Phyllis Scholl is at home in the power industry. As an attorney and partner at Baryon, she has broad experience of M&A transactions in the energy sector. In addition, Phyllis Scholl serves on the boards of directors of both listed and non-listed companies in the energy sector and is also mayor of a suburban Zurich municipality.

In an interview with Reto Eberle, the lawyer talks about the current energy crisis in Europe and how we can make energy production and management in Switzerland sustainable.

Prof. Dr. Reto Eberle: We seem to have had one crisis after another in recent years – diverse in nature and appearing with increasing velocity: the financial crisis was followed by the COVID-19 crisis, and now the war in Ukraine. Are crises also always an opportunity, and do you think lessons have been learned and appropriate changes made?


Phyllis Scholl: Crises are indeed opportunities, even if the statement contains a measure of calculated optimism. Crises reveal the weak points in our system, and that’s the great opportunity we should take advantage of. The last crises we experienced were certainly on the list of possible scenarios, but governments and risk managers rated their probability of occurrence as low. This is probably why preparation for these scenarios was neglected.

A good example is the threat of an energy shortage in Switzerland. Just because the probability was rated as very low, it doesn’t mean we shouldn’t have prepared for it – precisely because an energy shortage has very high damage potential. In the absence of existential crises in our society in recent decades, we’ve neglected the art of foresight.

So, it’s important to now consider possible future crisis scenarios with low probability but high damage potential. And we should take precautions to avoid – or at least mitigate the damage of – existential crises as far as possible.

The energy sector is strongly influenced by policy. The partial opening of the electricity market in 2008 brought it closer to a market economy. How do you assess the impact of (partial) liberalization to date? What are the possible effects of further liberalization, including for smaller electricity consumers (with less than 100 MWh)?


Partial liberalization has led to a market distortion, and we’re now stuck in it. Having benefited for years from extremely advantageous market conditions, large electricity consumers now face high market prices, while small companies and private households had to pay proportionately higher electricity prices, but are now much less affected by the high market prices. I’m of the opinion that we should decide on a concept and either release all consumers or none into the free energy market.

The decisive advantage of liberalization is that the market and demand send signals to production. Alongside price, security of supply has now regained importance. This helps to push domestic production more strongly as well. A return of all players to basic state supply is conceivable, but not a good solution, as it would mean a lack of signals from the market, which in turn would exacerbate the problem of available energy. In any case, the current situation is unsatisfactory. Households and businesses do not constantly want to have to deal with the question of where electricity comes from and how much it costs. People simply assume – as they do with water – that it will always be available and affordable.

We need to pay more attention to crisis scenarios with low probability but high damage potential.

Your work as a board member is certainly also characterized by the long investment horizon that is typical for the energy sector (at least in the area of power generation). In the current volatile market situation, how do you deal with the associated planning uncertainty, especially when assessing long-term investment projects?


For hydropower plants, for example, the aim is to have a concession of 60-80 years. These are long time horizons in which a lot can happen. In the past, it was assumed that the investment would pay off in the long run. But there was always the question of how to deal with what we call non-amortizable investments. It can be helpful to use the triangle of “ecology, economy and security of supply” to make sense of them. The economic component of price development on the sales market has been the most uncertain.

One approach to controlling this would be to introduce sliding feed-in premiums. These define a bandwidth for the electricity price. If the price falls below a certain level, the public sector would intervene to support the company; if the price rises above a certain level, the company would have to hand over part of the surplus to the state.

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