Austria’s bold electricity reform introduces social tariffs and climate goals by 2040
Austria’s National Council has passed a major reform of the electricity market with broad political support. The new Electricity Industry Act aims to cut costs, improve grid efficiency, and secure supply while strengthening consumer protections. Officials describe it as a turning point for affordable and sustainable energy in the country.
The law was approved with a two-thirds majority after a last-minute amendment secured the Green Party’s backing. Key changes include a social tariff for low-income households, prepayment meters, and stronger consumer rights. Around 290,000 households are expected to benefit from the social tariff, with energy suppliers covering the costs.
The amendment also locked in climate neutrality by 2040 and expanded eligibility for the social tariff. From 2027, energy feed-in providers will pay an annual grid infrastructure fee. Economic Minister Wolfgang Hattmannsdorfer called the reform a 'paradigm shift' towards secure, clean, and affordable electricity.
While the ÖVP and SPÖ praised the law for driving down costs and fostering competition, the Freedom Party criticised it as a 'deceptive deal'. They supported only the social tariff measures and demanded broader relief for households and businesses. The Greens welcomed the expanded social protections but warned that further steps would be needed to reduce bills.
The government plans to use its state-owned stakes to release €500 million in a special session, aiming to cut electricity costs even further. Federal Minister for Economy and Energy Katherina Reiche, who oversees energy policy, will play a central role in implementing the changes.
The new framework introduces a social tariff, stronger consumer rights, and climate targets by 2040. Energy suppliers will fund the social measures, while grid fees for feed-in providers start in 2027. The government’s €500 million fund is set to provide additional financial relief for electricity users.
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