WT/TPR/S/208Trade Policy Review Page 104
but also from Austria and Germany, while exports are mostly to Italy. Imports are duty-free and not subject to a licence.
The electricity branch is owned mainly by cantons and municipalities. There are 7 vertically integrated companies active mainly in production, transmission, and trade; 300 production and distribution companies; 200 companies (mostly) jointly owned by other utility companies and active in production; and around 700 mainly distribution companies operating at the municipal levels. Forty major firms account for more than 60% of total distribution. Production, transmission, and distribution activities are still under de facto monopolies. Seven major electricity companies currently own the electricity grid.
A new Electricity Law was adopted in March 2007 and entered into force in January 2008. The law provides for a two-stage opening of the Swiss electricity market. As of January 2009, large industrial and commercial clients20 will be able to freely choose their suppliers; the market for all consumers will be opened in 2014. The law provides for regulated third-party access to the grid in non-discriminatory terms. Vertically integrated companies are required to separate from their transmission grids and to create an exclusive grid operator (Swissgrid), which will become grid owner by January 2013. Local distribution companies have to keep separate accounts for electricity generation, transmission, and distribution.
The Electricity Law also established an independent Electricity Commission (ElCom). The Commission, which has seven members, has the power to order decreases or prohibit increases of transmission tariffs or consumer prices if it considers them inappropriate. Before the establishment of the EICom, this responsibility was with the Price Controller. The ElCom is also responsible for preventing abuse of dominant market positions by suppliers, and to ensure grid stability and electricity supply.
Swiss electricity prices for captive consumers (i.e. without grid access) are set either by cantonal or communal authorities, or by companies. Therefore, prices differ between cantons and municipalities. Switzerland is the only OECD country where electricity prices for industrial users have fallen in dollar terms since 2004; prices were below the average of European OECD countries in 2006 (Chart IV.2).
State-owned Liechtensteinische Kraftwerke (LKW) imports, produces, and distributes electricity in Liechtenstein. It also sets electricity prices. The LKW's electricity sales were 379 GWh in 2007, of which 307 GWh were imported from Switzerland. Liberalization of the electricity market started with the adoption of a new Electricity Law in 2002, which opened the market for large customers. Since 2005, independent power producers (IPPs) may sell electricity to any customer; the transmission fee payable to LKW is subject to approval by the Energy Commission. Nonetheless, no IPPs have yet entered the market.
20 These are clients with an annual consumption exceeding 100,000 KWh.