Austria threatens legal action over German gas storage levy

Austria, under the leadership of Climate and Energy Minister Leonore Gewessler, is intensifying its push to abolish the German gas storage levy. This charge, which was set at 2.50 euros per megawatt hour (MWh), was introduced in 2022 amid the ongoing energy crisis to cover Germany's gas storage expenses. However, the levy has negatively impacted neighboring countries, including Austria, where it has already caused substantial costs estimated at 60 million euros. Gewessler expressed that this financial burden affects both industries relying on gas and ordinary consumers heating their homes. During a recent meeting of EU energy ministers in Brussels, Gewessler reaffirmed her confidence that the levy would be dismantled as previously announced by the German government. Despite this proclamation, uncertainties loom due to the dissolution of the coalition government in Berlin, which has placed the legislative process regarding the levy on hold. The SPD and Greens, who initially supported the abolition, are left needing the cooperation of the conservative CDU to move forward with the necessary changes. Austria has expressed that lifting the levy is crucial for decreasing reliance on Russian fossil fuels, which have dominated the energy sector. Much of Austria's gas supply flows through Germany from alternative sources such as Norway and newly accessed liquefied natural gas (LNG). The German government has proposed an end to the levy at border crossings by January 1, 2025, yet the law's passage through the Bundestag remains uncertain due to the recent political shifts. Consequently, Gewessler has reached out to Austrian Chancellor Karl Nehammer and Foreign Minister Alexander Schallenberg, urging them to advocate for the CDU party to expedite amendments to the gas storage levy law. Gewessler has made it clear that should the levy continue at border crossings, she is prepared to take legal action against Germany in the European Court of Justice. This situation underscores Austria's commitment to securing its energy independence and protecting its economy from continued financial strain caused by the levy.