Energy and industry group EPH is currently one of Europe’s main threats for the future of climate and democracy across the continent. The company, owned by Czech oligarch Daniel Křetínský, ranks among Europe’s top emitters of greenhouse gases and has big plans for fossil fuel infrastructure expansion. Mr Křetínský’s firms are also involved in unsustainable biomass management and irresponsible waste management; in addition, they own media outlets, threatening their independency.
The socio-ecological transformation platform Re-set has recently published a report about Mr Křetínský’s business activities called “Fossil fuel hyena: How Daniel Křetínský’s EPH is destroying the climate, profiting from energy poverty, and threatening democracy”. If we want to understand the Czech billionaire’s mindset, we have to go back in time and look at his entrepreneurial beginnings. Mr Křetínský, a lawyer by training, gradually became one of the leaders at investment company J&T, which is now suspected of corruption in several cases, mainly in Slovakia.
The J&T investment group is known for its ability to link its interests with the public sector and politicians with whom it can work very closely. Mr Křetínský built his empire using the very same abilities. EPH was officially set up in 2009; as an unknown company at the time, EPH managed to make a deal with majority state-owned group ČEZ, the largest Czech power company. It was the Czech energy giant that helped the then unknown Křetínský’s EPH buy coal mines and power plants from German coal company Mibrag, as well as the Opatovice power plant in the Czech Republic.
This transaction, on which ČEZ lost millions, was EPH’s starting point in the energy sector. Interestingly, the then Czech PM Mirek Topolánek later started working for EPH after retiring from politics. Another crucial moment for EPH was a deal with the Slovak government to buy a 49% share in state-owned energy supplier SPP in 2013. Thanks to this agreement, EPH obtained management control over the gas company EUSTREAM, which transports gas from Russia to Europe through Ukraine and Slovakia. The Slovak state was left with control over the long-term money-losing parts of SPP’s activities.
This deal secured a long-term stable source of income for EPH, which uses the money from gas imports from Russia to finance its own further expansion. This money helped pay for the purchase of brown coal mines and power plants in German Lusatia, as well as coal and gas power plants in the UK, France, Italy, the Czech Republic, Ireland, and also Slovakia, where its coal power plants receive state subsidies to burn coal. Today, EPH is the company with the third largest greenhouse gas emissions in the EU, surpassed only by German RWE and Polish PGE.
According to a study by Ember and Europe Beyond Coal, EPH has the largest gas infrastructure development plans, as it aims to add at least 6 GW of gas-fired power into Europe’s electricity supply in the coming decade. In other words, EPH is currently Europe’s biggest driver of the coal-to-gas transition, sticking to the plans it made before the war in Ukraine. In Germany, EPH is the only company planning to mine and burn coal after 2030.
But the growing fossil fuel empire is not the only problematic part of Mr Křetínský’s business activities. In addition to developing gas infrastructure, EPH wants to invest in unsustainable biomass management, too. Today, EPH supplies its Lynemouth power plant in the UK with biomass from the USA, cooperating with American wood pellet producer Enviva, which is involved in the deforestation of healthy forests. Furthermore, EPH is masking up to a quarter of its emissions through biomass burning, as shown in a study by FERN, highlighting the shortcomings of European forest protection policy.
Mr Křetínský’s business activities also include waste management, as he is the co-owner (and probably the majority owner) of AVE CZ, which operates eight landfills in the Czech Republic, mostly in the Central Bohemia region, and one incinerator near Kralupy nad Vltavou. Strong lobbying by waste management companies is one of the reasons why the Czech Republic is lagging behind in the transition to recycling and keeps overusing its landfills. Moreover, AVE CZ is being prosecuted because, according to the police, it has not paid landfill fees for several years, defrauding the state and individual municipalities of more than 140 million EUR.
Another important part of Mr Křetínský’s assets is his media empire. In the Czech Republic, he owns the publishing house CMI, whose outlets include the most read daily, Blesk, the tabloid AHA!, the weekly Reflex, the daily E15, and the opinion website Info.cz. Mr Křetínský’s media editors use their influence to attack climate politics and individual activists. Info.cz’s Michal Půr regularly calls the climate movement the “Green Taliban”, while Marek Stoniš from Reflex prefers the term “eco-terrorists”.
Mr Křetínský also co-owns French media such as the daily Le Monde and the magazine Marianne. He also recently loaned 14 million EUR to the left-wing daily Libération, making him its creditor. French media have covered several problematic stories regarding Mr Křetínský’s outlets. Before the French presidential election, for instance, Mr Křetínský influenced the design of Marianne’s front cover. Media ownership can be interpreted as an attempt to influence the shape of public debate, something the fossil fuel industry has been aiming to do for decades.
Mr Křetínský’s business is based on a determination to obtain as much public funding as possible and questionable cooperation with governments. He is not very well known for giving back, however. His companies are incorporated in Cyprus and Luxembourg; and his name also popped up in the Panama Papers investigation. A few weeks ago, Czech media reported that Mr Křetínský’s firm EP Commodities plans to leave the Czech Republic so as to avoid paying windfall tax.
In the long term, there is a risk that Mr Křetínský will expand his empire even further. He is very close to Czech financial group PPF, whose owner, the richest Czech billionaire, Petr Kellner, passed away not that long ago. Some news outlets say that Mr Křetínský has the best chance of gaining key influence over the future of PPF, aided by the fact that his long-time girlfriend is Kellner’s daughter Anna.
Daniel Křetínský and his growing empire is one of the greatest dangers to not only the future of Europe’s climate protection plans, but also to democracy. It is necessary to start discussing policies that could regulate the activities of fossil fuel oligarchs. In Mr Křetínský’s case, however, one of the first steps should be the end of gas imports from Russia, the main source of income of this Czech fossil fuel tycoon.
Radek Kubala
The author is a researcher and campaigner at the socio-ecological transformation platform Re-set.
The report will be translated into English early next year. Please follow Re-set’s communication channels or send me an email at radek.kubala@re-set.cz