Inside Infrastructure: What's Happening in Austria?

Hot Topics

1. Construction Sector Outlook: Stable Growth Backed by Public Investment
   Austria's construction industry is projected to grow by 4.0% in 2025, reaching a market size of EUR 36.72bn. This growth is supported by increased orders in construction and civil engineering, a rise in housing loans, and declining inflation rates, coupled with substantial investments in infrastructure and energy projects. By the end of 2029, the construction sector is projected to expand to approximately EUR 43bn.
2. Electricity export shift and storage focus
   Austria became a net electricity exporter in 2024, supported by strong hydro capacity and improved grid infrastructure. Austrian Power Grid AG is investing EUR 9bn by 2034 to strengthen Austria’s transmission capabilities. Additionally, Austria’s largest battery storage system commissioned in the southern part of Austria: In just seven months, NGEN group deployed a 24 MWh grid-scale battery, using six Tesla Megapack 2XL units. The project enhances grid stability and enables the flexible use of renewable energy, reducing fossil fuel dependency and marking a strategic milestone in Austria’s energy transition. NGEN aims to replicate this intelligent storage model across the DACH region.
3. New Austrian Electricity Industry Act (Elektrizitätswirtschaftsgesetz - ElWG): the Austrian government plans to adopt the new act before Summer 2025 (the bill was submitted to the parliament on 24 April 2025). The main objective is to modernize the country's electricity regulatory framework, align it with European Union directives and facilitate the transition to a sustainable, decentralized, and consumer-centric energy system while recognising the importance of energy storage.
4. Digital infrastructure: hyperscale investments
   Microsoft is investing a reported EUR 1bn in three new data centres in the Vienna region (Vösendorf, Inzersdorf, Wiener Neustadt), forming part of its “Austrian Cloud Region.” Launch is scheduled for end-2025. These centres will play a pivotal role in cloud and AI-driven innovation, with strong implications for Austria’s data security and energy policies.

Latest Infrastructure Deals and Opportunities

1. Green steel transformation – voestalpine
Voestalpine AG greentec steel initiative is a cornerstone of Austrian industry’s decarbonisation path. Total investment: approximately EUR 1.5bn (Phase 1). Conversion of Linz and Donawitz steel plants to electric arc furnaces aims for 30% CO₂ emissions reduction by 2030. Backed by national and EU state aid.

2. REWE Austria climate-neutral transformation
REWE Group Austria is rolling out a EUR 1.5bn investment programme by the end of 2027 to modernise logistics centres, install rooftop solar, and electrify its delivery fleet. The initiative is part of its plan to reach climate neutrality by 2040, covering both real estate and operations.

3. Semmering, Brenner and Koralm Base Tunnels (Austrian Federal Railways)
The twin base tunnel projects – part of the EU’s Baltic-Adriatic and north-south transalpine Corridor – are among Austria’s largest infrastructure undertakings:  

• Semmering Base Tunnel: approximately EUR 3.9bn, completion expected 2030–2031
• Koralm Railway Line: approximately EUR 5.4bn, partial operation from 2026
• Brenner Base Tunnel: approximately EUR 8.4bn, completion expected 2032 (not owner but main Austrian infrastructure partner)

4. SoutH2 Corridor – Hydrogen transport route
Austria will form part of the SoutH2 Corridor, a cross-border hydrogen pipeline linking North Africa to Germany via Italy, Slovenia and Austria. The corridor is expected to transport more than 4 million tonnes of renewable hydrogen annually and represents a total planned investment of over EUR 4bn, according to project partners and official EU documentation.

5. BP Austria retail network divestment
BP is preparing the sale of its Austrian retail fuel and convenience business, comprising over 260 retail sites, its associated Austrian fleet business, electric-vehicle charging assets, and shares in a company operating the Linz fuel terminal. The sales process has already begun, and BP aims to announce a potential buyer by the end of Q3/2025. The completion of the sale is targeted for the end of 2025.

6. Private rail liberalisation – WESTbahn expansion
WESTbahn, Austria’s private passenger rail operator, will begin serving the Vienna–Graz–Villach southern corridor from March 2026. The corridor had been dominated by Austrian Federal Railways until now. WESTbahn is backed by Austrian and French investors.

7. Telecom infrastructure divestment – Cellnex Austria
Cellnex has sold its Austrian telecom tower portfolio to a consortium of Stonepeak, MEAG, and EDF Invest, as part of a broader European consolidation trend. While the Austria-specific value was not disclosed, the entire Central and Eastern European package was valued at approximately EUR 1bn.

8. Green Energy Lab and AEE INTEC pool expertise for the heat transition

Green Energy Lab was founded by the energy companies Wien Energie, EVN, Burgenland Energie and Energie Steiermark. The Green Energy Lab research initiative and AEE – Institute for Sustainable Technologies are jointly driving forward the development of solutions for the heat transition. It is an unprecedented cooperation between market-oriented companies and the public sector in the field of applied energy research. Green Energy Lab operates the largest innovation laboratory for sustainable energy solutions in Austria and coordinates over 60 cooperative research and innovation projects with a total investment volume of EUR 150m.

9. Industrial Transformation Investment Programme – Austria’s Decarbonisation Support Scheme

Austria’s Ministry for Economic Affairs, Energy and Tourism (BMWET) is preparing a major funding programme under the Environmental Support Act (UFG) to accelerate the decarbonisation of the country’s industrial sector. With a total budget of EUR 2.975bn available until 2030, the initiative will support investment measures aimed at achieving the greatest possible reduction in greenhouse gas emissions from the direct combustion of fossil fuels and from industrial production processes. The programme, part of Austria’s broader climate and energy transition strategy, is designed to contribute both to emissions reduction and to the long-term competitiveness of Austria’s industrial and economic base

Legal and Regulatory Developments – Energy & Climate

1. Carbon management strategy (CMS 2040)
Austria’s national Carbon Management Strategy (adopted late 2024) establishes a framework for:

• Legal recognition of CCS/CCU technologies
• A forthcoming national CO₂ registry and permitting system
• Regulation of CO₂ pipeline infrastructure and storage sites, especially in depleted gas fields

2. EU-approved State Aid for industrial transition
In March 2025, the European Commission approved a EUR 400m Austrian state aid scheme under the Temporary Crisis and Transition Framework. Targeted sectors include steel, chemicals, and cement. Beneficiaries like voestalpine will receive grants for hydrogen-based steel production and electrification.

3. Grid regulation and export governance
As Austria transitions to a net electricity exporter, its energy regulator E-Control is aligning national rules with upcoming EU reforms. Priorities include:

• Cross-border balancing
• Digitalisation of grid operations
• New models for grid fees and congestion pricing

4. New Austrian Electricity Industry Act (Elektrizitätswirtschaftsgesetz - ElWG): the Austrian government plans to adopt the new act before Summer 2025. It shall replace the outdated Electricity Industry and Oranization Act (ElWOG 2010). The new regulations shall

• Ensure affordable electricity with a secured supply
• Support reaching the goals of the Renewable Energy Expansion Act (Eneuerbaren-Ausbau-Gesetz) to achieve Austria’s climate targets by 2040
• Increase energy efficiency 

And finally…. Real Asset or Fake News?

Well done to everyone who wasn't taken in by the UK's hot springs last week. 

This week we are seeking clever carbon hiding places as we look at some of the innovative solutions that are being trialled/considered to capture and store carbon dioxide. But can you spot which of the following is currently not on the creative carbon capture cards? 

Dusty beaches: Spreading finely ground mineral rocks over large areas such as beaches to encourage reaction with carbon dioxide in the atmosphere,  forming stable carbonate compounds that lock the CO₂ away.

Seasoning sea water:  Adding alkaline minerals (such as lime or crushed basalt) to ocean waters can increase the sea’s ability to absorb and retain atmospheric CO₂ as bicarbonate ions.

Cloud(Net) nine: Trials are underway of vast floating platforms in the upper atmosphere equipped with artificially engineered “cloud nets” featuring ultra-thin, flexible meshes seeded with genetically modified microorganisms. These can use sunlight to photosynthesize and capture atmospheric CO₂.

Super seaweed: Large-scale cultivation of kelp and other fast-growing seaweeds aimed at absorption of CO₂ as they grow, and then sinking the harvested biomass into deep ocean layers or sediments, effectively burying the carbon.

Underground injections:  Injecting captured CO₂ into underground porous basalt formations, to instigate chemical reactions which convert CO₂ into solid carbonates that are then locked away in the rock.

Again, If you think you have spotted this week's fake news, please get in touch. We will publish the answer in our next post.