Grid Segment

Statutory and regulatory framework in the Grid Segment

The Renewable Energies Expansion Act, which is currently under review, will also bring about innovations for the Grid Segment when it comes into force on 1 January 2021. For further information, see the Group Management Report, section General conditions – energy and climate policy environment.

As an operator of essential services, Netz OÖ GmbH is required by the Austrian Network and Information System Security Act (NISG) to comply with stricter requirements for the information security of its ICT services (network and information systems). The implementation measures within the Group include the introduction of an information security management system (ISMS) in line with ISO/IEC, taking into account ISO 27019, the NIS fact sheets and the utility minimum standard of the electricity industry.

As of 1 January 2020, the grid usage fees of the electricity sector rose by between 8.4% at grid level 7 and 11.7% at grid level 4. This was due to higher investing activities in the grids and higher costs in upstream grids. The regulatory parameters established remained stable in the 4th regulatory period. In the System Usage Fees Ordinance for Electricity 2018 and its 2020 amendment, the metering charges were newly regulated, with the metering charges for low-voltage load profile metering and quarter-hour maximum metering being significantly reduced as of 1 January 2020.

In the natural gas sector, the grid usage fees for consumers at grid level 3 fell by 2.6% on 1 January 2020, while grid level 2 increased by 6.9% for consumers.

The general economic conditions for natural gas have been defined for the 3rd regulatory period since 1 January 2018, but the Austrian Federal Economic Chamber and the Federal Chamber of Labour have objected against the stipulations made by the regulatory authority. The decision for the year 2020 is currently still pending, while a decision for the years 2018 and 2019 was issued by the Federal Administrative Court in the reporting period. This decision defined the regulatory framework, which is tantamount to a deterioration for the industry compared to the original decision. The parameters of the 3rd regulatory period remain stable on this reduced basis.

Business development in the Grid Segment

The Grid Segment generated sales revenues of EUR 366.6 million in the reporting period. This represents a moderate increase of 1.1% compared with the previous year's sales revenues. In fiscal year 2019/2020, the EBIT of the Grid Segment amounted to EUR 36.9 million and was EUR 114.3 million up on the previous year's EBIT of EUR -77.4 million.

A necessary change in the valuation method as of 30 September 2019 prompted an impairment of EUR 109.3 million, which had a negative impact on the operating result in the previous year and accounts for the main deviation from EBIT in the reporting period.

Concerning operational activities, the regulatory tariff increase combined with lower upstream grid costs in the electricity sector had a positive effect on results in the reporting period. The regulatory cuts in gas grid tariffs and volume reductions in both the electricity and gas grids partially offset this effect.

Electricity and natural gas grid as the backbone of the Upper Austrian supply infrastructure

Electricity grid distribution volume to end customers

in GWh

In the 2019/2020 fiscal year, 7,677 GWh of electricity was distributed to end customers from the electricity grid (previous year: 8,067 GWh). This represents a decrease of 390 GWh (-4.8%) compared with the previous year. The decline in volume is mainly due to a decline in the industrial and commercial customer sector in the second half of the fiscal year in the wake of the COVID-19 lockdown. As of 30 September 2020, Netz OÖ GmbH supplied approx. 510,000 active customer installations.

One major challenge in grid operation with a tangible influence on the availability characteristics of the electricity grid was a consequence of several storms in February 2020, with storm “Sabine” on 10 February 2020 having the greatest impact on the electricity supply. In this situation, the 110 kV high-voltage grid once again proved to be the strong and reliable backbone of the Upper Austrian electricity supply.

In the 2019/2020 fiscal year, the activities of the Grid Segment focused on the consistent implementation of the “Electricity Grid Master Plan Upper Austria 2028” (Stromnetz-Masterplan Oberösterreich 2028) in addition to regular grid upgrade and expansion measures. Despite the extremely difficult project environment, the “Alm- und Kremstal Electricity Supply” project has been consistently pursued since construction activities resumed in August 2019 and is expected to be completed in spring 2021. In July 2020, line construction work began on the “Pramtal South Electricity Supply” project, and the Raab transformer station was completed in September 2020. In the “Mühlviertel Electricity Supply” project, landowner information events were held and a detailed route in the preferential corridor is available. Public communication, detailed planning and routing have commenced in the joint project “Central Region Upper Austria Electricity Supply” with Austrian Power Grid AG and LINZ NETZ GmbH. Submission for environmental impact assessment is planned for autumn 2021.

In the year under review, the programme to replace overhead medium-voltage lines that are particularly susceptible to disruption with underground cable proceeded according to plan. In the twelfth year of this programme, a further 14 kilometres of overhead power lines were replaced by underground cables.

Due to the ongoing integration of local electricity generation facilities, ensuring voltage quality for grid customers on the low-voltage grid remains a challenge. The installed capacity from photovoltaics is already around 283 MW (previous year: 243 MW) with around 24,100 connected systems (previous year: 20,000 systems). Lessons learned from research and development projects are being successfully adopted for efficient grid integration.

Natural gas grid distribution volume to end customers

in GWh

The volume of natural gas transported for end customers in the Company's own grid dropped by 7.8% to 19,205 GWh year-on-year in the 2019/2020 fiscal year (previous year 20,831 GWh). In the high-pressure area, natural gas volumes dropped, primarily due to lower proprietary electricity generation by industrial operations and power plants. Volumes in the household and trade sectors were slightly above the previous year's level.

In the year under review, in addition to the standard grid expansion, grid connections were also built for larger business customers in St. Florian am Inn, Ranshofen, Altenfelden, Engerwitzdorf, St. Georgen bei Grieskirchen, Gmunden, Schwanenstadt and Pöndorf. A new distribution station was built in Pöndorf, while in Neukirchen an der Vöckla/Zipf the existing distribution station was replaced by a new one.

Three high-pressure natural gas pipelines over a total length of 9.3 km were investigated using intelligent pigging. Various repairs to high-pressure pipelines (undercoverage) were carried out, and five pig locks were replaced or retrofitted in the year under review.

In the Grid Segment, the implementation of a workforce management system, “DigiWork”, started during the reporting period, with the aim of implementing further digitalisation steps. The smart meter roll-out was completed at the end of the fiscal year in the Netz OÖ GmbH concession territory. In order to continue to successfully implement new market models on this basis, a smart meter upgrade project was launched in the 2019/2020 fiscal year.