CEZ Power Group plans to decide on the future of its coal-fired power plants from year to year, with the key factor being the development of electricity prices on the stock exchange and emission allowances. This information was given by Pavel Cyrani, Vice-Chairman of the Board of Directors of CEZ, during the company's general meeting held on 23 June 2025 in Prague.

Current estimates suggest that coal-fired generation could cease to be economically viable around 2028, but this date is not fixed and may change depending on market conditions.

CEZ, as the largest electricity producer in the Czech Republic, has long faced pressure to reduce its carbon footprint and switch to more sustainable energy sources. Coal-fired power plants, which make up a significant part of the company's energy mix, produce significant amounts of CO2. According to the CEZ website, the company is committed to a gradual phase-out of coal-fired power in line with European carbon neutrality targets by 2050.

In the past, CEZ has invested in modernizing its coal-fired power plants to reduce emissions, for example by installing desulfurization equipment and other technologies. Nevertheless, the future of these sources is uncertain due to rising prices of emission allowances and competition from renewable sources.

Cyrani stressed at the AGM that decisions on coal plant retirements are not tied to a fixed timetable, but to economic realities. Emission allowance prices, which in the EU ETS (Emissions Trading System) are based on supply and demand, have a major impact on the operating costs of coal-fired power plants. In 2024, allowance prices range from €60-100 per tonne of CO2, which significantly increases the cost of generating electricity from coal.

At the same time, the growing share of renewables, such as wind and solar, is pushing down electricity prices on the stock exchange, further worsening the competitiveness of coal.

Cyrani estimates that 2028 could be the tipping point when coal-fired power plant operations become unsustainable. However, this estimate is not definitive because the energy market is highly volatile. For example, unexpected fluctuations in natural gas prices or geopolitical events could affect the energy market and push back this date.

ČEZ strategy and switching to other sources

CEZ has been working on diversifying its energy portfolio for a long time. According to its 2024 annual report, the company is investing in the development of renewable sources such as wind and solar parks, while planning to build new gas-fired power plants that have lower emissions than coal-fired sources.

In accordance with the National Energy Concept of the Czech Republic, which envisages the phase-out of coal by 2033, CEZ is also exploring the possibility of using biomass and other alternative fuels in some of its coal-fired power plants.

Another key element of the strategy is the development of nuclear energy. CEZ plans to build new units at the Dukovany nuclear power plant, which should ensure a stable and low-emission source of energy after 2035. This step is considered crucial for ensuring the Czech Republic's energy self-sufficiency after the coal phase-out.

During the CEZ AGM, the topic of coal-fired power plants met with great interest from shareholders who want to know how the company will respond to the rapidly changing market conditions. According to a post on the X platform by the account, some shareholders expressed concern about the impact of too rapid a coal decline on the company's financial results. On the other hand, environmental organizations such as Greenpeace CR are pushing for a faster move away from coal and have criticized CEZ for its hesitant approach.

gnews.cz - GH