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The Czech Republic's efforts to generate more of its electricity from renewable energy has led to a boom in solar power but it has also created challenges to the long-term stability of the power supply and provoked an outcry over its policy.

The Czech government reacted to these challenges in April 2010 by amending the  legislation promoting investment in renewable energy to produce electricity for the national grid.

The move follows warnings by ČEPS, the country's transmission systems operator, that reliance on intermittent energy sources such as solar power posed the risk of a potential shortfall in output that could destabilise the grid.

The government had originally offered a package of financial incentives and guarantees to encourage the generation of electricity using renewable energy as part of legislation introduced in 2005. 

The amount of electricity produced by solar power grew rapidly in response, increasing from a total installed capacity of 3.4MW at the end of 2007 to a forecasted installed capacity of 1,400MW by the end of 2010.

Critics had complained that solar power companies enjoyed a virtually risk free investment that was subsidised by the consumer, as well as preferential off-take prices and guaranteed access to the electricity distribution system.

The revised Act empowers the Czech Republic's energy regulator to determine the level of incentives available. The uncertainty over how the regulator will use its extended powers has created a new set of challenges to the stability of the energy market.

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