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Green Hydropower in Switzerland

Green Hydropower in Switzerland

This case study on green hydropower, conducted by Ecologic Institute, illustrates a novel application of economic policy instruments in European water management. Hydropower in Switzerland accounts for about 59 % of the electricity supply. While hydropower is already considered a green energy, the sector's "green" potential has increased with the introduction of a new label certification scheme.

Since 2000 customers in Switzerland are given the possibility to influence green energy production and thus promote fair competition in the electricity market by being offered the possibility to buy electricity produced sustainably under the label "Naturemade". From an ecological perspective, the introduction of this label developed by a non-profit organisation was to improve local river conditions by setting an incentive to develop sustainable hydropower. This instrument represents a combination of voluntary standards and payments for ecosystem services.

The main lesson learned from the introduction of this voluntary instrument is the fact that economic interests and ecological concerns can be combined in one voluntary instrument based on economic and regulatory instruments. Other positive outcomes include the guarantee of quality, the improvement of the environment on a local and regional scale, and the development of a competitive advantage for "greener" electricity from renewable energy sources compared to electricity from other renewable (e.g. non-certified hydropower) and non-renewable energy sources. The case study  [pdf, 560 KB, English] is available for download.


Citation

Dworak, Thomas 2011: Green Hydropower in Switzerland. Ecologic Institute, Berlin.

Language
English
Author(s)
Funding
Publisher
Year
2011
Dimension
35 pp.
Project ID
2707
Table of Contents

Executive Summary
Introduction
Definition of EPI and purpose
Rationale for choosing the case study
Legislative setting and economic background
Brief description of results and impacts of the proposed EPI
Conclusions and lessons learnt
1. Characterisation of the case study area(or relevant river basin district)
2. EPI background
2.1. What was the baseline before the EPI was implemented?
2.2. What are the key features of the EPI and what settings made it operational?
3. Assessment criteria
3.1. Environmental outcomes
Performance on the plant level
The performance on the national level
3.2. Economic assessment criteria
3.3. Distributional effects and social equity
3.4. Institutions
3.5. Transaction costs
3.6. Policy implementability
3.7. Uncertainty
4. Conclusions
4.1. Lessons learned
4.2. Enabling / Disabling factors
5. References
6. Interviews
7. Annex 1: Ecological criteria
8. Annex 2: Example of a costs estimate for the certification of green hydropower

Keywords
economic policy instruments, water management, environmental accounts, flood, excess water, water scarcity/drought, water pollution, water price, pollution tax and charges, ecosystem service payment, inclusion of Non-EU case studies, Europe