Austria’s government has reportedly agreed on a new electricity price cap aimed at shielding households from rising energy costs, according to a report by the newspaper “Kronen Zeitung.”
The measure, described as a “10-cent price guarantee,” is expected to be introduced this summer. Under the plan, the mechanism would automatically take effect once the average electricity price for end consumers exceeds 16.5 euro cents per kilowatt-hour.
If that threshold is reached, the price for a basic annual consumption of 2,900 kilowatt-hours would be capped at a net price of 10 cents per kilowatt-hour. Any additional electricity consumption would continue to be charged at regular market rates. The current average electricity price is reportedly around 14 cents per kilowatt-hour.
“So we can prevent exploding electricity prices from driving inflation higher again in the future,” SPÖ State Secretary Michaela Schmidt was quoted as saying by the newspaper.
The program would reportedly be financed through the existing energy crisis levy imposed on electricity producers, which automatically increases when market prices rise.
Linked To Industrial Electricity Prices
According to the report, the electricity price cap would not have a fixed expiration date. A three-month transition period is also planned to prevent households from facing sudden cost increases if prices fall back below the 16.5-cent threshold.
The newspaper also reported that small and medium-sized businesses would receive support through the energy crisis mechanism to help reduce costs.
According to government sources cited by the “Kronen Zeitung,” the household electricity cap would be linked to an industrial electricity price model previously proposed by the ÖVP. Under that system, up to 50 percent of wholesale electricity prices could be subsidized, with a minimum price threshold of five cents per kilowatt-hour.
The support would apply to companies with annual electricity consumption of at least 1 gigawatt-hour. Relief measures would also cover up to 25 percent of electricity costs tied to energy-intensive industrial processes.
