27 Provisions
PROVISIONS FOR ONEROUS CONTRACTS
The decision on whether there is a threat of loss on a long-term sales or procurement contract and the resulting recognition of a provision essentially depends on the situation of the relevant contractual prices and expected procurement or sales prices. In 2019 the entire provision that existed at the end of the prior year was released under energy procurement in the Market Switzerland segment because there was no longer a provisioning requirement on the 31 December 2019 cut-off date.
SEVERANCE PAY
When an employment relationship is terminated in Italy, the employee is entitled to severance pay corresponding to almost one month’s pay for each year of employment (see Note 34).
DISMANTLING PROVISIONS
The dismantling provisions category comprises various provisions for the dismantling of operating installations. Taken individually they are immaterial. Additions in 2019 were recognised under tangible assets.
OTHER PROVISIONS
A supplier of wind power equipment was unable to meet its commitment (see Note 15), delaying the construction of a Repower AG wind power plant for which a minimum feed-in tariff had already been agreed. Given the threat of a penalty resulting from the delay in the commencement of production, a provision of CHF 818 thousand was made.