Six years after infrastructure received its own category in the investment rules for occupational pensions, it has overtaken private equity as the largest alternative holding of Swiss pension funds. The growth has been steady and, for the most part, conservative: diversified funds, global managers, renewable generation and regulated networks.
The next step looks different. Swiss investment foundations now own battery storage plants directly, and pension funds are being offered access to assets whose revenues depend on how they are operated in electricity markets. For foundation boards, the question is no longer whether to hold infrastructure, but which kind of risk the label now covers.
From niche to the largest alternative
Since 1 October 2020, BVV 2 has treated infrastructure as a separate investment category with a limit of 10% of assets. Previously it shared the narrower quota for alternative investments. Holdings had grown quickly even before the reform: according to the Federal Statistical Office, pension funds’ infrastructure investments more than quadrupled between 2014 and 2018, to over CHF 8 billion, although they still accounted for less than 1% of assets. At the end of 2025, infrastructure accounted for 2.7% of total assets in the Complementa pension fund study, ahead of private equity at 2.5%. Swisscanto reports a similar share of 2.8% (investrends.ch, 2026).
The motive is largely defensive. Complementa’s head of investment research describes infrastructure as the current focus of alternative allocations, chiefly as a substitute for bonds and a source of diversification (IPE, 2026). Long asset lives, high barriers to entry and contracted or regulated cash flows, often linked to inflation, support that role. The regulatory headroom is considerable: on average, pension funds use little more than a quarter of the 10% limit.
One label, two risk profiles
Infrastructure is not a single risk. At one end of the spectrum sit regulated networks and power plants with long-term offtake contracts. Their cash flows are largely fixed in advance, often indexed to inflation, and they behave much like long-dated bonds. At the other end sit assets that sell into open markets. Their returns depend on prices, competition and the skill of the operator, and they behave more like operating companies.
Both qualify as infrastructure under BVV 2 and count towards the same 10% limit. The distinction matters because it determines how much a board should allocate, how the holding is valued and how closely it needs to be monitored.
Two routes into the asset class
The Pension Fund of the Siemens Companies in Switzerland illustrates the conventional route. Following a tender process, it committed capital to infrastructure funds managed by Aquila Capital, Luxcara and Partners Group, with a focus on solar, wind and hydroelectric plants in Europe (IPE Real Assets, 2023). At 30 September 2025, its infrastructure holdings amounted to CHF 80.3 million, or 2.1% of assets, within a strategic range of 0% to 5% (PK Siemens, 2025). The fund cited diversification, a better return/risk profile and a contribution to reducing climate risk as its reasons. A subsequent ALM study led it to raise the infrastructure allocation further (IPE, 2026).
The second route is direct and domestic. Avadis Anlagestiftung has acquired a battery storage project of 50–60 MW and 100–120 MWh in Bonaduz, Graubünden; construction is due to start in 2026, with energisation planned for 2027 (Aquila Capital, 2024; Energy-Storage.news, 2024). In Perlen, Lucerne, BESS Perlen AG, a joint venture between Perlen Industrieholding and the VALYOU investment foundation, is building a 10 MW/20 MWh plant due to enter operation at the end of 2026 (pv magazine, 2026). Utilities are expanding as well: in September 2026, Axpo and Energie Uri inaugurated a 58.4 MW facility in Gurtnellen, currently the largest in operation in Switzerland (SRF, 2026b).
Investment foundations give smaller pension funds access to single assets they could not hold alone. They also concentrate exposure in one technology and, often, one market.
How battery storage earns its money
The economic case rests on a structural need. As solar output grows and conventional capacity is retired, the grid requires flexibility at short notice. Large batteries supply it in three ways: they hold reserve capacity for the transmission system operator (ancillary services), they shift energy from hours of low prices to hours of high prices (arbitrage) and, in some cases, they sell services to utilities or network operators under contract.
Market participants put annual revenues at between EUR 40,000 and EUR 180,000 per MW, depending on the market, over an operating life of 15 years or more. The width of that range is itself informative. In one storage fund’s portfolio, arbitrage contributes around 58% of revenues, balancing power around 30% and contracted cash flows only around 12% (Picard Angst, 2026). In Switzerland, the revised Electricity Supply Act provides that grid usage fees paid by storage with end consumption are refunded on request for electricity that is fed back into the grid (Art. 14a StromVG; BFE, 2024).
Batteries are, however, a short-term instrument. They balance the day; they do not move summer solar output into the winter months, when Switzerland relies on imports (SRF, 2026a). Their value to the electricity system is real, but specific.
Saturation: where the risk sits
The feature that makes battery storage attractive, revenue from several markets rather than from a single contract, is also its principal risk. Ancillary service markets are small and saturate as capacity is added. In Great Britain and Australia, ancillary revenues fell by around 80% within two years, and similar saturation had reached the Nordic countries and Germany by early 2026 (POWER, 2026). In the Netherlands, aFRR capacity prices fell from around EUR 105 to EUR 27 per MW and hour between 2022 and 2026. German batteries still earned 55% of their revenues from ancillary services in 2026, yet aFRR capacity prices fell by 35% in July 2026 alone (Hive Power, 2026).
As these markets saturate, revenues shift towards wholesale arbitrage, which depends on price volatility and on the operator’s trading capability. The Perlen plant is a case in point: it will start out in the balancing markets, the segment that has saturated fastest elsewhere in Europe, with day-ahead and intraday trading to follow (pv magazine, 2026).
For a pension fund, this places a merchant battery at the operating-business end of the spectrum. It is exposed to electricity prices, competition and technology risk, and its returns depend heavily on the quality of its operator. That is a legitimate investment, but not a bond substitute.
What BVV 2 asks of the board
The category limit does not settle the question of risk. Articles 50 to 52 BVV 2 require the foundation board to select, manage and monitor investments with care, with regard to security and risk diversification, an adequate return and liquidity. For infrastructure, that assessment turns on four questions:
- Revenue quality. What share of revenues is contracted or regulated, and for how long?
- Valuation. How are assets valued between transactions, given that unlisted holdings are reported at net asset value?
- Concentration. How concentrated is the exposure by technology, market and operator?
- Cost transparency. Are all costs reported? The Siemens fund, for example, discloses one infrastructure fund as not cost-transparent, which its board approved retaining (PK Siemens, 2025).
Track records require particular care. Battery storage strategies are young, and early results reflect markets before saturation. Performance figures from managers and distributors are no substitute for an independent view of how revenues will develop as capacity grows.
The board’s decision
Infrastructure has earned its place in Swiss pension portfolios, and the 10% limit leaves room for further growth. The question for the coming years is composition. Boards that hold infrastructure as a bond substitute should select assets whose cash flows resemble those of bonds. Boards that add merchant energy assets such as battery storage should size and govern them as what they are: operating businesses with market risk, held for diversification and return rather than for income stability.
Recording that distinction in the investment regulations and the ALM study is a modest step. It makes the allocation easier to explain to insured members and supervisors.
References
Aquila Capital (2024), «Aquila Capital advises Avadis Anlagestiftung on investment in Switzerland’s largest battery storage project», press release, 18 November 2024 · Bundesamt für Energie [BFE] (2024), «Erfassung und Transfer von Netznutzungsdaten für Speicher mit Endverbrauch», Bern, 18 June 2024 · Bundesgesetz über die Stromversorgung (Stromversorgungsgesetz, StromVG), SR 734.7, Art. 14a · Energy-Storage.news (2024), «Infrastructure investor Avadis buys Switzerland’s largest BESS project, for 2027 energisation» · Hive Power (2026), «Germany’s aFRR gold rush is closing», hivepower.tech, 10 August 2026 · IPE (2026), «Siemens Pensionskasse targets direct lending to capture illiquidity premium», Investment & Pensions Europe · IPE Real Assets (2023), «Swiss Siemens Pensionskasse commits to infrastructure via Aquila, Luxcara, Partners Group», 11 September 2023 · investrends.ch (2026), «Infrastruktur als Anlageklasse: Warum Pensionskassen wie die PKZH verstärkt auf Wind, Sonne und Netze setzen», 5 July 2026 · Pensionskasse der Siemens-Gesellschaften in der Schweiz [PK Siemens] (2025), «Finanzbericht 2025», Zurich · Picard Angst (2026), «Batteriespeicher als Anlageklasse», 12 May 2026 · POWER (2026), «The hidden idle asset trap: a new era of BESS optimization in Europe», POWER Magazine, 1 April 2026 · pv magazine (2026), «Grossspeicher stärkt den Industriestandort Perlen als Energie-Hub», 17 August 2026 · SRF (2026a), «Batteriemonitor Schweiz 2026: Batterien-Boom bei Solaranlagen entlastet das Stromnetz» · SRF (2026b), «Kanton Uri: Grösster Batteriespeicher der Schweiz am Netz», 9 September 2026 · Verordnung über die berufliche Alters-, Hinterlassenen- und Invalidenvorsorge (BVV 2), SR 831.441.1