energy specialist, licensed to carry out energy audits by the Ministry of Industry and Trade, and commission an energy audit.

An energy audit is valid for a maximum 4 years unless the building or the energy unit, for which it has been carried out, undergoes a major change. The audit report includes information on the current or predicted levels of energy use and suggestions on how to save energy or increase energy efficiency and provides for practical recommendations for their implementation. Businesses are obliged to inform the Ministry of Industry and Trade that an energy audit has been carried out, to keep the audit report and submit it to the Ministry or the State Energy Inspection upon their request.

Despite the State Energy Inspection having announced that it will not of its own initiative check whether businesses observe the duty to carry out energy audits, businesses may be investigated and penalized due to information the Inspection has received and is obliged to investigate. Taking into consideration that the Inspection has not ruled out possible inspections in the second half of 2016, we can only recommend that businesses which are obliged to carry out energy audits do so at their earliest convenience.