The future of Swiss hydropower: how to distribute the risk and the profits?

Abstract Low electricity prices put economic pressure on hydropower companies. A more flexible water fee design can counteract this and support companies during times when market revenues are low. However, comes at the cost of lower for resource owners. Using a sample data 62 revenue derived from an model, we have quantified trade-off case Switzerland. We found that price developments dominate changes in fees profitability hydropower, important than levels. with around CHF 40 per MWh, make difference between profit loss. Therefore, while regimes shift risk producers to owners some extent, extent depends detailed regime.