Limit at 2900 kWh: Austria's government decides electricity price brake

Austria's government is helping private electricity customers with up to four billion euros.

Limit at 2900 kWh: Austria's government decides electricity price brake

Austria's government is helping private electricity customers with up to four billion euros. The discount should be automatically deducted from the invoice. The campaign is limited to mid-2024.

Austria's conservative-green government has decided on a price brake to cushion rising electricity costs. "It helps people to better cope with the price increases from the energy companies," said Federal Chancellor Karl Nehammer. According to government calculations, it amounts to an average of 500 euros per household per year. The measure is to be approved by parliament in October, and it is to be felt for the first time with the electricity bill from December.

"The high inflation burdens everyone in our country, jeopardizes purchasing power and has now reached the middle class," said Finance Minister Magnus Brunner. The aim is therefore to relieve people quickly. It is planned that the price brake should work for 80 percent of the average consumption of a three-person household. The limit is 2900 kilowatt hours (kWh). Until then, only ten cents per kWh have to be paid - which roughly corresponds to the pre-crisis level. Anything above that is at the current market price.

If the electricity price is more than 40 cents per kilowatt hour, a maximum of 30 cents per kWh would be deducted, the rest must be paid by the customer. This cap is designed to prevent utility companies from raising prices in the face of this support. The price brake should apply until mid-2024. According to experts, around half of all households will receive full subsidies for their electricity requirements because they consume less than 2900 kWh. The subsidy will be automatically deducted from the electricity bill, said Environment Minister Leonore Gewessler.

Households with more than three people should apply for further relief. Details are not yet available. In addition, there should be further relief of up to 200 euros for low-income households.

The costs were estimated by the government at around three billion to four billion euros. It is not the first relief package due to inflation. Previously, one-off payments worth billions, such as an increase in child benefit or a climate bonus, had already been decided.

Critics of the measure complain that the household size is not taken into account. According to this, a single household in a smaller apartment with lower electricity consumption receives the same amount of support as a large family with higher consumption.