General conditions

Economic environment ¹⁾

The 2020/2021 fiscal year (1 October 2020 to 30 September 2021) at Energie AG Oberösterreich (Energie AG) was again fraught by the COVID-19 pandemic, however, this was accompanied by a strong economic recovery, especially from the second quarter of the 2021 calendar year onwards.

Despite continued high COVID-19 infection rates in many countries, the global economy exhibited positive development, although at very different regional levels.

Economic growth and inflation

YoY real change (in %)
Sources: IHS, IMF, WIFO

After the marked economic slump in 2020, the Institute for Advanced Studies (IHS), the Institute of Economic Research (WIFO) and the International Monetary Fund (IMF) forecast an economic growth for the euro zone of between +4.3% and +5.0% and thus revised upward their projections for 2021. Values between +4.3% and +4.5% are forecast for 2022.

Dynamic growth was also recorded for the Austrian economy in the reporting period, prompting domestic institutes to expect GDP growth of between +4.4% and +4.5% for 2021. The IMF is somewhat less optimistic at +3.9%. For 2022, economic growth is expected in a range between +4.5% and +4.8%. This recovery will be accompanied by a significant rise in the inflation rate in the range of +2.6% to +2.8% for 2021.

For the Czech Republic market relevant to Energie AG, an increase in the gross domestic product of between +3.3% and +3.8% is anticipated for the calendar year 2021. The year 2022 is expected to bring positive economic impetus in the range of +4.4% to +4.8% in the Czech Republic.

The global economic upswing is partly accompanied by supply chain problems and price increases, especially in the raw materials sector. The increased inflation rates reflect this development and – like the continuing COVID-19 pandemic – limit the reliability of forecasts on the future development of the economic situation.

Energy and climate policy environment

On 11 December 2020, the European Council agreed on the European Commission's proposal to raise the EU's greenhouse gas reduction target for 2030 to -55% compared to 1990. The more ambitious climate target, which is to be understood as an intermediate step on the way to the realisation of the Green Deal by 2050, was legally anchored in the European climate targets on 21 April 2021. This enabled the Austrian Climate Act to enter into force by the end of June 2021, before the first specific legislative proposals associated with the “Fit for 55” package.

As part of the “Fit for 55” package, the European Commission presented a total of twelve legislative proposals on 14 July 2021, which are intended to fundamentally revise the EU's climate and energy policy legal framework by 2030 and align it with the new climate targets. The central projects which are highly relevant for the energy economy are the revision of the EU Emissions Trading Scheme and the Effort Sharing Regulation for sectors not covered by emissions trading. In addition, there are plans to introduce a second, separate trading system for buildings and transport, which will be launched in two steps from 2025. Further relevant proposals concern measures to increase the share of renewable energy and improve energy efficiency. In this context, a significant increase in the respective targets and level of ambition in the revised guidelines can be expected. This will ultimately push up the CO₂ price and intensify investments in energy efficiency and the expansion of renewable energies. The package will therefore set the central course for the coming years not only for the European, but also for national energy policy. The legislative procedures for the individual legal acts of the package are not expected to be completed until the second half of 2022 at the earliest.

The European Commission launched a public consultation on 11 January 2021 to develop legally binding EU targets for biodiversity restoration and species conservation. A proposal for a regulation to implement the biodiversity targets is expected to be presented by the European Commission in the last quarter of 2021.

On 21 April 2021 and 6 July 2021, the European Commission published delegated acts for the Taxonomy Regulation with the technical screening criteria for the environmental objectives “climate change mitigation” and “climate change adaptation” and with detailed requirements on the financial reporting obligations for companies. In the future, they will be decisive in determining which criteria certain economic activities must fulfil in order to be considered ecologically sustainable.

In line with a political agreement between the EU Council and the European Parliament on 12 July 2021, civil society's rights of action in relation to EU environmental law will be significantly strengthened and extended to individuals in future through an amendment to the Aarhus Regulation .

The Fuel Emissions Trading Act came into force in Germany on 1 January 2021. According to this law, the price for suppliers of diesel, petrol, heating oil or natural gas is EUR 25 per tonne of CO₂ emitted by these energy sources. By 2025, the price will increase gradually to EUR 55/t CO₂ . A price corridor of at least EUR 55/t CO₂ and at most EUR 65/t CO₂ will then apply for 2026.

Due to the urgent need for action on the topic of “electricity grid reserve management” , a separate, pre-emptive legislative resolution on the Renewable Energy Expansion Act package was initiated in Austria. The corresponding regulations, which improve planning security for operators of thermal power plants, and contribute to ensuring the secure operation of the grid and sufficient electricity supply in Austria, were published on 7 January 2021 in the Federal Law Gazette and formally approved by the European Commission under EU state aid rules on 28 June 2021.

Large parts of the Austrian Renewable Energy Expansion Act package have been in force since 28 July 2021. However, one of the most important provisions, the new regulation of green electricity funding with market premiums, still requires the approval of the European Commission under state aid law; this is expected to happen after the end of the reporting period. In addition to the Renewable Energy Expansion Act, the key elements of the Renewable Energy Expansion Act package are a revision of the Electricity Industry and Organisation Act (ElWOG) 2010, the Gas Industry Act (GWG) 2011, as well as the Heating and Refrigeration Pipeline Development Act and the High Voltage Power Lines Act. This list of topics already shows that the Renewable Energy Expansion Act package will have far-reaching effects on the energy sector in Austria. In addition to funding regulations for plants that generate energy from renewable sources, the structural changes to the energy market through the possibility for new players (energy communities) to participate will also be of significant importance. The Renewable Energy Expansion Act package means that a first milestone has been reached in the implementation of the EU's “Clean Energy Package”. However, many other points of the “Clean Energy Package” still require domestic implementation. This is why preparations are already underway for the revision of the Federal Energy Efficiency Act and, with regard to a revised electricity market design, a fundamental adaptation of the ElWOG.