According to the government, Elektrárna Dukovany II, a company to be wholly owned by state-controlled power group ČEZ, will be responsible for the expansion of the Dukovany nuclear power station. A tender for the project is expected to be organised at the end of 2020.
The government has also committed to provide financing and political guarantees for the project, the statement said.
The government said it will conclude an agreement with ČEZ which will guarantee the company can obtain financing for its project at the same borrowing rates as the Czech state.
The Czech Republic has also pledged to guarantee the stability of the legislative and regulatory environments and provide possible compensation for any changes in these environments.
The government said it will not provide guarantees on future power prices by way of a contract for difference as used by the UK government for the Hinkley Point C project in southwest England.
A statement by the Czech ministry of industry and trade said the country will have to negotiate the terms of the chosen financing model with the European Commission to make sure it fits the rules of the internal market.
The statement said the government sees the construction of new nuclear capacities as a way of ensuring energy independence and security of energy supply.
There are four Russia-designed VVER-440 reactor units at the Dukovany site, and the ministry said they should be replaced by new ones in about 20 to 30 years.
The ministry said construction of new units will contribute to the fulfilment of the state energy policy goals, which foresee an increasing share of nuclear energy in electricity production at the expense of coal-fired generation.
The Czech Republic has six commercially operational reactor units. In addition to the four units at Dukovany, there are two Russian VVER-1000 units at Temelín.
A 2015 Czech state energy policy calls for one new unit at Dukovany and possibly three more either at Dukovany or Temelín.
Details are online (Czech): http://bit.ly/2LaTh6m