On 24 April 2026, the European Commission (the “Commission”) published its decision approving the Czech Republic’s operating aid scheme for biomethane production.[1] The scheme was approved under the Clean Industrial Deal State Aid Framework (“CISAF”).[2]

The operating aid will be provided in the form of an auction-based monthly bonus and will apply to biomethane produced in production facilities located in the Czech Republic that:

• are or will be connected to the gas transportation system; and
• are already in operation or will be put into operation no later than three years from the date of the decision granting the operating aid.[3]

Biomethane produced in these facilities will be purchased by a mandatory purchaser selected by the Energy Regulatory Office (“ERO”) and the Ministry of Industry and Trade (“MIT”).[4]

Two auctions will be held each year in which the operating aid will be tendered.[5] According to the information available, the first auction is expected to be announced in the coming days. Applicants for operating aid will participate in the auctions by submitting their bid containing a reference auction price; the applicants offering the lowest reference auction price will be selected. In addition, a maximum reference auction price will be set for each auction, and bids exceeding that price will be automatically excluded from the auction.

The reference auction price represents the target price that the biomethane producer is ultimately intended to receive under the operating aid scheme. However, the mandatory purchaser does not pay this price to the producer directly, but instead pays the market price of gas. If the market price is lower than the reference auction price, the gas market operator pays the producer the difference. Conversely, if the market price is higher, the producer returns the difference to the gas market operator. The scheme therefore operates as a two-way contract for difference, stabilising the producer’s revenue at the level of its successfully tendered reference auction price.

The operating aid scheme will also be subject to several conditions. These include, in particular:

• the obligation to supply a minimum monthly volume of biomethane into the gas transportation system, which, according to the information available, should correspond to 75% of the maximum output of the biomethane production facility’s capacity;[6]
• the obligation to ensure a minimum share of so-called advanced biomethane in the total volume of biomethane produced; and[7]
• the obligation to ensure that the biomethane produced complies with the maximum emissions intensity requirements.[8]

The specific parameters of these conditions will be set separately for each auction; failure to comply with even one of these conditions will result in the loss of entitlement to operating aid for the relevant month. However, the biomethane producer’s entitlement to the market price for the biomethane supplied, payable by the mandatory purchaser, will remain unaffected.

Further information is available on the MIT website.[9] We will, of course, keep you informed on an ongoing basis once more detailed information on the auctions planned for this year is published.

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[1]     State Aid SA.119368 (2026/N) – Czechia, CISAF – Support scheme for biomethane 2026–2030, 14 April 2026. Available at: https://ec.europa.eu/competition/state_aid/cases1/202617/SA_119368_67.pdf.

[2]     Communication from the Commission – the Clean Industrial Deal State Aid Framework (CISAF) (C/2025/3602). Available at: https://eur-lex.europa.eu/legal-content/CS/TXT/HTML/?uri=OJ:C_202503602. Sections 3 and 4.1 of the CISAF contain the rules on the basis of which the aid scheme was approved.

[3]     This rule is set to apply to auctions occurring in 2026 and 2027; for the following years there is the possibility of shortening this period to 2 years from the date of the decision granting the operating aid.

[4]     In this regard, auctions on the basis of which the mandatory purchaser will be chosen for a certain period of time will also take place.

[5]     The volume of biomethane production sought will be determined for each auction by the Government in Government Regulation No. 189/2022 Coll., on the definition of the development of supported energy sources, as amended.

[6]     The assessment of this obligation will be done with reference to the parameters specified in the relevant gas producer’s gas production licence.

[7]     Advanced biomethane” means biomethane produced from waste, residual or non-food feedstocks, as listed in Part A of Annex IX to Directive (EU) 2018/2001 on the promotion of the use of energy from renewable sources (RED III).

[8]     The maximum emissions intensity will be set in grams of carbon dioxide equivalent per MJ of biomethane produced.

[9]     MIT Communication on the upcoming announcement of auctions for operating aid for biomethane, 27 March 2026. Available at: https://mpo.gov.cz/cz/energetika/sdeleni-ministerstva-prumyslu-a-obchodu-k-pripravovanemu-vyhlaseni-aukci-na-provozni-podporu-biometanu–292293/.

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This material is for general information on current topics only, it is not advice. It does not take into account any special circumstances, financial situations or special requirements of the addressees. Recipients should therefore always seek appropriate professional services for the information provided. Notwithstanding the careful compilation of this material, bpv Braun Partners s.r.o. advokáti, its partners, associates or co-operating solicitors and tax advisers cannot guarantee the accuracy or completeness of the information contained herein and accepts no responsibility for acting or refraining from acting on the basis of the information contained in this material