Switzerland is preparing a financial safety net for the energy sector
ZURICH, April 14 (Reuters) – The Swiss government is preparing a financial safety net for the power sector, it said on Thursday, citing heightened liquidity requirements amid unprecedented price swings.
“In order to ensure that the Swiss electricity supply remains guaranteed even if the situation worsens, the Federal Council decided at its meeting on April 13, 2022 to examine a rescue package for system-critical electricity companies,” it says said in a statement.
Sharp price fluctuations in the energy markets meant that electricity companies need more financial resources to cover security deposits associated with electricity trading, it said.
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“An uncontrolled failure of a large company could endanger the security of supply in Switzerland and trigger a chain reaction,” it said.
It said the government should only act in a subsidiary manner towards companies and their debt and equity providers.
The terms of federal assistance would be very strict and any assistance would be temporary. Interest rates would be in line with market rates and companies receiving subsidies would not be able to pay dividends.
After consultations with the electricity companies, the government will draft a law for accelerated consideration by Parliament in its 2022 summer session.
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Reporting by Michael Shields; Adaptation by Paul Carrel and Jason Neely
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