The Federal Council

27.1.2021

Switzerland's Long-Term Climate Strategy

Contents
Summary ................................................................................................................................................. 4
1

Introduction....................................................................................................................................... 6

2

Mandate for the development of a Long-Term Climate Strategy ..................................................... 6
2.1

Scientific basis ......................................................................................................................... 6

2.2

International provisions from the Paris Agreement ................................................................. 8

2.3

National environment............................................................................................................... 8

3

Previous development of climate and emissions in Switzerland ..................................................... 9
3.1

Climate development in Switzerland ....................................................................................... 9

3.2

Development of emissions in Switzerland ............................................................................. 114Long-term target for 2050 .............................................................................................................. 13
4.1

Classification and meaning ................................................................................................... 13

4.2

Domestic and foreign shares of reductions ........................................................................... 14

5

Strategic principles of the Long-Term Climate Strategy ................................................................ 15

6

Switzerland's climate legislation..................................................................................................... 17
6.1

Complete revision of the CO2 Act .......................................................................................... 18

6.2

Further measures in other sector policies ............................................................................. 21

6.3

Popular initiative 'For a healthy climate (Glacier Initiative)' ................................................... 23

7

Emissions reductions by 2050 according to Energy Perspectives 2050+ ..................................... 23
7.1

The basis of the Energy Perspectives 2050+........................................................................ 23

7.2

Scenarios of the EP2050+..................................................................................................... 24

7.3

Framework data and developments of the EP2050+ ............................................................ 25

7.4

Development of power supply according to the EP2050+ .................................................... 26

8Strategic goals and challenges in the individual sectors ............................................................... 27
8.1

Buildings sector ..................................................................................................................... 27

8.2

Industry sector ....................................................................................................................... 30

8.3

Transport sector .................................................................................................................... 34

8.4

Aviation sector ....................................................................................................................... 37

8.5

Food and agriculture sector ................................................................................................... 38

8.6

Financial market sector ......................................................................................................... 41

8.7

Waste sector.......................................................................................................................... 45

8.8

Synthetic gases ..................................................................................................................... 46

8.9

Negative emissions technologies .......................................................................................... 47

9Development of total greenhouse gas emissions by 2050 ............................................................ 51

10

Costs and benefits of the net-zero target .................................................................................. 53

10.1

Benefits and cost savings of not taking action ...................................................................... 53

10.2

Investments required, operating and maintenance costs and energy cost savings ............. 54

10.3

Summary ............................................................................................................................... 56

Literature references ............................................................................................................................. 57
Glossary ................................................................................................................................................ 602

3

Summary
On 28 August 2019, the Federal Council decided that Switzerland would aim to reduce its greenhousegas emissions to net zero by 2050 and gave the Federal Department of the Environment, Transport,
Energy and Communications (DETEC) the task of drawing up a long-term climate strategy, thus ensuring that Switzerland meets a requirement of the Paris Agreement. This document 'Switzerland's LongTerm Climate Strategy' is the result of this work.
The science is clear: to ensure sufficiently high probability of global warming remaining below 1.5° Celsius, global CO2 emissions must be reduced to net zero by the middle of this century at the latest. Any
CO2 still emitted at this point must be fully and permanently removed from the atmosphere through sinks(negative emissions). The emission of other greenhouse gases, particularly methane and nitrous oxide,
must also be significantly reduced. The Paris Agreement adopted by the international community at theend of 2015 and ratified by Switzerland on 6 October 2017 aims to limit global warming to well below
2° Celsius but, if possible, to 1.5° Celsius. By aiming to cut its greenhouse gas emissions to net zero by
2050, Switzerland is making a contribution to the Paris Agreement that is in line with its climate policy
responsibility and capacities. It has a strong foundation for achieving the net-zero target thanks to its
already largely CO2-free domestic power supply, a strong clean-tech sector, its internationally renowned
educational and research institutions, its high level of prosperity and prodigious capacity for innovation.
By pursuing this goal, Switzerland is keeping pace with its most important trading partner, the European
Union, which also announced its intention to become carbon-neutral by 2050, as well as China andBrazil which aim to achieve these goals by 2060. Various other states have already adopted legallybinding net-zero targets or have pledged to do so, including France, Germany, Sweden, Denmark, New
Zealand, Canada, Japan, South Korea, South Africa and the United Kingdom.
Switzerland's Long-Term Climate Strategy outlines the path to the net zero goal. It sets out ten key
strategic principles that will guide and shape Switzerland's climate policy actions over the coming years:
1. Switzerland will take advantage of the opportunities presented by a systematic transition to net zero.
2. Switzerland will assume its climate policy responsibility.
3. Priority will be given to reducing domestic emissions.
4. Emissions will be reduced across entire value chains.
5. All energy sources will be used effectively taking account of their optimal usage potential.
6. The Swiss Confederation and the cantons will gear their planning activities to net zero in all climaterelevant areas.
7. The transition to net zero will be carried out in a socially acceptable way.
8. The transition to net zero will be achieved in an economically viable way.
9. The transition to net zero will also improve environmental quality.
10. The Long-Term Climate Strategy is based on openness to all types of technology.
The Long-Term Climate Strategy outlines possible developments up to 2050 for the buildings, industry,transport, food and agriculture, financial market, waste and synthetic gases and international aviation
sectors and defines strategic goals for each sector. The strategy also determines the requirement for
negative emissions that is likely to be needed to balance the remaining emissions. The following principle applies: greenhouse gas emissions must be reduced as far as possible in every sector – whether
through a sufficiently high price for emission-intensive technologies, through technical measures or bypromoting alternatives. The buildings and transport sectors can cut their fossil emissions to zero by 2050
and energy-related emissions can also be almost completely eliminated in industry too. The reduction
potential in agriculture and the food industry will also be harnessed. Finally, international aviation will
also have to contribute to the attainment of the target, particularly through the use of renewable sustainable fuels and alternative drive systems. Difficult-to-avoid emissions from some industrial processes,
such as cement production or incineration, will be offset by the use of carbon capture and storage (CCS)
technologies. These technologies can largely prevent emissions from entering the atmosphere.
The revision of the CO2 Act adopted by Parliament in the 2020 autumn session requires greenhousegas emissions to be halved by 2030. The set of measures approved puts Switzerland on course to4

achieve the net-zero target by 2050 and is a key element in attaining this goal. Based on the scenarios
available, a reduction in greenhouse gas emissions by just under 90 per cent overall by 2050 comparedwith 1990 is possible. The greenhouse gas emissions remaining after the use of CCS technologies –just under seven million tonnes of CO2 equivalent in total – must be balanced with negative emissions.
The respective shares to be achieved through measures in Switzerland or abroad by 2050 are not yet
determined. The current level of compensation abroad, with projects that reduce emissions and therefore substitute reductions in Switzerland, is to be increasingly replaced long-term through international
commitment in the field of negative emissions as domestic capacity for geological storage is limited.
When using negative emissions technologies abroad, the same standards in terms of social acceptanceand environmental sustainability shall apply as in Switzerland.
From a scientific perspective, the reduction of global greenhouse gas emissions to net zero is imperative
to keep global warming below the critical threshold. A lack of or insufficient action would come at a very
high price, even by 2050. This applies especially to Switzerland which is significantly affected by climatechange. If global warming continues, existing studies indicate that the cost for Switzerland by 2050
would amount to up to 4 per cent of annual GDP. However, if global emissions are significantly reduced
and global warming is restricted to a maximum of 1.5° Celsius, the cost by 2050 would only stand at a
maximum of 1.5 per cent of GDP. According to these estimates, the benefits of a global reduction inemissions to net zero would amount to 2.5 per cent of GDP for Switzerland by 2050. This roughly
equates to around 20 to 30 billion Swiss francs. These benefits increase sharply long-term as the costof unchecked climate warming rises exponentially.
This means it is in Switzerland's interests to reduce greenhouse gas emissions to net zero and contributeto the global efforts to restrict global warming. Attaining the net-zero target requires a transformation of
the current energy supply system which still relies heavily on fossil energies. Even without the net-zerogoal, additional investment in the energy system of 1,400 billion francs is required by 2050, according
to Energy Perspectives 2050+. The goal of achieving net zero by 2050 increases the need for investment by 109 billion francs in total which is only 8 per cent. The cost of operating the energy supply plants
rises by around 14 billion francs. Reducing emissions to net zero will also enable savings to be madeon energy costs of 50 billion francs, in particular by eliminating imports of fossil energies,.1 Overall,
additional annual expenditure of around 2.4 billion francs on average will be incurred over the period
2020–50.
This means the reduction of emissions to net zero is also likely to pay off financially by 2050. A key
factor will be structuring the transition to the net zero goal over the coming years in a socially acceptable,
economically viable and environmentally sustainable way and aligning the regulatory environment accordingly. The complete revision of the CO2 Act lays the foundation in this respect.

1
This figure does not include potential savings in international aviation. If they are also taken into account, the savings amountto around CHF 64 billion.

5

1

Introduction

Switzerland signed the Paris Agreement in 2015 and ratified it in 2017. The Paris Agreement obliges allstates to reduce their greenhouse gas emissions for the first time. The main overarching objectives arelimiting global warming to well below 2°C compared to the pre-industrial era, whereby a maximum increase in temperature of 1.5°C is being targeted, improving adaptability to climate change and making
financial flows consistent with low-greenhouse-gas development. Switzerland wishes to make its contribution to achieving these goals. The Federal Council is endeavouring to cut greenhouse gas emissions
to the target of net zero by 2050, as it announced in 2019.2 This means Switzerland should no longer
produce any greenhouse gas emissions overall by 2050. Switzerland will therefore reduce the use offossil energies to a minimum, cut its greenhouse gas emissions as far as possible and balance remaining emissions through negative emissions. Negative emissions technologies (NET) use technical or
natural processes that remove CO2 from the atmosphere and permanently store it. Switzerland is also
committed to making financial flows consistent with environmental sustainability at national and international level.
Switzerland is already being severely impacted by climate change. Without effective climate protection
measures, these effects will continue to worsen. According to the CH-2018 Swiss Climate Change Scenarios, the summers will be drier in future, heavy rainfall will be more intense, the average and highest
temperatures will rise and snowfall and snow cover will continue to decline, particularly in lower-lying
areas. There is great need for action. To attain the net-zero target, greenhouse gas emissions in Switzerland must decrease sharply over the coming years and decades. The revision of the CO2 Act, which
was adopted by Parliament during the 2020 autumn session, establishes the climate policy framework
until 2030. The new CO2 Act is a key element in ensuring Switzerland meets its 2050 climate target. It
will enable Switzerland to halve its emissions overall by 2030 and reduce them by at least 37.5 per centdomestically. With the newly created Climate Fund, the emissions limits for buildings and new vehicles
and the strengthening of established market economy approaches, it contains instruments that will havean impact beyond 2030. The Act also obliges the Federal Council to submit proposals to Parliament on
post-2030 reduction objectives in good time. It puts Switzerland on course to achieve balanced greenhouse gas performance which is what the Federal Council is striving to attain in Switzerland by 2050.
In this Long-Term Climate Strategy, the Federal Council sets out how greenhouse gas emissions should
develop overall in the various sectors to 2050, how high the requirement for negative emissions could
be and the strategic principles on which climate policy action should be based at federal, cantonal andcommunal level over the coming years.
2

Mandate for the development of a Long-Term Climate Strategy

The need to reduce greenhouse gas emissions to net zero is based on the scientific evidence presented
by the Intergovernmental Panel on Climate Change IPCC (Section 2.1). The requirement to draw up
long-term climate strategies is enshrined in the Paris Agreement (Section 2.2). The Federal Council
therefore gave the departments responsible the task of drawing up a long-term climate strategy for
Switzerland in August 2019. This strategy is the result of their work and enables Switzerland to assume
its responsibility to limit the rise in the global temperature to 1.5° Celsius, to prevent mis-investment andto take advantage of emerging opportunities (Section 2.3).
2.1

Scientific basis

In autumn 2018, the IPCC published its special report on global warming of 1.5° Celsius (subsequently
referred to as the '1.5° Report').3 This summarises the current knowledge available on how global warming can be limited to a maximum of 1.5° Celsius and what impacts such warming will have comparedwith a rise in temperature of 2° Celsius. According to the '1.5° Report', the global temperature has already risen by around 1° Celsius since the beginning of industrialisation. The sharp rise in warming
since 1950 by around 0.65° Celsius can no longer be attributed to natural fluctuations. This has beencaused by greenhouse gas emissions, especially from the use of fossil fuels, such as oil, gas and coal,and extensive changes in land use, for example the destruction of rain forests.

2

Federal Council press release of 28.8.2019, can be viewed at: https://www.bafu.admin.ch/bafu/en/home/topics/climate/newsreleases.msg-id-76206.html.
3
IPCC (2018).
6

The '1.5° Report' outlines emissions pathways which are compatible with global warming by a maximumof 1.5° Celsius. The most important finding is that the global CO2 emissions in scenarios with no or
limited overshoot will reach their peak by around 2020 and must then fall to around 45 per cent of the2010 level by 2030 and to net zero by the middle of the century (2045–55). At the same time, the climate
impacts of the other greenhouse gases (non-CO2 emissions), in particular from methane, nitrous oxideand black carbon, must also decline sharply by 2050 and beyond. Figure 1 shows this in a graphic.

Figure 1: Global emissions pathways compatible with warming of 1.5°C. Source: IPCC (2018)

The '1.5° Report' also clearly shows that the effects of global warming by 2° Celsius and by 1.5° Celsius
differ significantly. In Central and Southern Europe, a significant water shortage and – particularly in the
Mediterranean region – a sharp increase in extreme droughts are anticipated in the event of warmingby 2° Celsius. As a result, there is a much greater risk, for example, of more frequent and significantly
hotter heatwaves, water and food shortages, but also a greater loss of alpine habitats. The effects ofclimate change will also result in an increase in migration of people from severely affected regions andcountries.
Net zero refers to the balance between the emission of greenhouse gases, on one hand, and theirremoval and storage in sinks on the other. The emission of greenhouse gases cannot be completely
eliminated in some sectors. From a current perspective, this includes agricultural food production, someindustrial processes, such as cement manufacture, and waste incineration. To achieve the net-zerogoal, these remaining emissions must be balanced by the use of technologies or processes that remove
CO2 from the atmosphere and store it permanently. Long-term, i.e. beyond 2050, the emission balancemust be negative overall so that the concentration of greenhouse gas in the atmosphere falls further.
Only then can global warming be limited to 1.5° Celsius with sufficiently high probability. If the emissions
are not reduced on time and the temperature goal of 1.5° Celsius is then exceeded, the emissionsbalance must become negative at an earlier stage to reverse the overshooting of the temperature target.
An early reduction in emissions also lessens dependency on technologies about the potential and costsof which there is still a great deal of uncertainty.
7

These scientific findings form the basis for Switzerland's long-term climate policy goals. Climate protection is a fundamental requirement if human wellbeing is to be ensured long-term. Achieving the net-zerotarget is imperative for the international community and so too for Switzerland. Only then will the probability of restricting climate warming to a tolerable level be sufficiently high. This requires global efforts
to which Switzerland wishes to make its contribution in line with its responsibility and capabilities. Thistarget should be attained while at the same time securing prosperity in an optimal way and ensuringsocial cohesion and the conservation of resources in all areas of the environment.
2.2

International provisions from the Paris Agreement

The Paris Agreement requires all contracting parties to draw up long-term climate strategies (Art. 4 para.
19):"All Parties should strive to formulate and communicate long-term low greenhouse gas emission development strategies, mindful of Article 2 taking into account their common but differentiated responsibilities and respective capabilities, in the light of different national circumstances."
The framework convention on climate change stipulates that the long-term climate strategies are to besubmitted by the end of 2020 and should be based on a time horizon of the middle of the century (section
3 para. 35 of Decision 1/CP.21 of the UNFCCC Framework Convention on Climate Change).
Finally, the Paris Agreement stipulates that the global emissions must reach their peak as soon as
possible and then fall sharply. A balance between emissions by sources and removal by sinks must be
achieved by the second half of the century (Article 4 para. 1). These are the key points for the long-termclimate strategies. This strategy is also based on these key points.
In addition to the Paris Agreement, the 2030 Agenda for Sustainable Development also underlines theimportance of climate protection.4 As one of 17 Sustainable Development Goals in total, Goal 13 callson states to take immediate measures to combat climate change and its impacts. The Goal also provides
for the incorporation of climate policy measures into national policies, strategies and planning (Target
13.2). Switzerland is primarily implementing the 2030 Agenda via its Sustainable Development Strategy(see Section 6.2).
2.3

National environment

The Paris Agreement states that the long-term climate strategies should be based on the principle of'common but differentiated responsibilities' and should take account of 'respective capabilities, in lightof different national circumstances'. Switzerland is a highly developed state with a strong economy andglobal trading relations. It therefore bears particular responsibility, together with other industrial statesand emerging countries.
Switzerland is in a favourable position to assume its climate policy responsibility long-term. Resolutely
embarking on the path towards a greenhouse-gas-neutral future also presents the opportunity to consolidate its leading role as a centre of innovation. Switzerland has internationally renowned universities
and educational and research institutions. The two Swiss Federal Institutes of Technology in Zurich andLausanne are amongst the world's best universities and are regularly included in the top 20 in international rankings. Overall, universities, the private sector, private organisations and the Swiss Confederation spend around 23 billion francs or 3.4 per cent of GDP on research and development, according to2017 figures. OECD estimates indicate that this is the third highest figure worldwide, after South Korea
and Israel. In total, the research and development sector employs 82,000 full-time equivalents.
Many innovative companies are operating in Switzerland and the cleantech sector is well represented.
The cleantech sector has achieved strong growth over recent years. The environment sector has almost
doubled its value creation since 2000 (from CHF 10.9 to CHF 21.2 billion).5 It has developed much more
dynamically than the overall economy. The provision of renewable energies as well as energy saving
and energy management (energy-saving measures, insulation, the construction of new low-energy-consumption buildings etc.) have seen particularly strong growth. Employment in the environment sector
4

See https://www.eda.admin.ch/agenda2030/en/home/agenda-2030/die-17-ziele-fuer-eine-nachhaltige-entwicklung.html for an
overview of the Sustainable Development Goals.
5
According to the definition of the Federal Statistical Office, the environment sector covers "Activities concerning the manufacture of goods or the provision of services that protect the environment against pollution and other adverse effects, on one hand,and foster the conservation of natural resources on the other." For further details see: https://www.bfs.admin.ch/bfs/de/home/statistiken/raumumwelt/umweltgesamtrechnung/umweltgueter-dienstleistungen.html.
8

has risen by 87 per cent since 2000 to around 150,000 full-time equivalents. Overall, the environment
sector and other cleantech-relevant sectors (such as public transport) today employ 5.1 per cent of theworkforce and contribute 4.2 per cent of GDP.
The reduction of greenhouse gas emissions presents growth opportunities that extend beyond the cleantech sector. Examples include the IT sector, which can contribute to emissions reduction with digitalsolutions in various areas, as well as the insurance and financial sectors. As a major global financial
centre, Switzerland can also play a key role in making financial flows consistent with the climate-resilient
development required by the Paris Agreement.
The situation in Switzerland is also favourable in other respects. The Swiss recycling system performs
well and companies are increasingly taking on board the concept of a circular econmy. Switzerland's
electricity production is largely CO2-free, while emission-intensive industries only make up a relatively
low share. Many developments required to achieve the net-zero target are already under way. New
buildings do not produce CO2 emissions in many cases today, the proportion of new registrations accounted for by electric vehicles is increasing rapidly, and the industry and services sectors are relying
less and less on fossil fuels. These developments must be consistently driven forward. There are greater
challenges in other areas, such as food and agriculture, international aviation and technologies for thecapture and storage of CO2 and negative emissions.
In terms of legislation, Switzerland has a broad-based foundation for assuming its climate policy responsibility. It has had national climate legislation since 2000 with the CO2 Act. In the 2020 autumn session,
Parliament concluded its consultation on the complete revision of the CO2 Act. With the complete revision, Parliament sets out goals and measures to 2030. The new CO2 Act nevertheless extends beyond
2030 and lays the foundation for Switzerland to achieve its climate goal for 2050 (see Section 6.1). This
strategy outlines how greenhouse gas emissions could develop to 2050 and sets out the long-term
objective. It reduces the risk of mis-investment in plants that will continue to emit high levels of greenhouse gases for decades. The Long-Term Climate Strategy creates planning stability and provides guidance for action in all sectors concerned. If the renewal cycles are applied consistently with immediate
effect to replace infrastructure, plants, vehicles and heating systems with lower-CO2-emiting alternatives, Switzerland will occupy an advantageous position over the medium to long-term.
3

Previous development of climate and emissions in Switzerland

3.1

Climate development in Switzerland

Systematic observations of the climate system over many years show that Switzerland is severely affected by climate change.6 The near-ground air temperature has risen by around 2° Celsius between
the pre-industrial reference period of 1871 to 1900 and the last 30 years between 1991 and 20207 –which is significantly higher than the global average of around 1° Celsius.8 Warming in Switzerland has
been particularly high since the 1980s. In some years, such as in 2019, 2018 and 2015, it was evenmore than 2.5° Celsius warmer than in the pre-industrial reference period of 1871 to 1900. Nine of theten warmest years since measurements began were in the 21st century (see Figure 2). The consequences of this warming are already evident today: heatwaves are occurring at increasingly closer intervals and to a greater extent than in the past, and intensive heavy rainfall is more frequent. The retreatof the alpine glaciers, whose volume has declined by around 60 per cent since the mid-19th century, isclearly visible. The number of days of snowfall per year has also fallen. At 2,000 metres above sea level,
this is 20 per cent lower today than in 1970, and at 800 metres above sea level it only snows half asoften as it did at that time. The vegetation period today is two to four weeks longer on average than 50
years ago.9 Climate change is also putting greater pressure on biodiversity and posing a threat to traditional habitats. The climate changes are also having an impact on health. For example, the heatwave
summers in 2003, 2015 and 2019 resulted in significant excess mortality.10
6

National Climate Observing System (GCOS Switzerland): http://www.gcos.ch/inventory
MeteoSwiss (2019)8
At international level, the period 1850 to 1900 (early industrial period) is used as a reference and compared with a norm period (1981 to 2010). In this analysis, the temperature increase stands at 1.5°C in Switzerland and at 0.6°C globally.
9
See https://www.meteoswiss.admin.ch/home/climate/climate-change-in-switzerland.html for a summary of the effects of climate change in Switzerland.
10
Ragettli / Röösli (2020).
7

9

Climate change will have an even greater impact in future. MeteoSwiss and the Federal Institute ofTechnology Zurich showed how the climate could develop in Switzerland to the middle of the century
and beyond in the CH2018 Swiss Climate Change Scenarios published in 2018.11 These scenarios
indicate that – without effective global climate protection measures – summers will become drier andheavy rainfall more intensive, the average and highest temperatures will increase and snowfall and snow
cover will continue to decrease. A comprehensive reduction in global greenhouse gas emissions in linewith the goals of the Paris Agreement would significantly mitigate climate change, also alleviating theeffects in Switzerland. In this scenario, the developments already under way would still continue but theextent of the changes would be significantly less overall. Based on the current situation, around half ofthe potential climate changes could be avoided by the middle of the century with systematic global
climate protection measures and two-thirds by the end of the century. Table 1 shows the main effects –each to the middle of the century – according to the CH2018 Swiss Climate Change Scenarios.

Figure 2: Deviation of the average annual temperature in Switzerland from the average in the period 1871 to 1900.
Source: CH2018 (2018)
Without effective global climate
protection measures (RCP 8.5
scenario)

With systematic global climate
protection measures (RCP 2.6
scenario)

Annual average temperature+2.0 to +3.3°C+0.7 to +1.9°C

Summer temperature+2.3 to +4.4°C+0.9 to +2.5°C

Winter temperature+1.8 to +3.3°C+0.6 to 1.9°C

Change in precipitation in summer-25% to +9%-16% to +7%

Change in precipitation in winter-3% to +21%

-1% to +16%

Annual highest temperature+2 to +5.7°C+1 to +3.2°C

Table 1: Overview of climate-related effects compared to the current situation (1981 to 2010) by the middle of the
century (2045–74) with and without effective climate protection measures. Source: CH2018 (2018)

The figures highlight that effective global climate protection measures in line with the goals of the Paris
Agreement are in Switzerland's interests. While temperatures would also continue to go up in this scenario, they would climb much less rapidly than in the event of an unchanged rise in emissions. The
differences will become even clearer long-term towards the end of the century. For example, without
global climate protection measures, the average summer temperature would rise by 4.1° to 7.2° Celsius
in Switzerland by this time. Effective climate protection measures would slow the increase and limit it to
0.7° to 2.4° Celsius compared with the reference period of today.
11

10

CH2018 (2018).

3.2

Development of emissions in Switzerland

70

9
8
7
6
5
4
3
2
1
0

Mt CO2eq

60
50
40
30
20
10
2018

2016

2014

2012

2010

2008

2006

2004

2002

2000

1998

1996

1994

1992

1990

0

t CO2eq/capita

In 2018, Switzerland's greenhouse gas emissions amounted to 46.4 million tonnes of CO2eq12 in total,
according to the greenhouse gas inventory. Compared with the base year of 1990, this equates to a
decline of around 14 per cent. A downward emissions trend has been observed since around 2005 –despite continuous population growth (see Figure 3). During the prior period, emissions remained relatively constant except for some annual fluctuations. The orange line shows the development of greenhouse gas emissions per capita. They have declined significantly since 1990 and stood at 5.4 tonnes ofCO2eq in 2018. Even though the trend is generally moving in the right direction, Switzerland will notmeet the target of reducing total emissions by 20 per cent in 2020 compared to 1990. Additional
measures are required to put Switzerland back on course beyond 2020.

International aviation and shipping

Total emissions in Mt CO₂eq
GHG emissions per capita

Figure 3: Switzerland's greenhouse gas emissions overall (left axis) and per capita (excluding international aviation and shipping, right axis). Source: Switzerland's greenhouse gas inventory (FOEN 2020)

If international aviation and shipping – which are not part of the international and national assessment
parameters – are included, the emissions in 2018 would stand at 52.1 million tonnes of CO2eq which isaround 9 per cent below the 1990 figure. The percentage decrease compared with 1990 is lower in this
scenario which is attributable to the increase in emissions from international aviation.

60
50

Mt CO2

40
30
20
10

2018

2016

2014

2012

2010

2008

N₂O

2006

CH₄

2004

2002

CO₂

2000

1998

1996

1994

1992

1990

0

Synthetic gases

Figure 4: Switzerland's greenhouse gas emissions by gases (excluding international aviation and shipping). Source:
Switzerland's greenhouse gas inventory (FOEN 2020)

12

Switzerland's greenhouse gas inventory: https://www.bafu.admin.ch/greenhouse-gas-inventory; without international aviationand shipping.
11

The breakdown by gases in Figure 4 shows the dominant role of CO2 emissions, which account foraround 80 per cent of total emissions today. This means the fall in overall emissions since 1990 is primarily due to a decline in CO2 emissions. Around 16 per cent of total greenhouse gas emissions aremethane (CH4) and nitrous oxide (N2O), both of which are predominantly generated in agriculture. The
remaining just under 4 per cent is accounted for by synthetic greenhouse gases where hydrofluorocarbons (HFC), which are used as refrigerants for example, are significant.
20
Buildings

18
16

Transport

Mt CO2eq

14
12

Industry

10
Agriculture

8
6

Waste

4
Synthetic Gases

2
2018

2016

2014

2012

2010

2008

2006

2004

2002

2000

1998

1996

1994

1992

1990

0

International Aviationand Shipping

Figure 5: Switzerland's greenhouse gas emissions by sectors according to the CO2 Ordinance, supplemented by
figures on international aviation and shipping. Source: Switzerland's greenhouse gas inventory (FOEN 2020)

The breakdown by sectors in Figure 5 clearly shows that the emissions reductions are primarily attributable to the buildings sector. The annual fluctuations are weather-related and highlight the continued
high level of dependence on fossil-fuel heating systems. Emissions in industry and – to a lesser extent– in agriculture have also fallen, while they have now stabilised in the waste sector13. The transport
sector has accounted for the highest share of emissions for several years. While the trend has been ona slight downward trajectory for around ten years, emissions are still at the level of 1990. International
aviation emissions show a clear upward trend to 2019 and would now make up around 10 per cent of
Switzerland's total emissions if they were included in the assessment.14 The short-term development
over the coming years is still uncertain due to the COVID-19 pandemic.
Figure 3 to Figure 5 show the emissions generated in Switzerland according to the international guidelines (territorial or point of sale principle). Food and other goods imported into Switzerland and the associated emissions abroad are not included here. In contrast, the footprint perspective covers the entire
supply chain and differentiates between emissions generated in Switzerland and those generated
abroad. Figure 6 shows that the greenhouse gas emissions are more than twice as high as under the
territorial principle if the share generated abroad is also considered. The share generated abroad has
clearly risen over the course of time and almost completely offsets the reduction in domestic emissions.15
Figure 6 shows the importance of emissions for which Switzerland is responsible abroad. A comprehensive climate policy must assume responsibility for this too. Domestic measures to conserve resourcesin Switzerland, for example by means of sustainable consumption, resource-efficient production processes, sustainable supply chains and recycling management policies, can make a substantial contribution to reducing environmental pollution abroad. This will enable Switzerland to reduce its footprint
abroad by 2050. This also reflects the will of Parliament.16

13
The waste sector in this classification primarily includes the emissions from landfilling, biogas plants and wastewater treatment plants. Incineration plants are allocated to the industry sector.
14
The emissions from international shipping only amount to just over 20,000 tonnes of CO2eq and are therefore negligible.
15
FSO Air Emissions Accounts (2020).
16
Parliament added a provision to the CO2 Act which states that emissions reductions abroad, which are not included in the
reduction target but also contribute to emissions reduction, should be in line with emissions caused by Switzerland abroad as far
as possible (Art. 3 para. 3 CO2 Act).

12

Greenhouse gas footprint(mio t CO2eq)

150

100

50

0
2000

2002

2004

2006

Import-related emissions

2008

2010

2012

2014

2016

Domestic emissions

Figure 6: Development of the greenhouse gas footprint based on Swiss final demand from 2000 to 2017, broken
down by domestic and import-related emissions (emissions related to exported goods and services are not included). Source: FSO Air emissions accounts (2020)

4

Long-term target for 2050

In line with the scientific evidence, based on the Paris Agreement, in accordance with its 'highest possible ambition'17 and in view of specific economic and social requirements, Switzerland has set itself thefollowing long-term target18:
Switzerland should achieve balanced greenhouse gas performance by 2050 at the latest (netzero).
Switzerland's greenhouse gas target for 2050 (net-zero target)…
… means achieving equilibrium between sources of emissions and removal and covers all internationally governed greenhouse gases (not just CO2);… includes all sectors in the greenhouse gas inventory (energy, industrial processes and product usage, agriculture, land use, land use changes and forestry (LULUCF), waste and others);… covers the emissions within Swiss national borders (territorial or point of sale principle);… also includes the emissions from international aviation and shipping attributable to Switzerland;… does not determine specific domestic and international shares for emission reductions;… represents an interim goal where future development after 2050 is still undecided.
4.1

Classification and meaning

The net-zero target means that greenhouse gas emissions must achieve a balance between sources
and removal by 2050 at the latest. The target covers all internationally governed greenhouse gases. In
addition to CO2, it also includes methane (CH4) and nitrous oxide (N2O) as well as certain synthetic
greenhouse gases. This is of particular significance because the methane and nitrous oxide emissions,especially in agriculture, are difficult to avoid or cannot be completely avoided as things currently stand.
The target covers all sectors in the greenhouse gas inventory: energy (1), industrial processes andproduct use (2), agriculture (3), land use, land use changes and forestry (LULUCF) (4), waste (5) andother (6).19 In its counter-proposal to the 'Glacier Initiative' (see Section 6.3), the Federal Council proposed also including emissions from international aviation20 and international shipping in the target in

17'Highest possible ambition' according to the Paris Agreement (Art. 4 para. 3)
Federal Council press release of 28.8.2019, can be viewed at: https://www.bafu.admin.ch/bafu/en/home/topics/climate/newsreleases.msg-id-76206.html
19
The figures in brackets refer to the corresponding categories in the greenhouse gas inventory in accordance with the provisions of the UNFCCC.
20
In 2018 greenhouse gas emissions from international aviation stood at 5.7 million tonnes of CO2eq according to the greenhouse gas inventory. The emissions are based on the aviation fuel used in Switzerland for international flights. This figure does
not include the indirect climate effects of aviation, such as its impact on cloud formation (see Section 8.4).
18

13

future, provided this is feasible scientifically and technically in line with the data in the greenhouse gas
inventory. These emissions sources are not included in Switzerland's current reduction target.
Net zero serves as a target value because Switzerland cannot reduce its emissions completely to zeroin all sectors by 2050. The generation of greenhouse gases is technologically unavoidable as things
stand in food production, in agriculture and in certain industrial processes, such as cement manufacture
or waste incineration. These technically unavoidable emissions – assuming no alternatives are available
or the emissions cannot be reduced in another way – must be balanced through the use of technicaland natural removal or through emissions-reducing measures abroad.
The net-zero target for all greenhouse gas emissions can simply be referred to as 'greenhouse gas
neutrality'. It refers, based on international reporting standards, to national greenhouse gas emissions,which means that the territorial or point of sale principle (for transport fuels) applies.21 Emissions that
Switzerland generates abroad are not included in the reporting parameters of Switzerland's net-zerotarget. However, the climate goals of the Paris Agreement can only be achieved if these emissions arealso reduced. These emissions must therefore be covered by the reduction targets of other countries.
Achieving the net-zero target will require a comprehensive and rapid reduction in domestic greenhousegas emissions. Buildings and road traffic must become almost or completely free of fossil emissions.
Greenhouse gas emissions must also be reduced in industry and the waste sector as far as technicallyfeasible. The emission of synthetic greenhouse gases, which are used in cooling systems for example,
must also be restricted to a minimum. Agriculture must utilise its full capacities – for example in manureand soil management and livestock farming – to reduce the emissions of methane and nitrous oxide.
Additional potential lies in the development of less greenhouse-gas-intensive foodstuffs in which Swisscompanies are playing a leading role. The potential for reducing emissions in international aviation mustalso be exploited. The net-zero target requires the use of technologies to capture and store (CCS) or,in some cases, utilise CO2 (CCU), particularly at large, fixed-location point sources, such as incineration
facilities and cement factories. The net-zero target also requires the use of negative emissions technologies to balance the remaining emissions that are difficult to avoid technically (see Section 8.9).
The reduction of global CO2 emissions to net zero by the middle of the century and the simultaneouscomprehensive reduction of the other greenhouse gases is the only way of limiting global warming to
below 1.5° Celsius, according to the scientific evidence. Switzerland's net-zero target is in line with therequirements of the Paris Agreement according to which developed countries should reduce their emissions to net zero more quickly than developing ones. Switzerland possesses the required capabilities
and is well positioned by international comparison to systematically implement the transition to net zero.
The completely revised CO2 Act plays a key role in this respect.
An internationally coordinated climate policy that meets the goals of the Paris Agreement is essential
for Switzerland. Switzerland is already being severely affected by the impacts of climate change today.
It therefore has a strong interest in the international community taking joint action and the major emitters
also setting and implementing ambitious reduction targets. Only by adopting this approach can the required technologies be developed, produced and applied to the extent required. Switzerland is reliant
on this global technological progress and its application to attain its target. Switzerland can only credibly
call for robust framework conditions and a reduction in emissions at international level if it is implementing the measures required itself. Measures at national level and efforts at international level must therefore go hand in hand.
4.2

Domestic and foreign shares of reductions

The Long-Term Climate Strategy leaves open the level of the domestic and foreign shares of the emissions reductions required by 2050. In the completely revised CO2 Act, Parliament set the ratio between
domestic and foreign reductions to at least three quarters versus a maximum of one quarter for 2030
(see Section 6.1). The principle of the highest possible ambition, to which the contracting parties to theParis Agreement are committed, means that domestic greenhouse gas emissions should be reduced
as far as possible. The inclusion of measures abroad is particularly beneficial during a transition period
to obtain flexibility and time so that regular investment cycles for infrastructure renewal can be used.

21

14

The point of sale principle applies to transport fuels. The emissions are attributed to the country where the fuel is used.

Reduction measures abroad are also an option long-term. The potential for measures abroad is nevertheless set to decrease as all countries must continuously reduce their greenhouse gas emissions toward net zero under the Paris Agreement. Their willingness to favourably assign allowable reduction
options to other countries is likely to decrease, while the investment required to reduce the remaining
emissions will increase. This means the prices for reductions abroad are set to rise long-term. Over the
short and medium-term, reductions abroad can nevertheless provide support for partner countries andfoster knowledge and technology transfer. The same quality requirements and environmental and social
standards should apply to reduction efforts both domestically and abroad.
Climate change is a global phenomenon that does not recognise national borders. If Switzerland's responsibility for climate change is viewed from an international perspective, it is evident that around twothirds of Switzerland's greenhouse gas footprint is generated abroad (see Section 3.2).22 Switzerland,
which is a technologically advanced and innovative country, can contribute towards establishing andexpanding the use of low-emission technologies and processes in developing countries. Such commitment abroad therefore remains important. Internationally Switzerland advocates binding and effective
rules on the allowability of reductions abroad (Article 6 of the Paris Agreement) and is already considering bilateral cooperation with various states. In this respect, the Federal Council approved an agreement with Peru23 – the first of its kind in the world – on 14 October 2020 and an agreement with Ghana24
on 18 November 2020.
Negative emissions technologies can generally be used both in Switzerland and abroad. Participationin relevant projects abroad can be worthwhile whereby the same requirements in terms of social acceptability and environmental sustainability as in Switzerland must be ensured. The framework conditions
for allowability must be governed at international level. In view of uncertainty over the potential, costs
and risks of negative emissions technologies, the comprehensive reduction of emissions in Switzerland
is essential if the net-zero target is to be met.
5

Strategic principles of the Long-Term Climate Strategy

The Long-Term Climate Strategy outlines how the net-zero target can be achieved by 2050. Building on
the progress achieved by the complete revision of the CO2 Act, the climate strategy shows emissions
developments, targets and the related challenges, going beyond the year 2030 and for the various sectors. The relevant future legal framework conditions can be defined on this basis.
The Long-Term Climate Strategy faces a major challenge: while the global target status is clearly definedscientifically and is bindingly laid down in the Paris Agreement, significant uncertainty exists over implementation. Forecasting technical developments is challenging. The effects of various instruments on theeconomy and society can only be predicted in general terms long-term. The scientific basis in all theseareas must therefore be improved over the coming years. The course towards a low-greenhouse-gas
future must nevertheless be set today despite the existing uncertainties. The greatest possible room formanoeuvre should also be maintained: there must be scope for new models of thinking and action insociety, the economy and technology as well as their development. Options, structures and requirements may change over the next 30 years, for example with new forms of work, living and mobility.
The Long-Term Climate Strategy marks the beginning of this process. It outlines the Federal Council'sviews on the direction of Switzerland's long-term climate policy and, in an initial step, sets out ten overarching strategic principles which are crucial to attaining the net-zero target from a present-day perspective. These principles aim to provide guidance for climate policy but also other related policy areas. They
are key elements on the path to net zero but provide the greatest possible room for manoeuvre.

22

According to the Federal Statistical Office, just under two-thirds of Switzerland's total greenhouse gas footprint is generated
abroad, see https://www.bfs.admin.ch/bfs/en/home/statistics/territory-environment/environmental-accounting/air-emissions.html.
The FOEN uses a slightly different method in its estimations, but includes a similar Switzerland/abroad ratio.
23
Federal Council press release of 20.10.2020 can be viewed at https://www.bafu.admin.ch/bafu/de/home/themen/klima/mitteilungen.msg-id-80791.html.
24
Federal Council press release of 23.11.2020 can be viewed at https://www.bafu.admin.ch/bafu/de/home/themen/klima/mitteilungen.msg-id-81266.html.
15

Principle 1:
Switzerland will seize the opportunities presented by a systematic transition to net zero
Systematic alignment with the net-zero target presents major opportunities for Switzerland as a centreof research and innovation. These opportunities must be seized. Switzerland can play a leading role inthe development of new, low-emissions technologies, processes and solutions and thus enhance its
competitive position – both in the real economy sectors as well as in the financial sector. This will benefit
not only climate protection, but also the export industry. The goal of cutting emissions to net zero by2050 sends out a clear message on the alignment of this innovation capability. It also encourages Swiss
research and innovation actors to contribute to attainment of the target. In addition to the developmentof new technologies to reduce emissions, research can also support the transition to net zero with findings from interdisciplinary and transdisciplinary projects.
Principle 2:
Switzerland will assume its climate policy responsibility
Switzerland is dependent on the commitment of other states in climate policy. It can only credibly callupon others to demonstrate this commitment if it is implementing the required measures itself. Switzerland therefore relies on the principle of common but differentiated responsibilities and different capacities (see Section 2.2) and will systematically pursue its path towards the net-zero target by 2050. In thisway, it will also make its contribution to the global efforts on limiting global warming. It will also systematically pursue the two other goals of the Paris Agreement, i.e. improving adaptability to a changed
climate and making financial flows consistent with climatic sustainability. Switzerland also supports the
reduction of direct and indirect subsidies for fossil energies.
Principle 3:
Reducing emissions in Switzerland will take priority
Switzerland wishes to achieve some of its reduction by 2030 abroad. This share achieved abroad is tobecome increasingly less long-term. The contributions to the net-zero target to be achieved in Switzerland and abroad have been left open by the Federal Council. However, the key to attaining the net-zerotarget most probably lies in reducing emissions in Switzerland. Avoidable emissions must be completely
eliminated as far as possible by 2050. This means that fossil heating and motor fuels can only be usedin clearly defined exceptional cases. Remaining emissions will be balanced by negative emissions technologies. These technologies will supplement the comprehensive emissions reduction. Owing to theirlimited potential, negative emissions technologies should be reserved for emissions that are difficult to
avoid technically. Switzerland will also endeavour not to relocate emissions abroad as far as possible(carbon leakage). To the extent that this is compatible with international trade obligations , no electricity
produced with fossil energies is to be used for power-based applications.
Principle 4:
The emissions will be reduced across entire value chains
Goods and services imported into Switzerland cause greenhouse gas emissions elsewhere in the world.
The aim is to structure the framework conditions in such a way that the production of and demand forgoods and services across the entire value chain cause as little environmental pollution as possible andgenerate the lowest possible greenhouse gas emissions.
The Swiss Confederation, the cantons and the communes will conserve natural resources and step up
their efforts to apply the principle of a circular economy within the scope of their responsibilities andcapabilities. This will also contribute towards reducing environmental pollution abroad. If materials areused for longer, their quantities are reduced, they are replaced by lower-emissions alternatives andreused, emissions will be cut across the entire value chain.
Principle 5:
All energy sources will be used efficiently taking account of their optimal utilisation
In addition to completely avoiding fossil heating and motor fuels as far as possible and the rapid expansion of renewable energies, the efficient management of all energy sources is a further key element intarget attainment. On one hand, this means that the potential available to improve energy efficiency andto reduce energy consumption is to be harnessed in all sectors. On the other, the energy sources available should be used as efficiently as possible. They should be used on a cross-sector basis where they16are optimal for the application. Energy sources that are scarce or expensive to produce (e.g. syntheticenergies) should be used where alternatives are difficult to find and there are no other solutions.
Principle 6:
The Swiss Confederation and the cantons will gear their planning activities to the net-zero target in all climate-relevant areas
A key requirement for attaining the long-term climate goals is avoiding mis-investment: buildings andinfrastructure have a long lifespan and are in use for many years. If such infrastructure is constructed
and maintained with emissions-intensive building materials and operated with fossil energies or encourage the use of fossil energies, they will cause emissions over the long-term. The Swiss Confederationand the cantons are therefore required to ensure careful planning activities geared to the climate goals.
This applies in particular to spatial and transport planning, urban development and energy planning.
New legal provisions and investment projects should also be verified for compatibility with the net-zerotarget and climate protection should be incorporated into all relevant policy areas and strategies.
Principle 7:
The transition to net zero will be carried out in a socially acceptable way
The Swiss Confederation – together with the social partners, the cantons and the communes – will
ensure that the transition to the net-zero target is carried out in a socially acceptable way. Additional
financial burdens for low-income households or particular regions will be avoided or mitigated with appropriate measures. Infrastructure will be planned with a view to facilitating the transition to net zero forthe population.
Principle 8:
The transition to net zero will be carried out in an economically viable way
The Swiss Confederation will ensure that the transition to the net-zero target is carried out in an economically viable way, cost-efficiently and in line with the polluter-pays principle as far as possible andcontributes to the internalisation of external costs. It will establish clear framework conditions so thatinvestment and renewal cycles can be systematically used to avoid mis-investment and to largely replace fossil energies. It will also ensure that sectors and companies facing international competition do
not suffer any disadvantages vis-à-vis their competitors.
Principle 9:
The transition to net zero also improves environmental quality
In addition to the climate, there are also major challenges in other areas of the environment. Attaining
the net-zero target should therefore go hand in hand with greater conservation of other environmental
resources. Many synergies exist, for example in the areas of air quality and biodiversity. However, interests must also be weighed up. Climate protection should not come at the expense of other environmental areas but should be compatible with them and support measures aimed at improvements.
Principle 10:
The Long-Term Climate Strategy is based on the principle of openness to all types of technology
Long-term technological, economic and social developments can only be predicted with a large degreeof uncertainty. As much political room for manoeuvre as possible should therefore be maintained. The
Long-Term Climate Strategy is open to all types of technology. It is based on a broad understanding oftechnology. As well as digitalisation, material sciences and engineering, new farming methods in agriculture, operational and organisational improvements and social and cultural innovations also play animportant role. In relation to negative emissions technologies, the strategy takes account of the limited
availability of suitable CO2 storage sites and the fact that suitable processes are not yet available to theextent required. Negative emissions technologies should therefore only be used on the condition thatno greenhouse gases from fossil energies which could be avoided through technical measures will beemitted by 2050 at the latest.
6

Switzerland's climate legislation

The CO2 Act and the related CO2 Ordinance are the legal basis of Switzerland's climate policy. They set
out the targets, instruments and responsibilities for implementation and enforcement. The CO2 Act also17

transposes the international climate policy obligations (Kyoto Protocol, Paris Agreement) into nationallaw. In addition to the CO2 Act, measures from other sector policies and legislation also contribute toemissions reduction, particularly in the areas of the environment, energy, agriculture, forestry and timber
management and voluntary measures.
6.1

Complete revision of the CO2 Act

In autumn 2020, a complete revision of the currently valid CO2 Act was adopted which – subject to theoutcome of the referendum – is set to enter into force in 2022 together with the applicable implementing
provisions. The Act will make a contribution to the goals of the Paris Agreement, namely restricting
global warming to well below 2° or 1.5° Celsius, to improving adaptability and making financial flows
consistent with climatic sustainability. The Act's purpose article also explicitly stipulates the objective ofbalanced climate performance.25
The revision of the Act aims to halve Switzerland's greenhouse gas emissions by 2030 compared with
1990. At least three-quarters of the reduction should be achieved in Switzerland and a maximum of one
quarter abroad. The CO2 Act also requires further reductions to be achieved abroad which cannot be
included in the reduction target, and namely in the level of emissions that imported goods and services
generate elsewhere in the world. In this way, Switzerland will undertake additional efforts to limit global
warming to 1.5° Celsius.
The revision of the Act builds on the exisiting set of measures in the buildings, transport and industry
sectors and also incorporates the field of aviation. Long-term perspectives have already been adopted
with various measures. They not only put Switzerland on course to halve emissions by 2030, but also
have a long-term impact in relation to the net-zero target by 2050. The complete revision provides forthe following measures:A Climate Fund will be set up to finance climate protection measures. They will include measures
to cut CO2 emissions from buildings and the funding of technologies and other measures to reducegreenhouse gas emissions. This covers the promotion of measures aimed at innovative and direct
reduction of the climate impacts of aviation, climate-friendly cross-border passenger transport (suchas night trains) and measures undertaken by the cantons and communes. The current technology
fund, which guarantees loans to innovative companies, will also be incorporated into the Climate
Fund. These guarantees enable banks to make more debt capital available for the rollout and marketing of new technologies. However, the Climate Fund can also provide support in earlier phasesof the innovation process and, for example, support pilot, demonstration and flagship projects. The
development of climate-friendly technologies is the key to the transition to net zero. The Climate
Fund will receive a third of the revenues from the CO2 levy on fossil-based heating fuels – up to a
maximum of 450 million francs – and just under half of revenues on levies on air travel. The Climate
Fund will also fund measures to prevent damage caused by climate change. Half of the compensation payments made by vehicle importers who fail to meet their CO2 target, further penalty revenues
and income from the auctioning of emissions rights will also be available.



The CO2 levy on fossil-based heating fuels intended as an incentive tax encourages the economicaluse of fossil energies and greater conversion to low-CO2 and CO2-free energies. Two-thirds of therevenues will be returned to the population and the economy which also makes them socially acceptable. As an impact analysis conducted on behalf of FOEN shows, the CO2 levy has resulted insignificant reductions in emissions since its introduction.26 It should therefore be continued using thesame mechanism as today. Depending on the development of emissions from fuels, the levy rate
may be increased from 96 francs per tonne of CO2 at present to a maximum of 210 francs per tonneof CO2 by 2030. The maximum rate possible under the currently applicable law of 120 francs per
tonne of CO2 did not have to be applied. If emissions are reduced to a sufficient degree, the maximum rate will not have to be used in future either. The CO2 levy contributes to the decarbonisationof the heating supply system by making the replacement of fossil-based heating systems with emissions-free alternatives more attractive. This gradual and potentially complete replacement over thelong term is a key requirement for attaining the net-zero target.

25
26

18

Federal Act on the Reduction of Greenhouse Gas Emissions (CO2 Act) of 25 September 2020, Federal Gazette 2020 7847.
Ecoplan (2017).



The buildings programme will be continued indefinitely and will now be managed by the Climate
Fund. Through overall contributions to the cantons, it supports energy-related renovation, the useof renewable energies, building technology and new replacement buildings. It will benefit, for example, homeowners wishing to improve their property's insulation. In addition to the buildings programme, the Swiss Confederation can now provide direct support for the replacement of fossilbased heating systems or guarantee investments in climate-friendly building improvements. To promote electric mobility, contributions for the installation of charging stations in apartment blocks andmulti-family buildings and other multi-party developments are provided for. To drive forward theintroduction of district heating networks, investments in the construction or expansion of heating
networks and heat generation systems can be guaranteed. The Climate Fund can also make acontribution to communes for spatially coordinated energy-relating planning and support production
plants for renewable gas. The buildings programme and the additional measures will contribute, on
one hand, towards ensuring the energy consumption of buildings falls further towards the technicallyfeasible and economically viable minimum. On the other, they will support renewable energies andthe installation of local and district heating systems as a replacement for inefficient, decentralised
solutions in the field of heating.

Responsibility for the energy-related buildings measures lies primarily with the cantons. In accordance with the completely revised CO2 Act, they should ensure that the CO2 emissions of the building
stock falls by half on average by 2026 and 2027 compared to 1990. The cantonal building regulations based on the model energy regulations for the cantons (MuKEn) should make the main contribution in this respect. The 'MuKEn' and their future development will also create incentives for
replacing existing buildings that no longer meet the future requirements with new ones that comply
with the current standards. This will also create opportunities for urban densification, the modernisation of the building stock and CO2-free energy supply.

With the complete revision of the CO2 Act, new binding limits will apply for buildings Switzerlandwide from 2023. The Act differentiates between existing and new buildings. New buildings constructed from 2023 must no longer generate any CO2 emissions. In contrast, existing buildings cancontinue to emit CO2. The Act takes account of the transition being easier in new buildings. However, the Act defines limits where new heating systems are installed in existing buildings. From2023, the target after the replacement of a heating system stands at a maximum of 20 kilograms of
CO2 a year per m2 of energy reference area. This target value falls in five-year increments by fivekilograms of CO2 per m2 a year and, as a result, will stand at zero in 2043. The limits lay the foundation for CO2-neutral building stock long-term. In cantons, which had brought into effect Part F ofthe basic module of the 'MuKEn 2014' or a more stringent regulation in relation to the share of
renewable energy in the replacement of heating systems by the entry into force of the CO2 Act, theseprovisions will apply from 2026.

The CO2 levy on fossil fuels also covers industry. However, the CO2 Act takes account of economic
viability. Much of industry receives a full refund on the CO2 levy and in return is subject to other
instruments:

19oCompanies in sectors of the economy whose competitiveness is adversely affected by theCO2 levy can obtain exemptions from the duty. In return, they make a commitment to the
Swiss Confederation to reduce their emissions. The new CO2 Act is to make this option
available to all companies. Only measures whose costs can be recouped within four years
through savings will be required. The period is eight years for building measures. Operatorsof combined heat and power plants (CHP) can also obtain exemptions from the CO2 levy
on fossil fuels which they use for power generation provided they commit to investment inefficiency measures. The CO2 duty and the reduction obligations will contribute to reducing
avoidable emissions, particularly those from the generation of process heat, at the samepace as technical progress and the availability of renewable energies. Both instruments will
pave the way for the gradual decarbonisation of industry.

oLarge emitters, such as the cement, glass, ceramics, paper and chemicals sectors, will participate in the emissions trading system (ETS) and are also exempt from the CO2 levy. The
ETS provides a market where emission rights can be traded. One emission right entitles theholder to the emission of one tonne of CO2. The total amount of emission rights is limited.

The ETS participants are assigned some free emission rights. Emission rights can be purchased or sold on the trading system. This incentivises the major emitters to undertake
measures to reduce their greenhouse gas emissions. In total, over 50 plants in Switzerland
are included in the ETS. Switzerland's emissions trading has been linked with that of theEU since 2020. This gives Swiss companies access to the European market for emission
rights. Flights within Europe are also covered by emissions trading in the same way as in
the EU. The emission rights available will be reduced by 2.2 per cent each year. The instrument is therefore geared towards the net-zero target long-term. If greenhouse gases arecaptured at the point of origin using carbon capture and storage (CCS) or removed from theatmosphere by negative emissions technologies (NET), they can be included in the ETS as
an emissions-reduction measure.


Any new fossil-thermal power plants constructed in Switzerland will be subject to emissions trading.
In line with EU regulations, they would not be assigned any free emission rights but would instead
have to purchase them at auction or on the secondary market. Diverging from the EU, the CO2 price,which they must pay at the minimum, should be in line with external costs.

Incinerators of waste are currently excluded from emissions trading. In return, they entered into a
sector agreement that is valid until the end of 2021. They undertook to make indirect emissions
savings by increasing power and heat production and recycling more metal from slag. If a new sector
agreement is concluded for the period from 2022, the incinerators will remain excluded from emissions trading. The sector is already focusing intensively on CCS and NET with a view to carbonneutral operation and is driving forward the implementation of the first specific projects.



If plants, which generate large volumes of greenhouse gas emissions, are newly constructed or
upgraded, the operator will now ensure climate-friendly operation as far as possible. All possible
technical and operational measures to reduce emissions must be taken into account as part of theenvironmental impact assessment. This counteracts the construction of additional new, potentiallylong-life infrastructure operated with fossil energies and emissions-intensive plants.



A CO2 emissions target value of 130 grams of CO2 per kilometre on average applied to new carsfrom 2013 in line with EU regulations. A target value of 95 grams of CO2 per kilometre on average
has applied since 2020. Delivery vehicles and light articulated vehicles are also subject to emissions
regulations for the first time (average target value of 147 grams of CO2 per kilometre; target values
according to the New European Driving Cycle (NEDC)). With the complete revision of the CO2 Act,target values for cars and light commercial vehicles will fall in line with the EU from 2025 by a further
15 per cent, from 2030 by 37.5 per cent for cars and 31 per cent for light commercial vehicles. Emissions regulations for heavy commercial vehicles will also apply from 2025 also based on EU regulations. Vehicle importers who fail to meet the target values must make compensation payments.
The emissions regulations incentivise importers to import more efficient vehicles and to increase theshare of hybrid and electric vehicles. The emissions limits are a key instrument on the path to greenhouse-gas-free transport in view of the development beyond 2030 already defined. Compliance with
the CO2 targets requires an increasing share of low-emission drive systems. The effectiveness of
this mechanism is already evident: newly registered electric cars (battery-powered electric vehicles
and plug-in hybrids) reached a new record high in Switzerland in 2019 with a share of 5.6 per cent.
The trend also continued in 2020. The share of electric vehicles stood at 12.1 per cent in the firstten months with the target of 10 per cent – which the industry association 'auto-schweiz' set itself
for 2020 – already being surpassed.



Manufacturers and importers of fossil fuels are obliged to compensate some of the CO2 emissions
from transport. In 2020, the share to be compensated for stood at 10 per cent. The fuel importers
can pass on the costs of the compensation measures to consumers under the applicable law with amaximum surcharge of five centimes per litre of fuel. With the complete revision of the CO2 Act, thecompensation component can be set within a range of 15 to 90 per cent after consultation with thesector. As a result, the CO2 emissions from transport will be largely offset by compensation
measures. Compensation abroad is now also allowable whereby the minimum reduction in Switzerland must initially amount to 15 per cent, rising to 20 per cent from 2025. These requirements will
result in an increase in investment in climate-protection measures. To take account of fuel importers
passing on the costs to consumers, the completely revised CO2 Act sets a ceiling for the surcharge.

20

This cannot exceed 10 centimes per litre up to 2024 and 12 centimes per litre from 2025. The compensation obligation also applies to around 4 per cent of aviation fuels, which are used in Switzerland for national and international flights and that are subject to mineral oil tax.


Biogenic fuels can replace gasoline and diesel, thus reducing CO2 emissions from transport. Mineral
oil tax relief will continue to be granted on biogenic fuels until the end of 2023 provided environmental and social requirements are met. Their use will subsequently be supported by fuel importers
subject to compensation obligations. The CO2 compensation obligation has resulted in a sharp increase in the share of biogenic fuels over recent years. The complete revision allows vehicle importers to now include synthetic fuels in the calculation of the CO2 emissions of the new vehicle
fleet.

In public transport, disincentives to switch from diesel-fuelled buses to buses with lower greenhousegas emissions will be eliminated as the partial mineral oil tax rebate for licensed transport companies
gradually expires: initially in local transport from 2026, and also in regional passenger transport from2030 unless topographical conditions prevent climate-friendly alternatives. The additional revenues
from the mineral oil tax are earmarked for promoting CO2-neutral, renewable drive technologies.

Two new steering levies are provided for in aviation. At least half of the revenues will be redistributed
to the population and economy. Up to 90 per cent of the population could benefit depending on the
structure.27 A ticket levy will be introduced on scheduled and charter flights where the level can bevaried within a range of 30 to 120 Swiss francs depending on distance and class of travel. A levy of
500 to 3,000 francs will be levied for business and private flights. The levy amount depends on theflight distance, take-off weight and competitiveness of the airports. Airlines which achieve significant
emissions reductions can benefit from a lower rate for both levies. This provides them with an incentive to use more renewable fuel, for example. Support with innovative measures to reduce climate impact in aviation can also be provided by the Climate Fund which will receive less than halfof the revenues from the flight levies.

In relation to financial flows, the completely revised CO2 Act ensures greater transparency oversupervision. The Swiss National Bank and the Swiss Financial Market Supervisory Authority will
have to report regularly on climate-related risks.

The measures adopted will reduce greenhouse gas emissions in Switzerland by just under 38 per centby 2030 compared with 1990 if implemented systematically. As this Long-Term Strategy outlines in
Section 9, a reduction in emissions in Switzerland of around 88 per cent can be achieved by 2050 compared with 1990. The completely revised CO2 Act puts Switzerland on this reduction pathway. The revised Act is set to enter into force in 2022.
6.2

Further measures in other sector policies

In addition to the CO2 Act, further pieces of legislation and sector policies also contribute to reducing
greenhouse gas emissions.
For the agricultural sector, which caused 14.2 per cent of greenhouse gas emissions in Switzerland in
2018, the Federal Council adopted its message on the future development of agricultural policy from202228 on 12 February 2020 and introduced steps to reduce methane and nitrous oxide emissions.
Specific reduction pathways and interim targets are also to be set in the implementing provisions for thecomplete revision of the CO2 Act. In the related message, the Federal Council proposed a domestic
reduction contribution for the agricultural sector of 20 to 25 per cent by 2030 compared with 1990. Thistarget is derived from the Climate Strategy for Agriculture in which the Federal Office for Agriculture
assessed the potential for reducing emissions in the food and agriculture sectors in 2011. According tothis climate strategy, emissions in agriculture can be cut by a third by 2050 compared with 1990. If thepotential of the agricultural and food sectors is fully harnessed, a reduction of up to two-thirds can beachieved according to the Climate Strategy for Agriculture.29

27

Sotomo Research Institute (2020).
Message on the future development of agricultural policy from 2022 (AP22+), Federal Gazette 2020 3955
29
FOAG (2011).
28

21

In addition to the technical measures and financial incentives that the Federal Council proposed in its
Message on Agricultural Policy 2022+, greater emphasis is also being placed on the production andconsumption of food. The Federal Council is also currently focusing on information, individual responsibility and improving the framework conditions. Closely related to this is the avoidance of food waste.
The Federal Council is currently drawing up an action plan in fulfilment of a postulate.30
The Energy Strategy 2050, which aims to transform energy supply, makes a major contribution to attaining the climate policy goals. A significant expansion of renewable energies – such as hydropower,
photovoltaic systems, biomass, geothermal energy and wind energy – is planned in the field of power
generation. In addition to efficiency measures, more domestic renewable energies are to replace fossil
energies in the area of heating. To consolidate the expansion of renewable energies, the Federal Council wishes – based on the results of a consultation procedure on an amendment to the Energy Act – topartially extend the support to 2035, on one hand, and to give it a more competitive structure on theother. It also wishes to turn the statutory limits for electricity generation from hydropower and otherrenewable energies of at least 54.4 TWh for 2035 into binding targets and to also define targets for2050. By opening up the electricity market to all customers, the Federal Council also intends to better
integrate renewable energies into the market and to strengthen the position of decentralised electricity
production to enable innovative services, such as district system solutions and electric mobility packages, to be created.
To drive forward the electrification of transport, the Swiss Confederation, together with the cantons,
communes and various industry representatives, signed a joint roadmap to promote electric mobility on
18 December 2018. This aims to increase the share of electric vehicles amongst newly registered cars
to 15 per cent by 2022. Electric vehicles also enjoy various benefits. They are exempt from automobile
duty, do not fall under mineral oil tax and in some cantons enjoy preferential treatment with regard tocantonal tax on vehicles. Federal government supports the expansion of the network of charging stations
to improve the infrastructure. The Federal Council approved the report "Voraussetzungen für ein
Schnellladenetz für Elektroautos auf Nationalstrassen" (Requirements for a fast-charging network forelectric vehicles on national highways) on 28 June 2017. The report outlines how the set-up of a fastcharging network can be driven forward.
In addition to future drive systems, traffic avoidance and the modal shift also play a key role in the
decarbonisation of transport. This also includes improved harmonisation of urban development andtransport. Spatial planning coordinated with public transport infrastructure and the intelligent networkingof all individual systems will enable the further promotion of lower-CO2 mobility. This also contributes tooptimal efficiency of the overall transport system which DETEC has set itself as a target for 2040.31 The
approval of the counterproposal to the 'Bike Initiative' by the Swiss people on 23 September 2018 also
gave the Federal Council a mandate to lay down the key principles for cycle path networks. Responsibility for planning, construction and maintenance remains with the cantons while the Swiss Confederation can provide support through subsidiary measures.
Various federal government strategies are also closely related to climate and support climate policy
objectives. The 2030 Sustainable Development Strategy (SDS 2030) by the Federal Council will set out
the medium to long-term priorities for sustainable development. It also outlines Switzerland's contribution to the Sustainable Development Goals (SDGs). Great importance is attached to climate policy. The
SDS 2030 includes the thematic area of climate, energy and biodiversity as one of three priorities andrefers to climate policy goals for 2030 and 2050. A further priority is 'consumption and production' which
underlines the need for transformation towards a sustainable food system.32
International cooperation also aims to cut emissions in value chains abroad despite these emissions notcounting towards the Swiss climate target. The new CO2 Act nevertheless states that Switzerland should
also contribute towards reducing emissions abroad and to the extent that it offsets the emissions it
causes. According to the International Cooperation Strategy 2021–24, international cooperation resources in the field of climate change will be gradually increased from 300 million francs a year (2017–20) to around 400 million francs per year by the end of 2024. To encourage the private sector to make30

18.3829 Chevalley postulate. Action plan to combat food waste.
DETEC (2017).
32
The SDS 2030 was still in the consultation procedure when the Long-Term Climate Strategy was adopted. See
https://www.are.admin.ch/sne.
31

22

climate-friendly investments in developing countries, Switzerland will promote partnerships, including at
multilateral level, which will aim to mobilise private funds. In addition to the specific programmes, theissue of climate change is also covered by most international cooperation programmes.33
The Forestry Policy 2020, the New Growth Policy 2016–19, the Foreign Policy Strategy 2020–23 andthe Digital Switzerland Strategy are also of importance. The Federal Council also duly noted the report
entitled "Massnahmen des Bundes für eine ressourcenschonende, zukunftsfähige Schweiz" (Swiss
Confederation measures for a resource-saving, future-oriented Switzerland) in June 2020 and will propose measures to improve the conservation of resources and recycling on the basis of it.34
6.3

Popular initiative 'For a healthy climate (Glacier Initiative)'

The 'For a healthy climate (Glacier Initiative)', submitted at the end of November 2019, seeks to enshrine
the objectives of the Paris Agreement in the constitution. It calls for Switzerland to reduce its greenhousegas emissions to net zero by 2050 at the latest. According to the initiative, no fossil heating and motor
fuels can be sold from 2050 whereby exemptions are permitted if no technical alternatives are available.
The remaining emissions are to be balanced by safe greenhouse gas reductions in Switzerland. This
also applies to the climate impacts of international aviation. The initiative also calls for the definition ofa reduction pathway, including interim goals, at legislative level which will, at the minimum, ensure alinear reduction of greenhouse gas emissions by 2050.
The Federal Council decided to submit a direct counterproposal to the initiative,35 in which it supports
the main requirements of the initiative, namely enshrining the net-zero target in the constitution and thewithdrawal from fossil energies. In contrast to the popular initiative, the Federal Council does not wish
to ban fossil energies. Their use should continue to be permitted provided this is necessary for reasonsof national security, the protection of the population or economic viability. Under this proposal, exemptions would also be possible if alternative energies are too expensive and would have an adverse impact
on competitiveness. This may be the case in aviation, for example. According to the Federal Council –in agreement with the popular initiative – its emissions should also be included in the net-zero target,
but only if this is scientifically and technically possible in line with the data in the greenhouse gas inventory.
In contrast to the initiative, the Federal Council does not wish to restrict this offsetting of the remaining
emissions through safe reduction of greenhouse gases to domestic reduction, but also wishes to permit
reductions abroad. Such flexibility is far-sighted in view of the limited potential in Switzerland.
7

Emissions reductions by 2050 according to Energy Perspectives 2050+

This and the following sections on the various sectors indicate how greenhouse gas emissions in Switzerland could develop so that the targeted net-zero goal can be attained. The emissions pathways arelargely based on the 'Energy Perspectives' of the Swiss Federal Office of Energy. They are supplemented by the estimates for sectors not covered by the Perspectives. In specific terms, this concerns
methane and nitrous oxide emissions in the agriculture (category 3 in the greenhouse gas inventory),
waste (category 5 in the greenhouse gas inventory), land use, land use changes and forestry (LULUCF
or category 4 in the greenhouse gas inventory) and other (category 6 in the greenhouse gas inventory)
sectors.
7.1

The basis of the Energy Perspectives 2050+

The Energy Perspectives help to estimate the long-term development of energy supply and demand in
Switzerland based on various assumptions and scenarios. The latest version from 2012 (Energy Perspectives 2050) formed the basis for reviewing and updating Swiss energy policy after the reactor accident in Fukushima. This revision resulted in the Energy Strategy 2050 and the new Energy Act which
entered into force on 1 January 2018. The possible long-term alignment of energy policy was set out inthe 'new energy policy' scenario which provided for the reduction of energy-related CO2 emissions to

33

The International Cooperation Strategy 2021–24 was still being drawn up when the Long-Term Climate Strategy was
adopted. See https://www.eda.admin.ch/IZA2021-2024.
34
FOEN (2020).
35
Federal Council (2020).
23

around 1.5 tonnes per capita a year by 2050 as an overarching strategic goal. If the population increased
to around 10 million, around 15 million tonnes of CO2 would still be emitted by 2050.
The Energy Perspectives 2050 were comprehensively revised, not least taking account of this LongTerm Climate Strategy. The framework data was updated and the new climate policy requirements wereset as objectives. The time horizon of the Perspectives was also extended by ten years to 2060 ('Energy
Perspectives' 2050+ and subsequently referred to as 'EP2050+').36 The EP2050+ and its scenarios provide a comprehensive model basis for the first time that sets out the objectives of energy and climate
policy in an integral way, shows their implications and outlines the possible technological developments
and measures to attain them. It focuses on measures in Switzerland.
7.2

Scenarios of the EP2050+

The EP2050+ scenarios are based on a set of assumptions and are not a forecast strictly speaking.
They show possible emissions pathways for the individual sectors and contain two basic scenarios. The'net-zero' scenario (ZERO basis) describes a possible development of the Swiss energy system andthe resulting emissions on the path to the net-zero target by 2050. It is based on the trends of technological progress currently being observed, projects them in the future and shows the technological developments required for a reduction of emissions to net zero. It assumes a high increase in energy
efficiency at the earliest possible stage, the sustainably useable biomass potential being exhausted andthe energy system having a significantly higher degree of electrification, for example, as a result of theincreasing importance of electric mobility and electrical heat pumps. Synthetic heating and motor fuels
and hydrogen (electricity-based energy sources, power-to-gas/liquid/H2) play a slightly less significant
role but make major contributions in some sectors. These assumptions form the basis for what is called
the basis variant of the net-zero scenario which is focused on below.37
Further reduction pathways are conceivable depending on the development of technology. The
EP2050+ therefore contains three additional variants of the ZERO scenario, each with different technological priorities and measures in Switzerland.38 All variants are compatible with the net-zero target. Thismeans the energy-related greenhouse gas emissions will be reduced as far as technically possible.
Remaining emissions are generally only found in a few industrial sectors (e.g. geogenic emissions from
cement production), in recycling, agriculture and from the use of synthetic greenhouse gases. They must
be balanced with CCS or negative emissions technologies.
The 'Business as usual' (BAU) scenario serves as a comparative basis. This scenario reflects themeasures and instruments of energy and climate policy in force up to the end of 2018 and the current
market conditions and projects them in the future without any further tightening of measures. It also
carries forward current or presently foreseeable trends in efficiency increases of plants, installations,vehicles and systems into the future. The measures of the complete revision of the CO2 Act completed
in 2020, which were still undergoing parliamentary consultation when the scenarios were being drawn
up, are not included in the scenarios. The comparison of this scenario with the net-zero scenario reveals
the need for additional action required for target attainment by 2050 under the assumptions made. Additional investment requirements and cost increases or decreases can also be determined in the sameway. The integration of the measures of the completely revised CO2 Act into the 'Business as usual'scenario would result in a sharper decline in emissions in the 'Business as usual' scenario. This narrows
the gap to the ZERO basis scenario in terms of both emissions and additional investment requirements.

36

Prognos/TEP Energy/Infras/Ecoplan (2020).
The measures implemented in the models are selected on the basis of existing potential restrictions (spatial and temporal)
and technical feasibility. Additional criteria are cost efficiency, acceptance, security of supply and robustness of target achievement. For a more detailed discussion, see Prognos/TEP Energy/Infras/Ecoplan (2020).
38
Variant A is based on extensive electrification of the entire energy system. Biogas and synthetic gases (e.g. hydrogen) play amore important role in variant B in addition to electricity. Variant C attaches more importance to heating networks and fluid biogenic and synthetic heating and motor fuels. The results of the basis variant of the ZERO scenario are shown in the following
sections under the assumption of electricity requirements being met by Switzerland's own production in the annual performanceassessment by 2050 ('balanced annual performance' strategy variant, nuclear power station duration: 50 years).
37

24

7.3

Framework data and developments of the EP2050+

12

1200

10

1000

GDP in billion CHF 2017

8
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2010

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160

2015

Energy prices in USD 2017

2015

0
2010

0

2010

Population in millions

The framework for the long-term forecasts is based on economic and demographic developments.
These framework developments can be estimated based on Swiss Confederation forecasts or on national and international studies.

Figure 7: population developments, GDP, energy prices (in USD/bbl or USD/MWh), CO2 prices, heating and cooling degree days according to EP2050+. Source: Prognos/TEP Energy/Infras/Ecoplan (2020), partly unpublisheddetailed data.



39

25

The population will grow at an average rate of 0.9 per cent a year until 2030 and at an average of
0.4 per cent a year until 2050. Switzerland's permanent resident population will reach around10.3 million people by 2050.39

FSO (2015), reference scenario A-00-2015.



Economic output, measured in terms of gross domestic product (GDP), will rise at an average rateof 1.3 per cent a year until 2030 and then at an average of 0.9 per cent a year. This means GDP
will increase by around 38 per cent by 2050 compared to today.40

The energy price assumptions are based on the World Energy Outlook 2018 of the International
Energy Agency and differ depending on the scenario. In the 'Business as usual' scenario, the pricesof the fossil energies increase until 2060. In contrast, they fall in the ZERO basis scenario due tolower demand.41

The international CO2 prices in the European emissions trading system also develop differently
long-term based on the assumptions. In the ZERO basis scenario, a relatively sharp increase isrequired compared to today, whereas there is only a moderate rise in the 'Business as usual' scenario. 42

The development of the heating and cooling degree days is based on the Swiss Climate Scenarios
CH2018 (see Section 6). In the 'Business as usual' scenario, the development is based on scenario
RCP4.5 where the average annual temperature in Switzerland rises by around 1.8° Celsius by 2060
compared to the reference period of 1984 to 2002. The heating degree days fall by around 14 per cent
up to 2050 compared to this reference period, while the cooling degree days increase significantly. The
ZERO basis scenario is based on the RCP2.6 scenario. In this scenario the average annual temperature
climbs by 0.8° Celsius by 2060. The heating degree days decline by 11 per cent by 2050 compared withthe reference period and there is only a slight rise in the cooling degree days (all compared to thereference period 1984 to 2002).
The framework developments, in particular the international energy prices, must reflect a consistent'world' in the scenarios. This means Switzerland must pursue an internationally coordinated energy andclimate policy and not act independently to avoid providing any inventive to relocate emissions abroad.
The ZERO basis scenario applies the assumption that Switzerland's main trading partners, for example
the EU, are pursuing equally ambitious targets. In relation to climate policy, this means that all contracting parties are pursuing the goals of the Paris Agreement just as systematically as Switzerland and are
implementing appropriate measures. This requires international technological progress from which Switzerland also benefits.
7.4

Development of power supply according to the EP2050+

The EP2050+ shows the development of power supply in the context of the net-zero target (ZERO basis
scenario). The second key framework condition – in addition to the net-zero target – is ensuring secure
power supply at all times in future. The long-term development of demand for power is influenced by
two opposing effects. On one hand, the technical progress and the measures taken result in tangible
efficiency improvements, reducing demand for electricity. On the other, there are developments resulting
in greater demand for power, in particular the market penetration of electric vehicles and heat pumps aswell as the production of electricity-based energies, such as hydrogen, and the deployment of CCS.
Total gross power consumption (including the consumption of storage pumps and grid losses) rises toaround 84 TWh by 2050 in the ZERO basis scenario. This represents an increase of around 30 per centcompared to today. The EP2050+ shows how Switzerland can meet this demand on an annual averagewith its own production by 2050. Long term, Switzerland's power supply will be provided by hydropower
plants and other renewable energies. Generation by hydropower plants and other renewable energies(primarily photovoltaic systems) rises continually over the course of time. Electricity imports will be required in the annual balance during the transition period. The integration into the European power system via imports and exports always remains fundamentally important in order to meet power requirements seasonally and at all times. Figure 8 shows the development of power generation by technologies
based on the ZERO basis scenario of the EP2050+.
The significant renewable electricity production – particularly through photovoltaic systems – can be
integrated into the power system if the national grids have the required capacities. The anticipated high40

SECO (2018).
IEA (2018).
42
IEA (2018).
41

26

degree of flexibility in the Swiss power system helps in this respect: existing and new hydropower plants
and additional flexibility in power consumption can make significant contributions in future.
90
75

TWh

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Gross consumption

2035

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New hydropower
Existing fossil-fuel plants
Existing renewables
Net imports

Figure 8: Development of power generation by technology according to the ZERO basis scenario of the EP2050+(strategy variant 'balanced annual performance 2050', nuclear power plant term: 50 years). Source: Prognos/TEP
Energy/Infras/Ecoplan (2020)

8Strategic goals and challenges in the individual sectors

8.1

Buildings sector

For the 2050 time horizon, Switzerland is pursuing the following objective in the buildings sector to attainthe overall net-zero target for greenhouse gas emissions:2050 target: the building stock no longer generates any greenhouse gas emissions by 2050.

20
18
16
14
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0
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020
Total buildings

Households

Services

Sector targets

Figure 9: Emissions from the buildings sector in million tonnes of CO2eq. Source: Switzerland's greenhouse gas
inventory (FOEN 2020)

The buildings sector covers emissions from private households (category 1A4b of the greenhouse gas
inventory) and the services sector (category 1A4a). In 2018, greenhouse gas emissions stood at
11.2 million tonnes of CO2eq which is over 34 per cent below the level in 1990. The buildings sector has
met its sectoral goal for 2015 in accordance with the CO2 Ordinance (minus 22 per cent compared with1990). Under the revised CO2 Act, the cantons must ensure that emissions from buildings are 50 per
cent lower by 2026/27 than in 1990. These efforts and the measures set out in the revised CO2 Act can
reduce emissions by 65 per cent by 2030 compared with 1990.

27

The annual fluctuations in the historic emissions are attributable to weather conditions. Demand forheating – which still primarily comes from fossil-based sources – rises in years with colder winter temperatures. The emissions are higher in these years. The trend is reversed in years with relatively warm
winters.
Households

BAU

ZERO

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ServicesZERO

Figure 10: Emission developments of households (left) and the services sector (right) in Mt CO2eq based on the'Business as usual' and ZERO basis scenarios of the EP2050+. Source: Prognos/TEP Energy/Infras/Ecoplan
2020.

Figure 10 shows the possible development of emissions from households and in the services sector
according to EP2050+ to 2050. A reduction to zero for households is possible by 2050, but there are
low levels of remaining emissions from older infrastructure in the services sector. The comparison withthe 'Business as usual' scenario clearly shows that much greater efforts are needed to maintain the
reduction pathway towards net-zero emissions.
According to the EP2050+, the decarbonisation of the heating supply system is the first main lever for
reducing the greenhouse gas emissions of households. Heating supply will continue to make up thebiggest part of energy requirements long-term. It is mainly met today by heating oil and natural gas.
These fossil energies must be replaced by emission-free alternatives by 2050. Figure 11 shows thedevelopment of energy consumption in the ZERO basis scenario according to EP2050+.
300

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2010 2015 2020
OthersSpace heating
Process heat
Drives, processes

2025

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Hot water
Air con, ventilation and build. tech.
I&C, entertainment media
Lighting

0

Figure 11: Development of the energy consumption of households by energy source (left) and by use (right) in PJ
according to the ZERO basis scenario of the EP2050+. Source: Prognos/TEP Energy/Infras/Ecoplan 2020, unpublished detailed data.

The fossil energies are almost completely eliminated in the buildings sector by 2050. By contrast, theimportance of new renewable energies and district heating increases significantly. They meet – together
with electricity – almost all energy demand by 2050 despite the simultaneous increase in heated living
space (driven by population growth). This depends on future renovations and new buildings being much28

more efficient than today. These efficiency improvements are the second main lever. Heating demand
per m2 is set to fall by around 35 per cent in new single and multi-family homes in comparison with
2020–50, according to the EP2050+. Progress on a similar scale is required for renovations. Figure 11(right) also shows the proportionally dominant role of heating supply long-term and also its decline (inabsolute terms) compared to today. There is increasing energy demand mainly in the areas of air-conditioning, ventilation and building technology owing to the rising demand for air-conditioned living space.
Compared to space heating, this area nevertheless still accounts for a small share of energy demandof residential buildings. Electricity is also primarily used.
Renovation work must significantly increase over the coming years in order to replace fossil energies
quickly and fully. The frequency for energy-related renovations of building components (windows, façade, roof and flooring) then also increases significantly in the ZERO basis scenario. The renovation
rates in old building stock are 30 to 50 per cent higher than in the 'Business as usual' scenario. The
renovation rate for single-family homes rises to around 1.4 per cent a year by 2040 in old housing stock.
The rate then stands at 1.2 per cent a year for the entire housing stock. For multi-family homes, the rate
in old housing stock stands at 1.6 per cent a year (1.2 per cent a year for the entire housing stock). The
level of renovation also changes in parallel with renovation frequency. The consumption of extensively
renovated buildings falls to 50 kWh/m2 per year (for space heating) long-term for single-family homes
and to around 35 to 40 kWh/m2 a year for multi-family homes. Restrictions on insulation (e.g. heritage
protection, planning restrictions) in some of the buildings holds back the reduction. From 2040, newbuildings reach around 30 to 35 kWh per m2 of energy reference area per year for single-family homes
and 25 kWh per m2 of energy reference area per year for multiple-family homes.
According to the EP2050+, heat generation is also the main driver behind the development of emissions
for services. The generation of process heat and air conditioning also play a role. The demand for heating and cooling is based on the development of gross value creation and full-time equivalents (FTE) in
the individual sectors. Sector scenarios are available which estimate the developments of these parameters. These scenarios indicate that FTEs increase by 2040 and then remain stable (see Figure 12 left).
Gross value creation rises relatively consistently overall (see Figure 12 right). The importance of theretail sector increases by 2050. Further major contributions come from the financial sector and otherservices, including real estate and housing.
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RetailTransport, communications

RetailTransport, communications

Hospitality

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Hospitality

FinancePublic administration

Education

Public administration

Education

HealthOther services

HealthOther services

Figure 12: Development of full-time equivalents (left) and gross value creation (right, in billion CHF) in services bysector according to the EP2050+. Source: Ecoplan, 2018. Sector scenarios 2014 to 2030–60 – update 2018. On
behalf of the Swiss Federal Office of Energy, Bern. Modifications by Prognos/TEP Energy/Infras/Ecoplan 2020,
unpublished detailed data.

To reduce the emissions, the decarbonisation of energy supply, particularly heat generation, is also
imperative in the services sector. The fossil energies widely used today (heating oil and natural gas) areto be replaced by lower-emission or emission-free alternatives. In a similar way to households, heatpumps and heating networks also play a key role in the services sector. In addition, the increased useof biomass-based heating systems (incl. biomethane) and district heating will enable the almost complete replacement of fossil-based energies by 2050 (see Figure 13 left).
29

In addition to the extensive decarbonisation of energy supply, the improvement of energy efficiency is
the second main pillar. The potential available must be fully exploited as far as possible as with households. If this is achieved, significant savings can be made on applications that are relevant to the development of greenhouse gas emissions (process heat and space heating, hot water). Figure 13 (right)
shows the development of energy consumption by types of use and outlines the efficiency improvements, particularly in space heating.
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OthersFigure 13: Development of energy consumption of services by energy source (left) and type of use (right) in PJ
according to the ZERO basis scenario of EP2050+. Source: Prognos/TEP Energy/Infras/Ecoplan 2020, unpublished detailed data.

Investment cycles in the buildings sector tend to be medium to long-term. The fact that lots of old oil andgas heating systems are still being replaced with new fossil-based systems is therefore an issue. A rapidchange of approach is required in this respect. The current low-interest rate environment and the existing
incentive mechanisms of the Swiss Confederation and the cantons (buildings programme, tax allowances, CO2 levy on fossil fuels) actually provide good incentives for full or partial energy-related renovations, particularly in larger services buildings. However, a study conducted as part of the city of Zurich's research programme shows that over half of people who have opted for a fossil-based system did
not even consider a non-fossil alternative.43 This illustrates that a reduction in emissions in the buildings
sector can only be achieved to the required extent if suitable framework conditions or regulations exist.
At institutional level, the allocation of responsibilities between the Swiss Confederation and the cantons
is a key factor. The cantons have extensive powers in the field of buildings which means they are also
responsible for reducing emissions in line with the target. Under the new CO2 Act, the cantons will receive targeted support from the Swiss Confederation in this area (specification of CO2 limits for replacement of fossil-based heating systems, overall contributions to cantonal funding programmes, supplementary Confederation programmes, CO2 duty). The effects of these new measures must be closely
monitored to develop further regulations or measures if required to ensure the long-term targets aremet.
Various structural obstacles also exist which often obstruct the use of renewable energies and energyrelated building shell renovations. These include, for example, different ownership relationships, landlord-tenant issues, expensive planning permission processes or stringent requirements in relation tocreditworthiness. These obstacles cannot be overcome with a simple solution. A combination of various
approaches geared to the individual target groups is needed that takes account of the different challenges in the best possible way.
8.2

Industry sector

For the 2050 time horizon, Switzerland is pursuing the following objective in the industry sector toachieve the overarching net-zero target on greenhouse gas emissions:43

30

Lehmann / Meyer / Kaiser / Ott (2017).

2050 target: Greenhouse gas emissions in the industry sector are reduced by at least 90 per cent compared with 1990.
The industry sector is made up of various sub-sectors. According to the greenhouse gas inventory, it
comprises energy conversion (category 1A1), industry (1A2), evaporative emissions (1B) and emissions
from industrial processes (2 without synthetic gases). Category 1A1 also includes incineration. In 2018,
greenhouse gas emissions in the industry sector stood at 11.2 million tonnes of CO2eq which wasaround 18 per cent below the 1990 level. The industry sector met the interim target for 2015 according
to the CO2 Ordinance (minus 7 per cent compared with 1990). According to the explanatory report on
the CO2 Ordinance, the expected target contribution for 2020 (minus 15 per cent compared with 1990)
was also already reached by 2017. However, the target attainment for 2020 has not yet been confirmed
owing to additional emissions of nitrous oxide emissions discovered in the chemical industry in 2018.
With the complete revision of the CO2 Act, emissions can be reduced by around 35 per cent by 2030
compared with 1990.

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Energy industries (1A1)

Industry (1A2)

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Figure 14: Emissions in the industry sector in million tonnes of CO2eq. Source: Switzerland's greenhouse gas inventory (FOEN 2020)

Figure 14 shows the development of emissions in the industry sector since 1990, broken down by individual sub-sectors. Industry (1A2) today accounts for just under half of the emissions. Energy conversion(1A1) makes up around 30 per cent. Its share has risen since 1990 which is mainly attributable to theincreasing emissions from waste incineration. Conversely, emissions from industrial processes havefallen (2). Their share has gone down since 1990 and today accounts for around a fifth. The evaporativeemissions are relatively low. Overall, emissions have fallen significantly since 1990.
The sector scenarios also form the basis for assessing the development of emissions in the industrial
sector.44 The development of employment and gross value creation are taken into account. In general,these scenarios indicate that employment is set to fall slightly by 2050, except in the construction sector and the chemicals and pharmaceutical sector. Value creation in the industry sector will go up by
2050, primarily driven by a significant rise in the chemicals and pharmaceutical sector.

44
The industry sector in the EP2050+ is not exactly the same as the definition used in the CO2 Ordinance. Energy conversion,
which includes incinerators for example, is assessed separately in the EP2050+.

31

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02010 2015 2020 2025 2030 2035 2040 2045 2050
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OthersConstruction

TextilesChemicals, pharma
MetalsMechanical engin., automotive ind.
Water supply, waste

TextilesChemicals, pharma
MetalsMechanical engin., automotive ind.
Water supply, waste

Figure 15: Development of full-time equivalents (left) and gross value creation (right in billion CHF) in the industry
sector (without energy conversion) by sector according to EP2050+. Source: ECOPLAN, 2018. Sector scenarios
2014 to 2030–60 – Update 2018. On behalf of the Federal Office of Energy, Bern. Modifications by Prognos/TEP
Energy/Infras/Ecoplan 2020, unpublished detailed data.

Figure 16 shows the possible development of greenhouse gas emissions, according to the EP2050+, inthe industrial sector by 2050 compared with the 'Business as usual' scenario (left) and broken down by
the categories of the greenhouse gas inventory (right). Overall, there will still be around six million tonnesof CO2eq in 2050 which cannot be avoided. The remaining emissions mainly come from the cement
production process (included in 2), the incinerators (included in 1A1) and the chemicals and pharmaceutical sector (included in 1A2). In contrast, the combustion-related emissions can be almost completely avoided by 2050.
EP2050+ indicates there will still be around 2.4 million tonnes of CO2 in the cement industry in 2050
which cannot be prevented with measures to increase efficiency or through the replacement of fossil
fuels. Most of them are geogenic emissions generated during manufacturing processes, i.e. during theburning of raw materials (limestone). CCS technologies are required to prevent these emissions. Only
minimal residual emissions will remain in 2050 if CCS with a CO2 capture rate of 90 per cent is deployed.
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Fugitive emissions (1B)

Industrial processes (2)Figure 16: Development of greenhouse gas emissions in the industry sector overall (left) and by categories (right,
only ZERO basis scenario) in Mt CO2eq according to EP2050+ both without CCS and NET. Source: Prognos/TEP
Energy/Infras/Ecoplan 2020.

The waste incineration situation is similar. The systematic recycling of reusable materials, more intensive separation in collection and digitalisation will enable emissions from waste incineration to be stabilised by 2050 compared to today despite the growth in the population and economy. This means there
will be a remaining four million tonnes of CO2 by 2050 of which around 1.5 million tonnes are of biogenic
origin. Incineration plants are suitable as point sources for the use of technologies for the capture and32storage of CO2. The extensive application of such technologies will enable emissions from waste incineration to be almost completely eliminated and could even result in negative emissions from the biogenic
share.
Residual emissions are likely to remain in certain other sectors, particularly chemicals and pharmaceuticals. Less emphasis is placed on CCS as large point sources are not generally found in these sectors.
The remaining emissions would therefore be balanced with negative emission technologies (NET). According to the EP2050+, a reduction of just under 60 per cent is feasible in the industry sector overall
by 2050 compared with 1990 under the assumptions made and without contributions from CCS and
NET. If the potential contributions of CCS are included (also see Section 8.9), there will still be around
1.2 million tonnes of CO2eq in remaining emissions by 2050.
In a similar way to the buildings sector, increased energy efficiency and the substitution of fossil fuelswith renewable energies and greater electrification are also the main levers for reducing emissions inindustry, according to the EP2050+. On one hand, the efficiency potential available must be utilised andimplemented as systematically and comprehensively as possible in all sectors. This concerns both technologies for heat generation (burners, ovens, steam generators) as well as electricity-based interdisciplinary technologies (e.g. pumps, presses and mills). Industrial processes also need to be optimised toachieve maximum efficiency. On the other hand, the replacement of fossil energies must be as comprehensively as possible. EP2050+ indicates that more biomass can be used to generate process heat in
the medium temperature range. Renewable gases can be used instead of natural gas for the generationof process heat in the high temperature range. There is still moderate potential in the electrification ofheat generation in the food industry, the papermaking sector and chemicals industry. Heat pumps anddistrict heating can replace fossil energies as sources of building heating.
Figure 17 shows the development of energy consumption by energy sources (left) and type of use (right)
in the industry sector (without energy conversion). The consumption of fossil energies falls sharply,
whereas renewable energies play an increasingly important role. The generation of process heat remains predominant in terms of type of use.
180
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Hot water

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Drives, processes
Process heat
Space heating
OthersFigure 17: Development of final energy consumption in the industry sector (without energy conversion) by energy
sources (left) and by type of use (right) in PJ according to the ZERO basis scenario of EP2050+ Source: Prognos/TEP Energy/Infras/Ecoplan (2020), unpublished detailed data.

The industry sector is extremely heterogeneous. The opportunities and approaches to emission reduction sometimes differ greatly between the individual sectors. Situation-oriented incentives are required
to put the sector on course to meet the target. The reduction obligations in their current form only provide
for the implementation of economic measures and do not therefore achieve any significant additional
reductions. Systematic orientation to the net-zero target is required over the medium term. Orientation
to net zero at the earliest possible stage also presents an opportunity for Switzerland as a centre ofinnovation and provides many sectors with new growth potential. It must be ensured that there is no
relocation of emission-intensive activities abroad.

33

A second challenge is presented by reducing emissions that are technically difficult to avoid, particularlyin the cement industry and waste incineration. The CO2 capture technologies required have barely beentested in practice at this stage and must therefore be brought to market over the coming years.
8.3

Transport sector

For the time horizon 2050, Switzerland is aiming to achieve the following objective for transport (excluding international aviation) to attain the overarching net-zero target on greenhouse gas emissions:2050 target: Land transport does not generate any more greenhouse gas emissions in 2050 with few
exceptions.

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Figure 18: Emissions from the transport sector in million tonnes of CO2eq (graphic above: transport emissions by
sub-category; graphic below: emissions from road transport by sub-category). Source: Switzerland's greenhousegas inventory (FOEN 2020)

The transport sector is made up of the transport (1A3) and military (1A5) emissions categories. In thegreenhouse gas inventory, the category 1A3 is broken down into road transport, domestic aviation (excluding military), rail, domestic shipping and pipeline transport. The transport emissions stood at 15 million tonnes of CO2eq in 2018 which is slightly above the 1990 level (14.9 million tonnes of CO2eq). Over97 per cent of transport emissions come from road transport which is why it is covered by this section.
International aviation is not part of the transport sector and is indicated separately in the greenhousegas inventory.
The CO2 Ordinance stipulated that transport emissions had to be reduced to the level of 1990 by 2015.
The sector clearly failed to meet this interim target (2015 emissions: 15.48 million tonnes of CO2eq).
According to the explanatory report on the CO2 Ordinance, transport emissions should be 10 per cent34

lower by 2020 than the 1990 level. The transport sector also looks likely to fall short of this expected
target. One reason for this is that the compensation obligation on fuel importers has only resulted in
negligible emissions reductions in the transport sector – most compensation projects are being carriedout in other sectors. With the revision of the CO2 Act, emissions can be reduced by 25 per cent by 2030
compared with 1990.
Figure 19 shows technologically feasible development of emissions under the ZERO basis target scenario compared with the 'Business as usual' scenario for the sub-sectors of road transport. From atechnological perspective, the transport sector can operate on a greenhouse-gas-neutral basis by 2050
according to EP2050+. Compared with the 'Business as usual' scenario, this nevertheless requires
much greater reductions.
Total transport

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Figure 19: Emissions development in the transport sector by 2050 (in million tonnes of CO2eq) according toEP2050+. Source: Prognos/TEP Energy/Infras/Ecoplan 2020, unpublished detailed data.

The number of kilometres travelled and the road-rail modal split in the EP2050+ are based on the forecasts in the Transport Outlook 204045 reference scenario. The number of kilometres travelled and themodal split are identical for all scenarios of the EP2050+. The number of kilometres travelled rises
sharply by 2060. The reduction in emissions according to EP2050+ compared with the 'Business as
usual' scenario is therefore due to a change in the fleet composition, extensive electrification, the use ofgreenhouse-gas-neutral fuels and greater efficiency across all vehicle categories (cars, light commercial
vehicles, heavy goods vehicles). The emissions per kilometre travelled should fall much more quickly
than in the past.
According to the EP2050+, the emissions reductions for cars and light commercial vehicles are achieved
long-term through extensive electrification of the vehicle fleets: Figure 20 shows that the share of cars
with combustion engines declines after 2020 and new vehicles with electric drives increase rapidly,
particularly after 2030. From 2025–30, the EP2050+ assumes cost equivalence between electric andconventional vehicles for many applications. The range of an average battery-powered electric car ofover 400 kilometres will be enough for most users. This means battery-powered vehicles play the mostimportant role by far long-term (2050: 90 per cent of all new vehicles in the car and light commercial
vehicle categories). The remaining ten per cent of new vehicles in 2050 are fuel cell vehicles (included
in 'electric car' or 'electric light commercial vehicle' in the graphic above). They will be used where greater
ranges or short refuelling times are required. Hybrid drives are relevant in all scenarios during the transitional phase but will be replaced by purely electric vehicles long-term. Almost half of the drive energy
required is provided by renewable electricity-based and biogenic fuels which are used in combustion
engines. Overall cars and light commercial vehicles with combustion engines which are still in circulationin 2050 can be operated on a greenhouse-gas-neutral basis, according to EP2050+.

45

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Federal Office for Spatial Planning (2016).

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Figure 20: Fleet development of cars (C) and light commercial vehicles (LCV) (left, in millions) and heavy goods
vehicles (HGV) (right, in thousands) by vehicle categories by 2050 according to the ZERO basis scenario of
EP2050+. Source: Prognos/TEP Energy/Infras/Ecoplan 2020, unpublished detailed data.

According to EP2050+, new heavy goods vehicles will account for most fuel cell vehicles. Electricitybased or biogenic renewable fuels are only used for road transport if they are not required for otherpurposes for which fewer alternatives exist. Biogas could play a relevant role for heavy goods vehicles
in a transition period. Electric vehicles are mainly used in public urban transport. It is nevertheless anticipated that vehicles with diesel engines, but which could be run on renewable fuels, will still be used
long-term on longer routes in heavy goods transport (electricity-based or biogenic). Their share of the
new vehicle fleet will still stand at around 20 per cent in 2050, according to EP2050+.
Transport modelling forecasts a further rise in passenger and freight transport driven by the expected
growth in the economy and population. Owing to an increase in the number of kilometres travelled, there
is a rise in energy demand, putting greater pressure on infrastructure and the environment. The technologies for largely greenhouse-gas-neutral transport already exist but are still not widely used enough.
A widely accepted, effective operating framework is required here to accelerate the penetration of thesetechnologies.
Further challenges facing greenhouse-gas-neutral transport are the conservation of resources in all areas of the environment (e.g. during raw material production for the batteries of electric vehicles and theirrecycling) and energy efficiency (for example, the use of synthetic fuels). Analyses of transport often
only take account of the climate effects during the operational phase. This is in line with the applicableinternational requirements. However, the climate effects of the entire life cycle of the vehicles, transport
chains and mobility infrastructure must be taken into account long-term (this takes place to some extent
through emissions reductions in industry). At European level, the inclusion of lifecycle emissions in theregulation on fleet emissions is currently being assessed. A proposal on the recording of these emissions is to be presented by the European Commission by the end of 2023.
Digitalisation can make a positive contribution to the reduction of greenhouse gas emissions in various
ways. Working from home and digital forms of collaboration can result in a reduction in the number ofkilometres travelled and therefore lower energy consumption. Multimodal mobility services enable various energy-efficient and climate-friendly modes of transport to be linked. In online retail, fewer CO2
emissions are generated per order on average if consignments are efficiently combined. Self-driving
vehicles may result in a reduction in the number of journeys if vehicles are shared in future. Appropriate
framework conditions must be established in order to harness this potential.
A greater shift of transport from road to rail also offers great reduction potential. A shift of transport torail makes a major contribution to reducing greenhouse gas emissions and ensuring climate-compatible
spatial development if the (additional) power used is produced in a renewable and sustainable way. The
strengths of rail transport – particularly the high transportation capacity on a small area and relatively
low energy consumption with good capacity utilisation – and technological innovations must be used in36

an optimal way. This also applies to freight transport in particular. Innovative changes are required totransport goods competitively and in an eco-friendly way by rail.
8.4

Aviation sector

For the 2050 time horizon, Switzerland is pursuing the following objective in international aviation toachieve the overarching net-zero target on greenhouse gas emissions:2050 target: International aviation from Switzerland should no longer generate climate-impacting emissions in net terms by 2050 as far as possible. This means:

Fossil CO2 emissions amount to net zero.
The other climate impacts decline or are offset with other measures.

Greenhouse gas emissions from international aviation from Switzerland are currently excluded from thereduction target in exactly the same way as those from international shipping traffic. While these emissions are indicated separately in Switzerland's greenhouse gas inventory, they are not included in theassessment of target attainment in accordance with the CO2 Act. While greenhouse gas emissions frominternational shipping are negligible for Switzerland, those created by international aviation are increasingly significant. In 2018, these emissions stood at around 5.7 million tonnes of CO2eq (of which 5.6 million tonnes was CO2). This means international aviation accounted for around 11 per cent of Switzerland's total greenhouse gas emissions and for around 13 per cent of total CO2 emissions.46
International aviation, which has seen steady growth to date, is increasingly responsible for emissions
from a climate policy perspective. As a result, the 193 member states of the International Civil Aviation
Organization (ICAO), including Switzerland, agreed a global CO2 compensation system in 2016 (Carbon
Offsetting and Reduction Scheme for International Aviation CORSIA) in which Switzerland is also participating. CORSIA aims to achieve CO2-neutral growth in international aviation. The commitment ofmember states to the compensation obligations is voluntary until 2026.47 The system initially applies
until 2035 and will then – depending on the impact – be continued or replaced by a new system.
In its direct counterproposal to the Glacier Initiative, the Federal Council proposes including the emissions of international aviation in the net-zero target for 2050 provided this is scientifically and technicallyfeasible in line with the data in the greenhouse gas inventory. This is currently possible for the greenhouse gases CO2, methane (CH4) and nitrous oxide (N2O). The reduction of CO2 emissions is therefore
a priority in the near future as they remain in the atmosphere for a long period. In addition to these gases
covered by the greenhouse gas inventory, international aviation also generates other emissions thathave an impact on the climate. These include water vapour (H2O), nitrogen oxide (NOx), sulphur dioxide(SO2) and black carbon. In particular, the vapour trails and the high thin clouds that form as a result ofthem (cirri) are relevant. The impact of the latter on the climate is at least the same as that of CO2. Bothfor the current climate impact of previous emissions from aviation and also with a focus on the remaining
emissions budget that is compatible with the warming limit of 1.5࿲°, the CO2 emissions of aviation mustbe multiplied by a factor of around 2.5 according to the information currently available to reflect the total
impact on the climate.48 This figure is a global average. The factor can fluctuate significantly depending
on weather conditions and altitude for an individual flight which means there is an element of uncertainty.
These emissions are not currently included in the greenhouse gas inventory on account of this elementof uncertainty. These emissions have a limited impact temporally in view of their short lifespan. They
should also decrease long-term. However, the cutting of these emissions should not come at the expense of reducing fossil-based CO2 emissions which remain in the atmosphere for significantly longer.

46

To ensure a global assessment that is as complete as possible, emissions are calculated according to the point of sales principle. In the case of international aviation this means the emissions of a flight are attributed to the country where the fuel for thisflight was provided. If the principle of national treatment – based on the data on the kilometres flown annually according to thetransport micro-census – is applied instead of the point of sales principle, the emissions caused by the inhabitants of Switzerland would stand at around 7.7 million t CO2.
47
To date (as at November 2020) 88 states have committed to voluntary participation in the compensation obligations from
1.1.2021. With the participation of these states, around 77 percent of total emissions from international aviation are covered.
48
Neu (2020). Comparing the climate impact of CO2, which remains in the atmosphere for a long period, and short-life non-CO2
emissions is generally complex and involves an element of uncertainty. The factor of 2.5 is based on the best estimate according to the information currently available.
37

A further challenge is the fact that the technical options for reducing emissions in international aviation
are limited. The aviation sector should increasingly focus on renewable, sustainable fuels and on alternative drive systems. Options include synthetic fuels from renewable energies and advanced biofuels,
hybrid drives and electric or hydrogen drives. However, it should be noted that – in contrast with othermodes of transport – alternative drive technologies in aviation are unlikely to be suitable, as things stand,for large aircraft or long distances even long-term on account of the high energy density required for theenergy sources as well as other technical requirements. The use of CO2-neutral synthetic fuels may
represent the only genuine alternative in the period under consideration to 2050. This potential – together with that of organisational measures (e.g. optimising flight routes) – must be harnessed. Remaining emissions must be balanced with negative emissions.
8.5

Food and agriculture sector

Agriculture is part of the food system that covers the entire value chain encompassing the production,
processing, sale and consumption of food. For the 2050 time horizon, Switzerland is pursuing the following objectives to achieve the overarching net-zero goal on greenhouse gas emissions:2050 targets:Thanks to favourable framework conditions for sustainable food systems, the greenhouse-gas footprintof food is falling in line with the net-zero target and further relocation of greenhouse gas emissions
abroad will be avoided.
The greenhouse gas emissions from agricultural production in Switzerland have been cut by at least
40 per cent compared to 1990.
Swiss agriculture will contribute a significant share of Switzerland's food supply of at least 50 per
cent by 2050.

The emissions of agricultural production are distributed across several sectors and categories of thegreenhouse gas inventory. They include:The methane and nitrous oxide emissions from livestock farming as well as nitrous oxide and CO2
emissions from the use of fertilisers on agricultural soils (category 3 of the inventory);
The greenhouse gases from the combustion of fossil heating and motor fuels in grass-drying operations and greenhouses as well as agricultural machinery and vehicles (parts of 1A4c);
The carbon footprint of mineral and organic soils used in agriculture and the biomass grown on it(4B and parts of 4C).

Greenhouse gases from the production of imported fertilisers and fodder lie outside the system limits ofnational climate reporting. They are attributed according to the international guidelines on countries oforigin.
In total, the greenhouse gas emissions from agriculture stood at 7.3 million tonnes of CO2eq in 2018
which is around 1.1 million tonnes of CO2eq or just under 13 per cent below the level in 1990. The
development of emissions reflects the changes in the cattle population and the use of nitrogen-based
fertilisers. Emissions have stagnated since the 2000s. Since 2007, they have not been on the pathway
defined in the Climate Strategy for Agriculture which provides for a linear reduction from one to twothirds by 2050 compared with 1990.49 The indicative minimum target – according to the Climate Strategy
for Agriculture – for 2020 (around 7 million tonnes of CO2eq or a reduction by a sixth compared with1990) is likely to be missed.
Figure 21 shows the development of emissions in agriculture since 1990, broken down by individual
sub-categories. The methane emissions from the digestive process in livestock account for the greatest
share at around 45 per cent. The nitrous oxide emissions from soil management makes up 20 per centand the methane and nitrous oxide emissions from manure storage around 16 per cent.
Livestock farming is very significant in Switzerland. Around 70 per cent of land used for agricultural
purposes is managed as pastureland and converted into food through ruminant animals. Animal fodder
is grown on around 60 per cent of arable land and the imported animal fodder requires another approximately 250,000 hectares of arable land abroad. Finally, around half of the food produced in Switzerland
49

38

FOAG (2011).

comes from animal production. Animal production accounts for over 85 per cent of agricultural greenhouse gas emissions.50

Figure 21: Development of emissions from agriculture in millions of tonnes of CO2eq by sub-categories according
to the national greenhouse gas inventory and the target pathways of the Climate Strategy for Agriculture (dottedlines). Source: Switzerland's greenhouse gas inventory (FOEN 2020)

The greenhouse gas inventory covers the emissions generated by agricultural production in Switzerland
to the point of leaving the farm. However, emissions are then also generated downstream in the processing, sales and consumption of food. These emissions are attributed to the industry or services sector. A large proportion of food is also imported. The greenhouse gas footprint provides a more comprehensive evaluation of the domestic consumption of food as this also includes the downstream and import-related emissions. In 2018, the footprint of households for the emission item food – according tothe overall environmental analysis of the Federal Statistical Office – stood at 15.6 million tonnes ofCO2eq51. This equates to around two tonnes of CO2eq per person. This also includes food waste. The
import-related emissions account for a share of 68 per cent.
Key elements of agricultural policy are border controls, direct payments and the evidence of ecological
performance requirements (ÖLN). In the agriculture and food sector, the following climate-relevant instruments are in force or being planned:The funding of research and advisory projects enables the decision-making basis for agricultural
policy to be established and support to be provided for agricultural businesses with implementationof scientific findings in practice. In addition to various research projects, the Swiss Confederation
has also supported the 'AgroCleanTech' association with setting up a platform to provide informationand exchange knowledge on energy and climate protection.



The co-funding of projects as part of the resources programme enables new paths to be forged to
improve resource efficiency in agriculture. Two resources projects have been running in the field of
climate protection since 2016: a measures-based points system for greater climate protection on
farming businesses is being created and applied as part of the IP-Suisse project. The Flaachtal
project of the 'AgroCO2ncept' association aims to harness the specific optimisation potential on
individual farms through operational greenhouse gas assessments and targeted advisory services.



By promoting quality, innovative projects can foster the improvement of the quality and sustainabilityof Swiss agricultural products. Opportunities for contributing to the reduction of greenhouse gas
emissions also exist in sales promotion, the water protection programme, rural development, structural improvements, livestock farming and crop cultivation. Larger farms can obtain an exemption

50

Bretscher / Ammann / Wüst / Nyfeler / Felder (2018)Federal Statistical Office, overall environmental analysis, https://www.bfs.admin.ch/bfs/en/home/statistics/territory-environment/environmental-accounting/air-emissions.html.
51

39

from the CO2 duty on fossil fuels if they in return commit to a reduction obligation with the Swiss
Confederation. Some farms using greenhouse production and processing companies are alreadytaking advantage of this option.


Manufacturers and importers of fossil fuels are obliged to offset some of the CO2 emissions fromtransport by supporting Swiss projects aimed at emissions reduction. Several biogas plants and theuse of a specific fertiliser have been registered as compensatory projects in agriculture so far.

The message on the complete revision of the CO2 Act for the post-2020 period indicated that a sectoral
target on emissions reduction is also provided for in agriculture.52 The Federal Council used the targetof the Climate Strategy for Agriculture and proposed a reduction contribution of 20 to 25 per cent by
2030 compared to the base year of 1990. The target is primarily to be achieved through measures basedon agricultural legislation. According to the message on the development of agricultural policy after 2022
(AP22+), agriculture should reduce its greenhouse gas emissions by 10 per cent by 2025 comparedwith 2015 in an interim stage. This represents a reduction by 19 per cent compared with 1990 and isalso in line with the minimum target of the Climate Strategy for Agriculture. The interim target is to beachieved through additional requirements and incentives relating to evidence of environmental performance, direct payments and structural improvements as well as through pilot projects and networks.
With regard to evidence of environmental performance, the tolerance limit of 10 per cent and anyother allowance options in the nutrient balance are to be abolished. Distributors of nutrients in theform of fertilisers and fodder also undertake to disclose their deliveries to agricultural businesses.

In relation to direct payments, production system contributions are planned to limit the input of raw
protein into ruminant fodder, to ensure a longer period of use for cows, to reduce ammonia in livestock farming, to improve the efficiency of the use of nitrogen in crop cultivation and in special crops,
to promote humus formation and soil fertility and to establish agroforestry systems. A reduction in
the use of fossil energies is also provided for. The replacement of fossil-fuel-operated machineryshould be facilitated through (optional) investment loans and the use of alternative machinery should(for a limited period) also be supported with production system contributions. Contributions should
also be paid to promote locally adapted agriculture based on regional agricultural strategies. The
Swiss Confederation should also provide investment support for innovative technologies to reduce
negative environmental impacts.



Pilot and demonstration projects, which contribute towards forming networks between research,education and advisory services, on one hand, and practical application in the agriculture and foodsectors, on the other, will receive financial support. The same applies to networks of excellence andinnovation for crop cultivation, livestock farming, livestock/animal health and animal welfare. Livestock farming legislation should also be amended so that environmental impacts are included in theassessment of state support.

Swiss agriculture should also make a major contribution to the food supply of the Swiss population in
2050. Food production results in emissions which cannot be completely avoided. According to the scientific information currently available, a halving of emissions in Swiss agriculture is possible by 2050
compared with 1990 while also achieving a higher level of self-sufficiency – provided the reduction potential in the food industry is also systematically harnessed. The food-related emissions could even be
reduced overall by three-quarters per person a year compared to the current level, i.e. from 2 to
0.5 tonnes of CO2eq.
Figure 22 shows the possible contributions from sets of measures in an ideal scenario from a current
perspective based on their reduction potential by 2050. The graphic shows greenhouse gas emissionsof agriculture in absolute terms (production perspective based on the territorial principle according to
the greenhouse gas inventory; left) and the greenhouse gas footprint of food per person (consumption
perspective including emissions abroad from imports and excluding domestic emissions of exports according to the overall environmental analysis; right).

52

40

Message on the complete revision of the CO2 Act post-2020, Federal Gazette 2018 247.

Figure 22: Greenhouse gas emissions and reduction potential by 2050 in agriculture and food from production
and consumption perspectives according to the greenhouse gas inventory and the overall environmental analysis.

The greatest reduction contribution results from a change to consumption and production patterns. Establishing suitable framework conditions could more than halve this sector's greenhouse gas footprint
as well as other negative environmental impacts. Combined with the complete avoidance of food waste
in households, a reduction of 66 per cent in total could actually be achieved.53
On the production side, the use of space changes: whereas pastureland can still largely be used fordairy cattle farming, arable farmland is used for food production where possible and feasible. This could
cut Switzerland's agricultural greenhouse gas emissions by a fifth compared to the current level.54
The emissions in agriculture and food production could also be further reduced through technical optimisations. In agricultural production this involves efficiency improvements in herd management andfodder (livestock farming), low-loss fertiliser management (nutrient management), maintaining the carbon stocks in moor soils (soil carbon) and the complete replacement of fossil heating and motor fuelswith renewable energy sources (energy use). The latter also concerns the downstream sectors of processing and retail.
Around 4.1 million tonnes of CO2eq from domestic agricultural production will remain by 2050 whichcannot be avoided under the assumptions made based on the information currently available. This remaining amount must be balanced with negative emissions. It is unclear to what extent a further reduction or compensation of these emissions through a permanent increase in the carbon stocks in agricultural soil and biomass (for example, through humus formation, biochar and agroforestry) would be possible.
The greenhouse gas emissions generated by agricultural production are predominantly related to biological and biophysical processes and come from diffuse sources or sources that fluctuate significantly
in terms of time and space. The various business operations also differ greatly. This makes it difficult todevelop generally applicable and simple measures and to assess greenhouse gas emissions accurately
at the level of the individual agricultural businesses. On one hand, there is substantial need for researchand data evaluation. On the other, the major emissions drivers have long been identified and are undisputed. Research and digitalisation must be stepped up without holding back or preventing the simultaneous realisation of the identified and undisputed reduction potential.
Conflicting priorities can arise between a strategy focused on climate protection and a comprehensive
sustainability strategy. In Switzerland 'the land of pasture', grass-fed ruminants play a major role, while
the greenhouse-gas footprint of this form of production and the products made in this way should not be
overlooked. Similar conflicting priorities are also apparent between soil cultivation and the use of herbicides. In a first step, the existing conflicting priorities should be made transparent and then resolved as
far as possible. Balanced solutions should be aimed at.
8.6

Financial market sector

For the time horizon 2050, Switzerland is pursuing the following objective in the financial sector toachieve the overarching net-zero target on greenhouse gas emissions:

53
54

41

Zimmermann / Nemecek / Waldvogel (2017).
Bretscher / Ammann / Wüst / Nyfeler / Felder (2018).

2050 target: Switzerland's financial flows are to be made consistent with a pathway towards low greenhouse gas emissions and climate-resilient development by 2050 in accordance with the target of theParis Agreement.
Article 2.1c of the Paris Agreement provides for the goal of: "Making finance flows consistent with apathway towards low greenhouse gas emissions and climate-resilient development." In theory, establishing a climate-compatible real economy for the financial markets would be the most efficient way ofachieving the net-zero target. This would mean investment and finance being automatically geared towards this objective. However, in view of this issue becoming much more urgent and the difficulty ofachieving global internalisation in pragmatic political terms, the international community has agreed thatthe financial market should also play a proactive role in the transition to a climate-compatible global
economy. By ratifying the Paris Agreement, Switzerland undertook to make financial flows compatible
with climate goals. The objective has now also been enshrined in the revised CO2 Act's purpose article.
The financial sector plays a key role in achieving the climate goals and the fundamental and rapidchanges to the global economy required to attain the net-zero target by 2050.
Accounting for over 9 per cent of GDP, the financial sector is a key part of the Swiss economy. It covers
insurance companies, pension institutions and foundations on one hand. These are institutional investors which possess or manage significant assets (asset owners). The Swiss National Bank (SNB) also
has assets of a similar volume to the pension institutions which it manages as part of its monetary policy
mandate. Other key players on the Swiss financial market are intermediaries which advise institutional
and private clients and manage their assets (asset managers). These include banks, fund managementcompanies and investment firms. Other actors, which can have a climate-relevant impact on the financial
market players previously mentioned, are consultancy firms, (foreign) credit rating agencies and stock
exchanges.
The various financial market actors are closely interlinked with one another, but also with sectors in thereal economy, such as buildings, industry and transport – in particular via the domestic mortgage andlending market and investments in Swiss and foreign companies. On one hand, the general global conditions for the real economy and the inherent price signals influence the activities and risk assessmentsof financial market actors. On the other, the various financial market actors create incentives – throughadvisory services, products/services or conditions – for companies and households which have a rangeof impacts from a climate perspective. Through their investment and financing decisions, dialogue withcompanies and political activities, they also influence climate-relevant developments in the real economy. The more aware financial market actors are about the climate impact of investment and financing
activities and the more transparent and comparable their reporting on the relevant decisions and products/services is, the better the decision-making basis for customers, insured parties, politicians and supervisory authorities.
Thus far investors have not primarily focused on the impact they could have on containing climatechange, but instead on the impact that climate change or its containment could have on their assets(climate risks for investors). This is also confirmed by an expert opinion by FOEN. It shows that financial
market actors already take account of material risks – including climate risks – today in accordance withthe legal provisions and are obliged to report on them. However, in contrast to risk analyses, reportingon the short and long-term climate impacts of investment and financing decisions are currently not explicitly required in any part of the applicable financial market legislation.55
Supervisory authorities and central banks are increasingly focusing on the various risks. This is helping
to raise awareness amongst financial market actors about the importance of the issue. However, it cannot be assumed that financial market actors will take climate-relevant measures based on risk analyses,
i.e. measures that contribute to containing climate change and the transition to a low-emissions age.
The existing findings indicate that investments on the Swiss financial market do not support the climate
goals sufficiently.56 This reflects the fact that the global economy is not on course to meet the obligationsof the Paris Agreement. This means the financial market actors are still currently investing too heavily
in companies that plan or promote an expansion of the production of CO2-intensive technologies (gasfired plants, the transportation of oil and gas, petrol and diesel vehicles etc.). Global investments in low55
56

42

Eggen / Stengel (2019).
2°Investing Initiative / Wüest Partner (2020).

CO2 alternatives, such as renewable energies or vehicles using alternative drive systems, have not yet
increased sufficiently either. A similar picture emerges amongst the lenders on the Swiss financial market at global level.57 In this area too, the climate impacts are comparable with those of listed companies
on the global market which is not in line with the goal of the Paris Agreement.
Institutional investors have large portions of their assets invested in the Swiss real estate market.
Through energy-efficient renovations and the replacement of fossil-fuel heating systems with alternatives using renewable energy supply, institutional investors can have a direct impact on the developmentof emissions in the buildings sector. Examples from Switzerland and abroad show that returns for investors can be improved with low expenditure, depending on the circumstances, through renovation
measures in the case of existing buildings with an average to low energy standard.58 In the 2020 climate
compatibility test, pension funds indicated that they are carrying out conversion from fossil energy torenewable heating systems for 30 per cent of their buildings. Overall, 70 per cent of the buildings tested
were still heated with oil and gas, while the figure was as high as around 80 per cent for mortgaged
properties.59
Financial consultants and asset managers have the opportunity to systematically survey the climate andenvironmental goals of their institutional and private customers and to incorporate them into investment
advice and portfolio management. Studies from the EU nevertheless indicate that most asset managers
barely take account of climate criteria and risks during financial consultancy, but instead focus on financial criteria.60 A third of the institutions surveyed in the 2020 climate alignment test indicated that theytake account of their customers' climate and sustainability objectives. However, only five per cent regularly address the issue of their own accord. Most only survey their customers when they request it.
Investment trends are undergoing change. The financial markets can actively support this process. The
results of the 2020 climate alignment test show that there are significant differences both between asset
classes and between the portfolios of the individual financial institutions. The number of actors that see
opportunities in actively supporting the transition towards net zero is also continually increasing. Twothirds of participants in the 2020 climate alignment test said that they were pursuing a climate strategy.
Improvements are nevertheless required to ensure these strategies make an impact and that customers
are sufficiently well informed about the climate risks and effects of their investments. For example, morethan half of the institutions – which indicate that they exclude coal from their investments – still holdequities and bonds of companies that mine coal or produce coal-based electricity.61
In the financial sector, the following climate policy instruments are in force or are being planned:Increasing individual responsibility: the revised CO2 Act is relying on the individual responsibility ofthe sector for the time being for the period 2021–30. The financial market actors should work to
make financial flows compatible with climate-resilient development through voluntary measures.
The Swiss Confederation lays the foundations and provides support, regularly measures progress(the next climate compatibility test is scheduled for 2022) and assesses further options and incentives if insufficient impact is being achieved.

Transparency and dialogue: The broad-based and representative participation in the voluntary climate compatibility tests in 2017 and 2020 shows that more attention is being paid to the issue ofclimate impact. The Federal Council has given the administration the task of assessing whether
there is need for regulatory action in the areas of transparency, fiduciary obligations and risk.62 It
also discussed these matters in the report "Sustainability in Switzerland's financial sector – Situation
analysis and positioning with a focus on environmental aspects".63 As a result, the State Secretariat
for International Financial Matters (SIF) has stepped up – in close cooperation the FOEN as well as

57

Banktrack (2018).
See for example https://www.copenhageneconomics.com/publications/publication/do-homes-with-better-energy-efficiencyratings-have-higher-house-prices-econometric-approach;
59
2°Investing Initiative / Wüest Partner (2020).
60
European Commission (2016) and 2° Investing Initiative (2017).
61
2°Investing Initiative / Wüest Partner (2020).
62
Federal Council press release of 6.12.2019, can be viewed at https://www.admin.ch/gov/en/start/documentation/media-releases.msg-id-77424.html
63
Federal Council (2020).
58

43

SECO and the FDFA – discussions with the sector as well as international activities related to thisissue.
Development of approaches: The Federal Council wishes to increasingly work towards industry
agreements with the financial market actors in future.64 A postulate submitted by the Council ofStates in autumn 2019 calls upon the Federal Council to outline – based on the results of the climate
compatibility tests – how Switzerland can make its financial flows compatible with climate-compatible goals and to propose suitable measures.65 In its responses to various parliamentary procedural
requests, the Federal Council has underlined in the past that it regularly assesses the climate impactof the efforts made as part of individual responsibility and, on this basis, evaluates whether further
steps are advisable.

The European Union launched a comprehensive action plan to fund sustainable growth in 2018 and has
adopted various regulations in this regard.66 A renewed 2020 Strategy aims to strengthen the aspectsof both risks and impact and to mobilise more private funds for the 'European Green Deal'.67 As many
Swiss financial market actors also sell financial products in the EU, EU regulations are also highly relevant for Switzerland.
The investments and financial assets, loans, mortgages, consultations and products of the Swiss financial market actors should support the transition to a climate-compatible national and global economy
and contribute to the net-zero target of the real economy sectors overall and their adaptation to climatechange by 2050. This means avoiding new investments in fossil energies and their financing mediumterm. The financial market can also play a key role in the penetration of alternative technologies andrenewable energies and achieving a reduction in the emissions of its real estate portfolios in line withtargets as quickly as possible.
The more transparently, consistently and comparably financial market actors explain the climate impactsof their products and corporate strategies to their customers and insured parties, the better they will beable to manage them according to their sustainability preferences. To ensure financial consultants andasset managers disclose comparable information on climate impacts proactively and comprehensively,
in-depth and broad-based training and education and the development of the existing information on the
climate impacts of financial flows are required. Efforts to create an eco-friendly image without legitimate
grounds, which is known as greenwashing, can be counteracted through reliable indicators and standards. Today there is still no standard definition of when a financial product is classified as climate compatible or not. The Swiss Confederation nevertheless provides free, comparable and targeted climate
compatibility tests on a regular basis. This tool is being continually improved and is coordinated internationally.68 Participation in these tests, which is as representative as possible, enables progress or shortfalls to be highlighted. Such monitoring but also minimum requirements, provisions and standards can
support market transparency and help to avoid greenwashing. Switzerland's approach is based on international standards and developments.
A challenge for climate-compatible investment is the various time horizons. Whereas investment andsupervisory decisions and financial incentive systems are geared to the short term today (months to afew years), a long-term horizon is required to take account of climate risks and effects. Some European
supervisory authorities are therefore discussing to what extent this can be corrected and climate risks
can be tackled more effectively by means of taxation or equity or solvency requirements. One option
would be financial incentives for more climate-compatible investment and financing decisions. Accordingly aligned, climate-optimised price signals from the global real economy – in other words CO2 prices
which internalise the external costs of climate change – would simplify the efforts of the financial market.
The EU is also increasingly assessing, as mentioned above, regulatory approaches that go beyond
purely voluntary measures. It wishes to put the entire financial market on course to meet the target. The
64

Federal Council press release of 26.6.2019, can be viewed at https://www.admin.ch/gov/en/start/documentation/media-releases.msg-id-75599.html.
65
19.3966 ESPEC-S postulate: Klimaverträgliche Ausrichtung und Verstärkung der Transparenz der Finanzmittelflüsse in Umsetzung des Übereinkommens von Paris (Climate-compatible alignment and strengthening of the transparency of financial flows
as part of the implementation of the Paris Agreement).
66
European Commission (2018).
67
See https://ec.europa.eu/info/consultations/finance-2020-sustainable-finance-strategy_en
68
See https://www.transitionmonitor.com
44

Swiss Confederation welcomes the current initiatives based on individual responsibility of various industry associations and continues to regularly monitor progress. It will continue the preliminary work alreadystarted, especially the climate compatibility tests, and will monitor the impact of the new provisions of
the completely revised CO2 Act on assessing climate-related financial risks. Depending on the progress
made by 2030, new, significantly more effective approaches may also be required in Switzerland, forexample in the regulatory environment and in training and education. This may be based on research
results on the effectiveness of measures and the experiences of particularly advanced representatives
at institutional and sectoral level.
8.7

Waste sector

The waste sector (category 5 of the greenhouse gas inventory) covers non-energy waste treatment in
landfill sites and wastewater purification plants as well as through biological recycling. The thermal recycling of waste in incinerators and special-waste incineration plants falls under energy conversion andtherefore the industry sector (see Section 8.2). As Figure 23 shows, the emissions from landfill sites andwastewater purification are most relevant. The former have declined steeply since 1990 which has inturn led to a fall in emissions in the sector as a whole. Emissions from wastewater treatment have risen
slightly since 1990, partly due to population growth. However, there is an element of uncertainty about
the level of these emissions. A research project conducted by the Swiss Federal Institute of Aquatic
Science and Technology (EAWAG) provides grounds to assume that emissions from wastewater treatment plants may be three times higher than previously assumed.69 The contributions from the othercategories are negligible. In total, emissions from the waste sector amounted to over 670,000 tonnes ofCO2eq in 2018, which is around 37 per cent below the level of 1990.
The depositing of combustible waste in landfill sites has been banned in Switzerland since 1 January
2000. No such waste has been deposited in landfill sites since this date. The future development oflandfill emissions can be projected relatively easily using models. These projections indicate that emissions will fall to around 60,000 tonnes of CO2eq by 2050. The scope for technical reduction is limited
and is largely already being implemented, in particular through a programme as part of the compensation obligation for fuel importers.
1,2
1,0
0,8
0,6
0,4
0,2
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018

0,0

Solid waste disposal
Incineration and open burning of waste
Other (shredding)

Biological treatment of solid waste
Wastewater treatment and discharge

Figure 23: Emissions from the waste sector from 1990 to 2018 in million tonnes of CO2eq. Source: Switzerland's
greenhouse gas inventory (FOEN 2020)

The forecast shows emissions from wastewater treatment plants develops in line with population growth.
This estimate is quite conservative and reflects the fact that the level of understanding of the impact ofpotential reduction measures (e.g. reduction of methane emissions by covering sludge tanks, reducing
nitrous oxide emissions from biological purification through increased nitrogen elimination) is currently
still quite low. The time series may also need to be corrected upwards based on the new findings indicated. The other components may also remain at around the current level long-term. Total emissions
from the waste sector may still stand at around 500,000 tonnes of CO2eq by 2050.

69

45

EAWAG (2018)

1,2
1,0
0,8
0,6
0,4
0,2

Solid waste disposal

Biological treatment of solid waste

Incineration and open burning of waste

Wastewater treatment and discharge

2050

2045

2040

2035

2030

2025

2020

2015

2010

2005

2000

1995

1990

0,0

Other (shredding)Figure 24: Possible emissions development in the waste sector by 2050 in million tonnes of CO2eq

8.8

Synthetic gases

The synthetic gases (known as 'F gases', category 2 of the greenhouse gas inventory, excluding CO2,
CH4, N2O) include the emissions from hydrofluorocarbons (HFC), perfluorocarbons (PFC), sulphur hexafluoride (SF6) and nitrogen trifluoride (NF3). HFC and PFC are mainly found in refrigerants and in foammaterials for heat insulation. SF6 is used, for example, as an insulation gas in electrical switching systems and NF3 in the manufacture of flatscreen TVs and solar cells.
The F gases are classified as substances stable in the atmosphere in the Chemical Risk Reduction
Ordinance. Here their use is restricted to applications for which there is currently no alternative and is
set to be restricted further in future. The HFCs are covered by an international agreement signed by theinternational community at the 28th Meeting of the Parties to the Montreal Protocol held in Kigali in 2016.
It provides for the gradual, comprehensive avoidance of use of this substance (Kigali Amendment).
Switzerland ratified the Kigali Amendment in November 2018 and is implementing its provisions. Switzerland can also provide for further measures if alternative technologies are available.
In addition to the legal requirements, the compensation programmes also contribute towards reducing
refrigerant-based emissions. In industrial and commercial applications, these programmes reduce thenumber of stationary cooling systems which are operated with refrigerants that are particularly harmful
to the climate. Depending on the situation, this reduction is achieved through one of three measures.
Firstly, these programmes promote the replacement of still functional systems operated with HFCKW or
HFKW refrigerants with systems operated with natural refrigerants (early replacement).70 Secondly, they
aim to replace HFKW refrigerants that are particularly harmful to the climate with less harmful synthetic
ones (drop-in). Thirdly, they support the new development of small commercial cooling systems which
can be operated with natural refrigerants instead of HFKW.
For SF6 an industry agreement exists in Switzerland between the FOEN and the operators of electricalswitching devices and systems as well as particle accelerators which defines the reduction targets forSF6 emissions. The scenarios therefore assume that the emissions of F gases will decline long-term.
No more than around 0.3 million tonnes of CO2eq should remain by 2050.

70

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HCFC: hydrochlorofluorocarbons; HFC: hydrofluorocarbons.

BAU

2050

2045

2040

2035

2030

2025

2020

2015

2010

2005

2000

1995

1990

2,0
1,8
1,6
1,4
1,2
1,0
0,8
0,6
0,4
0,2
0,0

ZERO

Figure 25: Possible development of emissions from the use of F gases in million tonnes of CO2eq

8.9

Negative emissions technologies

For the 2050 time horizon, Switzerland is pursuing the following objective in relation to negative emissions technologies (NET) as a contribution to the attainment of the overarching net-zero target for greenhouse gas emissions:2050 target: Switzerland's greenhouse gas emissions that are technically difficult to prevent and which
are still occurring in 2050 will be completely balanced by means of biological and technical sinks byremoving CO2 from the atmosphere and storing it permanently, securely and sustainably (negative emissions).
Reducing greenhouse gas emissions to net zero requires the use of negative emissions technologies(NET).71 NET remove CO2 from the atmosphere using biological and technical methods and store it
permanently. NET must remove the emissions remaining in 2050 which cannot be eliminated throughmeasures to prevent or reduce them. This means they must remove at least as many tonnes of CO2eq
from the atmosphere as the remaining emissions still being generated. Only then will the emissions
actually reach the net-zero target.
The Federal Council outlined its view in its report of 2 September 2020 in response to a postulate on
the possible role of NET in Swiss climate policy.72 It relies heavily on a report by the 'Risiko-Dialog'
foundation and underlines that NETs are not a substitute for the priority and comprehensive reductionof greenhouse gas emissions.73 Emissions-free alternatives are already available today in the buildings,
transport and industry sectors. The potential for reducing emissions must therefore be fully harnessedin these sectors by 2050 so that they do not generate any greenhouse gas emissions as far as possible.
The other, non-energy-related greenhouse gas emissions in agriculture, in the waste sector, from cement production and from the use of solvents and refrigerants should be reduced as far as possible.
NET should be regarded as a complementary element to emissions reduction. However, they should
only be used for emissions that are difficult to avoid owing to limited domestic storage potential, therequired transport of removed CO2 over sometimes long distances, the current high costs involved, thepotential risks, the concerns over acceptance by the public and the uncertainty over further technologicaldevelopment. In order for them to perform this role over the medium to long-term, suitable framework
conditions must be established in good time both at national and international level. The research, development and implementation of all possible methods should be rapidly driven forward.
NET is a collective term for various approaches which aim to remove CO2 from the atmosphere andstore it permanently. In general terms, it can be divided into natural and technical methods. The natural
methods remove CO2 through photosynthesis. It is stored either directly in biomass or in the ground, inthe sea or – in the case of combination with CCS – in geological underground disposal sites (bioenergy
71
In international climate policy the term carbon dioxide removal (CDR) is increasingly being used to indicate negative emissions technologies (NET). The two terms are equally valid.
72
Federal Council (2020).
73'Risiko-Dialog' Foundation (2019).

47

carbon capture and storage BECCS). The technical approaches are based on chemical processes. CO2
can be removed from ambient air by means of air filtration and the removed CO2 can then also be stored
underground (DACCS). Minerals can also remove CO2 from the air and permanently store it chemically(enhanced weathering). Figure 26 provides an overview of the methods.

Figure 26: Negative emissions approaches. Source: FOEN graphic based on Mercator Research Institute on Global
Commons and Climate Change MCC.

A key requirement for all NET is the permanent storage of the removed CO2 as far as possible for several
decades, or ideally centuries. This requirement is met in the case of storage in geological undergrounddisposal sites. Secure storage of at least several thousand years can be assumed here. For permanentstorage, the natural approaches require continuous, targeted management. Even then there is the risk,
particularly with storage in biomass, that the CO2 captured will be released again. This could happen,
for example, in the event of extensive forest fires. The potential of natural approaches – depending on
the method – could be exhausted within a few decades if the natural sinks reach saturation point.
The potential of the individual approaches for application in Switzerland and the costs and risks involved
have only partially been established to date and are being explored as part of current research. Initial
findings indicate that (re)forestation is likely to play a subordinate role in view of the limited space available. The Swiss forests can continue to act as a CO2 sink if targeted forestry management measures
are implemented. The long-lasting use of wood, for example in buildings, with subsequent energy usage
could store CO2 for a period and also replace CO2-intensive materials (such as cement) and energy
sources. Approaches in the field of soil management and the storage of biochar offer potential – depending on the method – which could be used sustainably. The same applies to bioenergy usage with
CO2 removal and storage (BECCS). Incinerators could play a role here as a significant share (currently
around 50 per cent) of the CO2 emitted during the burning of waste is of biogenic origin. This approach
as well as machine-based CO2 air filtration and storage (DACCS) are limited due to Switzerland's geological storage potential. Only rough estimates currently exist as the geological substructure has notbeen explored for this purpose. It can be assumed that there is capacity available at least for several
decades provided such geological CO2 storage sites can be successfully developed. Switzerland is likely
to also be dependent on access to storage sites abroad.

48

70
60

57,2

57,9

59,1
51,5

50

40,6

40

28,7

30
20

11,8

10
0
1990

2000

2010

2020

2030

2040

Buildings

Industry

Transport

Agriculture

Waste

Synthetic gases

International aviation

Total emissions

2050

Figure 27: Development of emissions by 2050 by sectors in million tonnes of CO2eq according to ZERO basis
scenario of EP 2050+, including international aviation. Source: Own graphic based on Prognos/TEP Energy/Infras/Ecoplan 2020.

The use of NETs has an impact on other environmental and policy areas, for example land use, spatialplanning and energy consumption. This means they must be deployed in agreement with these areas.
Their use should also be based on recognised sustainability criteria and take account of the environmental, economic and social dimensions in an appropriate way.
The section on the individual sectors has shown the extent to which greenhouse gas emissions can be
reduced by 2050. Technically difficult or unavoidable remaining emissions will continue to exist mainly
in industry (cement production, incineration and the chemical industry), in agriculture and, to a lesser
extent, in the households, services, transport, waste, synthetic gases and other sectors. Figure 27
shows the development of greenhouse gas emissions to 2050 by sectors. Around 11.8 million tonnesof CO2eq will remain by 2050.
To eliminate the remaining emissions and to create negative emissions long-term, the use of CCS andnegative emissions technology is required. The following scenarios are conceivable:


The remaining emissions from cement production (around 2.4 million tonnes of CO2eq in 2050) canlargely be reduced with CCS.74 CCS can also make a contribution in some other industrial sectors,
particularly the chemicals and pharmaceutical sector.

Around four million tonnes of CO2eq of residual emissions may remain from incineration in 2050.
CCS can also be used in incinerators. As some of the burned waste is of biogenic origin, negativeemissions can be generated with the biogenic share. The biogenic share currently stands at around50 per cent. This may decline long-term as biomass is also increasingly attractive for other applications. The EP2050+ assumes that around 1.5 million tonnes of CO2eq (or over 37 per cent) will beof biogenic origin by 2050. The remaining 2.5 million tonnes of CO2eq is fossil-based. Storage capacity is in turn required for the total emissions removed of around 3.6 million tonnes of CO2eq (ata capture rate of 90 per cent).

The emissions from international aviation are difficult to forecast. The EP2050+ assumes that acomplete conversion to synthetic fuels is technically and economically possible by 2050. This means
CO2 emissions in 2050 would stand at almost zero. In view of the limited potential and uncertain
economic viability of synthetic fuels, this forecast is deemed optimistic from a current perspective,
but is nevertheless used as a basis below. If there are still emissions remaining in 2050, the needfor NET would increase accordingly. The same would also apply for other climate effects if they
were included in the net-zero target.



The remaining emissions of 6.9 million tonnes of CO2, most of which are accounted for by agriculture, must be balanced to achieve the net-zero target. Various options could be considered. Around
1.5 million tonnes of CO2eq could be covered by the biogenic share of the incinerated waste. Further

74

49

A capture rate of around 90 per cent is assumed. This means around 0.2 million tonnes remain from cement production.

potential exists in land management, the use of wood and the application of biochar as well as in
the areas of DACCS, BECCS and in the enhanced weathering of minerals (cement). These estimates should be viewed with caution. The potential for DACCS and BECCS in Switzerland is still
unclear. Restrictive factors are the high energy usage, possible conflicting priorities over the use of
biomass, the currently still high costs and the limited storage capacity.
It is uncertain whether the domestic potential will be sufficient to fully meet the requirement for negative emissions. Switzerland is also likely to have to rely on negative emissions abroad.

Table 2 shows the remaining emissions in 2050 and possible approaches to avoid or remove them using
NET. Geological storage capacity is required for CO2 emissions that are captured directly at an emissions source (cement factory, incinerator) or directly from the atmosphere. The carbon-neutral recyclingof CO2 represents a good approach on the path towards the net-zero target, depending on the application scenario, if the CO2 comes from biogenic sources or directly from the atmosphere. However, only
the permanent removal from the atmosphere is compatible with the net-zero target long-term. The extent
of the potential in Switzerland for geological CO2 sinks has not yet been conclusively established. A
study carried out in 2010 estimated the theoretical geological storage potential at around 2.7 billion
tonnes of CO275 in total. This equates to just under 60 times Switzerland's current annual greenhousegas emissions. Annual storage capacities of at least five million tonnes of CO2 would be required by
2050; and even more if CCS is used in the production of biochar and/or DACCS. The current major
uncertainty over the level and location of geological storage potential can only be reduced through prospection and exploration strategies. Heating supply based on geothermal technology would also benefit
from such strategies. Better knowledge about the geological substructure is also urgently required forgeothermal technology.76
Emissions source

Emissions in
2050

Avoidance
through CCS

NET requirement

Cement production

2.4

2.2

0.2

Waste incineration (fossil-based share)

2.6

2.3

0.3

Further industrial sectors

1.2

0.6

0.6

Agriculture

4.6 (4.1-5.0)

4.6

Synthetic gases

0.3

0.3

Waste (landfill sites)

0.5

0.5

Transport

0.0

0.0

Buildings

0.4

0.4

Other

0.01

0.01

Total

11.8

5.1

6.8

Negative emissions – incineration plants-1.3

Other NET (e.g. biochar, capture of pyrolysis emis--5.5

sions, BECCS, DACCS, abroad)
2050 target

0.0

Table 2: Possible remaining emissions in 2050 and approaches to avoid or offset them according to the ZERObasis scenario of EP 2050+ (figures in million tonnes of CO2eq). Source: Prognos/TEP Energy/Infras/Ecoplan
2020, unpublished detailed data.

If Switzerland is dependent on capacity abroad for depositing CO2, there is a good chance that it will
also one day be available. The North Sea, where projects concerning the geological storage of CO2 arealready under way, is a possibility. The transport of the captured CO2 is one challenge. This must be
75

Chevalier / Diamond / Leu (2010).
The motion 20.4063 calls on the Federal Council to present a programme for the nationwide exploration of the geologicalsubstructure. The Federal Council recommends the motion for approval.
76

50

cost-effective and not generate any additional emissions. Transport via rail would be conceivable or, asa much more efficient option, the construction of a Europe-wide transport network to the deposition sites,
for example via CO2 pipelines. This would require pan-European cooperation. Initial, albeit not very
specific, considerations are already being given to this, including by the relevant actors in Switzerland.77
For Switzerland, DACCS could be implemented partly or exclusively directly at geologically suitablelocations abroad. This would eliminate transport costs and the storage capacity available in Switzerland
would be available to domestic point sources (cement factories, incinerators or other large plants).
It is important that CCS and NET capacities are developed over the coming years and then increased.
The EP2050+ anticipates that the first capture of CO2 in incinerators will be possible from 2035 (seeFigure 28). These volumes increase rapidly after 2040.
50
40
30
20

0,0
40,6

34,6

10

28,7

22,5
11,8

0

-0,4

-1,7

-4,8
-1,2

-7,0
-4,9

2035

2040

2045

2050

-10
-20
2030

Residual emissions

CCS and NET in Switzerland

NET abroad

Net emissions

Figure 28: Development of the remaining emissions and contributions of NET and CCS in Switzerland and abroad(figures in million tonnes of CO2eq) according to the ZERO basis scenario of EP2050+, including international
aviation. Source: Own graphic based on Prognos/TEP Energy/Infras/Ecoplan 2020.

9Development of total greenhouse gas emissions by 2050

Switzerland wishes to reduce its greenhouse gas emissions to net zero by 2050. It has the technicalpotential to achieve this objective. However, all actors are required to make their contribution as quickly
and fully as possible. The key requirement for attaining the target is reducing all avoidable emissions in
Switzerland. In addition to the approaches to replace fossil energies and to improve energy efficiency,
CCS methods are also required. The remaining emissions which cannot be avoided with technicalmeasures must be balanced with negative emissions technologies (NET).
The reduction of avoidable greenhouse gas emissions as completely as possible, on one hand, and thedevelopment and provision of the technical and natural sinks, on the other, represent two different challenges. This requires the involvement of various actors and the use of targeted regulatory incentives. It
is therefore advisable to aim to achieve the development required to meet the net-zero objective using
two targets: with a reduction pathway for the greenhouse gas emissions and a target (or a development
pathway) for the negative emissions (including CCS contributions where applicable). This separate approach is required to ensure both challenges are given the appropriate status. It also enables specificobjectives to be determined for the long-term reduction of greenhouse gas emissions in Switzerland andfor the required sink performance.

77

The association of Swiss waste recycling facility operators has developed the 'Carbon Hub' project which also focuses on theconcept of a pan-European pipeline network.

51

60
50
40
30
20
10

BAU

2050

2045

2040

2035

2030

2025

2020

2015

2010

2005

2000

1995

1990

0

ZERO

Figure 29: Reduction pathways of greenhouse gas emissions by 2050 in the 'Business as usual' and ZERO basis
scenarios (in Mt CO2eq) of EP2050+, both excluding CCS, NET and international aviation. Source: THGI FOEN &own graphic based on Prognos/TEP Energy/Infras 2020.

The completely revised CO2 Act covers the period up to 2030. Domestic greenhouse gas emissions
should decrease by at least 37.5 per cent by this point in time. A reduction to around 11.8 million tonnesof CO2eq is possible by 2050, excluding contributions from CCS. Figure 29 shows the resulting reduction
pathway. An average annual reduction of over one million tonnes of CO2eq is required by 2030 in orderto achieve the target of minus 37.5 per cent compared with 1990. Emissions should subsequently fall at
a greater rate of around 1.2 million tonnes of CO2eq. Figure 29 shows the difference to the 'Business as
usual' scenario. Without further efforts, greenhouse gas emissions would still stand at well over 30 million tonnes of CO2eq in 2050 according to this scenario.
Compared to the reduction pathway anticipated to 2030, ambitions should be further increased after
2030 so that emissions continue to fall. The measures planned to 2030 put the emissions on course tomeet the target if they are systematically implemented. The capacities required for CCS and NET must
be developed so that they can balance the remaining emissions long-term.78 The following figures havebeen produced for the years 2040 and 2050 based on the above information. These figures could provide a basis for the definition of binding targets at a later stage.

Greenhouse gas emissions excluding CCS contri-

1990

2018

2040

2050

57.2

51.8 (-10%)

28.7 (-50%)

11.8 (-79%)

57.2

51.8 (-10%)

27.3 (-52%)

6.7 (-88%)

bution (in brackets: reduction compared with 1990)

Greenhouse gas emissions including CCS contribution (in brackets: reduction compared with 1990)

Table 3: Greenhouse gas emissions in 2040 and 2050, including international aviation (in Mt CO2eq). Source: EP
2050+ ZERO basis scenario, Prognos/TEP Energy/Infras/Ecoplan 2020, unpublished detailed data.

The remaining emissions in 2050 are to be balanced by CCS and NET. CCS could make a reduction
contribution of around five million tonnes of CO2eq by 2050. Negative emissions of around 6.8 million
tonnes of CO2eq would be required. Targets for NET or for NET plus CCS can in turn be set based onthese figures. The following figures have been produced for 2040 and 2050 broken down by sector:

78

52

IPCC (2018).

1990

2018

2040

2050

Buildings

16.7

11.2 (-33%)

2.9 (-82%)

0.4 (-98%)

Industry (excl. CCS)

13.6

11.2 (-18%)

7.8 (-43%)

5.9 (-57%)

Transport

14.9

15.0 (+1%)

6.4 (-57%)

0.0 (-100%)

Agriculture

7.7

6.6 (-14%)

5.4 (-30%)

4.6 (-40%)

Waste

1.1

0.7 (-37%)

0.5 (-49%)

0.5 (-52%)

Synthetic greenhouse gases

0.3

1.7 (+625%)

0.4 (+80%)

0.3 (+22%)International aviation

3.1

5.3 (+74%)

5.2 (+71%)

0.0 (-100%)

Total (excluding CCS and NET)

57.2

51.8 (-10%)

28.7 (-49%)

11.8 (-79%)

CCS and NET in Switzerland

1.7 (of which CCS: 1.3)

7.0 (of which CCS: 5.0)

NET abroad

0.0

4.8

27.1 (-53%)

0.0 (-100%)

Total (incl. CCS and NET)

57.2

51.8 (-10%)

Table 4: Greenhouse gas emissions by sector in 2040 and 2050 (in million CO2eq or in per cent compared with1990). Source: EP 2050+ ZERO basis scenario, Prognos/TEP Energy/Infras/Ecoplan 2020, unpublished detailed
data.

10

Costs and benefits of the net-zero target

The aim of reducing greenhouse gas emissions to net zero by 2050 is to avoid dangerous disruption to
the climatic system and to contain the negative impacts of climate change. These impacts include – inaddition to the general increase in the average temperature – changes to precipitation patterns, theincrease in extreme events (severe weather, storms, heatwaves), the melting of glaciers and the rise in
the sea level. The main benefits of climate policy are reducing these impacts and the associated costs
involved. A further benefit is reducing dependence on fossil energies which Switzerland imports entirely
from abroad. Over the past ten years alone, over 80 billion francs have been transferred abroad forfossil energies. These funds could be invested in Switzerland.
The benefits must be weighed up against the investment costs for the implementation of emissionreducing measures. Further impacts on the economy and consumers will arise from structural change
and changes to the price of goods, employment and foreign trade. Finally, secondary effects must also
be taken into account. This refers to effects that do not relate to the actual goal of climate policy andoccur as a biproduct of the measures undertaken. Examples include the reduction of the emission of air
pollutants by converting to renewable energies and lower noise pollution from transport by switchingfrom combustion to electric engines.
The measures to reduce greenhouse gas emissions are mainly to be implemented over the next three
decades. This means the investments – particularly for the conversion of the energy supply, the renovation of the building stock and the replacement of fossil fuels – will largely be incurred during this period.
In contrast, the benefits will only become fully apparent long-term. Studies indicate that the costs ofunchecked climate warming are limited up until the middle of the century, but then increase sharply
towards the end of the century and beyond. A reduction in greenhouse gas emissions in line with thescientific recommendations will result in significantly lower costs long-term. The benefits of reducing
emissions to net zero pay off long-term and significantly exceed the investments required.
10.1

Benefits and cost savings of not taking action

Climate change causes an increase in damage to infrastructure, higher health costs, lower agricultural
productivity and lower earnings in economic sectors severely affected by climate change, e.g. wintertourism. These and other impacts of climate change result in costs. The level of such costs depends onthe future development of global greenhouse gas emissions, temperatures and other climate parameters. If inadequate or, in an extreme scenario, no measures at all are taken to combat climate change,
the impacts and costs involved will increasingly rise over the course of time. In the event of excessive
warming, there is the danger of reaching tipping points which will change the climate system permanently and irreversibly. Science indicates that even global warming of over 2° Celsius compared to the53pre-industrial level is likely to result in the permanent melting of the ice caps and irreversible changes
to monsoon systems. The costs involved in reaching such tipping points are extremely high.
The aim of the climate policy is to reduce emissions of greenhouse gases harmful to the climate and in
this way restrict climate change and its impacts. The benefits are the avoidance of the associated costs.
Estimating these is methodically complex. Climate change results in costs in many areas which are nottraded on markets at measurable prices. They include impacts on the ecosystems, biodiversity and moregenerally on the integrity of nature and landscapes. These costs are difficult to express in monetary
terms and are therefore omitted from most studies available. It should also be noted that the benefits
for Switzerland are heavily dependent on the development of global emissions. Containing climatechange requires measures from all countries. Switzerland will contribute to these global efforts with its
net-zero target but cannot stop the consequences of climate change alone.
Various studies exist for Switzerland which generally focus on specific sub-areas. They include, for example, the impacts of climate change on infrastructure, healthcare costs or economic productivity. Somestudies evaluate the costs of climate change at macroeconomic level.79 The existing studies show thatthe costs of not taking action – i.e. the costs of unchecked global warming – for Switzerland will reachan annual amount of up to four per cent of GDP by 2050.80 If the development of GDP according toEP2050+ is taken as an approximate basis, these costs will amount to around CHF 38 billion. According
to these estimates, annual costs of around one billion francs will be incurred on infrastructure from 2050
and annual costs of up to 11 billion francs in healthcare from 2060. If global efforts succeed in restricting
climate change in line with the goals of the Paris Agreement, the costs will be much lower. In this case,the annual costs in 2050 would amount to a maximum of 1.5 per cent of GDP81 which equates to around
14 billion francs. This means the benefits of reducing greenhouse gas emissions to net zero would standat 2.5 per cent of GDP a year. This is roughly 20 to 30 billion francs. The figures available today on thecosts of climate change should be regarded as conservative estimates. This is mainly due to a lack ofcomprehensive cost calculations that take account of all climate impacts. The actual costs of climatechange – and so too the benefits of comprehensive reduction of greenhouse gas emissions – may besignificantly higher.
These results are consistent with studies that adopt a global perspective. The much-cited report by the
economist Nicholas Stern (Stern Report) maintains that unchecked climate change over the next two
centuries would result in a fall in global GDP of 5 to 20 per cent a year on average. The costs of stabilising emissions at a level that restricts warming to a maximum of 2° Celsius would only amount toaround 1 per cent of annual GDP.82 The OECD's estimates are similar. It quantifies the costs of unchecked climate warming at up to 3.3 per cent of GDP for 2060 and at up to 10 per cent of GPD peryear by the end of the century.83 These high costs provide justification for rapid and decisive action. This
will also be beneficial economically, as the OECD also maintains. With an integrated strategy on growthand climate change, economic output in the G20 countries could be one per cent higher on average by2021 and 2.8 per cent higher by 2050 than if the recommended measures were not implemented. If the
avoidance of economic damage is also factored in, economic output could be increased by almost five
per cent by 2050.84
10.2

Investments required, operating and maintenance costs and energy cost savings

The conversion of the energy system requires investment in plants and infrastructure as well as emission-reducing and efficiency-increasing measures in buildings, transport and industry. Costs are also
incurred on the operation and maintenance of these plants. The withdrawal from fossil heating and motor
fuels and increasing energy efficiency also results in savings on energy costs.
Even without the net-zero target, additional investments in the energy system of 1400 billion francs are
required by 2050. With the net-zero target by 2050, the investment requirement increases by 109 billion
79

Swiss Economics (2019), Vöhringer et al. (2019), EPFL (2017), Ecoplan (2007)
Kahn et al. (2019). These impacts depend heavily on the underlying assumptions and scenarios and the impacts taken into
account and may differ significantly depending on the study.
81
Kahn et al. (2019)82
N. Stern (2006).
83
OECD (2015).
84
OECD (2017).
80

54

francs in total or by eight per cent. Then there are additional operating costs of around 14 billion francs
in total. Reaching the net-zero target eliminates costs for importing fossil energies which results in savings of around 50 billion francs.85 The cumulative additional costs over the period 2020 to 2050 amountto 73 billion francs in total.
15000
12500
+8684

Mio. CHF

10000
7500

+4796

5000
2500

-180

+106

+615

2020

2025

2030

+1691

+2749

0
-2500
-5000
2035

Investments (annualised)
Energy costs

2040

2045

2050

Operating costs and maintenance
Total

Figure 30: Development of annualised investments, operating and maintenance costs and energy cost savings in
the ZERO basis scenario of the EP2050+ (in million CHF, difference compared to the 'Business as usual' scenario,
excluding international aviation). Source: Prognos/TEP Energy/Infras/Ecoplan 2020.
12 000
10 000
8 000
6 000
4 000
2 000
0
-2 000-4 000-6 0002020
Buildings

2025
Industry

2030
Transport

2035

2040
NET/CCS

2045

2050

Energy costs

Total

Figure 31: Development of costs (investment and operating costs; aggregated energy cost savings) by sector in
the ZERO basis scenario of the EP2050+ (in million CHF, difference compared to the 'Business as usual' scenario, excluding international aviation). Industry including electricity, district heating, other conversion measures.
Source: Prognos/TEP Energy/Infras/Ecoplan 2020, unpublished detailed information.

The development shown in Figure 31 is broken down by sectors. In the buildings sector, the annualised
investments required increase until around 2050 and then stabilise. By 2050, they amount to around
2.9 billion francs, including operating costs. A similar development is observed in the industry sector
which has the highest investments due to the required conversion of the power supply system. By 2050,
they stand at around 5.2 billion francs (annualised, including operating costs). In the transport sector the
direct costs are lower long-term than in the 'Business as usual' scenario owing to lower infrastructure
and maintenance costs (primarily due to a continual decrease in the cost of electric vehicles). In 2050
the difference is around 1.4 billion francs. In contrast, additional investment requirements arise owing to
the use of CCS and NET. These investments are predominantly incurred after 2040 and stand at around85

In international aviation the changeover from fossil to synthetic fuels would enable additional savings to be made of CHF 14
billion, including any costs incurred on the import of synthetic fuels.

55

2.2 billion francs in 2050. The energy costs by 2050 are similar to those in the 'Business as usual' scenario due to the import of electricity-based fuels.
10.3

Summary

From a scientific perspective, there is no alternative to the reduction of greenhouse gas emissions to
net zero if the goals of the Paris Agreement are to be achieved. It is not a question of whether a climate
protection policy based on these goals should be pursued, but rather which measures should be used
to achieve the targets. Net zero is achievable from a technological perspective. The decisive factor will
be ensuring the transition to the net-zero goal is carried out in a socially acceptable, economically viable
and eco-friendly way as far as possible and creating a suitable regulatory environment. The long-term
benefits are likely to exceed the investment required by the middle of the century, but most definitely
over the long-term. The extremely high potential costs of inadequate climate protection justify decisive
action, both globally and in Switzerland.
It should be noted that a cost-benefit analysis is only possible to a limited extent for various reasons
which makes exact quantification difficult. The studies available are based on different assumptions,take account of different cost and benefit aspects, use different parameters86 and cover different time
horizons. As a result, the figures from the preceding sections cannot be compared directly. It is clearthat the reduction of greenhouse gas emissions to net zero is urgently required if global warming is tobe limited to a maximum of 1.5° Celsius. Unless this goal is systematically pursued, serious and sometimes difficult-to-estimate consequences involving high costs are anticipated. These costs would bemuch higher than those required to cut greenhouse gas emissions to net zero. Continuing as before is
therefore no longer an option. The investment costs required to attain the net-zero target will predominantly be incurred over the next 30 years but will make a major contribution to avoiding much higher
subsequent costs. The reduction of emissions to net zero will pay off long-term as various studies on
the impacts at global level clearly indicate. Put simply, climate protection will incur costs, but no climate
protection will cost a great deal more.

86
The costs are generally expressed in francs per tonne of CO2eq saved and the benefits in francs per degree Celsius of warming avoided.

56

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Vöhringer Frank / Vielle Marc / Thalmann Philippe / Frehner Anita / Knoke Wolfgang / Stocker Dario /Thurm Boris (2019): Cost and benefits of climate change in Switzerland, Climate Change Economics
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59Glossary
CO2eq

Greenhouse gases other than carbon dioxide (CO2) are converted into
CO2 equivalent (CO2eq) based on their climate impact to make them comparable.

CO2 neutrality

Achievement of the net-zero target for carbon dioxide (CO2) emissions

Climate neutrality

Meeting the net-zero target for all greenhouse gases (including all climate
effects of international aviation) and taking account of 'grey emissions'generated abroad as a result of domestic consumption (consumption
footprint).

Net zeroEquilibrium between emissions and capture, usually in relation to CO2 orother greenhouse gases.

Net-zero target

Equilibrium for greenhouse gases between emissions, on one hand, andcapture and storage in sinks on the other.

Difficult-to-avoid emissions Emissions which, based on the information currently available, cannot be
prevented with technical measures alone. If these emissions cannot be
reduced by using alternatives or through avoidance, they must be balanced with negative emissions technologies.
Greenhouse gas neutrality

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Meeting the net-zero target for all greenhouse gases excluding 'grey
emissions' generated abroad as a result of domestic consumption (see'climate neutrality').