Swiss ETS

The Switzerland (Swiss) ETS started in 2008 with a five-year voluntary phase. Thereafter, participation was mandatory for large, energy-intensive entities and voluntary for medium-sized entities. The Swiss ETS covered about 12% of the country’s total GHG emissions in 2020. Participants in the ETS are exempt from the national CO2 levy.

The Swiss ETS covers electricity generation, industrial entities (largely comprising companies from the cement, chemicals, pharmaceuticals, paper, refining, and steel sectors), domestic aviation, flights to the European Economic Area, and from 2023 flights to the UK. Allowances are allocated through benchmarking and auctioning. The same benchmarks as in the EU ETS apply to entities covered by the Swiss ETS. Auctioning volumes may be reduced if the total number of allowances in circulation exceeds a certain threshold.

The system is mandated by the Federal Act on the Reduction of CO2 Emissions (“CO2 Act”) and regulated through an implementing regulation (“CO2 Ordinance”). The Swiss ETS has been linked with the EU ETS since January 2020.

The scheme covers the following sectors: Domestic Aviation, Industry and Power.

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