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APG Balance Sheet: Electricity Year 2022 Shows How Important High-Capacity Electricity Infrastructure Is

Extreme weather events, changing framework conditions due to geopolitical crises, as well as the transformation of the energy system brought major challenges regarding the security of supply in Austria in 2022 and made it clear how important the rapid expansion of the power infrastructure is.  

General conditions prove the importance of a high-capacity grid infrastructure

The geopolitical developments surrounding Russia's war of aggression against Ukraine further exacerbated the already tense overall situation in the energy industry (the electricity system is being restructured too slowly in the certain fields such as grids and renewable production) at the beginning of 2022. Unprecedented real shortages of raw materials (including gas) and resulting price increases were the consequence. At the same time, the availability of gas, especially in the winter months, is key to the secure supply of electricity in Austria and Europe. In addition, more indicators of a progressing climate crisis became apparent in 2022. A large number of extreme weather events in Europe (including periods of heat and low precipitation) in the summer months have a major impact on the energy industry, making saving electricity the order of the day in order to counteract possible electricity shortages. 

At the same time, it became even more apparent that a high-capacity electricity infrastructure that is expanded in time for the energy future is the key factor for the security of supply, sustainable CO2 reduction and the availability of low-priced electricity.

Tendency for reduced electricity consumption, especially in the last few months of the year 

In 2022, 61,634 GWh (gigawatt hours) of electricity were consumed in Austria. This is around two percent less than the reference value from the average of the past five years. In this context the months of September to November were important, in which savings of as much as five percent were achieved compared with the reference period. This is also in line with the target for reducing electricity consumption set out in the EU Council Regulation on an emergency intervention to address high energy prices, which has been in force since December 2022.

"With the APG Powermonitor, which was launched by APG in December 2022, it is now possible for the Austrian population to recognize the most effective electricity-saving hours and to make an active contribution. This is an important contribution to ensuring that electricity saving is successful not only in absolute terms, but also particularly effective at the hours indicated. It not only reduced electricity consumption, but also CO2 emissions and overall, it also has a price-dampening effect. However, the decisive factor for the availability of low-priced electricity is the expansion of the entire grid infrastructure. Only if we expand the infrastructure in a timely manner can we succeed in reducing the current price difference for Austrian industry and consumers of around 26 euros per MWh compared to, for example, Germany," explains Gerhard Christiner, Chief Technical Officer of APG.

As positive as the decline in electricity consumption is, it will be important to have a high-capacity grid infrastructure available in the future. Only then will it be possible to manage a sustainable energy system with an adequate security of supply.

Climate crisis affects production output from renewable energies

The climate crisis is particularly noticeable with regard to renewable energies. The dry July 2022 saw 24 percent less precipitation than in the previous year. This led to a 23 percent reduction in production from run-of-river plants compared to the previous year. In August, we were 38 percent below the previous year's level, although the month of September was slightly better, with plus 5 percent compared to August. For a "water country" like Austria (where electricity production does not only rely on run-of-river power plants but also an pumped storage plants) these are important data for the future, as other renewables such as wind and PV could only partially compensate for these deficits.

On certain days 100% demand coverage from renewables in May and June

In May and June 2022, electricity generation from sustainable energy sources increased again compared to the previous months thanks to warmer weather. Around 87 percent of Austria's demand was covered by renewables in May and 95 percent in June. This meant that in calendar weeks 20, 23 and 24, as much as 100 percent of electricity consumption (on the balance sheet) was covered by electricity generation from renewable sources in Austria. 

Extreme weather events affect electricity balance. Austria becomes an importing country early in the year.

The prolonged hot spell in the summer of 2022 not only caused inland lakes (e.g. Lange Lacke Burgenland) to slowly silting up, but also had a negative impact on hydropower generation. July 2022 was 1.1 degrees warmer than average. There was much less precipitation, so production from hydropower also dropped. In July, only 77 percent of electricity consumption in Austria could be covered by renewables (2021: 96 percent). As a result, Austria became an electricity importing country already in August: despite good wind production of plus 21 percent compared to the previous year, the poor performance of minus 38 percent electricity from hydropower could not be compensated and led to a monthly import balance of 1,165 GWh.

At 100.5 GWh, we reached a historic daily high in electricity imports on December 21, 2022, and the day after that we registered another record high: at midnight, the historic highest 15-minute import capacity of 5,551.6 MW was reached.

Interventions in the power grid necessary on 237 days

With the expansion and increased integration of renewable energy sources as well as increasing electrification, the demands on the power grid are constantly growing. However, the current grid capacities are not able to meet these demands. Last year, redispatch measures (targeted interventions in power generation) had to be taken on 237 days to avoid bottlenecks in the power grid and ensure the secure of supply in Austria. This involves counteracting high line loads through targeted interventions and the use of thermal and hydraulic power plants. 

"In February alone, such interventions were necessary on 27 days (!). This causes costs that ultimately have to be paid by the electricity customers. At the end of the year, the costs of the year caused by redispatch measures for the Austrian electricity customer were around 94 million euros. A high-performance electricity grid with sufficient capacities would significantly reduce the need for interventions in power plant operations and cut costs. The immediate expansion of the grid infrastructure therefore has top priority," emphasizes Thomas Karall, CFO of APG.

The redispatch measures requested from abroad resulted in additional costs of 718 million euros (however, these "only" burden electricity consumers in other countries).

The current developments in electricity and energy prices as well as the geopolitical developments in Ukraine show how important a rapid and secure transformation to a sustainable energy system is. This requires immediate overall system planning, adequate capacities in the areas of grids, storage, production and comprehensive digitalization to exploit the flexibilities of all players in the system. All of this must be done immediately. Accelerating and simplifying approval procedures are key levers in this regard. With its investment program of around 3.5 billion euros for the expansion of the electricity infrastructure, APG is ensuring that Austria's transmission grid is made fit for the success of the energy transition and sustainable security of supply for all Austrians.

APG continually keeps track of the development of the domestic electricity industry and regularly publishes diagrams at regarding the topics: energy exchange, energy consumption in Austria, energy consumption in Europe, import/export, electricity prices, etc. 

About Austrian Power Grid (APG)

As independent transmission system operator Austrian Power Grid (APG) is in charge of ensuring the security of electricity supply in Austria. With our high-performance and digital electricity infrastructure and the use of state-of-the-art technologies we integrate renewable energies, we are the platform for the electricity market, we provide access to reasonably priced electricity for Austria’s consumers and thus create the basis for Austria as supply-secure industrial and business location and place to live. The APG grid totals a length of about 3,400 km and is operated, maintained and continuously adapted to the increasing challenges of the electrification of businesses, industry and society by a team of approximately 733 specialists. Also in 2022 Austria had a security of supply of 99.99 percent and thus ranks among the top countries worldwide. Our investments of 490 million euros in 2023 (2022: 370 million euros) are a motor for the Austrian economy and a crucial factor in reaching Austria’s climate and energy targets. Until 2032 APG will invest a total of approximately 3.5 billion euros in grid expansion and renovation projects, which amounts to approximately 19 percent of the total of 18 billion euros which the energy industry will invest in the grid infrastructure over the next ten years.

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Carolina Burger

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1220 Wien

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