Verbund

Stock performance

History

Verbund was created in 1947 under Austria's postwar electricity nationalization law as Österreichische Elektrizitätswirtschafts-AG, responsible for building the country's large hydropower stations and its national transmission grid. It was partially privatized and listed on the Vienna Stock Exchange in 1988, but the Austrian state has retained a 51% majority stake.

Business model

Verbund generates electricity mainly from run-of-river and storage hydropower plants on the Danube, Inn, and in the Alps, supplemented by growing wind and solar capacity, and sells power to wholesale markets, industry, and households. It also owns Austrian Power Grid, the national transmission system operator, and is investing in green hydrogen and pumped-storage capacity to balance intermittent renewables.

Market position

Verbund is Austria's largest electricity company and one of Europe's largest hydropower producers, with the large majority of its generation coming from water. Because its costs are low and largely fixed while its revenue tracks wholesale prices, its profits surged during the 2022 European energy crisis, making it one of the most valuable utilities in Central Europe.

Country impact

Verbund's hydropower fleet is the main reason Austria has one of the lowest-carbon electricity systems in the EU. Its windfall profits during the energy crisis flowed to the state through dividends and a temporary windfall levy, and its pricing became a national political issue as households faced soaring power bills.