Decision to support hydropower under a monopoly entrenches absurd market asymmetry

Lausanne – Tomorrow, Friday, in its final vote, parliament will, amongst other things, decide about additional support for hydropower under a monopoly. This decision does not affect pure electricity producers such as Alpiq, but benefits the distribution grid operators that have a monopoly market for end customers. The support of hydropower under a monopoly will entrench the existing market asymmetry and put an additional burden on households. As an electricity producer without access to bound end customers, Alpiq has been selling its generated hydropower on the market. What is needed now is the fast implementation of the electricity market liberalisation that has been repeatedly postponed since 2013.

Alpiq takes note of the decision of the Councils regarding the proposal of the Conciliation Committee to adopt the Electricity Grids Strategy. This federal law concerning the restructuring and expansion of the electricity grids, in particular the amended version of Article 6 Para. 5 and Para. 5bis of the Electricity Supply Act, affects the electricity grid operators that control a monopoly market for end customers. As a consequence, they will now be able to pass on the complete production costs for renewable energies to the end customers, without being obliged to pass on the price advantages from the liberalised market. This will entrench the existing market asymmetry between electricity grid operators that control a monopoly market for end customers and the pure electricity producers in the partially liberalised market, such as Alpiq. While the costs for monopoly hydropower can be passed on to the end customers in full, the hydropower within the partially liberalised market, where the market prices lie below the production costs, cannot be operated sustainably.

Alpiq calls for the long overdue complete liberalisation of the electricity market and the introduction of a new market model that enables viable operation of hydropower.

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