Only together can we achieve a change in energy policy in a socially acceptable way; alternative energy systems can make a significant contribution to this. There are currently around 400,000 single gas boilers and condensing boilers in Vienna. https://positionen.wienenergie.at/wissenshub/energie-dashboard/gasthermen-wien/
At the same time, there are many renovated and unrenovated residential buildings in Vienna from a wide variety of eras, which are situated on more or less large plots of land – but mostly with a lot of common courtyard space. Depending on the undeveloped area adjacent to the buildings, there is the possibility of using geothermal heat through so-called depth probes with drilling lengths of 100-150m.
For a renovated apartment from the 1960s with a total floor space of around 60-100 m², on average one depth probe in combination with a bivalent heat pump would be sufficient to supply the apartment with heat and cold all year round. However, the cost of an apartment would not be economically viable in this case. For this reason, the energy supply for residential buildings must be centralized. Yet this means that the local gas boilers in the apartments would have to be dismantled and replaced by a central heating system. Learn more….
New local, stationary air source heat pumps represent another option. Instead of the local gas boiler, new stationary air-to-air heat pumps (of a new design with a high flow temperature) are installed. The requirements are either an undeveloped attic for the associated outdoor unit and the possible ducting in the existing chimney flues. In case of a converted attic, it is possible to replace the chimney heads with the outdoor units or to position them between the chimney heads.
On the one hand, these centralized and decentralized systems are associated with increased investment costs, but on the other hand, they are much cheaper to operate than gas boilers and condensing boilers (and not only since the war in Ukraine). In 2021, the payback period for such alternative energy systems was 10-15 years; in 2022, the payback period dropped to 8-10 years.
This means that the increased initial investment can ‘pay off’ after up to 10 years through the reduced operating costs. However, this only comes into play if the person making the initial investment is also able to recoup the costs in these 10 years. The decisive point here is whether it is an association of owners or an institutional property developer who rents out the apartments according to the benchmark rents. It will be difficult to convince institutional property developers to adapt their existing buildings without being able to get these costs reimbursed. Furthermore, this also means an intervention regarding the rental property, and thus the tenant is partially deprived of the opportunity to make self-sufficient decisions.
- So what to do:
The regulations on benchmark rents along with surcharges and deductions are difficult to predict because legislators have only imprecisely defined the value-increasing or value-reducing factors in the Tenancy Law. The law itself states that a surcharge is due if there is a deviation from the standard of a rental apartment (according to general market opinion and everyday experience). In any case, the furnishings of the apartment must also be assessed, which clearly also includes the energy system(s) in place.
From the current point of view, it can be said (at least for Vienna) that the ‘standard apartment’ is equipped with gas heating. If an owner now equips the apartment(s) with alternative/renewable energy sources, a surcharge will probably be legally justifiable due to a value-enhancing property (climate friendly / future-oriented). After all, there are already decisions that go in this direction from an analogous point of view:
- The Regional Court for Civil Matters in Vienna ruled in decision 38 R 121/06k of 28 June 2006 (MietSlg 58.260) that no separate surcharge for a gas floor heating system is permissible because, in summary, this represents the standard apartment according to Tenancy Law.
- In return, the Austrian Supreme Court granted a 10% surcharge in decision 5 Ob 224/13x because the building was completely renovated and a thermally insulated façade was attached. Even if the surcharge is not based on the actual investment costs of the owner, but only on the value-increasing deviation from the standard apartment, the Supreme Court has stated that additional thermal insulation has a positive effect on the tenants’ energy costs, which is why a surcharge is justified.
So as long as there is no legal ban on gas heating and not all apartments have been converted, a surcharge for alternative energy sources – provided these also have a positive effect on the tenants – can be reasonably argued. Irrespective of this, at present there no possibility in the Tenancy Law to pass on a proportion of the investment costs for alternative energy sources to the tenant. This is because the owner of the apartment is responsible for such investments. There is currently only one (different) option in the Tenancy Law in § 18 MRG: the so-called ‘base renovation’. The rent can then be increased for such urgent renovation measures if the rental income of the past 10 years and the future 10 years is not sufficient to finance the renovations. However, the application of this regulation is very delicate and must in any case be approved by the Arbitration Board or the court.
From the current point of view, there is no case law that confirms a surcharge for alternative energy systems in rental apartments. From our point of view (at least for the time being and until gas heating is banned), a surcharge is legally justifiable and can be argued well in court.
What demands can be made of the City of Vienna / the federal government in this case:
- Determination of (temporary) surcharges on benchmark rents up to the time of amortization
- Determination of (temporary) surcharges on benchmark rents up to the time of amortization with a simultaneous reduction in operating costs or assumption of the operating costs by the property developer
- Securing the legal framework for intervention in existing tenancy agreements
- Securing the legal framework for intervention in existing energy purchase agreements
- Securing the legal framework for intervention in existing common areas
- Simplified approval processes in connection with the MA19 [Municipal Department 19 – Architecture and Urban Design] / Federal Monuments Office in Vienna and the development of possible solutions in relation to the cityscape
It is up to the federal legislature to create a regulatory framework for any interventions in existing tenancy agreements/energy purchase agreements in favour of alternative energy sources. The Federal Ministry of Justice is responsible for the implementation of the Austrian Tenancy Law [MRG and RichtWG]. This means that only the Ministry could create temporary supplementary regulations by means of an ordinance, such as a temporary surcharge.
DI Dr. Klaus Petraschka
