Following the resolution of the Federal Act on the Electricity Energy Crisis Contribution (Bundesgesetz über den Energiekrisenbeitrag-Strom, EKB-S) in the Austrian National Council on 13 December 2022, the Management of VERBUND AG provides an overview below of the measures adopted and their expected impact on VERBUND.

The law in Austria essentially provides for electricity revenues to be capped at €140/MWh, in particular for the hydropower (without pumped storage), wind power, solar (PV and solar thermal) and hard coal generation technologies. This revenue cap can increase to a maximum of €176/MWh as a result of the eligibility of investments in renewables (currently hydropower, wind and PV power in VERBUND's case) and in energy efficiency. The initiative takes into account 50% of the investments in the reporting period from 1 January 2022 to 31 December 2023 or the partial amounts capitalised in this period. Electricity generated from flexible pumped storage power plants, as well as flexibility products (control power products), which are necessary for the stabilisation of the electricity grids and therefore for the security of supply, are among the activities that are exempt from the levy on profits.

Revenues above the price cap will be levied at 90% once the above exceptions are taken into account. The monthly excess revenues accrued between 1 December 2022 and 31 December 2023 will be subject to the levy. The reference value for the profit levy is the revenue that results when electricity derivatives and electricity purchase agreements are taken into account (average monthly price). The amount levied is 100% tax-deductible.

The EKB-S will be applied on the following two dates: on 30 September 2023 for the period 1 December 2022 to 30 June 2023, and on 31 March 2024 for the period 1 July 2023 to 31 December 2023.

The special dividend announced by VERBUND on 25 May 2022 as per inside information cannot be offset against these measures, but it is still planned.

In addition to the profit levy in Austria, VERBUND and its renewable generation plants are also affected by market interventions in Germany, Spain and Romania; above all the new law in Germany is expected to result in significant amounts levied. The new profit levy system in Germany is based on differentiated limits depending on the generation technology, as well as on the type of marketing in the case of renewable energy plants. In Germany, 90% of the excess revenues accrued between 1 December 2022 and 30 June 2023 will be subject to the levy – with the possibility of an extension from 30 June 2023 until 30 April 2024.

Based on the laws and regulations in place, VERBUND assumes on the basis of current market data (reporting date: 9 December 2022) that the profit levy (EBITDA) will be recognised in profit or loss in 2023 at a total amount of approximately €2.1 billion (of which €1.8 billion in Austria and €0.3 billion in Germany). The payments from the profit levy will essentially be divided equally between the years 2023 and 2024.

The figures announced are best estimates of the effects of the profit levy on a specific reference date (9 December 2022) based on current market values (wholesale prices) and planned figures (investments, planned production volumes). The actual values may differ considerably from the planned values depending on any additional developments.

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