450 euros more

“Politics would have leverage against higher electricity costs”

According to the Verbund boss, politicians have a simple lever to reduce electricity costs for households.

(Bild: gopixa - stock.adobe.com)

This year will be another expensive year for Austrians - and electricity prices will be the first: "E-Control is expecting several hundred euros in additional costs per year for households," says Verbund CEO Michael Strugl. The reason for this is, for example, the end of the electricity cost brake. However, politicians have the power to reduce costs.

In concrete terms, an average household must expect an additional burden of 450 euros this year. Strugl: "This will be similar for Verbund, as we offer electricity throughout Austria." However, the reason for the increase is not that the electricity price is now higher than a year ago. Strugl: "The electricity bill is rising due to grid costs and the expiry of the electricity price brake." At the height of the price distortions, the old government also reduced the green electricity flat rate and contributions to the EU minimum level. However, the higher rates have been in force again since January. Strugl: "And the grid costs are also rising. This has been the case for electricity customers since the beginning of the year. This makes it expensive and not because the energy price has risen."

Verbund lowered prices twice in the previous year
Verbund is the largest alternative provider of electricity to the provincial energy suppliers in Austria and supplies a total of "just under 500,000 metering points", according to Strugl - from households to commercial enterprises and industry. However, Strugl emphasizes: "Verbund has reduced the energy price twice in the last year. We are not the cheapest, but we are not the most expensive either, but are in the good middle range in terms of prices." The aim is "to offer customers a long-term price and not to change prices in the short term". If wholesale prices fall again, it will therefore take a little longer for Verbund to pass on the reductions to customers.

Verbund Director General Michael Strugl: "We are not currently planning any price increases."

(Bild: Bartel Gerhard/Gerhard Bartel)

Wholesale electricity prices are currently also significantly higher than a year ago. Strugl is at least reassuring as far as pure energy costs are concerned: "We are not currently planning any price increases."

Enormous taxes and levies on energy
Of course, according to the Verbund boss, politicians have a simple lever to reduce electricity costs for households: "If you look at your electricity bill, you will see that more than 30 percent of this bill is made up of taxes and levies: More than 30 percent of this bill consists of taxes and levies. If politicians want to, they can immediately make the electricity bill cheaper by lowering taxes and levies. We pay a consumer levy, a green electricity flat rate, green electricity contributions, an energy levy and a sales tax on top of everything - the energy and grid costs. In total, this makes up 30 to 31 percent of the electricity bill."

At the Club of Economic Publicists on Thursday, Strugl also made it clear what he expects from a new government, namely to stick to the goal of decarbonization: "If a goal like this is abandoned and changed again, it means that we will get different framework conditions in the middle of the road. If you keep changing things, you make things difficult for companies, because investment plans are long-term plans."

Investment needs in the energy sector of 100 billion euros by 2040
For Strugl, one thing is clear: "No matter who is in power - there is no way around expanding generation, grids and storage. By 2024, the investment requirement in the energy sector will be more than 100 billion euros for the expansion of power plants, generation plants and storage facilities. That's a lot of money that we have to raise here." However, this expenditure would also make Austria more independent and represent "a major economic stimulus program". "We are in a recession and can make a contribution to economic recovery with these investments. It also makes economic sense."

Of course, the manager also understands the complaints from the industry, which criticizes the tight time horizon for the targeted climate neutrality by 2040. The EU only sets this target for 2050, Germany for 2045. Strugl: "I understand that industry is saying: 2040 is too soon for us, why this ambition? I can understand that the industry is critical of this. But at some point you have to say what's what. If you keep changing things, you get into trouble."