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Lex Mundi Global Climate Change Guide

Switzerland

(Europe) Firm Pestalozzi

Contributors Michael Kramer

Updated 14 Jun 2021
Has your country signed/ratified the Paris Agreement? If so, what is its INDC / NDC?

Yes, Switzerland has signed and ratified the Paris Agreement.

INDC/NDC: Switzerland commits to reduce its greenhouse gas emissions by 50% until 2030 compared to the 1990 levels, corresponding to an average reduction of greenhouse gas emissions by 35% over the period from 2021 to 2030.

Until 2025, a reduction of greenhouse gases by 35% compared to the 1990 levels is anticipated.

Carbon credits from international mechanisms will partly be used.

What are the key national policy instruments regarding climate change and what are the national long term greenhouse gas emissions (GHG) reduction targets?

Under the Paris Agreement, Switzerland has undertaken to reduce its greenhouse gas emissions by 50% until 2030 compared with the 1990 levels.

In Switzerland, CO2 emissions from transport, buildings and industry are reduced through technologies that are already available and by using renewable energy sources. There is also a potential for reducing greenhouse gases produced by agriculture, in particular, methane and nitrous oxide.

Switzerland aims at having net-zero greenhouse emissions by 2050. The Federal Council set the net-zero target in 2019 and on 27 January 2021 adopted the corresponding “Long-Term Climate Strategy for Switzerland”. The strategy sets out climate policy guidelines up to 2050 and establishes strategic targets for key sectors.

Another key element of the Swiss policy on climate matters is the so-called "Energy Strategy 2050." The Energy Strategy 2050 is implemented in phases. In the first stage, the aim is to reduce energy consumption, increase energy efficiency and promote renewable energies such as water, solar, wind and geothermal power, and biomass fuels. In addition, temporary support will be given to existing large-scale hydropower plants, because they are barely able to cover their production costs due to the low market prices. In this way, Switzerland will be able to reduce its dependency on imported fossil fuels and support the use of domestic renewable energy. The use of nuclear energy shall be withdrawn on a step-by-step basis and the Swiss energy system shall be gradually restructured until 2050.

Have national policies or legislation been adopted limiting or prohibiting the use of certain fossil fuels (e.g. coal, natural gas, nuclear)?

Switzerland does not limit or prohibit the use of fossil fuels, only an incentive strategy is used at the moment.

The so-called "Glacier Initiative," a popular initiative that was filed in November 2019, suggests introducing a constitutional provision stating that from 2050 and subject to a few exceptions only, no more fossil fuels may come into circulation in Switzerland. The popular vote about this initiative is yet to come.

In addition, the existing Swiss nuclear power plants may be operated as long as they are safe. The construction of new nuclear power plants is prohibited. This will lead to a gradual withdrawal from nuclear energy. The first Swiss nuclear power plant was permanently shut down for dismantling in December 2019.

What specific national climate change legislation has been adopted?

Currently, the main national act is the Federal Act on the Reduction of CO2 Emissions enacted in 2013 (CO2 Act).

In June 2021, the Swiss voters rejected a revised CO2 Act that was designed to meet Switzerland's commitments under the Paris Agreement. While these commitments are undisputed, the way to reach them is controversial. Hence, the revised CO2 Act faced resistance from various sides and in the end, the Swiss voters did not follow the federal government and the parliament and narrowly rejected the revised CO2 Act. The legislative process so far on this subject matter has already been quite lengthy and the federal government and the parliament must now continue their efforts to make sure that Switzerland will meet its commitments under the Paris Agreement.

Furthermore, a number of executive ordinances exist that regulate climate matters in more detail, among others, the Ordinance for the Reduction of CO2 Emissions (CO2 Ordinance). The CO2 Ordinance sets reduction targets for various sectors and contains specifications of the instruments mentioned in the CO2 Act.

Another key act is the Federal Energy Act (EA). The EA's objective is a sufficient, diversified, secure, economical and environmentally sustainable energy supply. Energy production shall be transformed and based on the use of renewable energies, in particular domestic renewable energy. One of the priorities of the EA is to improve the efficient use of energy. The details for implementing the EA are outlined in the Energy Ordinance (EO).

Does your country participate in an international or national GHG emissions trading scheme?

Yes, Switzerland introduced the emissions trading scheme (ETS) for industrial installations in its current form in 2013, on the basis of the EU regulation. The rules are defined in advance each time for a certain period – a “trading period.” The first trading period was from 2013 to 2020. With a partial amendment to the CO2 legislation, the Swiss parliament extended emissions trading. The next trading period covers the years 2021 to 2030. Switzerland’s ETS and the one of the EU have been linked since 1 January 2020.

It is compulsory for installation operators with high greenhouse gas emissions to participate in the ETS (ETS participants). Activities that generally cause high to very high emissions are listed in the CO2 Ordinance. Any company which carries out such activity must participate in the Swiss ETS. However, it is also possible to participate voluntarily in the ETS, provided that certain conditions defined in the CO2 Ordinance are met. Any company participating in the ETS with its installations will be reimbursed the CO2 levy on the fuels it uses.

Has a national CO2 tax or similar instrument been adopted?

Since 2008, Switzerland levies a CO2 tax on fossil combustible fuels, such as heating oil and natural gas which intends to create an incentive to use climate-damaging substances more economically and to utilize more carbon-neutral or low carbon energy sources.

Operators of greenhouse gas-intensive installations can be exempted from the CO2 levy if they voluntarily commit to reducing their emissions. As mentioned above, operators of large greenhouse gas-intensive installations must participate in the emissions trading scheme. They are also exempted from the CO2 levy.

Does national legislation regulate and/or subsidize carbon capture and storage (CCS)?

At present, Switzerland does not have any regulation of carbon capture and storage.

In May 2017, a number of scientists working in Switzerland addressed the public in a white paper in which they argued that an open societal conversation on the role of negative emissions technologies (NETs) and solar radiation management (SRM) in achieving internationally agreed climate targets was overdue. Their analysis is based on the science underpinning the Paris Agreement. Many questions, such as long-term safety, the tightness of these storage facilities, the costs, the infrastructure as well as the legal basis, still need to be clarified. In addition, there is likely to be a shortage of large enough reservoirs for the vast amounts of CO2 to be stored. Research projects are ongoing in Switzerland.

As there is a growing realization that the Paris climate goals can no longer be met by emission reductions alone, in Switzerland a number of recent political initiatives have been submitted on the federal and cantonal levels. The Risk Dialogue Foundation conducted a stakeholder dialogue in 2018/19 at the request of the Federal Office for the Environment. Switzerland pursues the goal of implementing regulation for carbon capture and storage but is currently still in a research stage.

Are the production and/or use of renewable energy sources subject to a national subsidy or similar support scheme?

Subsidy and similar support schemes exist on a national, cantonal and communal level.

With effect from 2009, operators of facilities producing electricity from solar, wind and geothermal energy as well as biomass have been able to apply for feed-in remuneration. This system has now been made more market-oriented by obliging major producers to sell their electricity directly on the market. The support scheme is also valid for a limited period: feed-in remuneration for new facilities can only be approved until the end of 2022.

Additionally, operators of photovoltaic systems may benefit from a federal one-off investment contribution, i.e. a non-recurring contribution towards the investment costs of the facility. Contributions towards investment costs as well as non-recurring remuneration will be applicable until the end of 2030.

Several other private and public support schemes exist for the above-mentioned renewable energy sources as well as for example for the use of heat pumps or wood pellet heating systems.

What are the main national measures being taken to reduce GHG emissions / improve energy efficiency in the built environment?

In Switzerland, buildings are the second-largest source of greenhouse gas emissions.

Since 2010, the federal government and the cantons use the so-called "Building Program" to promote the energy-efficient renovation of building shells, the use of renewable energies and waste heat and the optimization of building technology. Thanks to the Building Program, homeowners may benefit from subsidies for energy-efficient construction measures.

Additionally, since 2008, Switzerland levies a CO2 tax on fossil combustible fuels, such as heating oil (see above). The CO2 levy is only increased if CO2 emissions from thermal fuels do not decrease sufficiently. In the future and subject to further amendments of the CO2 Act, this CO2 tax levied on fuels will be continued. The tax rate may be increased to a maximum of CHF 210 per ton of CO2. The partial earmarking of the CO2 tax for the building program expires in 2025.

If CO2 emissions from this sector do not fall by at least 50 percent until 2026 and 2027, uniform limit values for buildings will be introduced nationwide as of 2029.

What are the main national measures being taken to reduce GHG emissions / improve energy efficiency in the transport sector?

In transport, which is the main source of greenhouse gas emissions in Switzerland, emissions are to be reduced by increasing the share of renewable fuels.

At the same time, CO2 emission regulations for new vehicles are tightened. In Switzerland, CO2 emissions regulations similar to those of the EU were introduced for new cars in July 2012 and adjusted on an annual basis.

Since 2021, passenger cars registered for the first time in Switzerland may emit a maximum of 118 grams of CO2 per kilometer on average according to WLTP, while vans and light semitrailers registered for the first time may emit a maximum of 186 g CO2/km.

What are the main national measures being taken to reduce GHG emissions / improve energy efficiency in the industry?

The CO2 tax, as well as emissions trading systems (ETS), play a key role to reduce greenhouse gas emissions.

Pursuant to the CO2 Act and Ordinance, companies engaged in activities with high greenhouse gas emissions are obliged to participate in the Swiss ETS and must surrender emission allowances or emission reduction certificates equal to the emissions caused by their plants every year.

Companies engaged in activities with medium greenhouse gas emissions with a total rated thermal input of at least 10 MW may apply for participation in the Swiss ETS. If these companies participate in the Swiss ETS, they must surrender emission allowances or emission reduction certificates equal to the emissions caused by their plants every year.

Fossil-fuel thermal power plants are obliged to completely compensate their CO2 emissions. In doing so, they must provide at least 50% of the compensation in the domestic market. Additionally, to achieve the maximum reduction of CO2 emissions, fossil-fuel thermal power plants are obliged to operate the power plant according to the current state of the art.

What are the main national measures being taken to reduce GHG emissions / improve energy efficiency in agriculture and land use?

The Federal Office for Agriculture has launched a climate strategy for agriculture in 2011. It provides an overall view of the relationship between climate and agriculture, identifies upcoming challenges and opportunities and derives targeted (non-binding) steps. Envisaged measures include for example integrated plant protection, water-saving irrigation systems, low-emission stable concepts, the keeping of animal categories that are appropriate for the specific location used and enhancement of soil protection and humus concentration (carbon storage).

What are the main national measures being taken to reduce GHG emissions / improve energy efficiency in the electricity production sector?

With regard to nuclear power, Switzerland prohibits the construction of new nuclear power plants, existing ones may be operated as long as they are safe.

Regarding hydropower, Switzerland aims at exploiting the realizable potential of existing power plants by renovation and expansion, while considering the related ecological requirements.

Wind energy has also still considerable potential in Switzerland. By 2050, facilities that meet the stringent conceptual specifications are expected to produce around 4'000-gigawatt-hours of electricity a year.

Regarding solar energy, more efficient ways of storing energy are currently explored.

The process and reactor technologies that are required for this long-term option for chemical storage and for the transport of solar energy are the subjects of intensive research and development activity.

What measures are national financial institutions (incl. banks, pension funds, asset management companies and insurance companies) aimed at reducing the GHG emissions of their customers?

Certain Swiss financial institutions offer, on a voluntary basis, clients the option to open sustainable saving accounts or to invest in sustainable investment funds.

Some financial institutions also reconsider their investment strategy and negotiate with non-sustainable clients about necessary changes in their behavior in order for the institution to stay invested.

Generally, banks and other financial institutions are facing increased pressure to reduce their investments in non-sustainable businesses.

Are there prominent national climate change litigation cases in your country? If so please provide a short description (e.g. plaintiffs/defendants, public or civil law based, etc.).

In Switzerland, a climate complaint was filed by the so-called "Senior Climate Women".

Because global warming of more than 2 °C is very likely to lead to a "dangerous anthropogenic disturbance of the climate system", the Senior Climate Women claim that Switzerland's current climate target violates the Federal Constitution (precautionary principle and right to life) and the European Convention on Human Rights. The Senior Climate Women consider the risk Switzerland is taking with its current failure to pursue the 2°C target to be unlawful. They say that Switzerland does not sufficiently fulfill its obligations to protect the fundamental rights holders.

On 25 November 2016, the climate complaint was officially submitted to Switzerland in writing. The Federal Department of the Environment, Transport, Energy, and Communications decided not to respond to the application in substance.

On 26 May 2017, a delegation of Senior Climate Women handed over their appeal to the Federal Administrative Court. The Federal Administrative Court rejected the appeal in December 2018 because the consequences of global warming did not only affect seniors. In May 2020, the Federal Supreme Court rejected a further appeal, stating inter alia that the concerns of the complainants are not to be enforced by legal means, but by political means.

The Senior Climate Women announced to appeal against Switzerland at the European Court of Human Rights.

Other climate change litigation concerns the activities of climate activists against banks, in particular by blocking access to bank branches or by occupying bank branches.

In one case, the competent District Court found nine activists guilty of coercion and trespassing and they were sentenced to fines. The verdict is not yet final.

In another case, twelve activists were acquitted by the competent District Court. The single judge concluded that the activists had acted on the grounds of a "justifiable emergency", that the action had been "necessary and appropriate" in view of the climate catastrophe, and therefore, no sentence for trespassing was handed down. However, the decision was overturned by the Cantonal Court, which sentenced the activists to conditional fines and penalties for trespassing and for obstructing an official act. The Federal Supreme Court confirmed the decision of the Cantonal Court. The activists announced to appeal against Switzerland at the European Court of Human Rights.

Climate change policies, measures or legislation (other than those covered by the questions above)

None

Lex Mundi Global Climate Change Guide

Switzerland

(Europe) Firm Pestalozzi

Contributors Michael Kramer

Updated 14 Jun 2021