One small step toward the energy transition

An important milestone has been achieved: On 8 October AlpinSolar, the pioneer project built by Axpo and IWB, produced electricity for the first time. The power will be purchased by Denner for a period of 20 years from the time of full commissioning. Federal Councillor Simonetta Sommaruga participated in the festivities in Tierfehd. She praised AlpinSolar as a "trendsetting project". Axpo Chairman of the Board Thomas Sieber is also pleased that the company and its partners were able to build the solar plant at 2500 metres above sea level within three years despite financial difficulties.

Chairman Thomas Sieber remarked that in 2018 Axpo received strong encouragement for its project, including from "deep inside the land of the critics". Many supported this unique pioneer project. He expressed his thanks to the local authorities and the government of the Canton of Glarus.

Despite support from all sides – there were still many challenges to be faced, said Sieber: "Building at an altitude of 2500 metres is no trivial matter. There were delivery delays, and the weather was poor during the summer. And above all there were financial challenges – a Gordian knot for the project." These problems were solved in a partnership with IWB and Denner: “In a joint effort we are now realising AlpinSolar – to achieve more together."

Security of supply is crucial

For Energy Minister Simonetta Sommaruga the security of supply in Switzerland is at the top of the agenda. Power is "almost like a staple food" and of key importance. In the last ten years, Switzerland did not invest enough in domestic power production and relied too strongly on imports. This must now change in view of climate goals and decarbonisation.

AlpinSolar is therefore a "trendsetting project", says the Federal Councillor: "We need more domestic power quickly. The new alpine solar plant reflects the will to invest in the expansion of renewable energies  in Switzerland – and in doing so to strengthen our security of supply."

More support...

The podium discussion that followed with Federal Councillor Simonetta Sommaruga, Axpo CEO Christoph Brand, IWB CEO Claus Schmidt, and Denner CEO Mario Irminger made clear how urgently plants like AlpinSolar are needed. If Switzerland wants to achieve the energy transition, more renewable production capacities are needed – especially during the winter. However, similar projects face significant challenges. In order to realise such plants, investors need simpler, faster approval procedures, as well as a subsidy framework that makes the construction of large-scale plants economical – above all for plants that will produce power when we need it the most – during the winter.

Axpo CEO Brand, like Sommaruga, emphasised how essential it is for Switzerland to ensure security of supply. In order to achieve this "we must want to build them, be allowed to build them, and be able to build them." Axpo, IWB and Denner have demonstrated their will with AlpinSolar. “Being allowed to” is a question of approval procedures. It's not about limiting legal scope and ignoring environmental issues, but the procedures for the construction of power production facilities are simply "way too long".

“Being able to” refers to the issue of profitability. "Countries abroad already have proven methods to support renewable energies in place," explained Brand. The buzzword is "capacity markets". Public authorities determine the energy volumes to be constructed by means of tenders. The funds that investors will receive are determined at auctions. Thanks to these subsidies, "it is worthwhile for power producers take on the lion's share of investments and realise the expansion of renewable energies".

... and more initiative from the economy

Security of supply is not only a topic for the government and power producers. "The cantons and the economy are also called upon to do their part," explained Federal Councillor Sommaruga. After all, many companies in Switzerland are prepared to become climate neutral. Denner CEO Irminger is convinced that "A commitment on the part of the economy is needed." It was the 20-year long term power purchase agreement that really made the AlpinSolar take off.

IWB CEO Schmidt added that companies increasingly want to know exactly where their power is being produced. "In order for the energy transition to move forward quickly, we must all close ranks."

Christoph Brand knows that Power Purchase Agreements (PPA) are important. Axpo has a pioneering role in this area and is now the market leader for PPAs. He is pleased because "PPAs are an important catalyst to drive the energy transition forward."