Switzerland is making some essential changes to its energy system. Facing some problems and challenges, the country is looking for better, cleaner, and more reliable ways to power homes and businesses.
Three significant changes include liberalization, local energy communities, and new energy storage policy. So, let’s explore each of them in detail.
Why Is Switzerland Changing Its Energy Market?
Two main factors led to the changes. First, the country wants to provide a reliable energy system where everyone can afford reasonably priced electricity. It became especially urgent after the energy crisis of 2022, when electricity costs across Europe spiked, exposing the risks of import dependence.
The second reason is about climate change. Switzerland aims to become carbon-neutral by 2050. It’s impossible without a shift to renewable energy, particularly solar. But those aren’t the only factors.
In recent years, new challenges have emerged. The phase-out of nuclear power, limited hydropower during winter, and growing uncertainty about electricity imports from France and Germany have pushed the government to act faster. In response, Switzerland created a “winter reserve” policy, storing 500 GWh of hydroelectricity and setting up a 250 MW backup power plant to cover emergencies.
Even though Switzerland isn’t part of the EU, it’s still feeling the pull of European climate policy. A 2024 agreement with the EU to liberalize the energy market opened the door to deeper integration with the European system.
And then there’s the public. In June 2024, 68.7% of Swiss voters approved a new law supporting electricity supply from renewable sources. They want to move from old energy models and support a greener future.
Also, to improve energy security, Switzerland decided in May 2025 to build five new reserve power plants, starting in 2026. They’ll add 583 MW of backup power, enough to help during high demand. Final costs will be announced after contracts are signed. As usual, they’ll be shared among consumers through electricity bills.
But these plants won’t be ready to fully replace current ones by winter 2026/27. So, Switzerland needs a temporary plan for at least three winters.
First Change: Liberalization of the Energy Market
The first major change is the liberalization of the market. This move gives consumers more freedom and closely connects Switzerland to the EU’s shared energy space.
Currently, 99% of people in Switzerland can’t choose their electricity provider. The supplier is assigned based on where you live. But starting in 2026-2027, that should change. People will be able to choose their electricity provider based on price, service conditions, or the energy source, for example, green only. This competition can lead to lower prices and more innovative options.
But there’s also a bigger goal here. Switzerland wants to integrate fully with Europe’s energy system. The country already has 41 cross-border connections to neighbouring countries, but this good cooperation is increasingly restricted by the absence of a formal electricity deal. A new agreement with the EU, signed in 2024, will remove these limitations, allowing electricity to flow more freely in and out of Switzerland. That’s especially important during the late winter, when energy use spikes and hydro reserves run low.
Liberalization also fits into the long-term plan to shut down Switzerland’s nuclear reactors by the 2040s. As part of this shift to clean energy, European countries will gain access to Switzerland’s pumped storage systems. These facilities work like giant batteries, helping balance supply and demand across the region.
What will this mean for everyday consumers? You won't have to change anything if you don’t want to change anything. You’ll stay with your current provider by default.
But if you want to switch, you’ll have new options, maybe a cheaper provider or one that supplies only renewable energy. If your chosen supplier ever stops working, don’t worry: the local company will still be required to keep your lights on, under the “supplier of last resort” rule.
There’s more. Dynamic tariffs will also become the norm. That means electricity will cost less during off-peak hours. You'll save money if you shift your usage (for example, charging your EV or doing laundry at night).
This system helps avoid problems like the “duck curve” in California, where energy demand peaks at all the wrong times. As experts point out, dynamic pricing is a key way to balance the grid and cut costs.
The government also made sure to protect passive users. People who don’t want to deal with changes will still have a steady electricity supply. But those who are more engaged can benefit financially.
Second Change: The Launch of Energy Communities
The new law gives businesses, municipalities, and households the legal right to join forces and produce or consume electricity together. Thus, energy communities will appear.
The idea itself isn’t new. Since 2018, Switzerland has run pilot projects, and the results have been promising. Producers earn more, consumers pay less, and the pressure on the grid is reduced. Everyone wins.
The main goal? To turn passive consumers into active players in the energy market. Under the new law, energy communities can take two forms.
1. Local energy communities
Picture two businesses in the same town. One generates more solar power than it needs; the other just consumes. With the new rules, they can strike a direct deal: instead of selling excess electricity to the grid for 6 cents per kWh, the producer can sell it directly to the neighbor for 15 cents. It’s cheaper for the buyer and more profitable for the seller.
Even better, there’s a 40% discount on transmitting electricity between them. These local communities don’t have to be next-door neighbors. They just need to be connected to the same power grid in the same district.
2. Consumer associations
Think of an apartment building where all the residents join forces. Together, they can choose their supplier, negotiate better rates, or invest in a shared solar panel system. It gives them more control over their electricity and lowers costs.
Why does this matter? Consumers will pay lower electricity bills and have more control over where their energy comes from. Producers can earn more by selling surplus directly. For the power grid, it eases demand, especially during peak hours.
And if a community runs out of electricity, they can still draw what they need from the grid.
Pilot Projects of Energy Communities
Before the new law was passed, Switzerland had already tested the concept of energy communities through pilot projects.Â
One of the most well-known was Quartierstrom in Walenstadt from 2018 to 2019. In this project, 37 households created a local energy market powered by blockchain technology. Every 15 minutes, they automatically traded solar energy with each other. The result showed that about 33% of their yearly electricity needs were met through local production, twice as much as before.
In the Geneva area, a local energy cooperative is working to connect prosumers (households that both generate and use electricity) to share solar power within their community. Over in Zurich, the city has launched a pilot project called Energiemap. It’s designed to highlight neighborhoods that are a good fit for energy communities and support them with legal questions, setup, and technology advice.
On the technical side, Swiss startups are stepping up with hands-on solutions. One is Exnaton, a company that grew from ETH Zurich’s Quartierstrom project. Their software handles metering and billing, helping communities manage shared solar power efficiently. In one Zurich housing complex already in use, residents could use over 90% of their own solar energy thanks to smart coordination and a shared battery system.
Third Change: New Rules for Energy Storage
The third big change in Switzerland’s energy strategy is a new policy to support energy storage. The idea is simple: save energy when there’s extra, and use it when there’s not enough.
Switzerland plans to grow its solar power. At the same time, over half of Switzerland’s electricity already comes from hydropower, making it one of the greenest energy producers in Europe. However, solar energy isn’t always reliable since it depends on the weather and the time of day. That’s why energy storage is so important.
For example, in winter, when days are short and cold, people use more energy, but solar panels produce less. This way, batteries and other storage technologies can store extra energy generated during sunny hours and release it when demand spikes.
Practically, this means having solar panels and a battery at home. During the day, the battery charges using free or inexpensive solar energy. In the evening, when electricity from the grid is more expensive, you rely on your stored power. You can still cook, do laundry, or run the dishwasher while saving money.
There’s even a new way to earn money: arbitrage. If your battery charges when electricity is 5 cents per kWh and sells it back when the price is 17 cents, that’s a profit. And under the new rules, this kind of small-scale trading is fully legal and encouraged.
Switzerland is also looking to the future. The law includes support for advanced storage technologies, like green hydrogen. These systems can store large amounts of electricity for long periods, potentially matching the capacity of hydro plants in the upcoming years.
To Wrap Up
Switzerland is taking significant steps to modernize its energy market. Liberalization of the market will give consumers more choice and connect the country more closely with the EU. New laws for energy communities will let people and businesses share electricity locally. And more substantial support for energy storage will help balance supply and demand as solar power grows.