The Swiss, famed for their democratic traditions, chocolate, and knives with corkscrews, have adopted an aggressive feed-in tariff to promote the rapid development of renewable energy.
The Swiss federal government has launched an aggressive system of feed-in tariffs that pays any renewable energy generator for every kWh of electricity generated. The Swiss system, which is just four months old, has a schedule of tariffs differentiated by technology, size and application, which sets payments per kilowatt-hour (kWh), for solar photovoltaics, wind, hydro, geothermal and biomass.
The payments are made for periods of 20 to 25 years, depending upon the technology.
The new Swiss tariffs, among the highest in the world, are the first to include a specific tariff for small wind turbines, under 10 kW. The states of Michigan, Illinois, Rhode Island and Minnesota have proposed similar tariffs for small wind turbines, US $0.25/kWh, but none of the proposals have yet become law.
Tariffs for large wind turbines use the German system of tariff differentiation by resource intensity. "Because of the rugged Swiss terrain, the program's designers needed to provide tariffs for wind energy that would enable profitable operation in deep valleys as well as on windy mountaintops, while at the same time protecting ratepayers from unnecessary costs," writes wind energy expert and renewable energy advocate, Paul Gipe.
Funds to pay for the tariffs will come from a systems benefits charge of 0.006 SWF/kWh on all electricity consumption. This is equivalent to about US $310 million, at current exchange rates.
While there is no MW cap on the program, there is a cap on the portion contributed by each technology to the total program. Hydro generation is capped at 50% of the fund, and wind at 30%. However, the entire program is capped at 150% of the funds collected.
The program will be reviewed every five years. The first review may be within three years.