At the end of June, the Social Democratic Party (SPÖ) said the stock exchange listing announced by Energie AG chief executive Leo Windtner for February or March 2008 was only the “start of a privatisation process” and that the “public initiative” (www.ooe.spoe.at/news) against the intended sale launched on 2nd July was therefore “well-timed” and “a perfect chance to prevent a sale”.

In Upper Austria’s all-party government – which since 2003 has been composed of members of the People’s Party/ÖVP (25 seats), Social Democratic Party/ SPÖ (22), Green Party (5) and Freedom Party/ FPÖ (4) – the Social Democrats are the only political force rejecting a partial privatisation of Energie AG in Upper Austria. Interestingly enough, a similar deal was concluded in 2002, when 25 percent plus one share of the company (which until 1998 was operated under the name of “OKA”) were sold to EnergieAllianz and EVN – backed by votes from both ÖVP and SPÖ!

According to Gottfried Hirz, chairman of the Green Party in Upper Austria, the former partial sale is closely associated with the current development: “Many political forces in Austria then were in favour of an ‘Austrian electricity solution’, which would have meant merging all domestic power suppliers and all power generation companies into two separate shareissuing companies. One intention was to incorporate Energie AG (and Linz AG) into Energie Allianz.

After the obvious failure of this scheme, in March 2006 the Upper Austrian Landtag used the only available chance for Energie AG to pull out of Energie Allianz and decided to buy back the package of shares held by EVN and Wiener Stadtwerke. The buyback cos€ 357 million that were taken from the provincial budget.

The other parties in the Landtag would never have accepted if the SPÖ had urged that the government should keep the reacquired shares, Hirz says. The purchase money was to be used to reduce the budget deficit and to serve for future investments. There were three options: reconciliation with VERBUND, a partnership with Tyrolean TIWAG, or partial privatisation. Hirz explains why they had opted for the latter option: “VERBUND expressed its wish to become a ‘controlling shareholder’, which could not be fulfilled; because of its energy focus, it would have sought to get rid of some of Energie AG’s lines of business over the long term.

Negotiations with the Tyroleans failed because of certain expectations regarding veto rights and because of their liaisons with Bavarian (nuclear) energy groups, which was specially criticised by the Greens.” The partial privatisation of Energie AG OÖ, approved in the Upper Austrian Landtag on 5th July, envisages the following:

• 51 % of equity shares are still owned by the provincial government;
• 6.219 % are owned by Linz AG;
• 0.5 % of shares are put at the company’s disposal free of charge and offered to employees working with the company for more than three years at special discount prices. This percentage shall be increased to 5 % maximum;
• roughly 40 % of shares will be listed on the stock exchange. The idea is to attract mainly institutional investors as this shall prevent that the group comes under control from outside. Negotations to find an appropriate investment bank are currently under way.

But it also enables the company to invest even more in the generation of eco-electricity – including hydropower. Energie AG OÖ is a classical infrastructure group; it is a supplier of electricity and district heat, provides waste disposal and recovery services, and also offers water-related services. The latter are bundled with the intermediate holding company Energie AG Wasser; the Czech, Slovakian and Hungarian subsidiaries as well as the Upper Austria-based WDL GmbH operate under its umbrella.

WDL, which supplies 130,000 people (or 7 % of the Upper Austrian population) with water, became the most recent point of criticism of the Upper Austrian SPÖ. The latter claim that astock exchange listing of Energie AG will also result in the sale of WDL “water rights” to private investors. While this hardly seems to be a risk under Austrian legislation (rights of disposition lie with the public authorities), there was enough political pressure to initiate a “water solution” for Upper Austria.

And here is another peculiarity: the “water rights”, which had previously been held by the water utilities LWU (rights of use, rights of exploration etc.), were sold to Energie AG OÖ in 2000 – again with backing from ÖVP and SPÖ.

Gottfried Hirz is pleased that the “water solution” for Upper Austria, which was also approved in the Landtag on 5th July, allows a repurchase of these water rights and reverses the decision with which the Green Party had been overruled. “Water rights will lie with ‘OÖ Wasserressourcen GmbH’ (working title of the application), a 100 % province-owned subsidiary. The concluded agreement seeks to secure the water rights by way of constitution, so that they can only be sold by a two-third majority in the Landtag”, says Hirz.

As for the future management of water assets, Walter Czetsch believes a “new WDL” of Energie AG will be put in charge. Detailed expert findings have revealed that in such a case no EU-wide tendering procedure would be needed! There will be no changes in customer relations and work processes. The repurchase of water services is expected to cost between € 15 and 20 million of taxpayers’ money; Energie AG is likely to benefit from this sum, says Hirz. Energie AG Wasser will continue to exist and serve as the umbrella for the foreign subsidiaries.

Gerald Höchtler, media spokesman of the Upper Austrian SPÖ, said in his interview with aqua press that the “water solution” for Upper Austria would not guarantee the province a safe water supply. Debates on a stock exchange listing of Energie AG OÖ are far from being concluded, he says. The deadline for the citizen initiative has therefore been extended to 21st December 2007.
(Source: aqua press Int. 3/2007, Mag. Christof Hahn)