Energy Policies – What are the Italian Government’s Priorities?

Luca FrancesangeliLuca Francescangeli is a consultant based in APCO’s Rome office.

During his first European Council meeting at the end of May, Prime Minister Letta called for a realistic and well-integrated European policy on energy. He highlighted his government’s four priorities to European partners:

1)      Optimize the internal energy market, both from a regulatory and an infrastructure perspective, including smart grids

2)      Promote investment to effectively implement policies addressing climate change, going beyond the 2020 targets

3)      Diversify procurement and consumption of energy by member states

4)      Improve overall energy efficiency, leveraging extensive Italian know-how in this field

According to Letta, green energy should be the top priority for a long-term EU energy road map. At the same time he emphasized the importance of considering new European energy sources, such as shale gas, with an open mind.

At national level, the prime minister declared his ambition to integrate renewables and energy efficiency needs into the existing system, and also to set more selective criteria for incentivizing green energy. Overall, Italy’s new government considers the green economy as central to tackling the economic crisis, fostering new business opportunities, and creating employment.  As a first step, at the end of May the government approved an extension to existing generous incentives on energy saving and buildings requalification, namely tax breaks of 55% and 50% respectively.

The renewable energy sector has welcomed Letta’s declarations and first moves, while pushing for further long-term incentives. To this end, Gifi, the association of Italian photovoltaic companies (which brings together more than 165 operators) is calling for a wider and more stable regulatory framework, supplying incentives “not only for the production but also for distribution, installation and maintenance of renewables.”

Representatives from the traditional energy sectors, on the other hand, are outlining the importance of on-going investment in fossil fuels. During the Fortune Global Forum 2013 in Chengdu recently Giuseppe Recchi, President of Eni, Italy’s largest oil and gas producer, declared that despite some enthusiasm, “alternative fuels seem destined to play a marginal role in the transport sectors.”

Another urgent priority for Italy’s new government is to quickly address the issue of energy bills. These are currently among the most expensive in Europe, mainly due to the scarcity of energy resources and the subsequent need to import supplies from overseas. To this end, Italian Minister of Economic Development Flavio Zanonato recently commented that his priority was to “reduce the excessive costs of energy, in particular for SMEs, aiming at realigning Italy with EU levels. However, he has yet to announce the details of how the government will seek to address this important issue. From the government’s perspective, the costs businesses bear for their energy use is a crucial issue that needs to be effectively addressed to boost the competitiveness of Italian companies, both abroad and in the national market.

Posted on June 25, 2013 By
Categories  Energy & Clean Tech and tagged , , , , , ,
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