Sustainable fuels, USI participates in the reFuel.ch consortium

The federal government's Energy and Climate Strategy places great importance on sustainable fuels. To determine how these fuels can be introduced into Swiss markets and energy systems, the Federal Office of Energy's SWEET promotion programme has initiated a call for applications named "Sustainable Fuels and Platform Chemicals". The reFuel.ch consortium, which includes participation from Professor Ilaria Espa of Università della Svizzera italiana, emerged as the winner of this call for applications.

There are several sustainable methods for producing fuels and combustibles. One way is through the generation of hydrogen using renewable electricity - also known as 'green hydrogen'. This can then be used to create ammonia, methanol or other substances. Another method involves biomass fermentation/gasification. Additionally, concentrated solar energy can be used to fuel chemical reactions. It is important to evaluate these solutions carefully to ensure Switzerland's future need for fuels and chemical intermediates. This includes considering their environmental, economic, and social impact throughout their entire life cycle. Ensuring that any solutions are legally feasible in light of Switzerland's international obligations is also important.

The fifth call of the SWEET (SWiss Energy Research for the Energy Transition) promotion programme on sustainable liquid and gaseous fuels and combustibles was won by the reFuel.ch (Renewable Fuels and Chemicals for Switzerland) consortium. The consortium is led by the Swiss Federal Laboratories for Materials Testing and Research (Empa) and includes several universities, including Università della Svizzera italiana. The total funding is CHF 17.6 million, of which CHF 15 million is through the SWEET programme.

The main objective of reFuel.ch is to improve sustainability and reduce the cost of sustainable fuels and chemical intermediates. To assess the effects of these solutions, the project considers not only technical contributions but also contributions from the social sciences. Ilaria Espa, Professor of International Law at the Law Institute (IDUSI) of the Faculty of Economics at USI, is responsible for the legal part of the project.

Professor Espa, what characterises the reFuel.ch consortium, and how did USI get involved?

The reFuel.ch consortium is unique in that it combines the technical expertise of the engineering component with socio-economic and legal expertise. The latter is essential to ensure that the production and integration of sustainable fuels and combustibles in the energy market takes place through innovative, economically efficient solutions that are also compatible with the current legal and regulatory framework. This is a remarkably complex analysis as this framework consists of a multilevel, national and international obligations network. These obligations, in turn, influence the Swiss legislator's room for manoeuvre in defining appropriate policies to support the development of the market for fuels, fuels and chemical intermediates.

How important are legal aspects in the transition to sustainable fuels?

I would say essential - and indeed, the Swiss Federal Office of Energy has considered the interdisciplinary element, particularly the focus on legal questions related to this transition, to be one of the strengths of the reFuel.ch consortium. In developing new tools and products, there is a risk of facing obstacles such as delays by the legislator and the need to ensure the interoperability of proposed technical solutions with current international obligations. Therefore, it is essential to comprehend the current possibilities, how to formulate or enhance appropriate support policies within these boundaries, and whether and how to push these boundaries to achieve Switzerland's climate goals.

Are there particularly important or sensitive legal aspects?

To successfully incorporate sustainable fuels into the energy market, it is crucial to establish an effective regulatory framework that considers infrastructure requirements for production, transport, and storage. This will ensure that the federal government's objectives are met. Additionally, regulating international trade and investment is necessary as Switzerland is likely to rely heavily on imports of sustainable fuels and fuels.

Will there be regulations to adapt?

We expect to propose targeted interventions in a number of strategic sectors: from the electricity sector to the chemical sector, from agriculture to aviation and so on. However, it is premature to anticipate which ones, since these will be proposals formulated on the basis of technological development trajectories that will have to be worked out by the technical component of the project and tested by our group of economists with reference to efficiency, effectiveness and social acceptability.
We plan to suggest targeted interventions in strategic sectors, such as electricity, chemicals, agriculture, and aviation. However, it's premature to predict which ones, as these proposals will be based on technological development trajectories that our technical team will work on. Then, our group of economists will test them for efficiency, effectiveness, and social acceptability, taking into account the international context.

We can't think of adding, adjusting, or changing the Swiss legal and regulatory framework in isolation. Sustainable fuels and fuels promotion will require an intensification of international trade and investment. We have already identified preferred partners for this purpose, including Spain, Portugal, and Oman. Coordination with the rules in force in the European Union, and compliance with international law laid down by, among others, the World Trade Organisation, will be necessary.

And these analyses will have to be made, as mentioned, taking into account the international context.

It is clear that any additions, adjustments or changes to the Swiss legal and regulatory framework cannot be thought of in isolation, especially since the promotion of sustainable fuels and fuels will, as mentioned, require an intensification of international trade and investment. We have already identified a number of privileged partners for this purpose, from Spain and Portugal to Oman. It will therefore be necessary to ensure coordination with the rules in force in, for example, the European Union, as well as to observe the rules of international law laid down by, among others, the World Trade Organisation.