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Glossary
Service price

The capacity price is an important key figure in the energy market that describes the costs for the electrical power provided. In Austria, it plays a central role in pricing and the integration of renewable energies.

10/21/2024

The demand charge is a key term in the energy market and refers to the costs charged to an energy consumer or producer for the electrical power provided. It is often expressed in euros per kilowatt (€/kW) and plays a decisive role in the pricing of various electricity tariffs and models. In an increasingly complex energy market such as the Austrian one, the capacity price has far-reaching effects on the economic efficiency of companies and households as well as on the integration of renewable energies.

In Austria, electricity costs are generally made up of various components, including the labour price, which covers the actual amount of energy consumed, and the capacity price, which ensures the necessary capacity for the energy supply. Especially for industrial customers who consume large amounts of energy, the demand charge is a significant component of operating costs. Companies that can manage their loads flexibly often have the opportunity to benefit from more favourable capacity prices by adjusting their consumption to the availability of renewable energy.

Another important aspect of the demand charge is its role in promoting grid stability. Grid operators must ensure that sufficient power is available to cover consumption at all times. To achieve this, they incentivise consumers to reduce their peak loads, which is often achieved by varying demand charges throughout the day. This can lead to consumers adjusting their energy consumption at times of lower prices in order to save costs.

The development of the demand charge is also closely linked to the European Union's targets for promoting renewable energy. In Austria, there are political endeavours to increase the share of renewable energies in the overall energy mix. In order to achieve these goals, demand charges must be designed in such a way that they promote the integration of renewable energy sources such as wind and solar energy. This can be done through specific tariff structures that incentivise the consumption of energy from renewable sources.

The EU has also adopted directives to promote transparent pricing in the energy market. In Austria, grid operators and energy suppliers are required to communicate their pricing models openly and give consumers the opportunity to optimise their energy consumption. The demand charge plays a decisive role in this context, as it not only influences the cost structure of the energy supply, but also incentivises consumers to use energy more efficiently.

To summarise, it can be said that the demand charge is a decisive factor in the Austrian energy market, reflecting the cost of the electrical power supplied and closely linked to grid stability, the integration of renewable energies and the economic efficiency of companies and households. The continuous adjustment of capacity prices to the changing requirements of the energy market will be crucial to ensure the sustainability of the energy supply in Austria and to achieve the EU's climate targets.

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