With regard to the economic development, the economic institutes expect the Austrian economy to return to a restrained but stable growth path in the second half of the current calendar year. IHS, WIFO and IWF forecast GDP growth rates of between +0.3% and +0.5% for 2023 as a whole. The inflation rate is expected to only slowly fall from its high level, with forecasts ranging between +7.1% and +8.2%. Slightly stronger growth of +0.7% on average is expected for the euro zone economy.

Numerous energy policy measures and regulations both at EU level and in Austria were at various stages of the consultation or legislation process at the end of the reporting period. For example, on 14 March 2023, the EU Commission presented proposals for a reform of the EU electricity market in order to accelerate both the expansion of renewable energies and the phase-out of gas as an energy source, and to protect consumers from price fluctuations in fossil fuels and future price spikes. To address practical requirements in greater depth, a far-reaching amendment to Austria's ElWOG is being discussed; this is expected to lead to an expert opinion draft in the second half of the 2022/2023 fiscal year. On 10 May 2023, the Council of Ministers also approved a tightening of the Energy Crisis Contribution Act in the form of an amendment to the threshold for the absorption and redistribution of surplus revenues; this is likely to come into force as early as June 2023. Detailed regulations under the Federal Energy Crisis Contribution Act – Electricity, and parliamentary negotiations on the Energy Efficiency Reform Act 2023, the Renewable Heat Act, and the Electricity Price Cost Equalisation Act are also expected in the second half of the 2022/2023 fiscal year.

Due to numerous imponderable geopolitical, economic and legal influences, the energy industry framework conditions remain highly challenging for Energie AG and the entire industry. Assuming largely stable framework conditions, lateral movement of price levels on the international energy markets is anticipated in the second half of the 2022/2023 fiscal year, with volatility remaining high.

Thanks to its forward-looking and long-term procurement strategy, Energie AG is in a position to reduce electricity prices for existing customers as of 1 June 2023, despite the challenging environment. Besides this, the general government-financed electricity price cap will remain in force under the Electricity Cost Subsidy Act to additionally cushion energy costs. The security of supply and the comparatively mild winter of 2022/2023 led to an easing of wholesale prices for gas, which enabled Energie AG to grant its gas customers (annual consumption < 400,000 kWh) a discount of 20% on standard products for the period between 1 June 2023 and 31 May 2024. Against the backdrop of high demand for photovoltaic solutions, the focus of sales activities in the second half of the 2022/2023 fiscal year will be on appropriate product offerings. In the business and industrial customer area, efforts will be stepped up, in the second half of the fiscal year, with a view to digitalisation and process optimisation.

In the generation business unit, the focus in the second half of the 2022/2023 fiscal year will be on launching a new expansion campaign for electricity generated from wind power in Upper Austria. For example, a fivefold increase in wind power generation by 2030 is planned in the Kobernaußerwald area. The focus here is on expanding the existing wind farm in Munderfing and adding between eight and twelve new wind turbines in the region. A building decision for the Ebensee pumped-storage power plant project is targeted before the end of 2023.

The general regulatory framework for the Grid Segment for the fiscal year can continue to be assessed as stable. The parameters for the fourth gas regulation period have been fixed. The detailed cost review for the fifth electricity regulatory period is in progress. The design and expansion of renewable forms of energy also remain challenging for the Grid Segment. In addition to this, the ongoing development of IT systems and certifications will be focal points of work in the second half of the 2022/2023 fiscal year.

In the Waste Management Segment, stable framework conditions are anticipated for providing traditional waste management services in the second half of the 2022/2023 fiscal year. However, further cost increases due to inflation are also expected in the second half of the fiscal year. A slight recovery from the low price level of the first half of the year is expected for paper as a recycling material. In the scope of the district heating extraction for the city of Wels, the experience gained in the first half of the fiscal year will be leveraged to introduce further optimisations and continue to be able to guarantee a worry-free district heating supply.

Despite the price cap on electricity and gas introduced by the Czech government on 1 January 2023, high energy costs will continue to play an important role for the Czech Republic Segment in the second half of the 2022/2023 fiscal year. Close monitoring of the situation on the electricity and gas market, which are dramatic in terms of costs, will continue, especially since the high price level is exposing suppliers, operators and customers to serious pressure. Work will push forward on the ongoing development of energy efficiency projects for the heat and water supply and waste water management. A positive development in services provided to municipalities and cities is expected in the second half of 2022/2023.

In the Telecommunications business area, the focus in the second half of the 2022/2023 fiscal year will be both on further process optimisation and on the implementation of the two strategic paths described earlier, “Wholesale Campaign” and “Added Value Offerings”.

In a situation that remains fragile in terms of geopolitics and the energy industry, besides the existing strategic objectives, such as ensuring the financial stability of the Group, activities in the second half of the 2022/2023 fiscal year will continue to centre on ensuring supply reliability for customers of Energie AG. In addition, the focus will be on the further development of the Group in the scope of the Group-wide strategy and organisational project launched in the first half of the fiscal year.

Against the backdrop of ongoing economic and market uncertainties, Energie AG expects the operating result for the 2022/2023 fiscal year to be above the level of the previous year, given an at least largely stable development of the business environment.

Linz, 30 May 2023
The Management Board of Energie AG Oberösterreich

Dr. Leonhard Schitter

Dr. Andreas Kolar

Dipl.-Ing. Stefan Stallinger MBA

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