Where will our future power supply come from

Coal and nuclear power are being phased out in Europe, but electricity consumption is rising. What do these developments mean for a secure supply in Switzerland? Axpo has looked into the issue and the results are encouraging: Switzerland has the ability to ensure a sustainable electricity supply – if it does the right thing. In addition to making improvements to Switzerland’s import capability by concluding a bilateral electricity agreement and maintaining a storage reserve, above all else this includes expanding photovoltaics (PV), preserving hydropower (Hy) and running nuclear power plants for 60 years if it is safe to do so. Or, to phrase this in a shorter, more formulaic way: PV+Hy+60 = 99.9% security of supply.

The electricity supply infrastructure in Europe is undergoing major changes. Nuclear power is being phased out in Germany in 2022, while coal will be gradually phased out by 2038. In France, President Macron is planning to reduce nuclear power’s share of the electricity mix to 50% by 2035. These developments will translate into a great deal of secure capacity disappearing from the market over the coming years. Although large amounts of new wind and photovoltaic capacity are being deployed, wind and solar electricity generation very much depends on the weather.

At the same time, oil and gas heating systems in buildings are to be replaced by heat pumps and e-mobility is increasingly gaining traction in the mobility sector. The key to radically reducing CO₂ consumption is electricity. It is thus highly likely that demand for electricity will increase. Electricity is becoming increasingly important, while the role of electricity infrastructure is gaining in significance for nation states in (geo-)strategic terms. We therefore really ought to ask ourselves what these developments in neighbouring countries and the CO₂-free energy supply mean for Switzerland.

A deceptive annual average: Switzerland’s reliance on European imports

On an annual average, Switzerland produces enough electricity to meet its domestic demand. But, on closer inspection, it becomes clear that surplus electricity is generated in summer, while domestic production in winter is unable to meet Swiss electricity needs. Switzerland is dependent on European electricity imports in winter, especially from France and Germany.

Whether Switzerland will be able to import enough electricity in future depends not only on the export capability of surrounding countries but also on the further expansion of the (cross-border) electricity grids and the bilateral electricity agreement with the EU. Although Switzerland has been negotiating with the EU for years, the outcome remains uncertain. But how bad does Switzerland’s future security of supply look?

The good news: not too bad

An investigation (see below) by Axpo has analysed what will happen with the export capability of neighbouring countries until 2035 and how this will affect Switzerland’s electricity supply. Under average conditions until 2035, it becomes evident that sufficient electricity can be imported from Europe to meet Swiss demand, even in winter. This assumes that renewable energies – especially PV – will expand and that the core of our electricity supply – domestic hydropower – will be preserved.

Hydropower accounts for around 60% of the electricity generated in Switzerland, but is coming under increasing regulatory pressure. For example, nowhere else in Europe is the fixed tax burden on hydropower anywhere near as high as it is in Switzerland. This has a direct impact on hydropower operators’ willingness to invest and thus on ensuring security of supply in Switzerland in the medium to long term and the ambitious goals of the Energy Strategy 2050. The current revision of the Energy Act offers a great opportunity to create stronger investment incentives in Switzerland so that the expansion of renewables in this country would again be worthwhile (see Interview Thomas Sieber).  The Axpo study continues to assume that Swiss nuclear power plants will have a service life of 60 years. While nuclear power is no longer a technology of the future in Switzerland, the existing plants will give us time to expand renewables and provide CO2-free domestic electricity until then.

Switzerland: up against a cold, cloudy and windless opponent

However, the situation is completely different when the weather turns cold, cloudy and windless. If the weather conditions are poor, the export capacity of neighbouring countries could become scarce within the next ten years and this development could potentially lead to Switzerland experiencing a temporary electricity shortage.

During a wind and solar lull, cloudy and windless weather means that wind turbines and photovoltaic installations only generate a minimal amount of electricity. When the weather turns cold, cloudy and windless, especially during winter, there is additional demand for electricity because more heating is needed. If additional nuclear power capacities in Switzerland or France were to or no longer exist during such a lull phase, this would only make the situation worse. Domestic production and imports combined wouldn’t be enough to provide sufficient electricity, so Switzerland would be likely to have an energy deficit.

Storage reserve: a potential solution

Changing how Swiss storage power plants are used could be a way to counter such deficits. But this would require adjustments to the regulatory framework. The storage reserve proposed by the Federal Council in the revision of the Electricity Supply Act (ESA) would be one possible approach. In addition to maintaining a storage reserve, concluding an electricity agreement with the EU would also be conducive to viable electricity exchange and would improve the security of supply in Switzerland.