Swiss Gas Supply Act Publication – Open for Consultation

In September 2019 the Swiss Federal Office of Energy published the draft Gas Supply Act (available in GermanFrench and Italian)(the GSA). The Federal Council commenced a consultation of the new GSA on 30 October 2019 which is open for comments by interested parties until 14 February 2020. 

The driving force behind the GSA is to build on the legacy of the Association Agreement 2012 (as amended) (the AA) and also to achieve maximum compliance with the related EU standards (Regulation No. 715/2009 and Directive 2009/73/EC). 

At present, the gas market in Switzerland is only partially liberalised. The GSA will open up the market for industrial consumers with an annual consumption of at least 100 MWh (Industrial Users), aligning the gas and electricity markets (as this is the same threshold as set out in the Swiss Electricity Supply Act 2007).

Right to Choose

Once the GSA becomes law, Industrial Users will be able to choose their gas supplier freely from the open market. Industrial Users represent around 10% of all gas customers in Switzerland, however this group account for 40,000 consumption sites and together consume around 70% of the gas sold in Switzerland. 

Under the AA, only 330 sites covering 30% of the gas sold in Switzerland were granted the freedom to choose their gas supplier. The GSA therefore significantly expands free market access benefiting more medium and large consumers. 

Applicability to Smaller Gas Consumers?

For consumers which do not meet the 100MWH consumption requirement, the GSA stipulates that they will not be able to choose their supplier and instead must purchase gas via their local regulated grid/utility operator (Art. 9 GSA). At present, there is no intention liberalise the supply to such smaller customers.

European Union Alignment

The Swiss authorities’ intention is to create an Entry Exit System (EES) in line with the systems operated in the European Union for the booking of capacities and gas transport and a Swiss gas hub. The EES facilitates gas trading by requiring only one contract at the entry point and/or one contract at the exit point to deliver gas throughout the entire market area. 

Additional Reporting Obligations

The GSA stipulates a new duty to provide information applicable to anyone domiciled or resident in Switzerland who participates in a wholesale gas market outside Switzerland. It obliges such companies to provide the EnCom, the new energy regulator, the same information in the same form they provide to foreign authorities simultaneously. This will mean that all data which is currently reported to ACER, will also have to be reported to EnCom. The Swiss Federal Council will determine the details of such reporting and will be responsible for defining exceptions. 

Michaela Duve is an energy law expert and EELA Partner based in Switzerland. Please call her on +41 417 504 813 or click here to email her to discuss anything contained in this article or EELA in general.

This client alert does not constitute nor is it intended to be legal advice.