EC approves Italy’s €9.7 billion renewables aid scheme

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Italy’s €9.7 billion scheme will support the construction of 17.65GW of new renewables capacity. Credit: Glyn Lowe via Flickr.

The European Commission (EC) has approved a €9.7 billion (US$10.2 billion) Italian aid scheme to spur the growth of renewables.

Approved under the State aid Temporary Crisis and Transition Framework (TCTF), the scheme aims to support the construction of new solar PV, onshore wind and hydropower for a combined 17.65GW of renewables capacity.

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Projects funded through that scheme will have 36 months to begin commercial operation.

The aid will be carried out through a two-way contract for difference (CfD) for a 20-year duration, with 95% of the electricity produced by the plant supported by the CfD.

According to the EC, plants with a capacity lower than 1MW can directly access the scheme with a strike price set by the Italian regulator, Autorità di Regolazione per Energia reti e Ambiente (AREA).

An exact date for when the auction will be held has not been disclosed by the EC, however it stated that the aid scheme must be granted before the end of 2025.

More recently, the country held its first agrivoltaics (agriPV) tender, which awarded 1.5GW of solar PV capacity to 540 projects. The auction was held more than six months after the Italian government decided to ban ground-mounted solar PV installations on agricultural land.

“With today’s 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,” said Teresa Ribera, Executive Vice-President for Clean, Just and Competitive Transition.

Italy is the latest country to see a renewables or manufacturing scheme approved by the EC since the TCTF was adopted. Before Italy, schemes supporting the development of renewables or its manufacturing were approved by the EC in Portugal, with a €1 billion budget, in Poland (€1.2 billion) in Hungary (€2.4 billion), in France (€2.9 billion) and a €2.2 billion decarbonisation grant in Germany.

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