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House favours opening power market in stages

Trade and industry will have first choice when it comes to power providers

(Keystone)

The House of Representatives has come out in favour of a two-stage approach to liberalisation of Switzerland's electricity market.

The proposal foresees opening the market first to big electricity providers and later to private homes.

The proposal, which still has to be discussed by the Senate, was approved by 94 to 92 votes.

Energy Minister Moritz Leuenberger successfully championed the "slow way", which initially gives only trade and industry the freedom to choose their power providers.

He said that in Swiss democracy, speed plays a big role. "They stumble that run fast," proclaimed Leuenberger, quoting Romeo and Juliet.

The narrow majority disregarded the opinion of a parliamentary committee, which believed a liberalisation of the power market in stages would discriminate against small users and was not compatible with the European Union.

The government argued that Switzerland, as a European power hub, could not stand apart as the internal EU electricity market has become more developed, and all end-users will be able to choose their supplier freely by 2007.

The vote caused a fierce exchange of views between the political parties. The centre-right and rightwing parties, supported by the Swiss Business Federation and the leading power producers, wanted an immediate liberalisation.

Werner Messmer, a parliamentarian from the centre-right Radical Party, said the threats of a referendum by the Left were "ideologically based".

The Federation of Trade Unions, which mounted a successful challenge against the first proposal (in 2002 the Swiss electorate rejected proposals to liberalise the electricity supply in a nationwide vote), and the Social Democrats favoured a staggered opening up of the market.

Choice

The power-supply law aims to lay the framework for the liberalisation of the Swiss electricity market. Currently regions have their own, partly state-controlled power suppliers each with their own supply monopoly.

Under the draft law consumers should be able to choose their supplier from 2007, as is currently the case in the telephone market.

Such a change would bring Swiss legislation closer into line with that of the EU, which also wants to introduce consumer choice.

The government says that the general conditions for electricity supply in Switzerland have changed over the past few years.

It points out that the Federal Court recognised the right to third-party network access in June 2003, and that the significance of the cross-border electricity trade has increased.

In brief

The proposal for the liberalisation of the energy market has been separated into three parts:

Power-supply law, which lays down the framework for the opening up of the power market.

Electricity law relates to international power transport and EU guidelines.

Energy law includes measures for the promotion of renewable energy.

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