Factsheet for measure
AT-2026-1/4330
– measures in Austria
Cheaper Electricity Act
Günstiger-Strom-Gesetz
Background information
In the face of the energy crisis caused by the war in Iran and the closure of the Strait of Hormuz, the national government implemented the so-called 'Cheaper Electricity Act', or more precisely, the 'Federal law enacting a federal law regulating the electricity industry (Electricity Industry Act – ElWG) and a federal law defining the concept of energy poverty for statistical recording and for determining target groups for support measures (Energy Poverty Definition Act – EnDG), as well as amending the Energy Control Act' (Cheaper Electricity Act).
Content of measure
The Act contains several measures to reduce costs and/or to mitigate further cost increases.
These are the most prominent measures:
* Price reduction guarantee:
This guarantee ensures that if energy suppliers are able to purchase electricity at lower costs, these savings must also be passed on to consumers rather than remaining solely with the suppliers. In practice, electricity prices will automatically be reduced after six months once procurement costs decline.
* Social tariff:
A dedicated, lower-cost electricity tariff will be introduced for low-income households, set at 6 cents per kWh for consumption up to 2,900 kWh. This is expected to reduce annual electricity costs by around €300 per qualifying household.
Approximately 290,000 households - representing more than 500,000 individuals - will benefit from this measure. Eligible groups include pensioners in financial need, recipients of long-term care benefits or social assistance, and individuals with incomes below the minimum threshold.
* Affordability as a corporate objective:
Publicly owned energy providers will be required to prioritise affordability alongside economic considerations. This means that pricing structures must serve consumer interests, and profits may only be distributed if they do not compromise affordability or security of supply.
* Dynamic electricity tariffs:
Energy suppliers will be obliged to offer tariffs with prices that vary over the course of the day, replacing the current system of predominantly fixed rates. This allows consumers to lower costs by shifting electricity use to cheaper periods, such as nighttime (when demand is low) or midday (when solar generation is high). For example, running appliances like a washing machine can become significantly cheaper during these periods. For a household with an annual consumption of 3,500 kWh, switching to a dynamic tariff could result in savings of €300 or more.
* Simpler billing and easier switching:
Electricity bills will be streamlined, presenting all key information clearly on a single page and eliminating unnecessary details. In addition, each bill will include a link to a tariff comparison tool, making it easier for consumers to identify and switch to better offers. This tool will be improved to clearly display the total price, energy price, and fixed charges.
Use of measure
Applies to all citizens.
Target groups
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Workers
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Businesses
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Citizens
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Does not apply to workers
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Applies to all businesses
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Applies to all citizens
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Actors and funding
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Actors
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Funding
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National government
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No special funding required
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Social partners
Social partners' role in
designing the measure
and form of involvement:
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Trade unions
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Employers' organisations
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Role
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No involvement
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No involvement
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Form
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Not applicable
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Not applicable
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Social partners' role in the
implementation, monitoring and assessment phase:
-
No involvement
-
Main level of involvement: N/A
Involvement
No involvement of the social partners.
Views and reactions
Organised labour (Chamber of Labour AK and the Austrian Trade Union Federation ÖGB) welcome the new social tariff as a milestone in the fight against energy poverty, but demand that the 'working poor' also be given more comprehensive protection.
The Federal Economic Chamber (WKO) welcomes that the federal government is setting the course for efficient and intelligent use of the electricity infrastructure via the 'Cheaper Electricity Act'.
Sources
