Italy Renewable Energy Market | Size, Share, Trends and Forecast to 2028

The global energy landscape is going through a major shift towards renewable based energy generation. This energy transition was possible after a decade of rapid technological advancement and a favorable regulatory environment.

Additionally, factors such as decreasing costs of renewable energy sources and increasing competitiveness of battery energy storage technologies are expected to contribute to accelerated renewables deployment in the coming years. Furthermore, as the concern for climate change and support for environmental, sustainability and governance (ESG) considerations grow, the demand for clean and green power is expected to increase from almost all end-users.

The renewable energy market consists of the establishments primarily engaged in operating renewable electric power generation facilities. The power generation can be from a variety of sources, including solar energy, wind energy, small hydro, bioenergy, geothermal and marine. The electric energy produced in these establishments is provided to electric power transmission systems or to the electric power distribution system.

Italy Renewable Energy Market Scenario

When it comes to renewable energy production, Italy is one of the most exceptional countries in Europe and the globe. After hydroelectric power, solar energy is the country's best performer among green energy sources. According to IRENA, Italy has renewable energy installation of 56987 MW by the end of 2021.

Italy is one of 14 EU nations that have met their 2020 renewables target as a percentage of total energy consumption (18.2 percent versus a 17 percent target).

The installed solar capacity (Photovoltaic) of Italy was 22692 MW, while for wind, it was 11276 MW. The capacity increased by 20.1% and 23.4% for solar and wind, respectively, since 2015. In the past decade, each time that the amount of solar photovoltaic installed capacity doubled globally, the price of installing solar panels and modules declined by 34%.

Italy Solar Energy

Italy is also one of the world's major leaders in solar energy generation. Mean annual solar radiation in Italy ranges from 3.6 kWh per square meter per day in the Po river plain area to 4.7 kWh per square meter per day in Central-Southern Italy to 5.4 kWh per square meter per day in Sicily: as a result, some regions have a very high electricity production potential from solar, despite the fact that the entire national territory has very favorable conditions for the installation of solar energy production plants. 

According to the Italian solar association Italia Solare, Italy installed approximately 937MW of additional solar PV power in 2021.

In the first three months of 2022, Italy installed approximately 433 MW of solar electricity. Installations increased dramatically from 152 MW in the same period last year to 115 MW in the first quarter of 2020. This year's (2022) largest growth month was March, with 241 MW, followed by February and January, with 103 MW and 89 MW, respectively.

The Italian government has issued the DL Energia decree, a new package of measures aimed at lowering energy expenses for Italian individuals and businesses. The new laws simplify licenses for commercial rooftop PV systems with capacities ranging from 50kW to 200kW, which are permitted to operate in Italy under the country's net metering plan, known as the "Scambio sul posto."

The so-called Energy Decree became official in Italy on March 1, 2022. The Energy Decree, in addition to dedicating more than EUR 8 billion to measures to combat growing fuel bills and fuel prices, has also included a series of simplifying measures for renewable energies.

The Energy Decree has made it even easier to put photovoltaic plants on houses, sheds, and other structures. This is due to the elimination of the requirement for any form of authorization or permit for the installation of PV modules, as well as the completion of any works required for the plant's connection to the power grid within those structures.

The National Integrated Plan for Climate and Energy in Italy plans for 50GW of solar capacity by 2030.

Italy Wind Power

Wind energy is also a major renewable energy source in Italy. Italian wind plants are concentrated in the south of the country and are dominated by onshore wind farms. In 2021, wind energy covered 7% of the annual electricity demand in Italy.

Individual wind turbines are being deployed in Italy. While larger plants predominated until 2012, for over a decade now, smaller plants, particularly residential plants, have become the favored option, resulting in a boom of installations with modest capacity. Each of these plants typically has a capacity of 20 to 200 kilowatts.

The country has also started to focus on offshore wind opportunities. Italy’s first offshore wind farm and the first in the Mediterranean was commissioned at the end of April 2022. The country is also discussing an increase in the offshore wind target to 5 GW by 2030 using incentives and other means.

Italy Energy policy

The Italian government's energy policy is heavily pro-renewables. The country has seen monumental growth in the renewable energy sector and has successfully integrated huge amounts of variable renewable output. 

The PNIEC (Integrated National Plan for Energy and Climate) of Italy describes the country's strategy for decarbonization, energy efficiency, self-consumption vs. distributed generation, and energy security from 2021 to 2030. The Plan intends to increase renewables' proportion of final gross energy consumption to 30% by 2030 and sets high targets for renewable energy generation. Italy is earmarking EUR 59 billion (roughly USD 66 billion) in the National Recovery and Resilience Program (NRRP) to incentivize renewables between 2021 and 2026.

Italy has been heavily reliant on gas imports: 95 percent of the gas it consumes is imported, 45 percent of which originates from Russia. This is noteworthy because gas accounts for 42 percent of Italy's energy use.

Hence, with the advent of the Russian invasion of Ukraine, Italy, along with the rest of the European Union, the UK, and the US, announced a plan to phase down dependency on Russian gas by 2025. Therefore will now be more reliant on renewable energy sources.

Challenges

Due to the lengthy permitting process, all three auctions for wind and solar PV in 2021 were undersubscribed, continuing the trend from 2020. The capacity not awarded in the undersubscribed auctions is moved to the next one, steadily increasing the total volume in the auction while ignoring the core reason for the under subscription - slow and burdensome permitting.

Recent Developments 

• In June 2022, the Gestore dei Servizi Energetici (GSE), Italy's energy agency, allocated 300 MW of solar capacity across 34 locations in Italy.
• In March 2022, the Italian government approved the building of six wind farms with a total capacity of 418 megawatts as part of its efforts to minimize reliance on Russian gas. The parks will be built in Puglia's central and southern districts, as well as Basilica and Sardinia.
• In Jan 2022, Italy introduced an 11-month retroactive incentive cut on PV systems over 20 kW, which will apply only for the period from February 1, 2022, to December 31, 2022.
• The Italian government has decided to spend USD 294 million to assist small and medium-sized businesses in installing PV systems for self-consumption. The money will be used to provide rebates to businesses to help them cover some of the costs of procuring and installing solar systems.

What do we cover in the Report?

Blackridge Research's Italy Renewable Energy Market report contains the installed capacity of renewable power generation sources (year-on-year) until 2028, the list of ongoing and upcoming renewable power generation projects such as solar photovoltaic farms, concentrated solar power projects, onshore wind, and offshore wind energy projects and the regulatory scenario within the renewable energy market of Italy.

Furthermore, the report will contain the drivers and restraints within Italy's Renewable Energy Market along with a meticulous evaluation of their impact in the near-, medium-, or longer term. Factors affecting renewable energy deployment include market conditions (e.g., cost, diversity, proximity to demand or transmission, and resource availability), policy decisions (e.g., tax credits, feed-in tariffs, and renewable portfolio standards), as well as country specific regulations. Finally, the presentation would enable one to identify market opportunities and plans for long-term growth.

The impact of the COVID 19 pandemic is an integral part of the report.

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