"Electricity is a question of shared sovereignty, and not of national withdrawal"

In Bern, the debate is becoming electric. For several weeks now, notably since the presentation of the clauses of the electricity agreement envisaged between Switzerland and the European Union, criticism has been pouring in against a text that is manifestly more controversial than expected.

At the heart of the current discord: market liberalization. As parties begin to spar over the issue, it is an ideal opportunity to probe the sector through a series of interviews with reference players.

Among them is Baptiste Leflaive, an energy consultant at Colombus Consulting. He is the author of numerous columns, including the one on the major power outage that occurred in Spain and Portugal, as well as its potential implications for Switzerland. In it he explained, in particular, that exceptional blackouts can happen anywhere. "They remind us of an essential reality: electricity is now a matter of shared sovereignty, not national withdrawal."

Is Switzerland making a bad bet by agreeing to liberalize its electricity market?

Not necessarily a bad bet, but a risky one. Liberalization has already been in place for large consumers since 2009, and the 2022 energy crisis highlighted their direct exposure to wholesale market volatility. Some Swiss industrials saw their energy costs soar.

European experience also shows that opening the market does not guarantee stable or low prices. Liberalization can stimulate competition and innovation, but only if it is accompanied by strong safeguards: full transparency of commercial offers, strict regulation of abusive pricing practices, the possibility of offering fixed-price deals over several months, and stabilization mechanisms during periods of severe stress on the wholesale market.

Without proactive regulation, Switzerland exposes itself to price volatility that could heavily penalize households and SMEs.

Isn't maintaining the basic market a sufficient safeguard?

The current system, based on a regulated basic market, has so far effectively protected Swiss consumers against price volatility. But remaining locked into this model also carries risks in the medium and long term.

On the one hand, Switzerland is increasingly dependent on the European electricity market, especially in winter when it must import massively. Without market opening, it risks being out of step with the European Union, which could make it more vulnerable to unilateral decisions by its partners.

On the other hand, a closed market can slow the emergence of new offers — for example those based on local renewable energies or innovative digital services — and discourage certain private investments in infrastructure that are nonetheless essential.

Doesn't this market opening risk leading to an accelerated consolidation of the sector, particularly for small or medium-sized DSOs?

Liberalization concerns the supply of electricity, but not distribution, which remains a regulated local monopoly. Many DSOs are backed by municipalities or local authorities, with a public service mission that goes beyond mere profitability.

This political and territorial link can slow consolidation driven solely by economic criteria. Moreover, some small structures have managed to adapt by pooling their purchases, their IT systems or back-office functions, while retaining their operational independence. The example of Swisseldex, which brings together almost all DSOs around a common platform, shows that there are alternatives to concentration.

That said, competitive pressure is likely to prompt some players to anticipate and seek economies of scale, which could accelerate mergers or takeovers in the sector.

The market alone is not enough to guarantee long-term investments, especially in a context of increasing price uncertainty.

Would a federal commitment to support the sector be needed to maintain investments in the network and more specifically in renewable energies?

The Confederation is not known for implementing large-scale incentive measures or shared financing, especially compared with its neighbors. Yet the market alone is not enough to guarantee long-term investments, particularly in a context of growing price uncertainty.

Take the example of developing alpine solar parks or storage installations: these projects require payback horizons of 20 to 30 years. Putting in place support or stabilization mechanisms — such as contracts for difference or guaranteed remuneration systems — would provide the sector with a coherent and genuinely incentivizing framework.

And how do you react to the multiple interventions by Pierre-Yves Maillard denouncing the agreement — interventions in which he mentions a risk of underinvestment in future electricity production capacities in Switzerland?

Tensions over financing investments are indeed to be expected. The weakening of the economic model of some diversified players — such as Romande Energie, BKW or the SIG — could lead them to postpone certain investments, in response to customer movements related to liberalization. The risk of underinvestment therefore does indeed exist.

DSOs remain regulated monopolies, which is a stabilizing factor in terms of network maintenance and modernization, obligations overseen by ElCom. Hence the need for clear and incentivizing regulation that secures network-related revenues and encourages the investments essential to the energy transition.

Is the argument that this agreement is necessary in the event of another energy crisis in Europe (as in 2022) really defensible? After all, in the event of a major shortage, isn't the risk that states will put their own interests first regardless of any agreements in force?

In an energy crisis, member states do indeed prioritize their national interests. This was seen in 2022, with occasional restrictions on gas or electricity exports, despite the framework of the European internal market.

However, the electricity agreement with the EU would allow Switzerland to obtain institutionalized access to European coordination mechanisms, in particular to the crisis management procedures provided for by Regulation (EU) 2019/941 on risk-preparedness in the electricity sector.

Without an agreement, Switzerland remains connected to the European grid, but legally isolated. In the event of major tensions, it would rely solely on the goodwill of its neighbors, with no guarantee of coordinated access to import capacities, nor formal recourse in case of discrimination.

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