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Brussels investigates €30bn public loan for two reactors in Czechia

The European Commission opens an in-depth investigation into Prague's public funding of a major nuclear project, which could reach €30bn ($32.88bn), with guaranteed revenues over forty years.

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The European Commission has announced the opening of an investigation to determine whether the Czech government’s proposed public support for the construction of two new nuclear reactors complies with European Union state aid rules. The project, planned at the Dukovany site, is part of Prague’s energy strategy to reduce reliance on fossil fuels.

A state loan and guaranteed electricity price for 40 years

The Czech government is planning a subsidised loan ranging from €23bn to €30bn ($25.48bn to $32.88bn) to fully cover the construction costs of the two reactors. In parallel, a “contract for difference” (CFD) mechanism would guarantee a minimum price for electricity produced by the facilities over a 40-year period.

This model aims to secure revenues for the project consortium EDU II, 80% owned by the Czech state and 20% by the energy group ČEZ, the country’s sole nuclear operator. The construction contract has been awarded to Korea Hydro & Nuclear Power (KHNP), with a contract value of €16bn ($17.52bn).

A strategic decision in a regional energy context

The European Commission acknowledged that, based on a preliminary assessment, the project appears to meet an identified economic need. However, it stated that it “has doubts about the full compliance of the state aid measures” and wants to assess the proportionality and relevance of the support package.

Czech authorities plan to begin construction in 2029, with commissioning of the first reactor scheduled for 2036. It is one of the largest energy investments in the country’s history. Czechia, home to 10.9 million people, is moving away from coal while reinforcing its independence from Russian energy imports.

Closer scrutiny of public support mechanisms

The CFD mechanism, increasingly used to support investment in major energy infrastructure, remains under close watch by Brussels, which seeks to prevent market distortion within the internal energy market. The Czech case may become a benchmark for how EU member states structure public support for civil nuclear development.

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