Market Switzerland

Record hydro production

With 747 GWh of power from 17 hydro plants in Graubünden, Repower's record in Switzerland in 2014 was impressive. But the picture is much less rosy when you consider the low energy prices that have undermined the profitability of hydropower.

Power generation projects

Repower is confident that hydropower will continue to play a leading role in energy supply in Switzerland going forward. This prompted it to drive its key generation projects ahead last year despite the challenges currently posed to Swiss hydropower by distortions in the market. However, in the current environment it is not possible to give the go-ahead for construction in any of these projects.

The major Chlus and Lagobianco projects both saw further progress in the approval process. In referenda on whether to grant concession for the Chlus hydropower project in the Prättigau/Graubünden Rhine Valley, voters in the twelve municipalities signalled a high degree of acceptance by giving the plans a clear go-ahead. The fact that all the relevant interest groups were closely involved in planning from the outset has now paid off in the form of broad consensus. Chlus has been classified as a project of national importance by the Swiss Federal Office of Energy. Currently the largest hydropower project in Switzerland (besides pumped storage), it could contribute around twelve per cent to the federal government's 2035 strategic target for increasing hydropower generation. Construction of the installation would also solve the problem of excessive fluctuations in the water level of the River Landquart. In short, the Chlus project ticks all the boxes in terms of river restoration and rehabilitation combined with the generation of precious renewable energy. The next step in the project will be submission of the request for concession approval to Canton Graubünden, scheduled before the middle of 2015. Despite this very pleasing progress, it should be noted that this outstanding project cannot be delivered either without major changes in the ground rules.

In April the Canton Graubünden administration approved the concessions for the Lagobianco pumped-storage project in the Bernina/Valposchiavo valley area. This marked the successful completion of the first of two phases in the cantonal approval process. Repower was then able to work on finalising the inspection project and phase two of the environmental impact report. This work was concluded in March 2015 with submission of the application for approval of the project at the cantonal level.

Given its storage capacity, the Lagobianco pumped-storage plant could play an extraordinarily important role in terms of realising the Federal Council's Energy Strategy 2050 and integrating new renewables in the system. However, given the environment of heavily distorted market prices that currently prevails, the project is not feasible, and Repower anticipates a delay of several years.

The Lagobianco project also includes the renovation of existing generation assets in the Valposchiavo valley. Now that the goalposts have shifted, these plans have been brought forward; refurbishment of the Robbia power plant, for example, is already at an advanced stage of planning.

In addition to these two large-scale projects, Repower also has a number of smaller undertakings in Canton Graubünden. With the granting of a new concession, Morteratsch power plant near Pontresina (Repower's oldest generation facility, built in 1890) will be comprehensively refurbished and extended to almost double its expected annual production. The municipality of Pontresina has already approved the concession, and approval is currently under way at the cantonal level.

Since 2011, Repower has operated the Taschinas hydropower plant in the Prättigau valley. The plan now is to extend the facility with the addition of the Taschinas 2 plant. With concessions granted by the relevant municipalities, the next step is to submit the request for approval to the canton.

The two plants, Morteratsch und Taschinas 2, will probably operate under the feed-in remuneration at cost (KEV) scheme.