Household energy bills: the pitfalls and the solutions

In addition to your rent, you have to pay for utilities related to the use of the flat. We invited two lawyers, Kateřina Hájková from HW Legal and Marek Viktor from RELP, to explain how energy bills work in the Czech Republic and the most common pitfalls of the system.
Tired of reading text? You can watch/listen to a 13-minute video with Katerina instead, in our YouTube Playlist of recorded webinars.
The questions discussed in this article:
- What are utilities in the Czech context?
- How can I pay for them?
- What is meant by underpayment or overpayment?
- Common issues and disagreements
- What if I disagree with the billing?
What are utilities in the Czech context?
As a rule, you discuss with your landlord what utilities they provide and you pay for, but typically they are:
- electricity
- heat supply,
- water supply and waste water disposal,
- lift operation,
- illumination and cleaning of common areas in the house,
- enabling the reception of radio and television signals
- operation and cleaning of chimneys
- removal of municipal waste.
How can I pay for them?
You have two options:
- lump sum payments,
- advance payments.
1] Lump-sum payments are simpler. You can pay one monthly amount including rent + lump-sum payment for all or some utilities, as agreed with the landlord. Or the amount for all services can be included in one lump sum payment, and the rent is separate.
Lump-sum payments for services mean that the landlord does not have to prepare settlement of the payments received at the end of the accounting period or at the end of the tenancy, nor establish the total consumption, nor calculate the final price of each service to learn if there is an overpayment or an underpayment.
This has a limitation though: for lease periods of more than 24 months (and for an indefinite period), the lump sum payment cannot include (1) the payment for the supply of heat, (2) the supply of water (called vodné) and (3) the disposal of waste water (called stočné).
Also, if the lump-sum payment amount needs to be changed, your consent with the landlord (or some pre-agreed mechanism of valorisation) is necessary.
2] Advance payments consist of paying monthly advances for each service. The amount of the advance payments is usually agreed in the rental contract. However, the landlord can unilaterally change the amount of the advance payment if the price of the service or, for example, the amount of consumption changes. Beware, your consent is not necessary.
The landlord may demand the changed amount of the advance payment no sooner than from the 1st day of the month following the delivery of a written notification of the new amount of the advance payment to you. The change in the amount of the monthly advance payment must be justified in the notification, otherwise the increase in the advance payment will not take place.
Advance payments are paid by you throughout the billing period. This lasts for a maximum of 12 months and the start date is determined by the landlord or agreed in the lease agreement. In most cases, it is one calendar year.
Within 4 months after the end of the billing period (typically, but not necessarily, by the end of April of the following year), the landlord delivers a bill to you.
This bill must include:
- the actual cost of the utilities, broken down to the specific types of the utilities, with all necessary details included; and
- the total amount of monthly advances received
Both must be done in such a way that any differences in the billing are obvious and verifiable.
What is meant by underpayment or overpayment?
It rarely happens that the advance payments are equal to the consumption. The billing will typically result in either:
- an overpayment, because of which the landlord has to return to you part of the advance payments received from you, or
- an underpayment, because of which you have to pay the amount for the services consumed above those advance payments.
The overpayment or underpayment must be paid within an agreed period and if no period is agreed on, then within 4 months after the date you received the bill.
End of a lease
The same rules apply even after the end of the lease. The landlord must deliver to you the bill within 4 months after the end of the billing period, which may lead to time delays, depending on when the lease ended.
The amount of consumption is based on the energy meter at the time of takeover and handover of the flat. Therefore, you must be careful when taking over at the start of the lease and handing over the apartment at the end of the lease to the landlord and make sure that these values are correctly recorded in the handover protocol.
Common issues
- the landlord delivers an insufficient utility bill,
- the landlord delivers the bill too late,
- the landlord does not deliver any utility bills at all.
1]
If the landlord delivers an insufficient utility bill to you, any underpayment doesn’t become payable. Once you find the bill incorrect (e.g. the consumption is too high, the prices are not correct), then you can ask the landlord in writing within 30 days of receiving the bill to present the documents showing the costs of the individual services, the method of their calculation, the method of determining the amount of the advance payments for services and the execution of the bill. Your landlord also must allow you to obtain a copy of these documents. The landlord must comply within 30 days. You can use these documents to object to the billing.
You may object to the bill in writing within 30 days of receiving it or within 30 days of receiving the supporting documents. The landlord must deal with your objections within 30 days of receiving your objections.
If you receive a formally correct utilities bill and do not object to it in time, then you are believed to have accepted the utilities bill (both the manner and content of the bill).
2]
If the landlord delivers the bill after the legal deadline, they should pay a late fee to you for each day the bill is late. The amount is established at CZK 50 for each day of delay. You can be kind and agree to a lower penalty. (Sometimes the landlord delivers the bill late because the utilities suppliers or the HOA also deliver the utilities bills late – typically during May. The landlord himself may then find it difficult to provide the bill in time.)
3]
If the landlord does not deliver any utility bills at all, your defence is to ask the landlord to submit the bills for the billing periods for which they have not been delivered. At the same time, you can claim a late payment penalty for the entire period of missing bills for each year, for each bill separately. Just beware, the right to pay the late payment penalty is time-barred 3 years back.
Also, do not forget, if the utility payments are done in a lump sum, the landlord does not have to provide you with any utility bills.
What if I disagree with the billing?
You first should contact the landlord and attempt to resolve the issue by an agreement. As already mentioned, you have the right to request a detailed breakdown of the bill, which should include all costs incurred for services and utilities, as well as the original bills from suppliers.
If you feel or find out that there is something wrong with the billing, you should contact the landlord and ask for a corrected billing.
What if the landlord does not respond or agree?
If the landlord does not respond to you or you cannot come to an agreement with them, you can formally file the complaint.
The complaint should be made in writing and sent by registered mail, to ensure proof of delivery. In the complaint, you have to tell the landlord that you find the bill incorrect. It is better, but not entirely mandatory, to describe what you find wrong. This helps to resolve the problem faster, but simply claiming that the calculation is not properly done is enough.
Careful! You have to send this complaint within 30 days. So if you don’t have your arguments ready, do send at least this bianco complaint (“the calculation is not properly done”). Continue trying to solve any issues outside of court. Some landlords, especially the ones with strong legal teams, will be familiar with this bianco complaint and will try to make you lose the case by giving you false promises to delay.
What if it gets serious?
Try to solve the disagreement through mediation. If this approach does not succeed either, then you can pursue the matter through the court. That is not often needed, though.