Sept. 29 (Bloomberg) -- Italy may face power cuts today as generators restore capacity after the nation's biggest blackout since World War II. Industry leaders criticized policies that have made the country dependent on imported electricity.

Supplies can't return to normal until tomorrow, said Carlo Andrea Bollino, chairman of the Rome-based national electricity grid operator, on state-owned RAI television. He called on residents to save electricity in the meantime.

The Italian grid shut down at 3:30 a.m. yesterday for more than three hours from, knocking out power for almost 56 million people. A storm may have damaged a transmission line in Switzerland, causing the loss of all 6,000 megawatts of imported power, a quarter of Italy's demand at the time, Bollino said.

``I'm not calling on people to wash their clothes by hand,'' Bollino told the newspaper Corriere della Sera. ``But maybe they could use the washing machine at different times.''

Demand was expected to peak at about 45,100 megawatts around 11:30 a.m., said a spokesman at Gestore della Rete di Trasmissione Nazionale SpA, the grid operator. The state-owned company is waiting to see if power stations that shut down yesterday can return to full capacity. No power cuts are planned until at least noon, the company said.

Italy has become more dependent on power imports than any other country in Europe because of delays in building new power plants. No large power stations have been built in the country for a decade because of bureaucracy and protests from residents. Investments in new transmission lines have also been hampered.

No Nukes

A referendum in the late 1980s banned nuclear power stations after the Chernobyl disaster in the former Soviet Union. That means Italy burns more oil to produce electricity, helping to make its power the most expensive in Europe and increasing imports of cheaper nuclear power from France and Switzerland.

The blackout was ``the dramatic result of a long series of errors that our country has been making for more than 20 years and of the lack of a clear and precise national energy policy,'' said Confindustria, Italy's biggest employer s' group.

Italy is the fourth European country in two months to suffer a major blackout, underscoring the need for investment in the continent's infrastructure. The lights went out in Italy less than a week after 4 million people in Denmark and Sweden lost power because of a fault in a Swedish cable. A 40-minute outage halted London's trains and subway cars a month ago.

Another blackout, this one on the U.S. East Coast on Aug. 14, left more than 50 million people in the dark. Italian Prime Minister Silvio Berlusconi said earlier this month a blackout like the one that hit the U.S. couldn't happen in Italy.

Falling Tree

A tree struck a transmission line in the Swiss canton of Schwyz, setting off a ``cascade'' reaction that shut down power transport and production in Italy, according to Atel, which runs the Swiss network. Atel said in a statement it took all necessary measures to restore power.

``Given the high level of power imports to Italy, it's crucial that all network operators co-ordinate their actions rapidly and in the right manner,'' the statement said. ``Obviously, this didn't work sufficiently.''

Paris-based Reseau de Transport d'Electricite said the disruption in Switzerland was followed by the loss of power at one of two high-voltage cables between Albertville, France, and Italy. ``Power on that line was re-established in just a few minutes in France,'' spokesman Michel Derdevet said. ``It was much longer in Italy.''

No Attack

The Italian network operator blamed problems in both France and Switzerland and said its own grid shut down within four seconds. Industry Minister Antonio Marzano said power lines kept working after the blackout, ruling out an attack on the network.

Parts of southern Italy and the island of Sicily lacked electricity until about 6 p.m. yesterday, and water supplies in cities such as Naples will take longer to return. Five people died, according to Corriere della Sera. Two were killed in separate car accidents, two people fell down stairs and one woman set herself on fire trying to light a candle, the newspaper said.

The only parts of Italy that kept power were the islands of Sardinia and Capri.

The cost of the blackout to food retailers, bars and ice- cream parlors may be 120 million euros ($137 million), according to Confcommercio, Italy's largest lobby for retailers.

Italian President Carlo Azeglio Ciampi, legislators and industry groups said Italy must build more power plants and transmission lines. The Industry Ministry has authorized 12,000 megawatts of new generation capacity in two years, although building has been slowed by disputes between local governments and opposition from residents and environmental groups.

Summer Heat

Italy repeatedly ran short of electricity during the summer. About 6 million people suffered rolling blackouts in June when demand soared during a record heat wave.

The problems may prompt the government and politicians to take action. Italy must now make ``unpopular decisions,'' Pier Ferdinando Casini, president of the lower house of parliament, said in an interview with Corriere della Sera.

``This could be the political shock the country needs in order to remove various obstacles, namely at a local level, which have slowed down the construction of new plants,'' analysts at UBS AG said in a note.

Shares of Enel SpA, Italy's biggest utility, which generates half the nation's power, rose 3 cents, or 0.5 percent, to 5.43 euros as of 11:32 a.m. in Milan.

Last Updated: September 29, 2003 06:11 EDT