Verbund Sees EUR1.8 Billion Hit From Austrian Energy Law

By Christian Moess Laursen

Verbund AG on Wednesday set out the expected hit to earnings from a new Austrian law capping energy prices as well as measures passed in other European countries.

The utility expects a negative impact of 1.8 billion euros ($1.91 billion) to its earnings before taxes, interest, depreciation and amortization due to the Austrian law, which places a levy on revenue gained above a certain price cap.

Verbund is also affected by a similar cap in Germany, from which it will suffer a further earnings loss of EUR300 million, it said. Market interventions in Spain and Romania will also affect the company.

The expected earnings hit is based on current market data and figures, and could differ according to further developments, Verbund said.

The Austrian law levies 90% of all revenue above EUR140 per megawatt-hour achieved between Dec. 1, 2022 and Dec. 31, 2023, Verbund said. The limit can however be raised to EUR176 per megawatt-hour if companies invest sufficiently in renewable energy or energy efficiency.

Write to Christian Moess Laursen at [e-mail]

(END) Dow Jones Newswires

December 21, 2022 10:16 ET (15:16 GMT)

Copyright (c) 2022 Dow Jones & Company, Inc.