Hydroelectric power in switzerland : challenges of an energy supply in turmoil

Hydroelectric power is the main electricity supplier in Switzerland. But in recent years the new paradigm of electrical supply in Switzerland has put pressure on the industry. With a low-price environment, the planned nuclear phase out following Fukushima and the emergence of new stochastic renewables energies, hydro production has a hard time generating positive returns. This paper aims to demonstrate the existing potential for this industry in the future and to propose a new regulation on how power companies pay the tax on water in Switzerland. Hydropower has some very valuable specificities, a very good predictability and a real flexibility in production. With the abandonment of nuclear power and the need for clean energy, this flexibility gives hydropower a very large advantage compared to wind or solar, whose progress in predictability still can't match the Swiss dams. We will also show that pricewise, hydroelectricity is competitive with solar, even cheaper considering the capacity that can be produced annually