Market Status: Austria - Stalled wind sector looks forward to brighter year

AUSTRIA: The outlook for Austria in 2011 is considerably brighter than last year, with 120MW likely to come online, according to the Austrian wind association, IG Windkraft.

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A highlight will be the installation of a 7.5MW Enercon machine - currently the world's largest turbine - in Burgenland later this year.

The new activity follows a subdued 2010 when only 16MW of new capacity was installed, bringing the country's total to just over 1GW - with 625 turbines generating 4% of Austria's total electricity. The previous two years had been even worse, with no new installations in 2009 and just 14MW in 2008. Unsupportive legislation introduced in 2006 has practically stalled the sector.

A new eco-electricity act in 2009 remedied the situation slightly, leading to some new installations. The remaining problems, IG Windkraft anticipates, will be at least partially resolved with a revision of the act expected to pass parliament by June.

One significant hurdle has been an annual EUR21 million cap on renewables support, EUR18.9 of which is earmarked for wind, biogas and biomass. In 2010, just 90MW of wind capacity was allocated funds for the feed-in tariff (FIT) by the relevant government authority Oemag. Currently, applications for a total 600MW of wind energy are lodged with Oemag to receive the tariff, with an application for another 140MW in the pipeline, depending on the outcome of a legal dispute. All in all, the support funds for all renewables are already accounted for up to 2015, says IG Windkraft.

Some wind farms have contracts with Oemag granting them the FIT, but cannot progress to implementation until 2012-13 because the transmission grid needs strengthening first. If these are not commissioned within two years, a new application must be made. Other projects that are ready to install and have network capacity available cannot progress because they are too far down the Oemag first-come first-served list of projects to get allocation of feed-in tariff funding.

An additional difficulty for the wind market is the uncertainty that derives from the level of the FIT being renewed every year.

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