Government Agrees on Crisis Mechanism: How Electricity Prices Are to Be Cut to Ten Cents

When activated, the model stipulates that 95 percent of energy companies' revenues above the threshold must be paid to the state. This is financed through a special crisis contribution, the Energy Crisis Contribution for Electricity (EKBS), which most recently generated 250 million euros annually.

The total package is valued at 250 million euros per year. The contribution is legally fixed in advance and will be levied on energy companies until 2030 inclusive.

The reduced price of 10 cents per kilowatt-hour would not necessarily apply to a household's entire consumption. According to initial reports, it may only cover a basic quota of 2,900 kilowatt-hours per year per household.

What Households Would Receive

This 2,900 kWh basic quota was previously used in the electricity price brake implemented by the former turquoise-green government, which expired in 2024.

As part of the agreement, an industrial electricity price is also set to be introduced starting in 2027. The government stated that companies would receive a "uniform subsidy" in parallel.

Currently, the mechanism is far from being triggered. According to energy regulator E-Control, the average household working price is just over 14 cents, while the wholesale price is below 100 euros.

Current Market Reality

"There can currently be no talk of an 'electricity price brake' that will soon be noticeable on the bill," the report noted.

For context, the European Commission defines an energy price crisis as occurring only after six months of elevated prices exceeding 18 cents per kilowatt-hour.

The agreement marks a key policy milestone for the coalition, which includes the ÖVP, SPÖ, and Neos parties. The legislation is expected to be introduced in the Nationalrat for approval.

Economy Minister Wolfgang Hattmannsdorfer has been a central figure in advancing the package, which aims to shield consumers from future energy price shocks while maintaining fiscal discipline through the capped annual budget.