Italy Planning to Phase Out Nation's Renewable Energy Incentives Gradually

Environment Minister Stefania Prestigiacomo indicated that Italy will keep renewable energy incentives for the time being and phase them out gradually.

“It’s obvious that incentives going forward will be declining,” Prestigiacomo said at an event today in Brindisi, Italy. “On this topic there won’t be any back-peddling. We will push ahead with renewable energy and we will push ahead with nuclear power. Italy needs both.”

Her comments are in line with those of other Italian officials. Industry Ministry Undersecretary Stefano Saglia said in December that Italy wasn’t planning any “dramatic” cuts in clean-energy incentives, preferring a gradual reduction that will help consumers without harming businesses.

The government is still drafting legislation regulating clean-energy incentives. There is no scheduled date on when legislation will be put to a vote in parliament. The bill was discussed today in a pre-Cabinet meeting, Prestigiacomo said.

“There are still ongoing meetings between the Ministry of Environment and that of economic development to put together a shared draft,” she said.

Government incentives may cost Italy as much as 5.7 billion euros ($7.8 billion) this year, according to a report by the energy regulator, Alessandro Ortis. A proposed decree to use auctions to award permits for renewable plants bigger than 5 megawatts goes in the right direction, Enel SpA Chief Executive Officer Fulvio Conti said on Feb. 8 in Milan. Prestigiacomo today excluded a cap on plants, such as an 8 megawatt limit.

In Brindisi, Enel started operating the country’s first plant for capturing carbon dioxide emissions and storing them underground in a pilot project intended to make the technology viable. Enel is Italy’s biggest energy company.

To contact the reporter on this story: Alessandra Migliaccio in Rome at amigliaccio@bloomberg.net

To contact the editor responsible for this story: Jeffrey Donovan at jdonovan26@bloomberg.net