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December, 2013

Switzerland incentive program

This document may not be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose, without our prior written permission. Switzerland Country Renewable Energy Overview December, 2013

Country renewable energy - Summary

Green energy diffusion in the incentives program country • National overview • Solar energy (photovoltaic) • Feed-in-tariffs • Wind mills • Tax credits • , wastes, biogas. • Incentive scheme for renewables

Wind mills energy incentives Biomass, , biogas energy, program incentives program • National overview • National overview • Feed-in-tariffs • Feed-in-tariffs

Geothermal energy • National overview • National overview • Feed-in-tariffs • Feed-in-tariffs Switzerland Renewable energy production December, 2013 Renewable energy - Production

Primary production of energy in 2010 Thanks to its topography and high levels of annual (in 1000 toe) 14,000 rainfall, Switzerland has ideal conditions for the

12,000 utilization of . Hydroelectric energy production is the leading renewable energy 10,000 source with 62.43% of national total electricity 8,000 Renewables production. Nuclear 6,000 Natural gas The total installed renewable capacity (biomass Oil 4,000 + geothermal + hydroelectricity +solar +wind) in 2,000 Switzerland increased by 1.13% from 14,031

0 MW in 2010 to 14,189 MW in 2011, ranking on 17th position globally. Over the previous 5 years,

Data Source: Eurostat the total installed renewable energy capacity has raised by 0.44% .

China was the world leader for total installed renewable capacity in 2011 with 301,440 MW, or 21.24 times larger than Switzerland.

The total installed renewable capacity in Switzerland in 2012 represented 69.5% of total installed energy capacity (all conventional + all renewable energy sources). Switzerland Renewable energy production December, 2013

Primary production of renewables by type 6,000

5,000

4,000 Wind 3,000 Hydro Switzerland renewable energy production is Geothermal mainly based on hydroelectric production. 1000toe 2,000 Biomass and wastes Solar energy 1,000 In 2011 it covered a share of 63% of total

0 renewable energy production. Biomass energy production is the second renewable source of the country.

Primary production of renewable energy, Despite the little share, solar energy production (1 000 toe) in 2010 has considerably grown up in the last years, such 35000 as wind and biomass energy production. 30000

25000

20000

15000

10000

5000

0

Data Source: Eurostat Switzerland Green energy production December, 2013 Green energy production

Switzerland electricity production Primary Production of 1998-2010 Renewables in 2010 (%) 80,000 0.06% 1.03% 70,000 69824 GWh (2012) Total Solar energy 60,000 electricity 50,000 production Biomass and 31.27% wastes 40,000 37954 GWh (2010) GWh Geothermal 30,000 Renewable 62.43% electricity 20,000 Hydro production 10,000 Wind 0 1998 2005 2006 2007 2008 2009 2010 5.21%

Data Source: Eurostat

In 2010, electricity production from renewable sources in Switzerland reached a share of about 55 % of the total.

One of the main objectives of Switzerland's energy policy, with the introduction of the FIT, is to increase the amount of electricity generated by “new” renewable energy (without large-scale hydro) by 5,400 GWh, or 10% of the electricity consumption, by 2030.

Wind energy is supposed to add 600 to 1,200 GWh to these targets. Switzerland RE forecast in Switzerland December, 2013

Forecasts

The Swiss government’s target for 2020 is to reach a renewable energy production equal to 24 % of total . The target put a few years ago for 2030 is to add a 5,400 GWh or renewable energy production to total. This means aproximatively 220 GWh per year. In 2020 the added production should be approximatively 3000 GWh. Swiss Federal Electricity Supply Act

Renewable energy production forecast 2035-2050

45.00 40.00 35.00 30.00 25.00 20.00 TWh 15.00 10.00 5.00 0.00 Hydroelectric Solar Geothermal Biomass and Wind wastes 2010 36.06 0.59 3.01 18.06 0.03 2035-2050 41 18 10.5 26 4.5

Forecasts by the AEE : National Energy Agency Switzerland Renewables - Incentive scheme December, 2013 Incentives for renewables – fast overview • The main stimulus for renewables is a feed-in-tariff scheme for each renewable source emended by government. The Swiss FIT program took as a base model the German FIT program.

• The first was introduced on 26th June 1998, the so called “LEne”, and in 2008 new feed-in-tariffs were introduced, with the “LAEI” the new Energy Law. Through the years there was made revisions on energy law. Feed-in-tariffs for renewables, were actualized in February 2010, but they are still provisory.

• Tariffs are paid for a period of 20-25 years.

Feed - in – tariffs 2013 (euro) /kWh Swiss Franc/ € = 0,83 October 2012 Ground mounted Rooftop BIPV Duration (years) Photovoltaic 0.281 (0.2324) – 0.365 0.334 (0.3019) – 0.488 0.037 (0.0306) – 0.399 (0.33) 25 (0.3019) (0.4036)

Small wind mills < 10 kWp Duration (years) Large wind mills > 10 kWp Duration Wind Mills 0.215 (0.1778) 20 0.215 (0.1778) first 5 years After premium period, 0.135 (0.1117) Biomass/gas/wastes Power plant 50 kWp - 5 MWp to year 20 0.185 (0.153) – 0.28 (0.2316) Hydro Power plant <10 MW Bonuses: 0.035 (0.0289) – 0.08 (0.0662) 0.075 (0.062) – 0.26 (0.2151) Pressure Bonuses: Duration 0.01 (0.0083) – 0.045 (0.0372) Geothermal (years) Plants <20 MW Plants >20 MW Water management bonusses: 0.28 (0.2316) – 0.4 0.025 (0.0207) – 0.055 (0.0455) 20 (0.3309) 0.227 (0.1878) Switzerland Feed-in Tariffs December, 2013

Feed-in Tariffs - 2013 Swiss Franc/ € = 0,8265 25 October 2012

in SWF In Euro Hydro Biomass (20 years) Solar Photovoltaic 25 years Wind (20 years) in SWF In Euro (25 years) in SWF € ct/kwh Ground-mounted in SWF € ct/kwh Small Wind <10 kW 0.215 0.1778 Sewage gas <10 kW 0.331 27.5 maximum 0.24 0.1985 Large Wind > 10 kW <10 kW 0.26 21.6 Waste gas <30 kW 0.27 22.4 All Sites 0.215 0.1778 <50 kW 0.2 16.7 maximum 0.2 0.1654 <100 kW 0.248 20.6 60% Reference Yield 0.215 0.1778 <300 kW 0.145 12.1 Other biogas <50 kW 0.28 23 >100 kW 0.231 19.2 70% Reference Yield 0.215 0.1778 <1 MW 0.11 9.2 <100 kW 0.25 20.8 >1,000 kW 0.216 17.9 80% Reference Yield 0.215 0.1778 <10 MW 0.075 6.2 <500 kW 0.22 18.3 Pressure Bonus (for the head of the Rooftop 90% Reference Yield 0.215 0.1778 penstock) <5 MW 0.185 15.4 >5 MW 0.175 14.6 <10 kW 0.361 30.0 100% Reference Yield 0.215 0.1778 <5 m 0.045 3.7 <30 kW 0.294 24.4 110% Reference Yield 0.215 0.1778 <10 m 0.027 2.2 Wood burning bonus <50 kW 0.08 6.7 <100 kW 0.269 22.3 120% Reference Yield 0.215 0.1778 <20 m 0.02 1.7 <100 kW 0.07 5.8 130% Reference Yield 0.215 0.1778 <50 m 0.015 1.2 >1,000 kW 0.251 20.8 <500 kW 0.06 5 >50 m 0.01 0.8 Building Integrated After Premium Period 0.135 0.1117 <5 MW 0.04 3.3 Water Management Bonus >5 MW 0.035 2.9 <10 kW 0.428 35.5 Power Bonus from Agricultural Wastes <10 kW 0.055 4.6 <30 kW 0.365 30.3 <50 kW 0.18 15 <50 kW 0.04 3.3 <100 kW 0.332 27.6 <100 kW 0.16 13.3 <300 kW 0.03 2.5 <500 kW 0.13 10.8 >100 kW 0.315 26.1 >300 kW 0.025 2.1 <5 MW 0.045 3.7 >1,000 kW 0.289 24 Maximum Bonus for district tariff 0.35 3 heating 0 0

Geothermal in SWF € ct/kwh (20 years)

<5 MW 0.4 33.3 <10 MW 0.36 30 <20 MW 0.28 23.3 >20 MW 0.227 18.9 Source: www.wind-works.org Switzerland Hydroelectricity December, 2013 Hydroelectricity

Share of hydroelectricity in EU27

9.85%

Switzerland 90.15% EU (27)

•In 2012, hydroelectricity production reached 3101 ktoe (36 064 GWh) (equal to 56.8% of total renewable energy production). Switzerland Hydroelectricity December, 2013 Hydroelectricity

At the beginning of the 1970s, based on the estimated mean production level, hydropower accounted for almost 90% of domestic electricity production, but this figure dropped to approximately 60% by 1985 following the shutting of Switzerland's plants, and is at present about 56%. In consequence, hydropower remains Switzerland's major domestic source of renewable energy.

Over a third of the total power produced in Switzerland is supplied by stations using reservoirs - constructed by building huge dams in the mountains. The dam wall of Grande Dixence, in canton Valais, the third highest in the world, at 285 meters.

Run-of-river stations, which use the water's natural flow to drive their turbines supply another quarter comes.

556 hydropower plants in Switzerland have a capacity of no less than 300 kilowatts each, which generate an average of approximately 35,830 GWh per year: -47% are produced in run-of-river power plants, -49% in storage power plants and -approximately 4% in pumped storage power plants.

Two-thirds of hydroelectricity are produced in the mountain cantons of Uri, Grisons, Ticino and Valais, while Aargau and Bern also generate important quantities. Approximately 11% of Switzerland's hydropower generation derive from facilities sited on bodies of water along the country's borders.

The hydropower market is estimated at 2 billion Swiss francs (basis = delivery from power plant at 5 cents/kWh), and is thus an essential fragment of Switzerland's energy industry. Switzerland Hydroelectricity December, 2013 Hydroelectricity Switzerland Solar energy December, 2013 Solar energy

Share of solar energy in EU27 1.38%

Switzerland

98.62% EU (27)

• The photovoltaics market has expanded globally by more than 30% per year over the past few years, in particular in Europe. In Switzerland, the installed capacity is approximately 30 MW, or 0.04% of Switzerland's electricity production, which is very small proportion. Nevertheless, with the introduction of feed-in tariffs remuneration to the electricity network, the Swiss photovoltaics market should expand more. The systems average output in Switzerland is about 820 kWh/kWp (annual yield/peak output of system), however modern systems are capable of generation up to 1,000 kWh/kWp, even in the low-lying regions.

• The export volume of Swiss photovoltaic products continues to be high and is estimated to more than 1 500 MCHF in 2009. Switzerland Solar energy December, 2013

Source: www.estif.org Switzerland Solar energy December, 2013

Europe yearly solar irradiation Switzerland Solar energy December, 2013

Yearly sum of solar electricity generated by 1kWp photovoltaic system with optimally- inclined modules.

The correct exposure to the solar rays of the photovoltaic modules represents a key factor to the purpose of getting optimal performances from the plant in terms of production of electric energy.

South regions are clearly advantaged in solar energy production because of the higher level of sun irradiation during the year. Especially the regions of Valais, Grisons and Glaris. Switzerland Solar energy December, 2013 European PV power map (MW)

Source: EPIA Switzerland Solar energy December, 2013

European PV power (MW)

Source: EPIA

Switzerland PV power installed per inhabitant in 2011 : 26.2 W Switzerland Solar energy December, 2013

European PV power (MW)

Source: EPIA Switzerland Solar energy December, 2013

Solar energy Switzerland Solar energy incentive process December, 2013 Solar energy – incentive scheme Period : 25 years. • From 2010 degression rate will be : 8 % • Cap : 16 Mio CHF but will increase to 32 Mio when the average system price falls below 0.60 SWF/kWh. •All tariffs are exclude VAT Swiss Franc/ € = 0,8265 25 October 2012 Power Tariff 2013 (kWp) Swiss Franc (€) kWh <10 0.365 (0.3019) < 30 0.337 (0.2787) Ground-mounted < 100 0.32 (0.2647) > 100 0.29 (0.2399) >1000 0.281 (0.2324) < 10 0.399 (0.33) < 30 0.368 (0.3044) Feed-in-tariff Rooftop < 100 0.349 (0.2887) > 100 0.317 (0.2622) >1000 0.037 (0.0306) < 10 0.488 (0.4036) < 30 0.439 (0.3631) Building intregrated (BIPV) < 100 0.391 (0.3234) > 100 0.349 (0.2887) >1000 0.334 (0.3019)

For installations with rated power > 10 kW, the compensation shall be proportionately calculated over the performance classes.

Investment In the following cantons: AG, AR, BS, FR (almost bailed out), SH, subsidies TG, UR, ZH, additionally in some municipalities. Mostly capped at a few kW. Switzerland Solar energy sample calculation December, 2013 Solar energy - Sample calculation BIPV plant situated in south Switzerland An installation operator installed and commissioned a plant in 2012 with a cumulative peak power of 5 kW. All the modules have the same (peak) output and the same orientation. In 2012 the operator has a total electricity yield of 6500 kWh. BIPV plant power < 10 kWp Incentive tariff: 0.4036 €/kWh

When calculating the total remuneration, the following procedure has to be applied:

6500 kWh x 0.4036 €/kWh = 2,623.4

The total remuneration for the year 2012 therefore amounts to 2,623.4 Euro

Ground mounted installation in south Switzerland An installation operator installed and commissioned in 2012 a plant with a cumulative peak power of 25 kW. All modules have the same orientation. In 2012 the operator has a total electricity yield of 37,000 kWh. Ground mounted PV plant > 10 kWp Incentive tariff : ≤ 10 kWp = 40 % = 14,800 kWh of 37,000 - 0.3019 €/kWh > 30 kWp = 60 % = 22,200 kWh of 37,000 - 0.2787 €/kWh When calculating the total remuneration, the following procedure has to be applied: 14,800 kWh x 0.3019 €/kWh = 4,468.12 Euro + 22,200 kWh x 0.2787 €/kWh = 6,187.14 Euro The total remuneration for the year 2012 therefore amounts to 10,655.26 Euro Switzerland Wind energy December, 2013 Wind energy production

• By the end of 2012, in Switzerland operated 32 wind turbines Share of wind energy in with a total power of 49 MW, generating about 88 GWh of electricity. EU27 0.02%

• In Switzerland, there is plenty of potential for developing wind Switzerland energy too: it would be possible for facilities that meet the stringent EU (27) 99.98% criteria of Switzerland's wind energy concept to produce around 600 GWh of electricity per annum by 2030. Switzerland Wind energy December, 2013

Europe wind map Switzerland Wind energy December, 2013

Europe wind installed capacity

Source: EWEA Switzerland Wind energy December, 2013

Switzerland yearly average wind speed

Northern and mountain regions have higher wind speed during the year. Switzerland Wind mills distribution December, 2013

Distribution of wind mills (MW)

In 2012, the total installed capacity of was of 49 MW.

There are : •13 units with a power above 100 kWp • 5 units with a power between 10 and 100 kWp, •and 14 units with a power less than 10 KWp.

The largest wind park is in the north, in Mont Crosin. It has 8 wind mills installed, with an annual average power of 9.6 GWh.

Source: Wind-data.ch

Source: ieawind.org Switzerland Wind energy December, 2013 Wind energy Switzerland Wind energy incentive program December, 2013 Wind energy - Incentive scheme Switzerland has opted for the German system of tariff for wind. Unlike the French system, the German and Swiss system extend the premium payment for a certain number of months as opposed to dropping the tariff in year 6.

Period : 20 years Degression rate : 1.5 % per year from 2013 Swiss Franc/ € = 0,8265 February 2010 Tariff 2012 Period Swiss franc (€) /kWh Small wind mills 0.215 (0.1778) 20 years power < 10 kWp 0.215 (0.1778) first 5 years Large wind mills After premium power > 10 kWp 0.135 (0.1117) period If actual performance meets or exceeds 150% of the reference yield, tariff is immediately lowered to 0.135 (0.115 €)/kWh until the end of the period of payment

Large wind mills :The higher initial tariff is paid for five years. This period is extended by two months for each 0.75 per cent of the reference yield by which the yield of the installation falls short of 150 per cent of the reference yield

Initial tariff Extention of Total duration Reference yield in (%) period initial tariff of payment ≥ 150 5 years - 5 years 142.5 5 years 20 months 6 years, 8 months 135 5 years 40 months 8 years, 4 months 127.5 5 years 60 months 10 years 120 5 years 80 months 11 years, 8 months Switzerland Wind energy incentive program December, 2013 Wind energy – sample calculation A Small wind energy installation, installed in 2012. Power of the plant : 7.5 kWp Production 2012 : 13,500 kWh Production 2013 : 13,900 kWh Tariff for 20 years fixed at 0.1778 €/kWh Degression from 2013 of 1.5 % per year of the tariff

REMUNERATION 2012 13,500 kWh x 0.1778 € = 2,400.3 Euro

2013 Tariff lowered by 1.5 % = 0.134 €/kWh 13,900 kWh x 0.17 € = 2.363 Euro Switzerland Wind energy incentive program December, 2013 Wind energy – sample calculation B Large wind energy installation, installed in 2012. Power of the plant : 100 kWp Production 2012 : 180,000 kWh Production 2022 : 182,000 kWh Tariff: 0.1778 €/kWh The actual performance is of 135 % and it is < 150 % reference yield. Higher initial tariff is extended by 40 months higher tariff period = 8 years and 4 months Degression of 1.5 % per year of the tariff from 2012 2012 First 8 years and 4 months tariff : 0.1778 €/kWh 180,000 kWh x 0.135 € = 24,480 Euro

From year 2015 to 2022 tariff decreased 1.5 % per year : 2022 tariff 0.102 €/kWh

2022 After premium period tariff : 0.102 €/kWh 182,000 kWh x 0.102 €/kWh = 18,564 Euro Switzerland Biomass, biofuels, biogas energy December, 2013 Bio energy production

Share of biomass and wastes in EU27 1.38%

Switzerland

98.62% EU (27)

• After hydropower, biomass is the second most Biomass&Wastes production (1000 toe) in 2010 important source of renewable energy in Switzerland, 30000 and it can be utilized for generating electricity, heat and 25000 motor fuel. About 40% of the energy potential of biomass 20000 is presently being used in Switzerland. 15000 10000 • In 2010, biomass and wastes energy production 5000

reached about 1553 ktoe (18.000 GWh), equal to 0 Italy

31.27% of total renewable energy production. Spain

Latvia

Greece

Poland

France

Turkey

Austria

Norway

Estonia

Sweden Finland

Belgium

Portugal Slovenia

Slovakia

Bulgaria

Hungary

Romania

Germany

Denmark

Lithuania Switzerland

• The Biomass-biogas energy production target for 2035- Netherlands Czech Republic Czech 2050 is 26.000 GWh. UnitedKingdom Switzerland Bio - energy production December, 2013

Switzerland Bio power installed capacity

ARA with co-fermentation Industrial treatment of wastewater Biowaste treatment plant

Biodiesel production plant Agricultural biogas plant

In 2010, biomass and wastes energy production reached about 1553 ktoe (18000 GWh), equal to 31.27 % of total renewable energy production. The target to 2035-2050 is to reach a 26.000 GWh production. Switzerland Bio - energy production December, 2013

Switzerland Bio-Wastes potential

In Switzerland the recycling of a waste fraction must not only be proven to be environmentally beneficial to be implemented, it must also be economically sustainable.

An estimated (not inventoried) 300’000 tones of bio-waste is treated by home or community composting, or in plants with a capacity below 100 t/year. Switzerland Biomass December, 2013 Biomass Switzerland Biomass and biofuels energy production December, 2013 Other Biomass incentive Minimum Energy Requirements Minimum electrical efficiency : 252 kW, 38 % . Heat utilisation rate: minimum mustn’t be lower more than 20 % of the rate required in a civil year or in two consecutive years, unless remuneration will be no more available until minimum heat utilisation rate is reached. Period: 20 years Degression: 0 %

Tariff 2012 Power plant Bonuses Swiss Franc/ € = 0,8265 February 2010 swiss franc (€) ≤ 50 kW 0.08 (0.0662) ≤ 50 kW 0.28 (0.2316) ≤ 100 kW 0.25 (0.2068) ≤ 100 kW 0.07 (0.0579) Wood use Bonus Other Biomass ≤ 500 kW 0.22 (0.1820) ≤ 500 kW 0.06 (0.0496) ≤ 5 MW 0.185 (0.153) ≤ 5 MW 0.04 (0.0331) > 5MW 0.175 (0.1447) > 5MW 0.035 (0.0289) • Wood bonus and agriculture biomass bonus can not ≤ 50 kW 0.18 (0.1489) be combined ≤ 100 kW 0.16 (0.1323) Agriculture • Bonus for biomass from agriculture is allocated if ≤ 500 kW 0.13 (0.1075) biomass Bonus uses: ≤ 5 MW 0.045 (0.0372) 1. fertilizer, with crop residues and waste substances from agricultural production surpluses District Heating 2. if the proportion of non-agricultural co-substrates 0.02 (0.0165) and energy crops is ≤ 20% (mass of fresh material). Bonus

• Bonus for external heat (CHP bonus) of 0.0165 euro cents per kilowatt hour is granted if the external heat exceeds by at least 20 % (based on gross production) the minimum requirements Switzerland Biomass and biofuels energy production December, 2013

Biomass energy – sample calculation

A

Biomass installation with an output of 1.5 MW; year of commissioning: 2012. The plant uses fertilizer, with crop residues and waste from agricultural production. Energy requirements in terms of energy efficiency are reached. Tariff: Output power 1.5 MW < 5 MW = 0.153 €/kWh Agriculture biomass bonus : 0.0372 €/kWh

Final tariff : 0.153 + 0.0372 = 0.1902 €/kWh Switzerland Geothermal energy December, 2013 Geothermal energy

Share of geothermal energy in EU27 4.40%

Switzerland 95.60% EU (27)

Geothermal power generation (1000 toe) in 2010 6000 5000 4000 3000 2000 1000 • In 2010, geothermal energy production 0 reached 259 ktoe (3012 GWh) (equal to 5.21 % of total renewable energy production). Data Source: Eurostat

Feed - in – tariffs 2012 Swiss franc (euro) /kWh

Geothermal Duration (years) Plants <20 MW Plants >20 MW 20 0.28 (0.2316) – 0.4 (0.3309) 0.227 (0.1878) Data Source: EREF Switzerland Geothermal December, 2013

Geothermal Energy

In Switzerland there are no installations and no electricity is produced from geothermal sources at present. Nevertheless, the Deep Mining project in Basel intends to build a facility capable to generate 3 MW of electricity and 20 MW of thermal production, capable as well to provide electricity to approximately 10,000 households and to provide heat to 2,700 households. In 1996 started the preliminary work on this pilot project on the initiative of, and with the support of, the Swiss Federal Office of Energy.

The utilization of geothermal energy for direct-use has enhanced considerably, mostly with the installations of geothermal heat pumps (GHP).

The second major utilization of geothermal energy is with thermal spas and wellness facilities. The percentage of the different uses in terms of energy use (GWh) is 73.9% for HE and horizontal loops, 13.6% for balneology, 10.4% using shallow groundwater, 1.0% using geostructures (energy piles), 0.6% using deep aquifers which includes using tunnel water.

On Riehen, Canton Basel city, is situated one geothermal district heating. The introduction of a feed-in tariff and a risk coverage system have been the latest modifications in governmental policy in 2008. Switzerland Geothermal December, 2013 Geothermal Energy

Source: www.geoelec.eu Switzerland Geothermal December, 2013 Geothermal Energy The geothermal utilization by the different categories is: •for individual space heating - 2 MWt and 14.7 TJ/year ; •for district heating - 3 MWt and 33.5 TJ/year; •for air conditioning 1.4 MWt and 11 TJ/year; •for snow melting - 0.1 MWt and 0.3 TJ/year; •for bathing and swimming - 34.9 MWt and 1,045.4 TJ/year; •for using tunnel water - 2.4 MWt and 7.7 TJ/year; •for GHP - 1,017.1 MWt and 6,602 TJ/year.

The total for Switzerland is 1,060.6 MWt and 7,714.6 TJ/year

Government aid for geothermal power production (for 20 years)

Feed in tariff covering cost in Switzerland

Fixed Tariff: 40 Rp./kWh electricity, or 33.3 ct/kWh electricity (exchange rate 1€ = 1.2 CHF) Risk insurance: the government will reimburse up to 50% of drilling costs in case of low productivity Switzerland Geothermal energy December, 2013 Geothermal energy