Social and Business Implications of the Clean Incentive: Outperforming the Swiss Carbon Levy & ETS

The recent Swiss Climate and Innovation Law targets net-zero emissions by 2050. However, the existing ETS and the carbon levy for fossil thermal fuels still fall short of achieving this goal. Moreover, additional taxes face low political acceptability, and new subsidies are constrained by budgetary limitations, as noted by FOEN representatives.

The Clean Incentive policy proposal is built around a steering levy, similar to the current carbon levy, making it both budget-neutral and politically viable. It covers all GHGs and streamlines the disbursement procedure, limiting it to residents. This approach potentially broadens the current levy and replaces the complex ETS system. Recently, a parliamentary initiative (22.415) by G. Pfister has been considered to introduce this new policy.

In this context, the social and business implications require careful assessment and proactive communication to guide businesses, civil society, and government. On the social side, EPFL LEURE will review the distributional impacts, with particular attention to low-income households and minority groups (e.g., farmers, the elderly, and rural communities). On the business side, IMD/HEC-UNIL will analyze costs, risks, and opportunities, as well as competitiveness, benefiting from IMD’s World Competitiveness Center. On the outreach side of the results, this proposal is particularly ambitious, envisioning a number of workshops and ambassadorial activities in close collaboration with E4S.

Primary Output—White Paper

The project will produce a concise white paper summarizing key findings. It will outline which societal groups and industry sectors stand to gain or lose under various scenarios and recommend adjustments to enhance fairness and minimize negative impacts. This document will serve as a reference for policymakers, industry stakeholders, and NGOs, providing actionable recommendations for equity and competitiveness.

Stakeholder Engagement Activities

To translate research into action, the project includes targeted stakeholder engagement in collaboration with E4S and other partners:

• Past Success: A session at the Building Bridges conference on December 12, 2024, gathered 35 participants, including FOEN, SECO, Swiss Cleantech, SSF, WWF, and economiesuisse. The event highlighted stakeholder perspectives on climate policy innovation.
• 1-to-1 Discussions: Personalized talks with policymakers, industry representatives, and civil society leaders will gather feedback and refine communication strategies.
• Roundtables & Workshops: Multi-stakeholder discussions and sector-specific workshops will facilitate collaborative problem-solving and refine actionable strategies.

By combining individual and group engagement strategies, these interactions will ensure research findings are practical, stakeholder-driven, and maximize policy impact.