Government dispute

ÖVP puts the brakes on green gas exit plan

Finance Minister Magnus Brunner (ÖVP), left Leonore Gewessler (Greens)

(Bild: APA/EVA MANHART)

The wrangling between the ÖVP and the Greens over the energy transition and the exit from Russian gas is entering the next round. Energy Minister Leonore Gewessler (Greens) has now presented her legislative package on the diversification obligation for gas suppliers, which was announced in mid-February, and has met with resistance from her coalition partner.

The amendments to the law proposed by Gewessler are intended to reduce Russia's share of domestic gas imports from around 90 percent to 0 percent in the 2027/28 gas year. All EU states have agreed to phase out Russian gas by 2027. In February, 87% of Austria's gas imports still came from Russia.

Ambitious plan from the green ministry
The Energy Minister's legislative proposals include amendments to the Gas Industry Act, the Gas Diversification Act and the Energy Steering Act. Starting with the gas year 2024/25, every gas supplier in Austria will be obliged to provide evidence of an increasing proportion of non-Russian natural gas. In the first year, this share must be 40 percent. By 2027/28, this share is to gradually increase to 100 percent.

(Bild: Neos Lab)

People's Party is concerned about price development
The ÖVP is concerned that gas prices would rise too sharply if the phase-out is pushed ahead so quickly and is therefore putting the brakes on. "The federal government is united in its goal of reducing dependence on Russian gas. However, major market interventions require a careful analysis of the effects, as an immediate exit will naturally affect security of supply and the price situation. Diversification steps must therefore be designed in such a way that neither citizens nor the economy are overburdened," says the Ministry of Finance.

A hydrogen plant at Voest

(Bild: Fotostudio Eder)

There is a lot at stake for industry in particular, as the path to a greener industry leads via electricity and hydrogen, says the Federation of Austrian Industries. It criticizes the government for its inaction in this area. "A legal obligation for gas suppliers to diversify will not compensate for a lack of pipeline capacity. Instead, Minister Gewessler is urgently called upon to fulfill her responsibility as Energy Minister and ensure a delay-free expansion of the urgently needed gas infrastructure - in particular the WAG Loop (strengthening the connection to the German gas grid)," said the IV at the request of the "Krone".

"Not a helpful proposal in view of inflation"
Apart from that, in times of persistently high inflation and a business location under pressure, forcing domestic gas suppliers to import more expensive gas is not very helpful. "Entrepreneurial action in the interests of energy customers should not be politically undermined in this situation."

Neos also sees failure on the part of the government. "779 days after the start of the Russian war of aggression, Energy Minister Gewessler is now presenting a draft for phasing out Russian gas by 2027/28." After this hesitation, this draft is "a step in the right direction for the pink energy spokesperson Doppelbauer, but it not only comes too late, it also does not go far enough".