There is no transition without transmission

There is no transition without transmission

Background

The transmission network is often described as the backbone of the energy system – functioning like a highway that carries electricity over long distances at high voltages, before it is distributed to end users. In Switzerland, more than 6,700 kilometers of extra-high-voltage transmission lines span the country supported by over 12,000 pylons.

Since the first extra-high-voltage lines were constructed in the 1920s in Switzerland to transmit electricity from large hydropower plants to urban centers, the grid has continuously evolved — particularly from the 1960s onwards, when nuclear power was integrated — while energy consumption and generation patterns have shifted fundamentally. As the energy sources that feed power into the grid have become more spread out and intermittent, and as demand grows from electric vehicles, heat pumps, and data centers, the grid must become more flexible — yet planning and approval for new or upgraded infrastructure remain complex, costly and lengthy, often taking decades.

ESG in action

Swissgrid, Switzerland’s national transmission system operator, regularly develops a multi-year Strategic Grid plan, based on energy scenarios from the Swiss Federal Office of Energy and in coordination with international and local stakeholders. This collaborative, scenario-based approach has proven resilient and robust, even amid unforeseen events like the 2022 energy crisis.

Swissgrid has identified or reconfirmed a total of 31 key grid projects requiring investments of approximately CHF 5.5 billion by 2040, as part of the Strategic Grid 2040.¹ As a key principle, when upgrading the grid, Swissgrid prioritizes optimizing the existing infrastructure, then enhancing it, and only expands it when necessary.² Major projects include installing four new phase-shifting transformers in western Switzerland, which will enhance cross-border electricity exchange and lay the foundation for even more effective connection to neighboring European countries. Another example is the replacement of an old overhead line between Airolo and Göschenen with an underground cable through the second tube of the Gotthard road tunnel. By coordinating with other large infrastructure projects, land-related, visual and environmental impacts typically associated with new transmission lines can be minimized.

Outcome

The Strategic Grid 2040 addresses these challenges by determining expansion requirements, while making efficient use of existing infrastructure to reduce costs and environmental and social impacts. National and international coordination —across sectors like transport and energy — can accelerate the often lengthy permitting procedures. As energy systems evolve, Swissgrid plays a vital role in ensuring Switzerland achieves its decarbonization targets and remains securely powered for generations to come.

Note: Case study for illustration purposes only. Holdings are subject to change, this does not constitute investment advice to buy or sell the presented securities.