Austria’s people decided in a national referendum in 1978 against the start-up of the nuclear power plant in Zwentendorf, which resulted in a constitutional law (Bundesverfassungsgesetz Atomfreies Österreich, 1998). On the other hand, Austrian utilities recently imported large amounts of “dirty” electricity, in particular from the Czech Republic as well as from Germany – including at least 5 % of nuclear electricity.
Electricity in the EU can be traded separately from its guarantee of origin. On the first impression, this system sounds complicated as it makes the process of trading much more complex (issue of certificate, trading of certificate and cancellation of certificate as well as de-labelling the original source of the certificate). On second thoughts the system is simply not working – the general idea of electricity certificates was that by making certificates (guarantees of origin) tradeable separately from the electricity itself, extra revenue would be generated for renewable electricity and hence the investment in renewable energy sources would be supported. As the experiences with renewable electricity certificate systems show not just in the EU, but also in the US, there is no noticeable extra support for “new renewables” through this system, rather customers who are willing to pay a premium buy the renewable parts of the electricity mix, and in particular industry customers buy just anything they can get cheap, including nuclear electricity (as long as it is still heavily subsidized). Electricity certificates are mostly issued for renewable sources, but also for nuclear and fossil generation.
We started off from the position of thinking that electricity certificate systems in general are a stupid and not functioning system, but as there is no major overhaul to the system on the EU-level in sight, we thought it better to reform the system (on a national level) than to carry on lamenting, at the same time closing the worst loophole in the electricity certificate law for the import of nuclear electricity:
Legal aspects of (nuclear) electricity certificates
The Renewables Directive of the EU (2009/28/EC) defines in Article 15 that electricity certificates can be traded separately from the electricity itself. The Electricity Internal Market Directive (2009/28/EC) regulates in Chapter II, Article 9 consumers’ rights for fuel mix disclosure – it is the right of customers to know what sources of electricity they consume (and hence pay for / support).
There is, however, a major snag to this: as electricity can be traded separately from its certificate, electricity bought from an electricity exchange does not as such have a certificate / guarantee of origin with it. (The electricity exchanges account for small amounts of total trade, in the case of the German exchange 17 %, in the case of the Austrian exchange 7 % – most electricity is traded in direct, Over The Counter (OTC)-contracts.)
For electricity bought from the exchanges, the Electricity Internal Market Directive allows suppliers to use aggregated figures for the electricity exchange – an average value, an assumption about the average mix rather than precise figures. This of course contradicts the right of customers for full disclosure of fuel sources.
On the national level of the member states, it got worse: The Austrian Electricity law (Elektrizitätswirtschafts- und Organisationsgesetz 2010) provided in § 79.3 a major loophole for hiding unwanted amounts of electricity: If suppliers were unable (or unwilling) to purchase certificates for electricity, as is the case of electricity bought from the electricity exchanges without buying accompanying certificates, the suppliers could still sell this electricity and label it according to average European values, assumed from data for the previous year / statistics of the European Transmission System Operators (excluding electricity generated from renewable sources, as it was rightly assumed that this would not be sold at the electricity exchanges, but rather for a premium in direct Over The Counter-contracts).
The situation in Austria
With the advent of electricity market reform, Austrian utilities exported more and more “green” electricity (or green electricity certificates) to countries where consumers were willing to pay a premium for this – and selling electricity generated from fossil, nuclear or unknown sources to the Austrian industry (that consumes 57 % of electricity).
Most recent data (2010) show that 14,7 % of Austria's total electricity consumption was either bought from the electricity exchanges without any electricity certificate, or its certificate was sold separately (mostly hydro certificates to Germany). There was no legal requirement for suppliers to provide electricity certificates for all electricity, amounts without certificate were simply called "Strom unbekannter Herkunft" (electricity with unknown origin) in § 79.3 of the Electricity law.
This meant that traders could easily hide the fossil and nuclear parts of their fuel mix behind the smokescreen of "Strom unbekannter Herkunft" – they could even buy electricity from known (dirty) sources, sell it at the exchange and buy it back – whereby it lost its certificate.
The campaign
GLOBAL 2000 and Greenpeace CEE had been campaigning on this issue / “hidden” nuclear electricity in Austria for years. When the majority state-controlled utility “Verbund” started a massive advertising campaign in 2010 positioning itself as “100 % hydro”, GLOBAL 2000 started a campaign outlining that a 100 % subsidiary of Verbund sold almost entirely dirty electricity to the industry. After the Fukushima-events in March 2011, the campaign gained momentum and the Austrian government, eager to demonstrate change, agreed to ban nuclear electricity at a first summit with the two NGOs in June 2011. Quite predictably, some utilities opposed these moves, so the NGOs had to provide detailed legal and financial expertise that a) the proposed legal changes are sound on basis of European and WTO law and b) electricity prices would not skyrocket – the average price increase for labelling all electricity in Austria without nuclear certificates would be in a very modest range from € 0.13–1.95 per average household per year.
We were lobbying for a legally binding prohibition to import nuclear electricity or certificates, but this stalled as the ministry of economics was fiercely opposed to this: The minister argued this would be an infringement to Art 34 TFEU (Treaty of the Functioning of the European Union, Free movement of goods) – we argued: yes it would, but this can be justified by Art 194.2 TFEU – the right of member states of the EU to choose their energy sources, that came into force with the Lisbon treaties.
The NGO campaign was backed by Austrian anti-nuclear initiatives, the Austrian Chamber of Labour and the major tabloid in Austria, Kronenzeitung – this helped a lot. When finally even the Catholic Church (in the person of the Klagenfurt bishop) signalled that nuclear electricity imports should be stopped, on April 16th we finally managed to achieve at least a compromise as follows:
Results
1) Labelling: legally binding obligation for disclosure of all electricity that is consumed in Austria -- this includes households and industry as well as pumped-storage hydro (which consumes large amounts of electricity in Austria). The legal changes to the national electricity law will make it mandatory that the entire electricity supplied is labelled, i. e. that electricity can only be sold together with an electricity certificate, and “Strom unbekannter Herkunft” is not applicable any more for fuel disclosure. These changes to § 79.3 are to be drafted this year and come into force by 2015.
2) Nuclear certificates & electricity: Austrian utilities voluntarily exclude certificates and direct contracts from nuclear generation from their portfolio immediately (it would be economic suicide to market explicitly labelled nuclear electricity in Austria anyway). Österreichs Energie (representing the largest utilities in Austria) also agreed that on a voluntary basis they will already start labelling their entire electricity supply by 1.1.2013 for household consumers and the – much larger amounts – for industry by 1.1.2015.
3) Label: there will be a certification label by the (federal) Issuing Body E-Control, developed together with the NGOs, that guarantees that the utility does not use any nuclear electricity or nuclear electricity certificates.
4) Transit: as electricity labelling is consumer/disclosure-oriented, the proposed changes do not affect the transit of electricity through Austria.
Regarding electricity certificates: The Austrian issuing body only acknowledges four types of electricity certificates, three national certificates under RES-law and one international – the EECS-GO (European Energy Certificate System-Guarantee of Origin), where the issuing body is nominated by the state and conforms to fairly tight rules (to prevent double counting of certificates). This excludes systems (RECS, TÜV, ...) that are not as strict, are set up by market players or cannot exclude double counting, which of course immediately perverts the entire system.
The above is a compromise, but a reliable disclosure of all electricity sources is a big victory for the campaign. Lots of people were involved in this campaign, on the NGO-side Friends of the Earth Austria/GLOBAL 2000 & Greenpeace CEE as well as the ÖKOBÜRO legal experts.
If – as we hope – this campaign can be copied to other European countries, full disclosure can give consumers more power in choosing the clean electricity sources they want to consume – and avoiding the ones they do not wish to pay for any more, namely nuclear electricity.
Source and contact: Reinhard Uhrig, anti-nuclear campaigner, GLOBAL 2000 / Friends of the Earth Austria. Neustiftgasse 36, 1070 Wien, Austria
Tel: +43 699 14 2000 18
Mail: reinhard.uhrig[at]global2000.at