Austrian biogas industry expects important improvements and greater consideration of green gas with the Renewables Expansion Act – now available as government bill.

The Renewables Expansion Act (Erneuerbaren-Ausbau-Gesetz) underwent an extensive development phase but the target of passing the highly anticipated law is now in reach. In spring 2021, the draft law passed the Council of Ministers and is now available as governmental bill. Feedback had been carefully assessed and led to some significant improvements for the biogas industry and the consideration of a green gas market in Austria.

The Renewables Expansion Act has been on everyone’s lips. At the beginning of 2020, the Austrian federal government had endorsed the target of reaching climate neutrality in Austria by 2040 (REGATRACE reported). After two years of extensive visibility for climate action with initiatives such as Fridays for Future and a successful petition for a referendum on climate action, the draft law has now been published as governmental bill. Which changes and expectations come along with a law on renewable energies which has been in the making and has gained such high visibility over the last months?

In autumn 2020, the public review phase of the first official version of the draft law resulted into more than 1,000 pages of feedback, reflecting the high interest and visibility of the addressed topics. The extent of feedback was not surprising however, considering that the extensive draft law not only introduces a completely new law on the expansion of renewables (EAG), but it also proposes amendments to eight existing national legislation pieces. Unfortunately, the draft law was a disappointment for the biogas industry at that point (REGATRACE reported). Missing strategy, missing incentives and missing subsidies for renewable gas deployment were criticised – the latter being the most problematic as neither producers at operational production installations, nor investors were provided with planning security.

The extensive feedback collected during the public review phase, however, was carefully accessed and led to significant improvements for the biogas industry and the consideration of a green gas market in Austria. “In addition to the labelling system for green gas, it is particularly positive from our point of view, that an investment subsidy for the conversion from electricity generation to gas feed-in is now to be included in the Renewable Expansion Act.”, was emphasised by the Austrian Compost and Biogas Association Chairman Norbert Hummel. Providing these funds may enable the use of existing know-how and experience of the plant operators to convert biogas plants to produce green gas. But there are also investment subsidies planned for newly constructed biomethane plants which will feed biomethane into the gas grid. To ensure sustainable production, the use of energy crops (e.g., grain, etc.) will be capped and the upper limit will be tightened on a year-by-year basis. A follow-up premium for biogas-based plants whose current business case is based on the FiT for renewable electricity from biogas will be provided for a period of 24 months for those plants only which have a capacity of 250 kWel and are not more than 10 kilometres away of the next gas grid injection point. For all other installations, follow-up premiums are granted until the end of the 30th year of operation of the installation. Investment grants for the conversion of electricity into hydrogen or synthetic gas will be also provided. Further measures to pave the way for green gas to enter the Austrian gas market are, the implementation of a Guarantee of Origin system for gas consumer disclosure, implementing Art 19 of RED II as well as a new certificate type of “Green Gas Certificates” for off-grid renewable gas volumes and a “Green Gas Seal” which shall ensure the Austrian as well as sustainable production of renewable gases.

Meanwhile, the gas industry, led by the Austrian Association of Gas and Heat, continues to call for a comprehensive gas package with clear framework conditions and legal certainty to leverage the potential of green gas. According to statements by representatives of the Ministry for Climate Action, this call shall be answered soon with the elaboration of a Renewable Gas Act (EGG, Erneuerbares Gas Gesetz) providing a support mechanism for renewable gases and implementing the renewable gas quota for energy utilities. “For only through a holistic green gas system can the energy transition succeed not only in the electricity sector but also in the gas sector, which is still almost exclusively dominated by fossil fuels.”, as concluded by the Austrian Compost and Biogas Association.