Switzerland will liberalise its power market in early 2021

7 Apr 2020

Switzerland will go ahead with plans to open the electricity market for all customers, with the introduction of an amendment to the Electricity Supply Law (loi sur l’approvisionnement en électricité, LApEl) by early 2021. So far, only large consumers (more than 100,000 kWh/year) can freely choose their electricity supplier. Households and small businesses will be authorised to remain in the basic supply or to return to it after moving to the free market. Opening the retail electricity market is expected to strengthen decentralized power generation and thus to better integrate renewable energies into the electricity market; renewable producers will be allowed to sell their surplus generation to their neighbourhood, inciting energy communities.

A storage reserve will be created to ensure supply in extreme situation: the power transmission network operator Swissgrid will issue annual tenders for storage capacity, to be financed by the tariffs for using the power grid; all storage operators will be able to take part in the tender.  In addition, the Federal Council will launch tenders to boost renewable power capacity. It will make binding the existing indicative targets for hydropower and other renewables by 2035. Contributions to renewable projects will thus be extended from 2030 until 2035 and a target for the period up to 2050 will be enshrined in the law.  Tenders to award one-off payments for large PV plants will be introduced and feed-in tariffs for wind, small hydro, biogas, and geothermal plants will end in 2023. The new policy will cost CHF215m/year (€204m/year).

In August 2019, the Federal Council decided to accelerate Switzerland’s decarbonisation trajectory, with a target of zero net carbon emissions by 2050. The objective is to meet the internationally agreed goal of limiting global warming to a maximum of 1.5°C when compared with the pre-industrial era.

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