Austria's New Energy Future

By Dr Reinhold Mitterlehner, Federal Minister for Economy and Energy, Austria
Autumn 2012

Europe's energy system is facing huge challenges which have been accentuated further by the nuclear disaster in Fukushima. The inevitable reduction of the proportion of nuclear power in the energy mix has increased the pressure in many countries to introduce a real change in sources of energy. It is even more important within the framework of the EU's 2020 targets to use every opportunity to move our energy supply as soon as possible towards an efficient, renewable and secure system. Only in doing so, Europe can take a leading role in the globally competitive field of renewable energy and noncarbon-based technologies. Moreover, the dependence on oil imports must be reduced in the long term in order to protect business and domestic users from large fluctuations in energy prices and supply.

In Austria, in order to be able to shape this process pro-actively, the further development of already well established alternative energy sources will be accelerated on all fronts. Within the framework of the new Green Energy Legislation, the share of renewable energy sources of our total electricity consumption will increase to 85% by 2020. With renewables currently standing at 68%, Austria is leading the field in Europe. As a result of our amendment, a total of 12 billion Euros in investment funding will be released for green technologies until 2020, thereby increasing the competitiveness of producers of green energy. This helps businesses with exports, because green innovations 'Made in Austria' are increasingly sought after world-wide. Furthermore Austria will be able to successfully position itself as an important energy hub. Through the extension of domestic pumped storage power stations we are increasingly becoming the 'green powerhouse' of Europe.

These positive developments underline the fact that within the scope of the Energy Strategy for Austria the right measures are being brought forward in a timely manner. While other European countries are still in the starting blocks, Austria is fully engaged in changing its energy provision and is thereby well on the way towards achieving the energy targets of the European Union.

In the area of green energy we want to give incentives to renewable energy technologies to become cost competitive. Under the new legislation annual subsidies will more than double to 50 million Euros. In order to take account of technological development and to avoid excessive demand,
total funding will decrease by one million Euros a year to 40 million Euros in 2021. In particular, we are further developing the means of production of future photovoltaic technology, but wish to ensure, through this reduction in funding, that cost reductions in technology are fully taken account of.

Each year the available funding will be split between the different technologies on the bases of an analysis of their potential. In this way we shall reach an optimum energy mix and will increase Austria’s security of energy supply while keeping track of costs. With this funding, constructors and
operators of green energy plants will receive support for 13 years or, in the case of raw material dependent plants, for up to 15 years, with entry tariffs guaranteed by the energy distributors. It was important when drafting the Bill to ensure a reasonable balance between the interests of producers and buyers of green electricity. Likewise the legislation’s new financial model supports and promotes the international competitiveness of energyintensive businesses.

Alongside the development of renewable energy sources, efficient deployment of energy supply is the keystone of a sustainable energy future. Indeed, the cheapest and most environmentally-friendly electricity is still that which has not yet been consumed. Therefore we want to reduce energy consumption through various measures and to stabilise it at 2005 levels by the year 2020. The requisite national measures and targets will be drawn up along agreed EU-wide energy efficiency guidelines for Member States, which will be binding both for national administrations and for energy distributors.

In this context the introduction of Smart Meters prescribed by the European Union brings new opportunities and challenges. The greater transparency enabled by Smart Meters should increase cost awareness, thereby making energy-saving easier for consumers. Simultaneously Smart Meters combined with Smart Grids support further advances in renewable energies, leading to more efficient use of the national energy grid.