0 - Highlights

- The development of the Czech gas industry was triggered in the 1970s by Czechoslovakia's involvement in the transit and transmission of Russian gas, thereby gaining access to its sources.

- Czechoslovakia's split, and the transformation of the state-owned CPP in the last two to three years was a complex process which has been successfully completed.

- The Czech gas industry's privatization is still far from being finalized. The state-owned company, CPP/Transgas is to retain its status of a 100% state-owned concern until about the year 2000.

- 8 regional distribution companies (RDCs) were established as joint-stock companies in 1994. 15% of RDC's assets were sold to Czech citizens under the 'second wave of voucher privatization. They have changed hands many times by now. The 20% of the shares that have been slated for both domestic and foreign investors are still waiting for their would-be owners because their sale was suspended by the Czech Government in 1995.

- The energy sector is regulated by the Ministry of Industry and Trade, according to the Energy Act of November 1994 and Regulatory Decrees. The principal new provision of the Act is the introduction of governmental regulation, exercised by the Ministry of Industry and Trade, for doing business in the energy sector (i.e. the production, purchase, storage, transport and distribution of gas, electricity and heat) and state regulation of the energy companies.

- Gas prices are still deeply deformed. Prices are being kept at low levels because energy input plays a significant role in the competitiveness of the products turned out by other industries, and in expenditures on households and living costs.

- A scenario for the correction of distorted prices exists and is gradually implemented.

- Natural gas has taken a firm foothold in the Czech energy sector, and gas is gaining an ever increasing share in the consumption of primary energy sources (16% in 1995).

- The low price of natural gas lead to further increases in gas demand (+16% in 1996 to 9.1 Bcm), largely for the space heating of households. Total household consumption is 26% of total gas consumption.

- Important changes are taking place in the structure of gas consumption; these result in marked changes of the load factor

- Considerable potential exists in the Czech Republic for demand growth. In the next 14 years, it might go up by up to 75% (to 14 Bcm). To meet the demand, efforts will be continued to diversify the sources of natural gas and its transportation routes.

- During the first half of 1996, the restructuring and privatization of Cesky plynarensky podnik, s.p., was completed with the last two LPG bottling plants at Karlovy Vary and Dysina were privatized.

- On 1 July 1996, all of Cesky plynarensky podnik s.p., operations were incorporated in its last remaining subsidiary, Transgas.