The Czech Republic Segment supplies just short of 1 million people with approx. 48.2 million m3 of drinking water (previous year: approx. 47.5 million m3 drinking water) and provides waste water management services to around 700,000 residents with around 45.1 million m3 waste water (previous year: approx. 44.3 million m3 of waste water). Given that local authorities are responsible as the infrastructure owners for renovating networks (except for one investment – VaK Beroun a.s.), Energie AG’s measures focus on locating and remedying leaks. The continuous monitoring, reporting and benchmarking allows for a detailed analysis of the complex developments in the piping networks. In recent years, extensive investments have been made in modern hardware and software for hydraulic network modelling, as well as in expanding district metered areas, supplying equipment and providing employee training.
A benchmarking in accordance with the internationally accepted “unit water leakage” method paints a positive overall picture for the 52 supply areas that each have a population of more than 5,000. In fiscal year 2018/2019, 94% of the networks were in good condition, 6% in average condition and 0% in poor condition. For the 2019/2020 fiscal year, these values have changed to 92% in good condition, 6% in average condition and 2% (representing a single municipality) in poor condition.
The business area “Heat” in the Czech Republic Segment supplies over 50,000 residents with district heat and provides installation services for municipalities and private customers with a focus on energy efficiency and CO2 reduction. The ongoing investments in generation systems and heat distribution networks deliver an improved security of supply and a better energy efficiency. In the Czech Republic, the Energie AG Group operates boiler houses with an installed thermal output between 50 kW and 20 MW. Measures aimed at increasing their efficiency and reducing their CO2 footprint are carried out regularly.
Effects of climate change on the business model
The effects of climate change within the operations area of the Czech Republic Segment requires a differentiation between specific regional aspects as well as the water/waste water and heat business areas. For the supply with drinking water, quantitative resource problems must be expected regionally as well as over the course of the year. Large-area distribution systems will be less affected. Peak coverage from additional storage facilities will become necessary in the case of longer periods with little precipitation. In the area of waste water, an increasing frequency of localised to regional heavy rain events must be expected to overburden the sewage systems and sewage treatment plants.
The operator model as the dominant business model in the Czech Republic is affected to a lesser degree by the described scenarios, because the infrastructure is owned by the municipalities, who are bearing the risk of having to adapt the infrastructure. Opportunities arise from the municipalities' need for additional funding, leading to opportunities in the area of public-private partnerships (PPP). In the few cases where Energie AG entities own the infrastructure, additional investments for the development of new resources, for peak demand coverage, and for adaptation of the precipitation/stormwater drainage management must be expected.
In the business area Heat, the milder cold periods must be expected to result in declining heat sales. Financial assistance from the EU climate initiatives may reinforce the trend toward new, alternative, and decentralised options for heat supply, and thereby compete against the centralised heat grids. At the same time, these new developments and the increasing demand for cooling supply offer the opportunity to develop new business models.
Further information on performance and output data as well as key figures, benchmarking and environmental topics can be found at www.energieag-bohemia.at and www.energieag.cz, as well as in the Group Management Report, Czech Republic Segment.