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Title page 1

Contents 5

Foreword 4

Reader's guide 8

Basic statistics of Austria 9

Executive summary 10

Assessment and recommendations 13

1. Towards the green transition 14

1.1. Addressing key environmental challenges 14

1.2. Enhancing policy coherence for the green transition 25

2. Promoting the circular economy 32

2.1. Setting a sound policy and governance framework for the circular economy 32

2.2. Strengthening progress towards waste management and circular economy objectives 35

2.3. Developing new business models and economic opportunities 39

References 42

Notes 49

Annex 1. Actions taken to implement selected recommendations from the 2013 OECD Environmental Performance Review of Austria 50

Chapter 1. Towards the green transition 52

1.1. Setting the scene 53

1.1.1. Austria's socio-economic context 53

1.1.2. Decoupling environmental pressures from economic growth 53

1.1.3. Key elements of environmental governance 54

1.2. Addressing key environmental challenges 56

1.2.1. Progress towards net zero 56

1.2.2. Accelerating the clean energy transition in all sectors 60

1.2.3. Tackling air pollution 67

1.2.4. Controlling the expansion of artificial surfaces 69

1.2.5. Halting biodiversity loss 71

1.2.6. Managing water resources 76

1.2.7. Enhancing resilience to the impact of a changing climate 80

1.3. Enhancing the cost effectiveness of the policy mix 83

1.3.1. Aligning fiscal decisions with environmental and climate goals 83

1.3.2. Better targeting environmentally motivated incentives 84

1.3.3. Removing environmentally harmful subsidies 85

1.3.4. Greening the tax system 88

1.3.5. Investing in the green transition 91

1.3.6. Aligning finance and investment with climate goals 93

References 98

Notes 109

Chapter 2. Promoting the circular economy 111

2.1. Strategic framework 112

2.1.1. Austria's Circular Economy Strategy sets an ambitious vision and targets 112

2.1.2. Multi-level governance is central to delivering circular economy ambitions 113

2.1.3. EU legislation and policy set the framework 113

2.2. Trends in waste generation and management, material consumption and resource productivity 114

2.2.1. Domestic resource consumption and material footprint have decreased, but Austria may not meet all the CE Strategy's targets 114

2.2.2. Construction drives 80% of Austria's waste 116

2.2.3. Municipal solid waste generation is high, although almost all is recycled, composted or incinerated 117

2.2.4. Austria's circular material use rate has risen 118

2.3. Policy mix for the circular economy 120

2.3.1. National waste management plans and policy instruments provide a foundation for circularity goals 121

2.3.2. Regional and local government initiatives should be expanded 123

2.3.3. Further policy measures are needed to accelerate use of secondary and bio-based materials 125

2.3.4. Government funding is a catalyst 126

2.3.5. Support for research and innovation has increased 128

2.4. Progress in key waste and materials streams 130

2.4.1. Austria has achieved a high share of waste recovery in the construction sector, but major challenges remain 130

2.4.2. Recent actions have targeted plastic packaging waste, but most plastic waste is incinerated 131

2.4.3. The upcoming introduction of EPR for textiles and textile waste should further increase collection and re-use 134

2.4.4. An innovative national programme repairs electrical and electronic equipment 136

2.4.5. Austria should build on its progress addressing food waste 138

2.5. Public and stakeholder action 141

2.5.1. The private sector has a key role 141

2.5.2. Policies have supported the role of social economy in repair and re-use 145

2.5.3. Public awareness appears strong, but further consumer action is needed 145

References 147

Note 152

Tables 6

Table 1. Austria is on track to meet the EU's 2025 target for total packaging waste 37

Table 1.1. Potentially climate-counterproductive tax measures 83

Table 2.1. The CE Strategy sets clear 2030 and 2050 targets 112

Table 2.2. Austria imports and exports high shares of key waste streams, 2023 120

Table 2.3. Recent federal policies and plans have promoted the circular economy 120

Table 2.4. Austria has met packaging waste targets, except for plastic packaging 132

Figures 5

Figure 1. Environmental decoupling from economic performance has accelerated in recent years 15

Figure 2. GHG emissions have declined but remain off track to meet climate targets 16

Figure 3. Annual land take has declined and is nearing the end-of-decade target 20

Figure 4. The protected area network is extensive, but habitats and species are under pressure 21

Figure 5. Carbon prices have increased with the eco-social tax reform 27

Figure 6. Despite progress, achievement of the CE Strategy 2030 and 2050 targets is uncertain 33

Figure 7. Recycling and composting are at high levels, except for plastics and textiles 36

Figure 8. Over half of separately collected textile waste is prepared for re-use 38

Figure 1.1. Environmental decoupling from economic performance has accelerated in recent years but is uneven 54

Figure 1.2. GHG emissions declined, but emissions from transport and industry remain high 58

Figure 1.3. Austria is off track to meet its climate targets to 2030 and 2040 59

Figure 1.4. More renewables and lower energy intensity drive Austria's clean-energy transition 61

Figure 1.5. Public transport use is high and has increased in recent years 63

Figure 1.6. Deployment of electric vehicles has accelerated 64

Figure 1.7. Energy use and GHG emissions from space heating have declined but remain high 66

Figure 1.8. Air emissions and pollution have declined, but exposure to fine particulates exceeds recommended health thresholds 68

Figure 1.9. Annual land take has declined and is nearing the end-of-decade target 69

Figure 1.10. Large shares of habitats and species show a poor conservation status 73

Figure 1.11. Much of Austria's territory is protected, but areas under strict protection are limited 74

Figure 1.12. Growing organic farming has helped slow the decline of farmland bird populations 75

Figure 1.13. Surface water ecology has improved moderately, while groundwater chemical quality has deteriorated slightly 78

Figure 1.14. Federal funding has leveraged substantial water-related investment, with increasing focus on restoration and flood protection 79

Figure 1.15. A large share of the population lives in areas potentially exposed to river flooding 81

Figure 1.16. Environmental subsidies grew, with building energy efficiency as the main focus 85

Figure 1.17. Support to fossil fuels remains high in the wake of the 2022 energy price crisis 86

Figure 1.18. Environment-related tax revenue has declined 88

Figure 1.19. Effective carbon prices have risen 90

Figure 1.20. Investment in climate change mitigation has risen, especially in the energy sector 92

Figure 1.21. Austria has a higher share of climate stress tests than European peers 94

Figure 1.22. Austria's stock market retains fossil-fuel exposure but no exclusively low-carbon listings 96

Figure 1.23. Central bank data on bank holdings reveal large climate-relevant financial stocks 97

Figure 2.1. Austria's domestic material consumption has decreased slightly over the past decade 115

Figure 2.2. Austria's material footprint declined but remains above the EU average 116

Figure 2.3. Construction waste and manufacturing waste have risen since 2014 117

Figure 2.4. Generation of municipal waste declined slightly from 2020 to 2023 118

Figure 2.5. Austria's circular material use rate is above the EU average but below EU leaders 119

Figure 2.6. Recycling rates for plastics and textiles remain low 119

Figure 2.7. Austria's landfill and incineration tax levels are relatively modest 122

Figure 2.8. Levels of municipal waste vary across Austria's states 124

Figure 2.9. Austria has a comparative advantage in material recovery and recycling technology 129

Figure 2.10. Over half of separately collected textile waste is prepared for re-use 135

Figure 2.11. Austria collects an increasing volume of WEEE but has not reached the EU target 136

Figure 2.12. Households produce the largest share of food waste, in line with the EU average 139

Figure 2.13. The waste management sector has grown since 2010 142

Boxes 7

Box 1.1. The KlimaCheck: A mandatory climate assessment for federal policies 57

Box 1.2. The KlimaTicket: Effects on mobility choices and GHG emissions 63

Box 1.3. Promoting use of brownfields to reduce land take 71

Box 1.4. The Biodiversity Strategy Austria 2030+ 72

Box 1.5. EU Sustainable Finance Framework 95

Box 2.1. Vienna has taken a leading role in promoting the circular economy 125

Box 2.2. Austria's international initiatives for the circular economy 127

Box 2.3. Research projects to improve recycling of CDW waste 131

Box 2.4. The French EPR programme for textiles has introduced eco-modulation of fees 136

Box 2.5. The disposal of portable batteries in mixed municipal waste has led to fires 138

Box 2.6. Raising public awareness about food waste 140

Box 2.7. Research projects have supported industrial symbiosis 143

Box 2.8. The Climate Lab undertakes policy research and dialogue on the circular economy 144

Box 2.9. Federal states have supported social employment for the circular economy 145

Box 2.10. Littering remains an issue in Austria 146

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