On 25 September 2019, an amendment to the Green Electricity Act (Ökostromgesetz 2012 – "ÖSG 2012") passed the Austrian National Council. The objective of the amendment is to prevent an interruption of the expansion of green electricity and to ensure a stable transitional period until the Renewable Energy Expansion Act (Erneuerbaren Ausbau Gesetz) is adopted in the next legislative period.
Why the amendment?
Within the framework of mission2030 – Austria's Climate and Energy Strategy – Austria plans to generate 100 % of its electricity from renewable energy sources.1
The ÖSG 2012 regulates (i) the preconditions for and regime of support for electricity generation from renewable energy sources, and (ii) the financing mechanism for the expenses incurred in supporting electricity produced from renewable energy sources. 2
Under the current framework, the Green Power Settlement Agent (Ökostromabwicklungsstelle – OeMAG) will enter into contracts for the procurement of green electricity from certain types of power plants, when such electricity is offered 3, and within the limits of the available funds for renewable electricity support. The purchasing obligation applies to a term of 13 years (15 years for green power plants operating on solid or liquid biomass or biogas) from the time of contracting. 4
The Green Power Settlement Agent may only conclude new contracts with plants within the limits of the additional annual support funds.5 The drawdown of these funds created long waiting lists for new contracts for wind power plants, small hydropower plants and green electricity plants based on solid biomass and biogas. Therefore, the Austrian National Council has deemed it necessary to adopt an amendment.
To shorten the waiting list, the amendment – like other amendments in the past 6 – provides additional funds for immediate contracting. For the year 2020 – complementing the additional annual support funds – the following amounts are earmarked for immediate contracting:
- EUR 40m for wind power plants;
- EUR 5m for small hydropower plants;
- EUR 30m for green power plants generating electricity from liquid biomass or biogas. 7
Applications for immediate contracting must be submitted to the Green Power Settlement Agent within three months of the entry into force of this provision. 8 For wind power plants and small hydropower plants, the feed-in tariff for such new contracts is to be reduced (by up to 12 %) depending on the expected date of contract. 9
Newly constructed or rehabilitated medium-sized hydropower plants are eligible for investment aid. The cap for the support funds for these investment aids will be raised from EUR 50m to EUR 80m. 10
In addition, the investment subsidy for photovoltaic systems and electricity storage introduced will be extended for one more year. This means EUR 15m is envisaged for the construction and expansion of photovoltaic plants in 2020. If these funds are not exhausted, the rest will be used for electricity storage systems.
The main purpose of the amendment is to provide an interim solution until a more extensive Renewable Energy Expansion Act is adopted. Nevertheless, the reduction of the waiting list is a positive signal for the renewable energy industry and will lead to the implementation of many already planned projects. However, new projects are unlikely to kick off before the Renewable Energy Expansion Act is adopted. This might cause delays in establishing new renewable capacities in upcoming years until 2030.