[RedirectPrompt_en-US]

24 February 2020
newsletter
austria

New opportunities for renewable energy: Austrian government programme 2020 to 2024 | Austria

Introduction

For the first time, a coalition government consisting of the People's Party and the Green Party has a powerful voice in Austria. On 2 January 2020 the government programme for the legislative period 2020 to 2024 was published.(1) The programme is called Taking Responsibility for Austria and should make Austria a pioneer in climate protection.

The high priority of climate protection runs like a red thread throughout the entire 326-page programme. The Paris Agreement climate targets are to be met at all costs, while the Climate Protection Act, with its clear greenhouse gas reduction paths, responsibilities, timetables and corresponding resources, should ensure that Austria does not exceed its CO2 budget.

For achieving the climate targets, one of the most important projects is the expansion of energy production from renewable sources. In concrete terms, the government programme includes not only financial incentives, but also simplifications in plant approval procedures and targets for the expansion of renewable energies stipulated as 'public interest'.

At the same time, the tightening of environmental protection legislation concerning water, nature and air protection is likely to take place with a sense of proportion.

The programme is rounded off with measures for sustainable resource use in the areas of waste legislation and land use.(2)

Necessary expansion of renewable energy

The ambitious objectives of the government programme can be summarised as follows:

  • 100% electricity supply from renewable sources by 2030; and
  • climate neutrality (not required until 2050 under EU targets) by 2040.

Since electricity demand is only a fraction of Austria's total energy demand, a further massive expansion of energy generation from renewable sources will be necessary from 2030 to 2040.

These goals are to be achieved by further developing all forms of renewable energy use by (in total) 27 terrawatt hours (TWh) by 2030.(3) One of the government's beacon projects is to equip 1 million roofs with photovoltaic (PV) panels combined with an uncomplicated direct distribution for self-produced electricity.

Further, major changes in Austrian law will set the stage for so-called 'renewable energy communities' and 'citizens' energy communities'. Such communities aim to bring together electricity producers, storage operators and consumers to set up 'micro-grids' and facilitate the distribution of electricity on a regional level. Besides positive effects on the promotion of renewable energy and savings for consumers, vast opportunities could be created for utility companies and municipalities in those energy communities.

Climate neutrality also requires a change in the use of fossil fuels. Therefore, the government programme calls for avoiding the combustion of fuel oil, coal and fossil gas for the provision of heat and cooling as far as possible. In addition, Austria's consistent anti-nuclear energy policy will continue. Considering an increased demand for electricity in the transport and industry sectors, the abstention from nuclear energy and electricity generation from fossil fuels will require a major increase of the (already ambitious) goal of an additional 27TWh of renewable energy generation from 2030.

In order to support the volatile and decentralised electricity generation through wind and PV plants, hydrogen technology will also be promoted. The government programme calls for the development of a new Austrian hydrogen strategy and the formation of a climate protection and hydrogen centre as a cluster for research, innovation and technology.

Financial incentives

Besides taxes, the main mechanism to achieve the abovementioned climate policy objectives is subsidies. On the one hand, the government is planning to reform subsidies for eco-electricity that affect the power generation sector, while on the other hand providing subsidies in the area of energy consumption.

The subsidies for eco-electricity, which are to be newly regulated in the Renewable Energies Expansion Act, will be changed from the previous fixed feed-in tariffs to a 'sliding market premium'. According to this model (already implemented in Germany), the difference between a reference value, which is determined in a tendering procedure, and the market price actually achieved will be granted. The term of the market premium is to be extended to 20 years (instead of the previous 13 or 15 years for fixed feed-in tariffs). In addition, the existing provisions for investment premiums should remain unchanged.

The government programme lays a special focus on PV systems: in addition to simplifying network access and legal framework conditions, the programme plans to extend performance-related funding limits and eligibility for funding on certain areas outside buildings (eg, car parks).

A so-called 'green deal' is to be implemented to promote emission-reducing investments by large energy consumers and high-emission industries, such as the steel, cement and chemical industries and the waste management sector. On the one hand, the existing instruments for technology development at the national and European level (eg, the EU Emissions Trading System Innovation Fund, Horizon Europe and European Cluster Collaboration Platform) are to be used more intensively, while incentive systems are planned for the replacement of inefficient technologies and investment premiums for the use of climate-friendly technologies.

Environment, nature, water and air protection

The chapter "Environment & Nature Protection" contains rather mild and programmatic objectives. For example:

  • the competences in the field of biodiversity are to be "clarified and, if necessary, adapted";
  • a concept for the protection and sustainable use of the alpine environment under the Alpine Convention is to be developed; and
  • the federal states are to be supported in maintaining existing and designating new Natura 2000 areas and national parks.

It remains to be seen what consequences the commitment to the "ambitious implementation of international obligations" will have and whether it will also affect, for example, the recently amended rules on public participation in approval procedures and the right of appeal (which are regulated in the Aarhus Convention) or the current protection regime of the Alps (according to the Alpine Convention and its protocols).

Regarding the impact of hazardous chemicals and pollution on air, water and soil, the government plans significant reductions by 2030.

Specific reduction targets are foreseen for water resources, among others, for nitrate and pesticides. To achieve the targets of the Water Framework Directive, the standardisation of the conditions for the establishment of snow depots and legal facilitations for the implementation of hydromorphological measures are planned. In addition, the drinking water supply is not to be privatised and is to remain in the public sector.

In the field of air protection, the government programme stipulates improvements in the Air Imission Protection Act, such as a pilot project on measuring points for ultra-particulate matter and measurement of the black carbon content of PM2.5 emissions. In addition, the national air pollution control programme is to be revised and special attention is to be paid to ammonia, nitrogen oxides and particulate matter.

Sustainable use of resources and land

At the heart of the new government's waste policy is the promotion of the circular economy (recycling). This involves incentives for sharing, leasing, reusing, repairing, reconditioning and recycling existing materials and products as long as possible. The measures provided for in the government programme include financial incentives for repairs, expansion of returnable systems (especially for beverage packaging), an action plan against food waste and a deposit system on batteries and small appliances.

The government programme also provides for measures concerning the mitigation of negative effects of plastic and microplastic. To achieve this goal, the Austrian government is planning several measures to reduce their use (also through a ban on microplastics in certain products) and make them recyclable.

The focus on sustainable development can also be found in the chapter on regional planning and the commitment to a reduction of land sealing and land use (ie, the conversion of grassland into buildings, shopping centres, car parks and roads). The aim is to reduce land use to a net 2.5 hectares per day by 2030 and to compensate for additional land sealing by unsealing corresponding areas. Considering that in 2018 this figure was still 10.4 hectares per day, these aims are very ambitious.

Comment

In summary, the government programme is extensive in terms of climate protection. Some chapters already provide for specific legislative proposals, while others remain on the surface and on a programmatic level.

According to the government programme, many levers are to be pulled to achieve the ambitious climate protection targets. The required (massive) expansion of energy generation from renewable sources is not being neglected: in addition to extensive projects in the form of financial incentives, the programme also includes measures to speed up approval procedures, although the specific proposals remain vague. On a positive note, the environmental protection standards, which are enormously relevant to the progress of the expansion of renewables, are unlikely to be significantly tightened.

One question that remains open for now is the size of the funding pools. The field of subsidies for renewable energy sources suggests that funding pools – however big – are drained before the intended duration.

Put short, the government programme for 2020 to 2024 in terms of climate protection offers several opportunities for existing and future operators of plants for energy generation from renewable sources, recycling enterprises and enterprises with an affinity for 'green innovation' in general. Depending on the final level of the funding pools, one could see truly golden times ahead for the green economy in Austria.

This article was first published on International Law Office

Endnotes

(1) Available in German here or here.

(2) For further details on the government programme please see "New government programme sets course for expansion of renewable energies".

(3) Expansion of PV systems by 11TWh, wind power by 10TWh, hydropower by 5TWh (the division between large and small hydropower should be based on so-called 'ecological potential' and the revitalisation of large hydropower plants should be accelerated) and biomass by 1TWh.

Christoph
Cudlik

Attorney at Law

austria vienna

co-authors