Austria

In the first three quarters 2003, the increase in electricity consumption was surprisingly high. Almost 46 TWh was consumed between January and September. This corresponds to an increase of 3.4 % compared to the same period the previous year. Electricity consumption from April to June was up 2.5 % on the corresponding period last year. In summer, 2.2 % more electricity was consumed compared to the previous year with a significant increase of 3.2 % during the hot month of August. This can be attributed to the extremely cool winter months, the increased utilization of air conditioning devices during the heat waves and the rise in industrial electricity consumption. All in all, in terms of electricity consumption, Austria was a front-runner in the EU along with Greece, Finland, France and the Netherlands. One trend is very apparent: the demand for electricity will continue to rise in the medium-term. According to the demand forecast prepared by WIFO on behalf of E-Control, demand is expected to increase by 1.7 % per annum.

Against the backdrop of the increasing demand for electricity and the major expansion of renewable forms of energy which, by nature, display fluctuating output levels, great importance was also attached in Austria to the issue of security of supply. The greatest problem – and one which has already existed for a number of years – lies in the inadequate dimensions of the transmission grid used to transport electricity from the generating center in the north to the major consumers in the south. This situation was made all the worse by the intense heat waves in the summer of 2003 and the low water levels in the rivers. The failure of the Hungary-Croatia line in August also had a burdening effect on the Austrian grid.

Definite plans have been in place for quite some time already to expand the power grid and create adequate grid capacities so that bottlenecks can be avoided in the future. A great deal of significance was attached to the construction project to close the gaps in the 380 kV line in South Styria and Salzburg. The 380 kV ring can be seen as an essential backbone – not least against the backdrop of enhanced electricity generation from renewable energy sources.

On 16 September 2003, the directive of the European Parliament which establishes a framework for greenhouse gas emission certificate trading came into force. This directive focuses on the creation of a system within the community that aims at reducing greenhouse gas emission in an economic and efficient manner. Being a member of the EU, Austria had to enforce legal and administrative regulations in compliance with the directive by 31 December 2003 and must also draw up national emission allocation plans by 31 March 2004. These define the number of emission rights that are assigned to the individual companies or plants or the emission cuts that are imposed. Within the framework of the Kyoto process, Austria is obliged to reduce greenhouse gas emission by 13%. In order to achieve this very ambitious goal, the electricity sector has already introduced extensive measures that aim at protecting the environment and will continue to play an active role in promoting these measures in the future. Compared to the EU 15, the share of renewable energies in Austria is already very high.

With 100 % market liberalization, a regulator and clearly defined rules governing competition, Austria is one of trailblazers in Europe on the liberalization front. Following the full deregulation of the Austrian electricity and gas market, the authorities implemented further measures to guarantee and further enhance competition. With effect from 01 November 2003, E-Control lowered the system utilization fees in Austria by, on average, 2.5 % (grid level 3) to 4.1 % (grid level 5) for business customers and by 4.2 % for private customers. This represented one further step towards harmonizing the grid tariffs within Austria.

Two and a half years after full liberalization, the domestic electricity market is, however, still quite fragmented and heterogeneous. In order to remain competitive in Europe over the medium to long term, the consolidation trend in Austria will have to be accelerated.