Techno-Economic Case Study of a Rural Local Electricity Community in Switzerland

TL;DR

This study analyzes the economic and technical impacts of Swiss Local Electricity Communities, highlighting benefits for renewable use and challenges for grid revenues, with implications for community design and regulation.

Contribution

It provides the first detailed techno-economic case study of Swiss CELs, assessing their effects on participants and distribution system operators.

Findings

CELs increase local renewable energy use, especially photovoltaics.

Community size and composition influence economic benefits and energy matching.

Grid import reductions of 27-46% are observed, impacting DSO revenues.

Abstract

Local Electricity Communities (communaut\'es \'electriques locales, CEL) will become operational in Switzerland in 2026, allowing prosumers, consumers, and storage operators within the same municipality and distribution system operator (DSO) area to exchange electricity over the public grid with reduced distribution tariffs. This report examines a rural Swiss case study to explore the techno-economic implications of CELs for both participants and the local DSO. The findings indicate that CELs can enhance the local use of renewable generation, particularly photovoltaics, and offer modest financial gains, with outcomes strongly shaped by community size, composition, and tariff design. Larger and more heterogeneous communities achieve better internal matching of supply and demand, though the overall incentive remains limited because the tariff reduction applies only to distribution charges. The study further shows that internal energy exchange is maximized when local PV generation covers roughly 1-2 times the community load. For DSOs, CELs reduce grid imports (27-46%), resulting in a substantial reduction in distribution tariff revenues (17-36%), necessitating regulatory adaptation. While centralized batteries provide economic value to members, their technical impact on the grid remains modest due to their small, economically optimized capacity. Larger centralized storage is shown to reduce transformer peak power, but risks increasing line loading, suggesting a need for careful sizing and placement.