European Commission Nod to €9.7b Italian Renewable Energy Scheme

In a boost to Europe’s green energy ambitions, the European Commission announced that it has approved a €9.7 billion Italian scheme, aimed at building 17.65 GW of renewable energy capacity. This scheme will be crucial in Italy’s journey towards a net-zero economy.

Speaking about this development, Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition said, “With this decision, Italy will be able to support the production of renewable electricity from various technologies, such as onshore wind, solar photovoltaic or hydropower. It helps Italy reduce its dependence on Russian fossil fuels, while making sure that any potential competition distortions are limited.”

The approved aid will support the construction of onshore wind, solar photovoltaic, hydropower, and sewage gas electricity production plants. The aid, which will be disbursed by December 31, 2025, will be granted only after a transparent and non-discriminatory bidding process. Plants with capacity lower than 1 MW can access the scheme directly.

Also attached is a variable payment structure under a 20-year 2-way contract for difference (CfD) for each kWh of electricity produced and fed into the grid. All plants must enter into operation within 36 months of the aid being granted.

The €9.7 billion budget is also based on projected market price estimates. However, actual net support may be lower in case of higher-than-expected market prices.

This initiative falls under the European Commission’s State Aid Temporary Crisis and Transition Framework (TCTF), which was introduced in March 2023, and amended in November 2023 and in May 2024. (see EU’s New Measures To Boost Solar PV Manufacturing). The TCTF framework aims to facilitate the green and digital transition while mitigating the impact of geopolitical and economic shocks on Member States’ economies.

Source from Taiyang News

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