The article concerns the regulation of the Renewable Energy Market in Italy, providing a brief overview on the matter at hand.

Although Italian policy on renewable energy is greatly

influenced by EU policy, in Italy there are financial motivations such as the

feed-in tariff[1] and the feed-in premium[2] that provide incentives for the

installation of renewable energy plants and therefore the development of

renewable energy.

In addition, the, as of 2015, abolished Green

Certificate mechanism[3] provided an incentive for the

production of energy from renewable sources. The certificates supplied the

producer with a double economic advantage as they were assigned independently

of the income associated with the sale of electricity.

New measures have been introduced to promote the use

of renewable energy sources. For example, the production of electricity from

renewable sources was addressed by and implemented in Legislative Decree No.

387/2003, which included a simplified single authorisation procedure issued by

regions or provinces to adapt town-planning regulations.

Furthermore, Decree No. 28/2011 details legislation in

relation to the frameworks necessary to reach the targets outlined for 2020 by

the Italian National Renewable Energy Plan. Moreover, the decree implemented

the simplified authorisation procedure, replacing the declaration of commencement

of activity. Additionally, for installations that do not entail a building

permit, only a notice to the Public Administration is mandatory.

The development of Renewable energy is aided by the, in

comparison with conventional production plants, lower connection fees which are

granted for renewable energy sources that produce electricity. The AEEGSI

Resolution No. 281/2005 outlines that the renewable energy producer may also

choose to construct by themselves, free of charge, all the necessary components

for the connection to the network. In addition, renewable energy sources that

produce electricity are provided with priority access to the transmission and

distribution grid.

The Italian Energy efficiency and conservation system

consists of a number of mechanisms. Of particular note are:

i) ‘White

Certificates’ within the energy saving sector which certify energy saving

accomplishments as a result of energy efficiency initiatives;

ii) Funds

for energy redevelopment interventions administered by the Ministerial Decree

of 16 February 2016, including thermal insulation of matt surfaces and the

replacement of traditional air-conditioning systems with the installation of

condensation heat generators or amending the type of windows used;

iii) The

period of tax deductions for energy redevelopment projects has been extended up

to 31 December 2017. Law No 232/2016 implemented this incentive mechanism

whereby owners of buildings can reduce the expenses by 65 per cent and owners

of apartments can reduce the expenses by 70 per cent;

iv) The

European Directive 2004/08/EC was implemented by Legislative Decree No. 20/2007

regarding cogeneration. The Decree introduced the CAR qualification ‘Cogenerazione ad Alto Rendimento’

(high-yield cogeneration) which guarantees that the electricity produced

through high-yield cogeneration can be certified by GSE if the energy

production reaches at least 50MWh/year. The Ministerial Decree dated 5 September

2011 outlines the circumstances in which the CAR qualification provides access

to the White Certificates.

Since 2011, various operators in Italy have executed

smart grid pilot projects under Resolution No. ARG/elt 39/10 and Consultant

Document No. 255/2015/R/EEL. More recently, the MISE commenced a state aid

programme to advocate investments for the building of intelligent electricity

distribution networks. For the advancement of smart grids in Basilicata,

Calibria, Campania, Puglia and Sicily, the Ministerial Decree issued on 19

October 2016 assigned €321,620,225.

The AEEGSI has made recent technological developments

regarding second generation smart metering, enabling the remote control of

electricity, gas and water meters.

Firstly, in the electricity sector, the AEEGSI has supported the

expenses for low voltage electricity metering and has furthermore commissioned

provisions under AEEGSI Resolution No. 646/2016/R/EEL and functional

specifications under AEEGSI Resolution No. 7/2016/R/EEL. Secondly, in the gas

sector, the commissioning requirements of gas meters has been updated up to

2018 under AEEGSI Resolution No. 554/2015/R/gas.

Regarding the outlook and development prospects of the

energy market it is essential to refer to the AEEGSI Resolution No. 3 dated 15

January 2015, whereby the progression of the energy sectors between 2015-2018

specifically requires the establishment of adept and unified electricity

markets, in addition to adaptable gas markets that work within a European

framework. The Resolution requires the creation of competitive retail markets,

an increased accountability of the network operators for infrastructures and

the management of the water sector.

[1] See AEEGSI Resolution No. 369/2016

[2] Feed-in premium tariffs that apply

to the electricity produced by solar thermal plants, in addition to

photovoltaic plants that were established and operating prior to 26 August

2012.

[3] The certificates were introduced by

Legislative Decree No. 79/1999. From 2015 the current Green Certificate

mechanism no longer applies. From 1 January 2016, the producers eligible to

benefit from the mechanism have received a ‘replacement’ incentive provided by

the GSE.