Only around a month after the electricity price cap was extended until the end of 2024, the responsible ministries confirmed last week that an adjustment to the subsidy level was being discussed. Both the finance and energy ministries confirmed this to the Kleine Zeitung. The new parameters were fixed in the Council of Ministers on Wednesday. The previous regulation looked like this: The first 2,900 kWh of electricity per year will be subsidized for every household until the end of 2024. This is what is being held on to.
Furthermore, households only paid ten cents per kWh of electricity up to 2900 kWh of electricity per year. The state took over the rest. At least up to an electricity price of 40 cents per kWh. The funding was therefore limited to a maximum of 30 cents. If the price of electricity rose above 40 cents, households had to pay any additional amounts themselves. According to the Ministry of Finance, the electricity price brake has so far cost 900 million euros, 600 million euros are budgeted for 2024, and a further 500 million would be available if necessary.
From July onwards, the state will pay a maximum of 15 cents
What will apply in the future: Since electricity prices have fallen, the amount of funding will be adjusted to the market situation, as Finance Minister Magnus Brunner (ÖVP) – together with Energy Minister Leonore Gewessler (Greens) – emphasized on the sidelines of the Council of Ministers. This applies from July 1st.
The threshold falls from 40 to 25 cents per kWh, with the state covering a maximum of 15 cents from July. Wifo head Gabriel Felbermayr made a corresponding suggestion the previous week. This is also intended to stimulate competition and encourage more electricity customers to switch providers. By the way:
Households in which more than three people live will also receive a subsidy of 52.50 euros per person in the second half of the year. Low-income households also continue to receive an additional discount of 75 percent of the network costs. That’s up to 100 euros.
According to Gewessler, the measure should also be an incentive for electricity suppliers to reduce prices and stimulate competition in retail tariffs. The change should then be reviewed in the next few days.
Profit skimming is also adjusted
There are also changes to the so-called “profit skimming” for energy companies. The revenue cap for oil and gas companies will be extended until the end of 2024. But now the following applies: the amount “that exceeds the taxable profits from 2018 to 2021 by more than five percent” will be skimmed off, as the government says.
For comparison: in 2023, excess profits were only skimmed off from ten percent. In the previous year, 90 percent of the revenue per megawatt hour (MWh), which exceeded 140 euros, was skimmed off from electricity producers. This will not be shaken. But there is one exception: “If investments in the energy transition can be proven, this value increases to up to 200 euros per MWh – last year it was still 180 euros.”