Electricity price

The Electricity Supply Act (StromVG) and Electricity Supply Ordinance (StromVV) define Swissgrid’s mission and the general conditions for its business activities. Swissgrid calculates the grid usage and ancillary service tariffs for its services every year on the basis of forecasts. Its tariffs are monitored by the Swiss Federal Electricity Commission (ElCom).

Electricity price 2022

The costs for Swissgrid's transmission grid amount to around 8 per cent of the total electricity price that the end consumer pays. In 2023, a Swiss household with an annual consumption of 4,500 kWh will pay a total of CHF 70 towards the costs of the transmission grid operated by Swissgrid.

The majority of the costs for ancillary services are incurred through the provision of control power. Swissgrid uses the control energy made available by the power plants to balance short-term differences between electricity production and consumption. The grid usage tariff covers the costs of renewal, development and maintenance of the transmission grid, as well as of operations and monitoring via the control centres.

Swissgrid charges the grid usage tariffs – a working tariff, a power tariff and the fixed basic tariff per weighted outflow point – to the distribution system operators directly connected to the transmission grid. In turn, they calculate their own tariffs based on their grid costs and Swissgrid's initial grid usage tariffs. For end consumers, such as private households, this means that electricity tariffs often vary by distribution system operator.

For private end consumers, Swissgrid's tariffs for grid usage and individual ancillary services are included on their electricity bill as part of the «grid usage» price component. The general ancillary service tariffs as well as fees for cost-covering remuneration for feed-in to the electricity grid (CRF) and water pollution control are usually listed separately on the electricity bill.


Questions & answers

The costs for end consumers will increase in 2023 compared to 2022. Why is that?

It is true that the tariffs for general ancillary services and for active power losses, in particular, are rising. The costs in the general ancillary services sector are largely attributable to the provision of control power, and in the individual ancillary services sector, costs for active power losses are attributable to the procurement of active power loss energy. The prices of these products correlate with developments on the power markets. At the time of the tariff calculation for 2023, we had to assume that prices would be high, as they have been in recent months. In addition, in the general ancillary services sector we have to reduce a deficit, which is also largely due to the sharp rise in electricity market prices. The tariffs for general AS will therefore increase from 0.16 cents/kWh to 0.46 cents/kWh and the tariff for active power losses from 0.16 cents/kWh to 0.30 cents/kWh.

The tariffs for grid usage are increasing only slightly, while the tariff for reactive energy is actually decreasing.

The world is in an extraordinary situation. Why is Swissgrid raising tariffs at this particular time?

Swissgrid operates in a highly regulated environment, particularly with regard to tariff calculation. Prices on the power market and other external factors also have an impact on tariffs (hydrological conditions, liquidity of the market, bidding behaviour etc.). This situation gives Swissgrid little scope to flexibly adjust its tariffs in line with current economic and political circumstances.

Will tariffs go down again soon? How will tariffs behave in future?

Swissgrid expects greater tariff fluctuations in future.

The forecasting of future tariff development is always full of uncertainty. Procurement costs in the General AS sector in particular are significantly influenced by external factors (market prices, hydrological conditions, liquidity of the market, bidding behaviour etc.), while the procurement costs for active power losses are determined by the prices on the spot market. Swissgrid is committed to keeping tariffs as low as possible by reducing operating and procurement costs as much as it can.

How are Swissgrid tariffs incorporated into electricity bills?

Swissgrid bills the grid usage tariffs – a working tariff, a power tariff and the fixed basic tariff per weighted outflow point – to the distribution system operators directly connected to the transmission grid. In turn, they calculate their own tariffs based on their grid costs and the tariffs charged by Swissgrid for use of the grid. For end consumers such as private households, this means that electricity tariffs often vary according to distribution system operator. This is because the grid usage tariffs paid by end customers include costs for all grid levels in Switzerland.

The general ancillary services tariff is charged directly by Swissgrid to all distribution system operators, who pass it on to their end consumers.

Doesn’t Swissgrid simply want to make as much money as possible?

No. Swissgrid operates in a highly regulated environment. The Electricity Supply Act (StromVG) and Electricity Supply Ordinance (StromVV) define Swissgrid’s mission and the framework conditions for its business activities.

The Swiss Federal Electricity Commission ElCom oversees compliance with StromVG and StromVV. It is the independent, state regulatory authority in the electricity sector and monitors Swissgrid’s business activities. Among other things, it checks the allowability of costs and the tariffs charged by Swissgrid.

Swissgrid calculates each tariff in advance based on projected figures. Within the financial year concerned, the actual costs and income then deviate from the assumptions. With regard to volume- and tariff-related timing differences, it should be noted that according to Art. 19 Para. 2 StromVV, surpluses achieved in the past must be compensated for by reducing tariffs in the future. Higher tariff revenues therefore do not lead to higher profits for Swissgrid.


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