SME Policy in Czechia

7. The green transition of SMEs

Abstract

Czechia has made meaningful progress in decarbonising its economy, notably by lowering energy intensity and expanding renewable energy sources. Nonetheless, it remains one of the most energy-intensive EU countries due to its large manufacturing base and continued reliance on coal in electricity generation. SMEs account for an estimated 41–48% of business-sector GHG emissions, yet only a small share have adopted climate strategies. Those that do, however, also introduce specific climate actions, such as developing or acquiring new environmental technologies.

Government support for improved energy efficiency in SMEs is substantial through the offer of both financing and advisory services. However, the national energy audit system needs to be strengthened, and there is scope for streamlining the existing fragmented offer of energy advisory services into one single flagship initiative with a larger budget and stronger visibility to the SME targeted audience. Smaller government schemes have also encouraged the uptake of renewable energy sources and the adoption of circular-economy practices in SMEs. However, given the high material intensity of the Czech economy, financial support for the SME adoption of circularity could be scaled up. Finally, the Czech government could devote more attention to green skills development, especially in its three coal mining regions, and to supporting SME compliance with sustainability reporting requirements.

Key messages

• Czechia has made progress in decarbonising its national economy by reducing energy intensity and by increasing the share of renewables in the national energy mix. However, it is still one of the most energy-intensive countries in the EU, which is a consequence of the comparatively larger weight of manufacturing in the economy and the relatively wide use of coal in electricity generation. Furthermore, despite a 42% drop in material intensity since 2000, Czechia still lags behind the EU average across the main resource-efficiency indicators.

• Czech SMEs account for between 41-48% of business-sector greenhouse (GHG) emissions, in line with the EU average. Survey evidence also shows that only 14% of SMEs had a climate strategy in place, compared with 21% at the EU level. Nevertheless, those Czech SMEs that have a climate strategy in place are more green-active than European peers, with 58% of them developing and 66% of them purchasing new green technologies. Among the main barriers to undertaking resource-efficiency actions, Czech SMEs were more likely to report the complexity of administrative and legal procedures (49%), complex environmental reporting requirements (34%), and the costs associated with environmental actions (26%).

• The Czech government has actively supported energy efficiency in the business sector through a suite of programmes (e.g., Energy Savings, ENERG-ETS, and the Transformation Loans). However, the national energy audit system would benefit from reforms, notably by ensuring that energy audits are effectively followed by concrete energy-saving actions.

• National energy consulting services (e.g., EKIS and EnKoMas) offer valuable free advice to help SMEs improve their energy performance. However, the current offer looks fragmented and could be streamlined into one single flagship programme with a larger budget and better visibility to the SME targeted audience.

• Czechia has encouraged the uptake of renewable energy sources (RES) by SMEs, including through a project call of the Ministry of Industry and Trade (MIT) supporting the installation of solar panels and the purchase of batteries by SMEs which has led to a 14% progress towards the 2030 objective of installed photovoltaic capacity by SMEs. Furthermore, legislative changes have enabled smaller energy producers (from 10 kWh to 50 kWh) to operate without a license, thus further facilitating RES development, in particular solar power.

• Czechia lags behind the EU average in the registration of new electric vehicles (EV). In this area, the Electromobility Guarantee Programme has encouraged the acquisition of EVs by SMEs through a financial contribution and a loan guarantee. While the programme has been well-received, supporting the acquisition of over 5 300 EVs and 2 200 charging stations within the first six months, its benefits are possibly too generous. The Czech government could, therefore, consider a revised version of the programme that reaches more companies through a smaller subsidy rate.

• Recent calls under OP TAC have also encouraged SMEs to improve the circularity of their business operations, notably through better recycling, re-use of material and product eco-design. Going forward, given the high material intensity of the Czech economy, financial support could be scaled up. Furthermore, advisory services, adequate legislation and better recycling infrastructure are also important to ensure that businesses can effectively adopt circular-economy practices.

• The Czech government could develop a more systemic approach to green skills development, covering education and training programmes for high, mid- and low-skilled workers, as well as the monitoring of green skills demand to ensure that the current training offer is in step with labour market trends.

• Finally, the Czech government could support SMEs in their compliance efforts with sustainability reporting requirements. While the European Sustainability Reporting Standards (ESRS) introduced by the Corporate Sustainability Reporting Directive (CSRD) do not directly affect SMEs, there are concerns that SMEs will be impacted indirectly through their relationships with financial institutions and large companies, which are subject to the obligations of the CSRD. The government could offer help through advisory services – for example, on the voluntary SME reporting standards currently being prepared at the EU level – and through the development of automated reporting mechanisms allowing the sharing of emissions-related company information between authorised public and private entities.

SME greening conditions

Czechia is one of the most carbon-intensive economies in the EU, partly due to the role of manufacturing in the economy and coal in electricity generation

According to the environmental performance index jointly produced by Yale and Columbia universities, Czechia ranked 15^th in overall environmental performance among the EU-27 countries and 19^th out of the 180 countries covered by the index in 2022.1 While between 2010 and 2020 Czechia grew by 5.2 percentage points in the overall ranking and improved in most of the specific environmental indicators composing the index, it also experienced a deterioration in the growth rate of greenhouse gas (GHG) emissions.

An important barrier to industry decarbonisation in Czechia consists in the high share of energy-intensive industries compared to the EU average, which contributes to making the national economy particularly reliant on fossil fuels. In particular, coal, Czechia’s largest source of energy, still accounts for 28% of total energy supply and for 59% of total carbon-dioxide emissions from fuel combustion.2 As a result, Czechia has the 3^rd highest carbon-emission intensity (i.e., carbon emissions per capita) at the EU level (Figure 7.1), while the share of renewable energy sources (RES) in the final gross energy consumption was only 18% in 2022, up from 11% in 2010, but still behind the EU average of 23% in 20223 (MIT, 2024[1]). Similarly, despite a regular decrease in material intensity (i.e., the amount of material used per unit of output) since 2000, Czechia lags behind the EU average in key circular-economy (ManpowerGorup, 2024[2]) indicators such as resource productivity and the use rate of circular material (OECD, 2021[3])4.

Figure 7.1. Carbon emission intensity of GDP, Czechia and the EU-27, 2013-2022

Adjusted for inflation (chain-linked volumes)

Source: OECD based on Eurostat Energy Statistics Database

Czechia continues to have a relatively high share of polluting jobs, but green-tasked jobs are on the rise

The OECD defines green jobs following a “task-based approach”, whereby these are jobs that align with environmental goals or that necessitate green skills, rather than jobs in specific sectors or industries classified as green (OECD, 2023[4]). Based on this definition, the share of green jobs has been on the rise across many regions of Europe. Czechia is no exception, with the share of green jobs that increased across all 8 NUTS-2 regions between 2011 and 2021. Like in other EU countries, the capital region (Prague) features the highest share of green jobs in Czechia – i.e., 23%, 5 percentage points higher than the OECD average – which is the result of the large number of green-tasked jobs in sectors such as utilities, professional services and financial activities, which are more concentrated in large cities, notably capital regions (OECD, 2023[4]). On the other hand, the gradual phase-out of coal mining is reflected in the declining share of polluting jobs in the three coal regions of Czechia, with 2-3 percentage-point drops in Northeast and Moravia-Silesia. Nonetheless, the overall proportion of polluting jobs remains relatively high, around 24% at national level, which underscores the need for boosting more green-tasked jobs, especially outside the capital region of Prague (Figure 7.2).

Figure 7.2. Share of green jobs and polluting jobs by region in Czechia, 2011 and 2021

Percentage values

Note: The chart reflects the proportion of green jobs (occupations where at least 10% of tasks are green, or contribute to sustainability goals, whereas polluting jobs are a subset of non-green-task jobs that are particularly concentrated in high-polluting sectors).

Source: OECD based on the OECD “Job Creation and Local Economic Development 2023: Bridging the Great Green Divide” database (OECD, 2023[4]).

Additional survey evidence shows that 64% of employers in Czechia plan to recruit in green-related jobs and roles. Based on the results of this survey, at global level, the highest demand for these jobs is expected in the energy and utility sector (81% of companies), followed by manufacturing and production (36% of companies). Furthermore, other studies have pointed to labour shortages in seven technical occupations requiring specific green skills5 in Czechia, including electrical technicians and pipefitters (EURES, 2023[5]).

Czech SMEs trails behind the EU average in the green transition

According to OECD estimates, SMEs in Czechia accounted for around 41%-48% of business-sector GHG emissions in 2018, depending on the type of sector weights used (output or employment-based), which is only marginally higher than the EU average (OECD, 2023[6]).

To reduce carbon emissions, it is helpful for SMEs to have climate neutrality strategies in place that can steer environmental actions in a more systemic way. However, based on recent Eurobarometer survey evidence, only 14% of Czech SMEs already had a climate neutrality strategy in place in 2024, compared with 21% at the EU level. Furthermore, 66% of Czech SMEs did not have such a strategy and were not planning to have one in the following two years, which is also higher than the EU average (52%). On the upside, Czech SMEs that have a climate-neutrality strategy appear to be more likely to take more concrete environmental measures, such as developing (58%) or purchasing new technologies (66%), compared with the respective EU averages (Figure 7.3). This suggests that only a small group of Czech SMEs are taking actions to reduce GHG emissions, while the majority either faces significant barriers or is reluctant to invest in the green transition.

Figure 7.3. Climate strategies and climate actions of Czech SME, 2024

Percentage values

Note: The figure in Panel A displays the results from the question “Does your company have a concrete strategy in place to reduce your carbon footprint and become climate neutral or negative?”. The follow-up question “What actions is your company undertaking to become climate neutral?” (Panel B) was only asked to respondents who answered “Yes” to having a climate strategy in place (see Panel A). Results are based on the 2024 Eurobarometer flash survey (FL549), conducted by the European Commission, on “SMEs, Resource Efficiency and Green Markets”. The benchmark group CEE refers to the average of the countries Poland, Hungary and the Slovak Republic.

Source: OECD based on “Flash Eurobarometer FL549: SMEs, resource efficiency and green markets” (EC, 2024[7]).

Resource efficiency – which includes efficiency in the use of energy, natural resources, and materials – is a key channel through which businesses can reduce their environmental footprint. A disaggregated analysis by firm size shows that, expectedly, Czech micro (1-9 employees) and small firms (10-49 employees) are less likely than mid-sized companies (50-249 employees) to undertake resource-efficiency actions. While 89% of the latter takes at least some action in this field, only 82% of small and 75% of micro firms do the same. Despite a rising share of micro and small firms taking many actions – respectively from 40% to 48% and from 43% to 56% between 2021 and 2024 – high upfront costs, limited economies of scale, and uncertain returns on investment remain a significant barrier to resource-efficiency actions for these firms (Figure 7.4, Panel A).

There are also strong differences in resource-efficiency actions across sectors (see Figure 7.4, Panel B), with manufacturing (61%) and industry-based (53%) SMEs leading the way, followed by retail trade (50%) and services (39%). This is in line with recent OECD findings across 15 countries suggesting that SMEs in more polluting sectors, such energy-intensive manufacturing, tend to be more likely to report on their greening efforts, as they have more opportunities to take action to offset their emissions (Wildnerova et al., 2024[8]).

Figure 7.4. Resource efficiency actions by firm size (SMEs) and sector in Czechia, 2024

Percentage values

Note: The figure displays the results from the questions “What actions is your company undertaking to be more resource efficient?” from the 2024 survey. The questions were asked to all responders to the survey. For the question, it was possible to provide multiple answer alternatives, but presented here is a grouping of the responses: “many actions” = 5 or more actions, “some actions” = 3-4 actions. “few actions” = 1-2 actions, and “no actions” = 0 actions.

Firm size categories of SMEs are defined by number of employees: Micro=1-9, Small=10-49, Medium-sized= 50-249 employees.

Sectors are defined following NACE Rev.2, with “Services” representing the aggregate of “Transportation and storage (H)”, “Accommodation and food service activities (I)”, “Information and communication (J)”, “Financial and insurance activities (K)”, “Real estate activities (L)”, “Professional, scientific and technical activities (M)”, and “Industry” representing the aggregate of “Mining and quarrying (B)”, “Electricity, gas, steam and air conditioning supply (D)”, “Water supply; sewerage, waste management and remediation activities (E)”, “Construction (F)”.

Source: OECD based on “Flash Eurobarometer FL549: SMEs, resource efficiency and green markets” (EC, 2024[7]).

The main barriers to undertaking resource-efficiency actions reported by Czech SMEs are the complexity of administrative and legal procedures (49%), followed by the emerging challenge of complex environmental reporting requirements (34%) and the high costs of environmental actions (26%) (see Figure 7.5). On the upside, while 30% of Czech SMEs reported problems in the supply of materials, parts, products, or services in 2021, this proportion dropped to 22% in 2024, which is partly the result of the lingering effects of the Covid-19 crisis generating supply-chain disruptions in 2021 but may also point to the recent development of new national green markets.

Figure 7.5. SME barriers to resource efficiency actions, Czechia, EU and CEE, 2024

Percentage values

Note: The figure displays the results from the question “Did your company encounter any of the following difficulties when trying to set up resource efficiency actions?” from the 2024 survey. The question was asked only to those responding that they are taking action to the question "What actions is your company undertaking to be more resource efficient?". For the question, it was possible to provide multiple answer alternatives. The benchmark group CEE refers to the average of the countries Poland, Hungary and the Slovak Republic.

Source: OECD based on “Flash Eurobarometer FL549: SMEs, resource efficiency and green markets” (EC, 2024[7]).

Given existing barriers, external support to undertake resource-efficiency actions is key. In 2024, only 18% of Czech SMEs used external support to undertake resource-efficiency actions, which is two percentage points below the 2021 figure (20%) and below the 2024 EU average (23%). Among the Czech companies that received support, 86% received it from the private sector (EU average, 77%) and 62% from the public sector (EU average, 49%). EU-funded programmes, such as the Operational Programme Technologies and Application for Competitiveness (OP TAC) and the national Recovery and Resilience Plan (RRP), which are discussed in the following section of the chapter, help explain the larger proportion of Czech SMEs that received public support for resource efficiency actions compared with the EU average.

SME greening policies: Mid-term evaluation of the national SME Strategy

There are strong financial incentives for Czech SMEs to invest in energy efficiency

Both the national RRP and OP TAC, which is the operational programme managed by Czechia’s Ministry of Industry and Trade (MIT) and financed through the European Regional Development Fund (ERDF), actively support resource-efficiency actions at firm level, including in SMEs6. The main programme in this field is funded through an OP TAC call named “Energy Savings”. The first edition of the call, which run between 2022 and 2023, had a budget allocation of CZK 10 billion, while the second in 2024 received an allocation of CZK 5 billion. All companies, regardless of size and sector but with the exception of those based in Prague7, can apply for grants disbursed through this programme, which cover between 35% and 80% of the energy-efficiency investment depending on the action and the size and sector of the supported company.

Eligible activities are broad and include improvements in building-related energy efficiency (e.g. better insulation or ventilation, improved electricity systems, etc.); the use of renewable energy sources (e.g. solar panels); gas, heat, and compressed air distribution systems; capture and re-use of energy waste; production modernisation; and energy management support. Furthermore, companies receiving grant support need to work with an energy expert from a database managed by the MIT, which helps to improve the effectiveness of this policy and to keep up a network of energy experts. The MIT monitors this policy by collecting information from beneficiary companies on the reduction of final energy consumption and primary energy consumption before and after project implementation. 8 In the first call, which closed in 2023, the programme supported 756 projects, three-quarters of which were run by SMEs, despite the relatively complex application and documentation requirements.

In this regard, an evaluation of a similar scheme run under the previous Operational Programme “Enterprise and Innovation for Competitiveness” (OP EIC), which was the predecessor of OP TAC covering the period 2014-2020, found that the measure had supported energy efficiency improvements affecting both production and building management, with most recipient companies reporting a decrease in energy consumption between 10-50% within a year. However, half of the programme beneficiaries also reported that they would have introduced the energy-efficiency improvements regardless of government support, pointing to the possible low additionality of this policy (MIT, 2023[9]).

More generally, while collecting information on energy consumption before and after the intervention is certainly useful, this metric cannot simply be used to assess programme effectiveness, since energy consumption can increase or decrease for reasons beyond efficiency improvements (e.g., increased production levels, global energy prices, national energy subsidies, etc.).

Moreover, while effects on energy consumption have been largely positive, there is wide variation in the energy savings rate (between 10-50%), which can depend on the sector of intervention – i.e., the scope for energy savings are larger in energy-intensive sectors – but may also point to strong heterogeneity in the energy-saving potential of the supported actions. This issue could partly be redressed through improved ex-ante analysis of the energy-saving potential of the financed projects.

Finally, low additionality may suggest that many actions have been directed at low-hanging fruits involving low-cost investments (e.g., smart lighting). This issue could be tackled through the funding of bigger-ticket investments (e.g. supporting production-related energy-efficiency investments), although self-reported feedback always needs to be taken with a grain of salt, as there is no real guarantee that respondents would have really undertaken the investment without government support, even when they say so.

Some energy-efficiency programmes target specific regions and sectors

The capital region of Prague, due to its average per-capita income, does not qualify for ERDF funding. Czechia’s national development bank (NRB) has, therefore, launched a programme similar to OP TAC’s Energy Savings programme, but only targeted to Prague-based businesses. The scheme (ENERG) offers interest-free loans to finance energy-efficiency investments similar to those funded under the OP TAC scheme.9 Furthermore, the NRB offers subsidised loans to companies outside Prague under another Energy Savings programme, but loans must be co-financed by a commercial bank in this case.

The NRB also offers specific support to SMEs in three regions of Czechia with a tradition in coal-based industries (Moravian-Silesian, Ústí nad Labem and Karlovy Vary⁾, notably through so-called Transformation Loans, which are interest-free loans funded through the EU Just Transition Fund (CZK 2 billion). The scheme assists companies, including SMEs, with the purchase of machinery and equipment, building upgrades, and the acquisition of technology licenses and software across different sectors. Loans are interest-free, the repayment period is over 10 years, and projects worth between CZK 500 000 and 100 million can be funded, with only 10% of these costs to be borne by the beneficiary. As of June 2024, 88 projects had been approved with an average loan size of CZK 6 million (i.e., about EUR 236 000), suggesting that the programme has mostly funded mid-sized investments. The take up has been stronger in two of the three targeted regions, suggesting that stronger outreach efforts may be needed in the third region.

Finally, particularly relevant to small industrial companies is the scheme “ENERG ETS: Modernisation of Sources and Technologies: Small Projects”, which has a budget of CZK 5 billion from the Modernisation Fund and is financed through the emission allowances collected through the EU ETS system. The scheme offers grants for investments in the reduction of production-related energy consumption and greenhouse gas emissions.

Overall, these measures have the merit of targeting specific regions or sectors which are in special need of support and complement the main energy saving programme run by OP TAC (see previous section). The NRB programme in Prague, for example, fills a policy gap caused by the ERDF classification of Prague as a high-income region. However, the Prague region is the economic powerhouse of the country and continues to have an important manufacturing sector, which makes its involvement in industrial decarbonisation policies still very crucial. In a similar vein, the ETS-funded measure targets energy-intensive industrial SMEs that have a large decarbonisation potential, thus warranting special attention by policymakers.

SMEs also benefit from a strong national network of energy advisors

In addition to financial support, Czech businesses (and households) also benefit from a strong network of energy advisory services. In particular, the Energy Consulting and Information Centre (EKIS) Network consists of around 50 centres that provide free advice on energy efficiency to households and businesses. In 2022, the EKIS centres conducted 10 000 consulting activities, also thanks to their mobile units (M-EKIS). EKIS funding comes from the national Programme on the Promotion of Energy Savings and the Utilisation of Renewable Energy Sources (EFEKT), which makes possible the offer of advisory services fully free for clients. Energy advisors are certified by MIT, based on technical education, two years of work experience, and an entry exam. As of 2024, there were around 1 300 certified energy experts, organised in 4 groups: a) energy audit and assessment (around 500 specialists); b) control of air conditioning; c) control of heating; d) building energy performance. Efforts are currently underway to categorise professions in energy consulting to ensure easier accessibility for clients based on their specific needs.

The MIT also runs a programme called “Energy coordinators of Local Action Groups” (EnKo MAS), which offers free energy advice to businesses and households at local level. In particular, the programme, running between 2022 and 2024 with a small budget of CZK 10.5 million (i.e., about EUR 400 000), intends to inform the public about existing energy-saving measures and available financial support, to help co-ordinate first steps in community energy projects and, more generally, to raise awareness on the importance of energy savings.

Finally, in 2024, under the National Reform Programme (NRP)10, Czechia established three regional unified contact points to provide households, businesses, and the public sector with advice on energy-efficient renovations. Through an allocation of CZK 4 billion a system has been established to provide advisory and awareness-raising activities in the areas of sustainable projects, building renovations, the use of renewable energy sources (RES), and community energy projects, aiming to offer 120 000 advisory services by June 2026 (Government Office of the Czech Republic, 2024[10]) (EC, 2023[11]). As part of this programme, the MIT has developed a business-dedicated website that offers energy advice and information on existing investment support. Additionally, as part of the RRP and in line with the National Recovery Plan, a reform of the advisory system is underway to establish a network of one-stop shops for energy advice.

On the whole, non-financial support for energy efficiency is well developed in Czechia, although existing programmes have very similar objectives, which could undermine their cost-effectiveness and make it difficult for SMEs to discern the nuances between the different offers. Furthermore, there is a limited follow-up of the actions taken at firm level after the received advice, which makes an impact assessment of these programmes difficult. As will be seen in the next section, this problem also extends to the national energy audit system.

The national energy auditing system should be revamped

Since 2000, in line with EU legislation, Czechia has made energy audits mandatory every four years for energy-intensive companies with annual energy consumption levels above MWh 5 000 (IEECP, 2023[12]). Until recently, based on EU legislation, energy audits were voluntary for SMEs (i.e., enterprises with fewer than 250 workers and annual turnover below EUR 50 million). However, the European Commission’s new Energy Efficiency Directive (EED) (2023/1791) has introduced a change in the criterion used to establish which companies are subject to an energy audit obligation, from employment size to energy consumption levels. Notably, this directive has lowered the l energy-consumption threshold to 10 terajoule (TJ) (i.e., about 2 800 MWh), regardless of the number of workers employed by the company. This change will extend the audit obligation to a larger number of SMEs, making this policy more relevant for this business segment. As of March 2025, the Czech Senate was discussing the transposition of the new EED into national legislation, including Article 11 on energy management systems and energy audits.

At present, based on information gathered during the fact-finding mission of the project, Czechia lacks a monitoring system of its energy audits. Companies required by the national law to go through an energy audit do so, but there is no follow-up to monitor if any energy-efficiency action is introduced following the audit, which undermines the effectiveness of this policy. Typically, companies, after an energy audit, are required to undertake specific actions to improve their energy efficiency, which can be encouraged through fiscal and financial incentives, such as exemptions on energy-related taxes (e.g., excise duties) or subsidised loans and grants. These benefits are often conditional on the submission of progress reports on the energy-savings measures that have effectively been implemented. Even in comprehensive national energy-audit systems, only about half of the energy efficiency measures recommended in the audits are generally implemented (Anderson and Newell, 2004[13]). This ratio is likely to drop even further in the absence of proper follow-up and enforcement, like in Czechia.

Czechia’s national energy audit system would, therefore, benefit from an overhaul. First, it would be important that energy audits be followed by rationalisation plans, setting out the main energy-saving actions that audited companies are expected to undertake, including the estimated payback period for each of these actions. Second, information from energy audits could feed into an information management system, where information on energy consumption by firm size and sector and on estimated energy savings from specific measures could be collected, aggregated, and used to design better evidence-based policies (see Box 7.1 for ongoing data collection efforts in Czechia which could be complemented with this approach).

Box 7.1. Czechia’s Energy Performance Database

A new information system, called “Energy Performance Database” (DEN), is currently under development in Czechia. It will serve as a tool both to monitor the registration of energy professionals and their activities and the energy performance of buildings. It will replace the existing system which has so far only managed the agenda and training of energy specialists. Through its integration with the building database, the new system is expected to document the renovation of public buildings in compliance with the new EU EED and to integrate data from voluntary agreements.

Building on data from enterprise energy audits, it would also be useful to include in this new database detailed information on energy consumption by firm size and sector and on the impact of selected energy-savings measures, including payback periods. By collecting and aggregating these data, the government would have a better understanding of the average enterprise energy performance by sector and firm size, which will support the policymaking process, while energy auditors would benefit from this repository of knowledge in their auditing work.

Additional future reforms of the national energy audit system could include the integration of international standards in energy management system as part of the auditing process (see also below) and the extension of energy audits to less energy-intensive SMEs on a voluntary basis. The first policy would ensure that energy audits go beyond advice on production or support-systems (e.g., lighting, ventilation, etc.) to embrace a holistic understanding of how energy can be managed at firm level (e.g., analysis of consumption peaks during the day and the year, analysis of energy costs during the day, etc.). The second policy would enable smaller SMEs to better understand the importance of energy use and energy management for their business and offer concrete advice on possible improvements. Suggested actions could be financially supported by the government, depending on budget availability.

Czechia could consider the launch of new targeted energy programmes

The Czech government could also consider new programmes to further encourage energy efficiency at the firm level, notably through the adoption of energy management systems and the launch of energy efficiency networks.

In 2024, Czechia only counted 328 ISO 50001 certificates (i.e., the reference international standard in energy management systems), compared with above 10 000 in Germany.11 Voluntary Agreement Programmes (VAPs) can foster the adoption of energy management systems (EnMS) in large energy-intensive companies through the offer of tax breaks and other financial incentives on condition that energy-savings targets are met. These programmes combine an energy audit with management and workforce training supporting compliance with an international EnMS standard (e.g., on software to better manage energy consumption and good practices to improve energy savings).

Energy efficiency networks are more relevant to SMEs, especially in light industries. They involve regular meetings of SME business owners or managers, preferably from the same sector or related sectors, over a period of 3-4 years. Meetings and other activities are co-ordinated and steered by an expert, who help network members to identify energy-efficient solutions and/or to pool resources towards joint investments.

There has been progress in the uptake of renewable energy sources by SMEs, whereas SME participation in renewable energy industries is limited

In addition to energy efficiency, the Government of Czechia has also encouraged the adoption of renewable energy sources (RES) by SMEs. The main programme in this area has been a call, launched by the MIT in 2022 with a budget of CZK 1 billion from the national RRP, to encourage the installation of solar panels by SMEs, also in combination with batteries. The project received strong interest from SMEs, with 5 000 approved projects, and facilitated an estimated 270 MWh of added photovoltaic capacity, corresponding to a 14% progress towards the 2030 objective12. Besides financial support measures, the government of Czechia has also increased the threshold for renewable-energy production without a license, from a maximum output of 10 kWh to 50kWh, which is expected to facilitate the generation of renewable energy by SMEs in the future.

A small number of SMEs with the license to operate in the energy sector have also participated in the larger RES+ call, which received CZK 4 billion funding from the Modernisation Fund in 2022. The call has supported projects in renewable-energy industries and technologies such as photovoltaics, biomethane, hydroelectric plants and wind farms, some of which typically require large upfront investments. Support was provided in the form of a one-off ex post subsidy paid after submitting documents proving the completed implementation of the project. SMEs benefitted from preferential conditions in the form of a 10% (for medium-sized enterprises) and 20% (for small enterprises) of additional investment aid for the outlined projects (State Environmental Fund of the Czech Republic, 2021[14]). Despite grant bonuses given to SMEs, few of them have benefited from this call: two respectively in wind farms and biomethane and four in hydroelectric plants.

The Czech government could encourage stronger SME participation in future RES development projects, for example, starting with the green hydrogen industry, whose national strategy was updated in 2024 with the objective of producing 20 000 tons of renewable hydrogen per year by 2030.13 The hydrogen industry is generally led by large energy companies, as upfront investments for green hydrogen production through electrolysis are high and industry regulations are still in the making, which may further discourage small operators. Nonetheless, a recent Important Project of Common European Interest (IPCEI), funded by the European Commission through EUR 6.9 billion, is expected to finance 33 green hydrogen projects with the participation of 32 companies, including 5 SMEs, suggesting that there is scope for involving SMEs also in cutting-edge technologies like green hydrogen14. In particular, SMEs can be suppliers of large energy companies (e.g. of parts and components used in the electrolysis process) or play an active role in support activities like energy storage. The Czech government could support SME participation in the green hydrogen supply chain through specific calls, to be funded by a relevant operational programme, as well as through awareness-raising and training initiatives. Such an approach would ensure that hydrogen development better support job creation at local level, which is one of the objectives of the EU Strategy towards “green hydrogen valleys”, i.e., local areas that promote the production and use of green hydrogen through the development of infrastructure and partnerships between industry, government, and local communities15.

The government has fostered the uptake of electric vehicles (EVs) by SMEs, although the EV diffusion is still weak

While the EU-27 average for newly registered electric vehicles (EVs) – including battery electric vehicles (BEVs) and plug-in hybrid vehicles – stood at 18.5% in 2022, Czechia ranked second-last in the EU, with only about 4% of new vehicle registrations involving EVs16, which is partly the result of less generous EV incentives in Czechia compared to other EU countries. As a consequence, Czechia lagged significantly behind the targets set out in the National Action Plan for Clean Mobility in 202217.

To make progress in this area, Czechia’s MIT has supported the acquisition of EVs and charging stations by SMEs through a call under the previous operational programme OP EIC, which approved 520 projects resulting in the purchase of 826 EVs and 347 charging stations. This measure was complemented by the OP Transport 2014-2020, which further developed the network of charging stations. As highlighted in the 2024 update of the National Action Plan for Clean Mobility, a basic coverage of public charging stations (accounting for around 20% of charging needs) has been achieved across Czechia, including fast-charging stations (Czech Government, 2024[15]). However, a persistent challenge is the low average utilisation of these stations, i.e., 2% in 2022 well below Germany (8.5%), Sweden (9.5%), and Denmark (27%). While some imbalance is to be expected at the beginning, since the construction of charging infrastructure initially tends to outpace the sales of vehicles, the current major gap in Czechia suggests that there should be better co-ordination between the rollout of infrastructure (i.e., charging stations) and the market uptake (i.e., of electric vehicles) to limit overcapacity and underutilisation. Stronger incentives for the acquisition of EVs can clearly help address this imbalance.

More recently, in March 2024, through funding from the RRP (CZK 1.95 billion), Czechia’s national development bank (NRB) launched the electromobility guarantee programme, which offers companies of all sizes loan guarantees for the purchase of emission-free vehicles and charging stations, as well as grant contributions up to CZK 300 000 per vehicle.18 Since its launch, the programme has experienced high demand, with around 80% of the total budget spent in the first six months to finance the acquisition of 5 300 EVs and over 2 200 charging stations, exceeding the initial objectives of 4 055 vehicles and 1 500 charging stations.

The NRB programme has been successful, as shown by its strong uptake, but the available funding will run out very soon, which is also the consequence of the generous conditions of the scheme (i.e., up to CZK 300 000 per vehicle, i.e., about EUR 12 300). Moving forward, the generosity of similar measures could be reduced so that more companies can benefit from support, although financial incentives will still be important, as EVs remain on average 30% more expensive than equivalent fuel-burning cars.19

National programmes supporting circularity in SMEs should be scaled up

The promotion of the circular economy is also a priority at the EU level. In addition to reducing waste, the circular economy directly affects industry decarbonisation by reducing the need for new material and products to be manufactured. Czechia’s circular economy strategy is laid out in the “Strategic Framework for the Circular Economy of the Czech Republic 2040”, while specific actions are included in the “Action Plan: 2022-2027”. A stronger diffusion of the circular economy is particularly relevant for Czechia, as national resource productivity – i.e., the efficiency with which material resources are used in the economy – lags behind the EU average, and Czechia’s material consumption is expected to increase by one third by 2050 (OECD, 2021[3]). Furthermore, high levels of commodity prices put pressure on national budgets, further accentuating the importance of the circular economy to reduce dependency on volatile raw material prices. Against this backdrop, SMEs can play a crucial role in reducing resource consumption through the use of technologies that support the recovery, processing, and use of secondary raw materials.

The main national circular economy projects are supported by OP TAC, which is managed by the Ministry of Industry and Trade (MIT), and by the Operational Programme Environment, which is managed by the Ministry of Environment. The most relevant initiative for SMEs has been a call under OP TAC, which was budgeted with CZK 1 billion and provided grants to SMEs to support investments in better materials and re-use of production waste (54%), waste prevention (53%), technologies enabling creation of secondary raw materials (30%), eco-design, and enhanced recyclability of products (10%)20. Recognising the interdependency of many of these activities and technologies, the call was flexible enough to allow companies to apply for more than one type of investment at once. The call received 300 applications, about half of which (160) were approved. This can be considered a high approval rate, but it is in line with the experience of EU-funded programmes in which the programme budget needs to be spent relatively quickly. As of end-2024, a follow up of this project call was already underway and another one in the making, for a total budget of CZK 2.5 billion.

Going forward, it would be recommended to scale up circular-economy projects for SMEs in Czechia. As noted earlier, material intensity is high in Czechia and has not improved significantly in recent years: for example, between 2011 and 2018, the share in the use of secondary raw material only rose from 8% to 8.3% (Czech Environmental Information Agency, 2022[16]). In addition, the evaluation of circular economy projects under the previous operational programme of the MIT (OP EIC, 2014-2020) points to positive impacts of these measures on the increased use of secondary raw materials (MIT, 2023[9]).

Advisory services, sound legislation and adequate infrastructure should complement financial incentives to further promote the circular economy

While financial support is key, it should also be complemented with advisory services, adequate legislation and quality infrastructure to ensure that the circular economy unleash its potential. For example, the establishment of regional circular-economy hubs could further support circularity by offering tailored advisory services for SMEs and by helping them navigate relevant processes and existing funding opportunities. By facilitating multi-stakeholder dialogue (government, business associations, technology and research institutes), these hubs could act as platforms for networking and knowledge-sharing (OECD, 2020[17]). The dual approach of providing SMEs with streamlined access to expert advice while helping public actors understand the practical challenges that SMEs face to become more resource-efficient would be a key strength of these hubs. This model could draw inspiration from successful examples, such as Scotland’s Circular Economy Business Support Service. Alternatively, rather than establishing entirely new hubs, the existing network of Czechia’s regional innovation centers could be leveraged to deliver similar services. These centers already provide bespoke business support to SMEs and start-ups and play a critical role in co-ordinating regional innovation strategies, including those outlined in the National RIS3 strategy (see chapter 5 on R&D and innovation).

Adequate legislation and quality infrastructure are also essential to ensure that key circular-economy activities, such as eco-design and recycling, are possible and easy to perform for businesses. As noted in the first section of this chapter, “complexity of administrative procedures” is the main barrier to undertaking resource-efficiency actions in Czechia, pointing to the importance of simplifying regulations in this area. Support for recycling infrastructure, recycled products and markets for secondary materials are also important pillars for the promotion of the circular economy (OECD, 2021[3]), which take even more importance after the government’s decision to discontinue preferential taxation for recycling activities21. Alternative mechanisms to increase demand for recycled or repaired products could include the promotion and simplification of the existing ecolabel system. Similarly, raising awareness and providing informational tools on how to share clear and accessible product details at the point of sale can also shift consumer and businesses demand for circular products (OECD, 2021[3]).

Finally, monitoring SME participation in the circular economy would provide valuable insights for policymakers. Beyond the targets of the implementation plan of the SME Support strategy, which primarily focus on the number of completed projects, there are several indicators which could offer valuable information for policymakers which could be shaped after the macro indicators used in the EU Circular Economy Monitoring Framework (OECD, 2021[3]).22

Box 7.2. Possible indicators to monitor SME participation in the circular economy

The following indicators could be monitored in the implementation of the national SME Strategy to assess the participation of domestic SMEs in the circular economy:

• Number of patents related to recycling – This indicator would reflect the progress of innovative SMEs in the development of new recycling technologies. Data could be gathered by the Industrial Property Office of Czechia.

• Private investments in circular innovations – This indicator would reflect the profitability and scalability of circular-economy solutions. The data could be sourced from applications for public funding or R&D tax incentives

• Circular material usage rate by SMEs – This indicator would represent the share of secondary materials used in the total input materials of SMEs. This indicator would provide insights into the integration of circular-economy practices in the business model of SMEs. While SME-specific data may not yet be available, it would be recommended to include a similar aggregate indicator for the whole business sector in the “Czechia 2040 Circular Economy Framework”. As monitoring capabilities progress, this indicator could be further refined so to capture SME-specific data.

There is not yet a systemic approach to green skills development in Czechia

In the face of increasing demand for green skills, the OECD has pointed out the importance of training policies that target both high-skilled workers, for example through new university curricula, and mid- and low-skilled workers, including through on-the-job training and micro-certifications (Pissareva et al., 2025[18]).

As of mid-2024, Czechia had not yet put in place extensive green skills policies, despite the presence of three coal regions which could benefit from these programmes. The Operational Programme Just Transition (OP JT)23, which has a budget of CZK 41 billion, has supported SMEs in these regions through advisory services, including through the offer of innovation and digital vouchers, and knowledge-sharing activities, for example informing SMEs about opportunities in the hydrogen economy in the region of Karlovy Vary. Initial feedback from SMEs suggests interest to extend the voucher programme also to cover education and professional training activities (Frankfurt School of Finance and Management, 2024[19]).

More generally, there is scope for a more systemic approach to green skills development in Czechia. For instance, there are currently no programmes that identify the needs of regional employers and provide job seekers with the specific (green) skills in demand (Shaikovski and Broughton, 2021[20]). To do so, it would be useful to monitor the offer of green skills and the distribution of green and brown jobs across the different regions of Czechia, as this would enable the identification of possible mismatches between the demand and supply of green skills at the regional level. The experience of dedicated national labour market research centre, like the one existing in France (i.e., Observatoire national des emplois et métiers de l’économie verte), may offer useful lessons for similar exercises in Czechia.

The Czech government should support SME sustainability reporting through advisory services and automated reporting systems

One important green skill involves sustainability reporting, i.e., the ability of companies to report on their levels of carbon emissions. One of the key pillars of the EU Corporate Sustainability Reporting Directive (CSRD), adopted in 2022, concerns the European Sustainability Reporting Standards (ESRS), which companies subject to the CSRD will need to integrate in their reporting framework from 2025. While most European SMEs are not directly exposed to this obligation, they may have to comply with ESRS when they ask for credit or if they are suppliers of larger firms, as both financial institutions and large companies are asked by the CSRD to report respectively on the emissions of their client portfolio and on the emissions generated along their supply chains (i.e., the so-called Scope 3 emissions) (OECD, 2022[21]).

As of end-2024, the European Financial Reporting Advisory Group (EFRAG), a private association established in 2001 to provide technical advice to the European Commission on the draft of sustainability reporting standards, was working on the development of European “Voluntary Sustainability Reporting Standards” (VSME) for non-listed SMEs, whereas listed SMEs are expected in principle to comply with the same ESRS obligations as large companies. This is a welcome step, although it is not clear if VSME reporting requirements will be comprehensive enough for large companies to be able to report on Scope III emissions in the context of supply-chain relationships, as demanded by the CSRD.

While legislation in sustainability reporting requirements is mostly set at the EU level, the Czech government could support this process in at least three ways. First, it would be important that national initiatives in sustainability reporting closely align with existing EU initiatives, to ensure that SMEs are not faced with multiple and different reporting demands and standards at the same time. A harmonised approach, at least at the EU level, is key if SMEs are to comply with and benefit from sustainability reporting. Second, advisory services can help SMEs navigate a fairly complex legislation, possibly involving other key stakeholders such as the main employer associations and the regional innovation centres. A knowledge-sharing web platform could also be set-up, as done by Portugal’s Knowledge Platform on ESG and Sustainable Finance. Finally, “automated reporting” can help SMEs comply with at least some of the ESG reporting requirements at low cost, although there are always data confidentiality issues to be solved when private information is shared between different actors. One example is emissions related to energy consumption, which could be calculated based on information from energy bills. The “Project Perseus”, which is run by the association Bankers for Net Zero in the United Kingdom, offers an example of this approach.24

Box 7.3. SME greening policies from an EU legislation perspective

The EU’s main energy efficiency legislation, the Energy Efficiency Directive (EED), sets rules and obligations for EU countries to meet energy-saving targets. First adopted in 2012 and revised in 2018 and 2023, the latest update (EU/2023/1791) introduces the “energy-efficiency-first” principle and a target of reducing energy consumption by 11.7% by 2030. Czechia’s SME Support Strategy is broadly aligned with the revised EED through a number of energy-efficiency programmes offering both financing and advisory services. However, as seen earlier, the national energy audit system could be reformed to ensure that audits are followed by the implementation of concrete energy-efficiency measures, notably through the draft of energy rationalisation plans and the offer of incentives to implement the measures suggested in these plans. This will allow to increase the contribution of energy audits to national energy-savings targets, which is currently set at only 3 000 Terajoules, i.e., 0.5% of the total. In this regard, the major energy-savings contributions from the business sector are expected from the Modernisation Fund (i.e., 80 000 Terajoules, which is about 12% of the total energy-savings targets).

Czechia also promotes renewable energy among SMEs in line with its national target of achieving a 30% renewable-energy share by 2030 (National Energy and Climate Plan). Strong uptake of MIT’s solar installation schemes and streamlined permitting for small energy producers are contributing to this goal. However, the EU has raised the 2030 renewable-energy target to at least 42.5% under the revised Renewable Energy Directive (EU/2023/2413). This implies increasing Czechia’s national target to 33%. While legislation is pending, meeting the new goal will require intensified efforts both in terms of infrastructure development and increased uptake by households and businesses, including SMEs.

Finally, the EU’s Circular Economy Action Plan (CEAP), a core element of the Green Deal, promotes waste prevention and circular practices across many sectors, including some with strong SME participation (e.g., packaging, plastics and textiles). Czechia’s circular-economy support programmes are well aligned with CEAP by supporting improved use of materials, re-use of production waste, waste prevention, and product eco-design, but they are relatively modest in size given the strong material intensity of the Czech economy. As noted earlier, complementary measures would be needed to make further strides in the promotion of the circular economy in the SME population.

Conclusions and policy recommendations

In recent years, Czechia has made considerable progress in decarbonising its economy, although it remains one of the most energy-intensive countries in the EU, which is partly linked to its industry composition, notably the relatively large weight of manufacturing. SMEs account for between 41% and 48% of GHG emissions, similar to the EU average, but face significant challenges in the implementation of resource-efficiency actions. Nonetheless, Czech SMEs that have adopted climate strategies are also somewhat pro-active in the adoption of specific green technologies.

The Czech government has introduced various financial and advisory programmes to foster the green transition of SMEs, notably through EU funding sources such as the European Regional Development Fund (ERDF), the Recovery and Resilience Facility, the Modernisation Fund, and the Just Transition Fund. Priority has been placed on financial incentives for energy efficiency and the uptake of renewable energy sources at the firm level. Czechia also benefits from a good network of energy efficiency advisors, while the national energy audit systems could be reformed to better contribute to the national energy-savings targets.

Areas where the government could invest more, on the other hand, include the circular economy, green skills, and supporting compliance with sustainability reporting requirements. Current circular economy programmes are relatively small given the size of the challenge – i.e., the high material intensity of the Czech economy – while green skills policies are still undeveloped despite the possibility of using funding from the Just Transition Fund for this purpose, especially in the three coal-mining regions of Czechia (i.e., Usti, Moravian-Silesian and Karlovy Vary). Finally, the Czech government could ease SME compliance with sustainability reporting requirements through advisory services and “automated” reporting mechanisms, by which relevant information on the carbon emissions of business enterprises could be shared between authorised public and private entities.

Against this backdrop, the following recommendations are put forward to enhance the green transition of SMEs in Czechia:

• Reform the national energy audit system to ensure compliance with Article 11 of the new EU Energy Efficiency Directive, which extends the audit obligation to all companies with annual energy consumption above 10 Terajoules. In this regard, consider the introduction of financial incentives for SMEs going through an energy audit to help them implement the energy savings measures suggested by the auditors.

• Establish an energy information system that builds on data stemming from the energy audits and presents aggregate information energy consumption by sector and firm size and on the average payback period of main energy-savings measures.

• Streamline the current offer of energy advisory services with a view to creating one flagship programme with a bigger budget and better visibility to the SME targeted audience.

• Continue encouraging the uptake of renewable energy sources by SMEs (e.g., solar panels), while also fostering more active participation by domestic SMEs in green supply chains, such as in the green hydrogen valleys.

• Scale up the existing offer of financial incentives for the adoption of circular-economy business models and complement such offer with new advisory services and adequate recycling infrastructure. In this respect, consider the creation of Regional Circular Economy Hubs, a role which could also be performed by the existing regional innovation centres.

• Invest in green skills policies through programmes that target both high-skilled workers (e.g. through university courses) and mid- and low-skilled workers (e.g., through on-the-job training and micro-certifications). The Operational Programme “Just Transition” could be leveraged to this aim.

• Monitor labour market trends, including new job demands in green industries and tasks, to ensure that the demand for green skills is met by the training offer.

• Introduce advisory services and experiment with an “automated” information-sharing mechanisms to help SMEs comply with sustainability reporting requirements.

References

[13] Anderson, S. and R. Newell (2004), “Information programs for technology adoption: the case of energy-efficiency audits”, Resource and Energy Economics, Vol. 26/1, pp. 27-50, https://doi.org/10.1016/j.reseneeco.2003.07.001.

[16] Czech Environmental Information Agency (2022), Report on the Environment of the Czech Republic 2022, https://www.cenia.cz/publikace/zpravy-o-zp/.

[15] Czech Government (2024), Update of the National Action Plan for Clean Mobility (NAP CM), https://www.mpo.gov.cz/en/guidepost/for-the-media/press-releases/clean-and-sustainable-transport--government-approves-the-update-to-the-national-action-plan-for-clean-mobility---282798/.

[7] EC (2024), Flash Eurobarometer FL498 : SMEs, resource efficiency and green markets, https://data.europa.eu/data/datasets/s3221_fl549_eng?locale=en.

[11] EC (2023), Analysis of the recovery and resilience plan of Czechia - Accompanying the document, https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX%3A52023SC0319.

[5] EURES (2023), Report on labour shortages and surpluses, https://www.ela.europa.eu/sites/default/files/2024-05/EURES-Shortages_Report-V8.pdf.

[19] Frankfurt School of Finance and Management (2024), Support to the implementation of the Just Transition in the Czech Republic, https://mmr.gov.cz/getmedia/0e1c01f1-5a3f-43ac-a6d7-2f429237378d/D3-Documentation-for-application-to-the-JTF-under-the-groups-of-projects-_JT-CZ_Final_EN-for-publication.pdf.aspx?ext=.pdf.

[10] Government Office of the Czech Republic (2024), National Reform Programme of the Czech Republic 2024, https://vlada.gov.cz/assets/evropske-zalezitosti/aktualne/NPR-2024_EN-version_2.pdf.

[12] IEECP (2023), Overview of energy audit obligations across Europe – Comparing energy audit requirements from 6 EU countries, https://ieecp.org/publications/overview-of-energy-audit-obligations-across-europe-comparing-energy-audit-requirements-from-6-eu-countries/.

[2] ManpowerGorup (2024), Building Competitive Advantage with A People-First Green Business Transformation, https://www.manpowergroup.cz/green-business-transformation/.

[1] MIT (2024), Podíl obnovitelných zdrojů energie na hrubé konečné spotřebě energie 2010-2020, https://www.mpo.gov.cz/assets/cz/energetika/statistika/obnovitelne-zdroje-energie/2024/3/SHARES-2010-2022.pdf.

[9] MIT (2023), Ex-post evaluation of OP PIK and replication of the counterfactual impact evaluation of OP PI – Final report.

[6] OECD (2023), “Assessing greenhouse gas emissions and energy consumption in SMEs: Towards a pilot dashboard of SME greening and green entrepreneurship indicators”, OECD SME and Entrepreneurship Papers, No. 42, OECD Publishing, Paris, https://doi.org/10.1787/ac8e6450-en.

[4] OECD (2023), Job Creation and Local Economic Development 2023: Bridging the Great Green Divide, OECD Publishing, Paris, https://doi.org/10.1787/21db61c1-en.

[21] OECD (2022), “Financing SMEs for sustainability: Drivers, Constraints and Policies”, OECD SME and Entrepreneurship Papers, No. 35, OECD Publishing, Paris, https://doi.org/10.1787/a5e94d92-en.

[3] OECD (2021), “Towards a national strategic framework for the circular economy in the Czech Republic: Analysis and a proposed set of key elements”, OECD Environment Policy Papers, No. 27, OECD Publishing, Paris, https://doi.org/10.1787/5d33734d-en.

[17] OECD (2020), The Circular Economy in Cities and Regions: Synthesis Report, OECD Urban Studies, OECD Publishing, Paris, https://doi.org/10.1787/10ac6ae4-en.

[18] Pissareva, L. et al. (2025), “Equipping SMEs with the skills to navigate the twin transition”, OECD SME and Entrepreneurship Papers, No. 65, OECD Publishing, Paris, https://doi.org/10.1787/caf420e6-en.

[20] Shaikovski, M. and A. Broughton (2021), Marie Shaikovski and Andrea Broughton,, EC, https://energy.ec.europa.eu/system/files/2021-06/employment_and_skills_in_karlovy_vary_-_part_ii_0.pdf.

[14] State Environmental Fund of the Czech Republic (2021), Programme for the provision of support from the Modernisation Fund: New Renewable Energy Sources (RES+), https://www.sfzp.cz/files/documents/storage/2021/05/20/1621500994_ModF_RES_EN.pdf.

[8] Wildnerova, L. et al. (2024), “Which SMEs are greening?: Cross-country evidence from one million websites”, OECD SME and Entrepreneurship Papers, No. 60, OECD Publishing, Paris, https://doi.org/10.1787/ddd00999-en.

Notes

← 1.  The Environmental Performance Index (EPI) ranks a total of 180 countries according to their efforts in the policy goals of Environmental Health, Enhancing Ecosystem Vitality and Climate Policy. The overall EPI summarises the state of sustainable development and shows which countries are responding best to current environmental challenges. For further information: https://www.cenia.cz/publikace/monografie/slozity-svet-jednim-cislem/ .

← 2.  Total energy supply is the total energy available in a country, including production and imports minus exports and storage, encompassing energy used directly or transformed for consumption. Further information on GHG emissions and energy use in Czechia is available at the following websites: https://www.iea.org/countries/czechia/emissions and https://www.iea.org/countries/czechia/energy-mix .

← 3.  Data from: https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Renewable_energy_statistics#:~:text=The%20EU%20reached%20a%2023.0,pp)%20higher%20than%20in%202021.

← 4.  Material intensity is measured as Domestic Material Consumption over GDP. Resource productivity measures the efficiency with which the economy uses material resources to produce wealth; it is the inverse of material intensity. Resource productivity in Czechia was equal to EUR 1.2 per kg in 2018, versus the EU average of EUR 2.24 per kg. Circular material use rate in Czechia was equal to 8.1% in 2017, versus the EU average of 11.7%. Additional information at OECD (2021[3]), “Towards a national strategic framework for the circular economy in the Czech Republic: Analysis and a proposed set of key elements”, OECD Environment Policy Papers, No. 27, OECD Publishing, Paris, https://doi.org/10.1787/5d33734d-en.

← 5.  Green skills are defined in this case as “the knowledge, abilities, values and attitudes needed to live in, develop and support a sustainable and resource-efficient society”. Further information is available at: OECD (2023[4]), Job Creation and Local Economic Development 2023: Bridging the Great Green Divide, OECD Publishing, Paris, https://doi.org/10.1787/21db61c1-en.

← 6.  At the peak of the 2022/2023 energy crisis, Czech SMEs, together with larger companies and households, benefited from electricity and gas price caps, which have kept energy prices artificially low when the cost of energy had risen to unprecedented levels. The price cap for SMEs was set at 80% of the highest consumption for the calendar month under consideration in the past five years. Additional information is available at: https://www.energiezamene.cz/strop-cen-pro-firmy. As of mid-2024, these measures were being phased out, pointing to the importance of continued progress on energy efficiency to reduce the impact of energy costs on SME profitability.

← 7.  The region of Prague does not qualify for ERDF support due to the average level of income per capita.

← 8.  Further information on the programme “Energy savings – Call II” at: https://www.agentura-api.org/cs/podporovane-aktivity-optak/uspory-energie-optak/uspory-energie-vyzva-ii/ .

← 9.  Further information on the ENERG programme at:: https://www.nrb.cz/en/produkt/energ/ .

← 10.  The National Reform Programme (NRP outlines the government’s planned reforms and key public investments for the following twelve months to address economic, social, and environmental challenges.

← 11.  The full ISO Survey of certifications to management system standards results (2024) is available at the ISO website: https://www.iso.org/committee/54998.html?t=KomURwikWDLiuB1P1c7SjLMLEAgXOA7emZHKGWyn8f3KQUTU3m287NxnpA3DIuxm&view=documents#section-isodocuments-top .

← 12.  The target value for 2030 is 3975 MWh, while the baseline value in 2018 was 2075 MWh.

← 13.  Further information on the national government hydrogen strategy is available at the following website: https://www.mpo.gov.cz/en/guidepost/for-the-media/press-releases/government-approved-the-update-of-the-hydrogen-strategy-of-the-czech-republic--282178/

← 14.  Further information at: “Commission approves up to EUR 6.9 billion of State aid by seven Member States for the third Important Project of Common European Interest in the hydrogen value chain”, https://ec.europa.eu/commission/presscorner/detail/en/ip_24_789.

← 15.  An example of green hydrogen valley in Czechia is the H2 triangle project in the Ústí nad Labem Region, which was approved in 2022 under the Operational Programme Just Transition (https://opst.cz/projekt/h2-triangle/).

← 16.  Calculations based on data from the European Environment Agency (EEA) (2023), https://www.eea.europa.eu/en/analysis/indicators/new-registrations-of-electric-vehicles .

← 17.  Among others, the plan sets the target of at least 220 000 electric vehicles on the street by 2030.

← 18.  Additional information on the Electromobility programme is available at the NRB website: https://www.nrb.cz/en/entrepreneurs-and-companies-received-czk-65m-eur-2-6m-from-the-nrb-to-support-electromobility/.

← 19.  See: “Electric vehicle sales are stumbling. Here’s why”, https://www.businesstimes.com.sg/international/electric-vehicle-sales-are-stumbling-heres-why.

← 20.  The aid intensity in this programme was as follows: small enterprises, 60%: medium-sized enterprises, 50%; and small mid-caps, 40%. Grants ranged between CZK 1 million and CZK 100 million. Additional information at: https://www.agentura-api.org/wp-content/uploads/2023/09/obehove-hospodarstvi-vyzva-i-cs-en-gb-c.pdf.

← 21.  As of January 2024, the standard VAT rate of 21% applied to waste-related activities, thereby abandoning the plan for a reduced VAT rate for recycling processes.

← 22.  For an overview of potentially relevant indicators, see also chapter “8. Monitoring and evaluation plan” in OECD (2021[3]), “Towards a national strategic framework for the circular economy in the Czech Republic: Analysis and a proposed set of key elements”, OECD Environment Policy Papers, No. 27, OECD Publishing, Paris, https://doi.org/10.1787/5d33734d-en.

← 23.  Additional information on the Operational Programme “Just Transition” is available at the following website: https://www.sfzp.cz/en/administered-programmes/operational-programme-just-transition/ .

← 24.  More information on project Perseus is available on the B4NZ website: https://www.bankersfornetzero.co.uk/perseus/.