Real Estate & Construction

The Aus­tri­an fed­er­al gov­ern­ment has draf­ted the Re­new­able En­ergy Act (EWG, Erneuerbare-Wärme-Ge­setz), which is ex­pec­ted to con­trib­ute to mak­ing Aus­tria cli­mate neut­ral. The draft EWG bill aims at switch­ing the heat sup­ply of build­ings to re­new­able en­ergy sources and provid­ing so-called ‘qual­ity-as­sured’ (i.e. de­car­bon­ised) dis­trict heat­ing by 2040 through the gradu­al pro­hib­i­tion of the burn­ing of fossil fuels. The EWG will also reg­u­late the in­stall­a­tion of heat­ing sys­tems in new build­ings as well as the con­ver­sion of heat­ing sys­tems in ex­ist­ing build­ings. The draft, which will likely not be passed be­fore Janu­ary 2023, con­tains the fol­low­ing points.Res­id­en­tial and non-res­id­en­tial pro­ject­sThe in­stall­a­tion, con­ver­sion and ex­ten­sion ob­lig­a­tions for heat­ing sys­tems en­vis­aged in the EWG bill will be of cru­cial in­terest to pro­ject de­velopers since it will cov­er all kinds of ex­ist­ing and newly con­struc­ted build­ings, both res­id­en­tial and non-res­id­en­tial. Ban on fossil heat trans­fer me­dia in new build­ing­sThe bill’s main in­nov­a­tion is a com­pre­hens­ive ban on in­stalling oil, coal and gas heat­ing in new build­ings from 2023. Such a ban has been in force for cent­ral oil and coal heat­ing since the Oil Boil­er In­stall­a­tion Pro­hib­i­tion Act 2019 (ÖKEVG, Ölkesselein­bau­ver­bots­ge­setz). Ac­cord­ing to the draft, from 1 Janu­ary 2023 the ban will ex­tend to cov­er ex­ist­ing de­cent­ral­ised heat sup­ply sys­tems run­ning on oil and coal as well as gas heat­ing sys­tems. The ÖKEVG is to be re­placed by the EWG.De­com­mis­sion­ing re­quire­ment for cent­ral heat­ing sys­tems ex­ist­ing build­ing­sThe law centres on the de­com­mis­sion­ing re­quire­ment for cent­ral heat­ing sys­tems in ex­ist­ing build­ings. Nat­ur­al gas heat­ing sys­tems must be de­com­mis­sioned by 2040, and oil, coal and li­quified pet­ro­leum gas (LPG) heat­ing sys­tems must be de­com­mis­sioned by 2035. In ad­di­tion, build­ings with cent­ral heat­ing sys­tems run­ning on oil, coal or LPG will be par­tic­u­larly af­fected since build­ing own­ers must de­com­mis­sion heat­ing sys­tems earli­er than this de­pend­ing on the sys­tem’s year of con­struc­tion. Ac­cord­ing to the cur­rent draft, cent­ral oil heat­ing sys­tems built be­fore 1980 must be de­com­mis­sioned by 2025, while new­er sys­tems must be gradu­ally de­com­mis­sioned by 2035 (as part of the suc­cess­ive de­com­mis­sion­ing re­quire­ment). This will mean sig­ni­fic­ant ad­di­tion­al costs since ex­ist­ing fossil-fuel sys­tems must be de-in­stalled and con­ver­ted to oth­er sys­tems. Those costs must be care­fully con­sidered for build­ings already in op­er­a­tion and for pro­ject plan­ning and con­tract design, es­pe­cially when de­term­in­ing the pur­chase price of real es­tate.Re­new­able en­ergy re­quire­ment for cent­ral heat­ing sys­tems in ex­ist­ing build­ing­sIf a cent­ral heat­ing sys­tem in ex­ist­ing build­ings is ren­ov­ated, im­proved or re­newed, it must either be con­ver­ted to a sys­tem us­ing use re­new­able en­ergy sources or the build­ing’s heat­ing sup­ply can be switched to qual­ity-as­sured dis­trict heat­ing. Con­sequently, as of 1 Janu­ary 2023, cent­ral heat­ing sys­tems not run­ning on oil, coal or LPG any more may not be re­placed with an­oth­er fossil heat­ing sys­tem. The heat­ing sys­tem to be re­placed must be de­com­mis­sioned. The EWG of­fers some flex­ib­il­ity. For ex­ample, the re­place­ment of old sys­tems will not be re­quired and a switch to dis­trict heat­ing and oth­er al­tern­at­ives is also pos­sible as ex­plained be­low.De­velopers are en­cour­aged to take the re­new­able en­ergy re­quire­ment in­to ac­count for their pro­jects, both in plan­ning and con­tract draft­ing. For re­pairs, re­fur­bish­ments and im­prove­ments to fossil-heat­ing sys­tems, the costs of re­mov­ing and dis­pos­ing of old sys­tems and in­stalling new ones must be weighed against a pos­sible switch to dis­trict heat­ing (for which the bill provides tech­nic­al ex­cep­tions).  Con­ver­sion re­quire­ment for de­cent­ral­ised sys­tem­sEx­ist­ing de­cent­ral­ised plants run­ning on oil, coal or gas will be treated more strictly. They must be con­ver­ted to cent­ral­ised non-fossil fuel plants by 2035 or, if op­er­ated by nat­ur­al gas, by 2040. Op­er­at­ing a build­ing will only be per­mit­ted if the build­ing is heated with re­new­able en­ergy sources or qual­ity-as­sured dis­trict heat­ing. For de­cent­ral­ised nat­ur­al gas heat­ing sys­tems, this only ap­plies if the build­ing is loc­ated in an area, which already has qual­ity-as­sured dis­trict heat­ing or where this will be­come avail­able by 2035. If this is the case, in­di­vidu­al units (e.g. flats, of­fices, shops) must be con­nec­ted to this cent­ral sys­tem with­in five years. If this con­ver­sion has not taken place in a build­ing, this must be taken in­to ac­count in pro­ject plan­ning and cost plan­ning. In in­di­vidu­al cases, it must be ex­amined in more de­tail what ex­actly "qual­ity-as­sured dis­trict heat­ing" means and how a real es­tate in­vestor can de­term­ine this or check wheth­er "it will have dis­trict heat­ing by 2035". It is also not clear wheth­er ten­ants can in­sist on a cer­tain changeover or, con­versely, op­pose it.Ac­cord­ing to the bill, fur­ther reg­u­la­tions are to be ex­pec­ted for those nat­ur­al gas-based sys­tems that are not covered by the re­new­able en­ergy re­quire­ment, the suc­cess­ive de­com­mis­sion­ing re­quire­ment and the re­quire­ment to con­vert de­cent­ral­ised sys­tems. There­fore, an­oth­er draft to ad­dress the phase-out of fossil gas heat­ing sys­tems in ex­ist­ing build­ings will ap­pear soon. However, these nat­ur­al gas plants will also have to be de­com­mis­sioned by 2040.En­ergy Out­look – is green gas the fu­ture?Ac­cord­ing to the draft, de­clared ob­ject­ives of the EWG in­clude the ex­pan­sion of dis­trict heat­ing and the con­ver­sion of heat sup­ply to re­new­able en­ergy sources or qual­ity-as­sured (i.e. de­car­bon­ised) dis­trict heat­ing. Ac­cord­ing to the draft, en­ergy from re­new­able gas falls un­der en­ergy from re­new­able en­ergy sources and is there­fore a means of de­car­bon­ising dis­trict heat­ing. The ex­plan­at­ory notes to the bill refer to the use of green gas for the lat­ter in ad­di­tion to waste heat util­isa­tion, heat pumps, geo­therm­al en­ergy and bio­mass. As a res­ult, heat­ing sys­tems that are op­er­ated with re­new­able gas are ex­empt from the de­com­mis­sion­ing re­quire­ment for cent­ral heat­ing sys­tems. Pending reg­u­la­tions on nat­ur­al gas heat­ing ab­sent from the EWG will not change this either. Green gas plants can be op­er­ated bey­ond 2040. Au­thors: Thomas Ham­erl, Dr. Jo­hannes Hysek, Karl Weber-Wois­etschläger 

The new cap­it­al will be used both to fin­ance the on­line gro­cer’s con­tin­ued ex­pan­sion in Ger­many, Italy, Spain and Ro­mania and to drive for­ward tech­nic­al in­nov­a­tion.Foun­ded in 2014, on­line gro­cer Roh­lik, which re­volu­tion­ised gro­cery in Aus­tria with gurk­erl.at, is one of the fast­est grow­ing re­tail­ers in the Czech Re­pub­lic and the en­tire CEE re­gion. Prom­ising de­liv­ery just 90 minutes after an or­der is placed, the com­pany already sup­plies more than one mil­lion cus­tom­ers with more than 17,000 products. Roh­lik now not only of­fers its de­liv­ery ser­vice in Vi­enna (gurk­erl.at), but also in Prague (roh­lik.cz), Bud­apest (kifli.hu), Mu­nich and Frank­furt (knus­pr.de). Soon the ser­vice plans to launch in Ham­burg, Mil­an (sezamo.it), Bucharest (sezamo.ro) and Mad­rid (sezamo.es). The fresh cap­it­al will be used to fin­ance con­tinu­ing ex­pan­sion and drive tech­nic­al in­nov­a­tions.Al­ex­an­der Rakosi, Part­ner in the CMS Vi­enna Cor­por­ate Trans­ac­tions Team, is de­lighted with the deal: “Such a large cross-bor­der trans­ac­tion al­ways raises a num­ber of com­plex leg­al and or­gan­isa­tion­al is­sues that re­quire sound leg­al ex­pert­ise and a well-co­ordin­ated trans­ac­tion team. Our in­ter­na­tion­al net­work en­ables us to provide our cli­ents with com­pre­hens­ive ad­vice and ac­cess to seasoned ex­perts in all coun­tries.”Man­aging Part­ner of CMS in Prague and Brat­is­lava, Helen Rod­well, is also pleased about the suc­cess­ful clos­ing: “We are proud to have been able to ac­com­pany this new fin­an­cing round. Roh­lik’s unique of­fer­ing and first-class ser­vice make it an at­tract­ive growth can­did­ate for in­vestors cau­tious due to the cur­rent eco­nom­ic and geo­pol­it­ic­al cli­mate. As a lead­ing in­ter­na­tion­al law firm – with a sig­ni­fic­ant pres­ence in CEE and many oth­er European coun­tries – CMS is ideally placed to provide leg­al sup­port for this kind of cross-bor­der trans­ac­tion.”The Aus­tri­an CMS leg­al team in Vi­enna in­cluded Al­ex­an­der Rakosi and Flori­an May­er (Cor­por­ate Law/M&A), Anna Hiegel­sper­ger (Cor­por­ate Law/M&A), Jens Winter (Em­ploy­ment & Pen­sions), Sonja Oten­hajmer (Dis­pute Res­ol­u­tion), Mar­i­ella Ka­poun (Real Es­tate & Con­struc­tion) and Max­imili­an Uidl (Real Es­tate & Con­struc­tion). The in­ter­na­tion­al CMS leg­al team was led by ex­per­i­enced CMS part­ner Helen Rod­well (CMS Czech Re­pub­lic) and con­sisted of Dav­id Cran­field (CMS Ro­mania), Štěpán Havránek and Tristan O'­Con­nor (CMS Czech Re­pub­lic); and Mor­itz Kop­ka (CMS UK). Also ad­vising were Flori­an Kami­en­ke and Oliv­er Thurn (CMS Ger­many); Mik­los Boros (CMS Hun­gary); José Lu­is Rodrig­uez and Car­los Peña (CMS Spain); Cristina Ci­omos and Rod­ica Manea (CMS Ro­mania); and Aless­andra Cuni, Sara Tam­marazio and Daniela Murer (CMS Italy).