Energy Styria

Auditor: High electricity price did not result in excess profit

Heinz Drobesch, Director of the Court of Audit, took a close look at Energie Steiermark.

(Bild: Krone KREATIV/Christian Jauschowetz, Foto Fischer )

The opposition in the provincial parliament probably did not expect this result: they demanded an audit of Energie Steiermark's tariffs by the provincial court of auditors. The result: prices have risen sharply in recent years, but in a comprehensible manner. There were no excess profits - and therefore no scandal.

It was one of the political upsets of the previous year: the province of Styria once again took over all shares in Energie Steiermark and put more than 500 million euros on the table - in times of extremely high inflation and energy prices. The opposition parties FPÖ, KPÖ and Neos then commissioned the provincial court of auditors to carry out an audit. The main question: were the price increases of recent years really necessary?

Well, the almost 140-page result is now available. And it paints a picture that speaks in favor of the energy company: the tariff increases are comprehensible and appropriate for the auditors, they reflected the development on the wholesale markets and had not led to any additional profits. In other words, there was no enrichment of the Group at the expense of customers.

The report confirms fair and transparent pricing in all divisions - even in the extremely turbulent environment of recent years.

Energie-Steiermark-Sprecher Urs Harnik

Bild: www.bigshot.at / Christian Jungwirth

The majority of the company's profit does not come from the end customer business, but from other shareholdings - such as the Group's hydropower plants. Which, as the Neos critically point out, means that consumers are indirectly responsible for the profits.

An overview of the audit results in the areas of electricity, gas and district heating:

Strom: Nur vier Prozent selbst erzeugt

Energie Steiermark purchases almost all of its electricity on the wholesale market, only four percent is self-generated - that is almost completely negligible. Following the energy shock (keywords: inflation and war in Ukraine), there were several price increases for customers until mid-2023, but these did not differ noticeably from other provincial energy suppliers.

Energy costs were a major concern for many Styrians.

(Bild: EVELYN HRONEK)

Energie Steiermark's tariffs were also not in line with the "electricity price brake" introduced by the government. The industry was often accused of this.

However, the Styrians are not cheap: compared to the other rural energy suppliers, they were in the top third of prices from 2019 to 2021 and between mid-2022 and mid-2023, and in the middle third in the first half of 2022 and the second half of 2023. Incidentally, flexible tariffs do not play a major role for private customers with a share of 18%. 

Gas: Steirer plötzlich sehr teuer

Energie Steiermark's gas prices were in the lower third from 2019 to 2021. However, the picture changed from 2023 onwards and since then the company has been one of the most expensive energy suppliers in the province. Incidentally, 79% of customers have a fixed tariff.

As with electricity, the State Court of Auditors recommends considering shortening the procurement horizon. This would allow favorable market opportunities to be exploited and price advantages to be passed on to private customers.

Fernwärme: 99 Prozent mit Gas erzeugt

There is still a long way to go to decarbonize Graz's district heating network with a good 90,000 households: according to the Court of Audit, 99 percent of the heat supplied to Energie Graz was still generated with natural gas in the previous year!

The district heating tariff rose by more than 60 percent in 2022: According to the ACA, this increase was "economically justified." A reduction of ten percent followed in the previous year, and the next price reduction is soon to be fixed.

The gas-fired power plant in Mellach supplies a large part of Graz's district heating.

(Bild: Sepp Pail)

Due to the medium-term strategy for procuring gas, international price developments have a delayed impact on customers. For example, the exorbitantly high market prices for natural gas in 2021 and 2022 were not passed on immediately, but from 2023 this will also apply to the sharp fall in natural gas prices. As a result, Energie Steiermark recorded an operating loss of EUR 4.37 million in the district heating segment in 2021. In 2023, however, there was a balance sheet profit of 10.3 million euros again.

The ACA makes one recommendation: an evaluation should be made as to whether the operation, generation and transportation of heat should not be carried out by Energie Graz itself.