Italy: Fifth Conto Energia to come into effect when €6 billion ceiling reached; draft measures laid out

12. April 2012 | Top News, Applications & Installations, Global PV markets, Industry & Suppliers, Markets & Trends | By:  Becky Stuart

The Italian government has announced that the country’s new renewable energy law, Conto Energia V, will come into effect when the €6 billion photovoltaic feed-in tariff (FIT) ceiling is reached – expected to be between this July and October. It has also laid out initial proposals for the new law, which include remuneration cuts, an annual installation cap, and big changes to ground-mounted criteria.

Italy solar photovoltaic rooftop

Under the new proposals, Italy's small photovoltaic rooftop sector will benefit.

Italy may have been the King of the solar castle in 2011, however, its government is working hard to ensure that photovoltaic growth is curbed going forward. And indeed, many, like Jefferies, have predicted that the country will install just two gigawatts (GW) this year.

Following speculation in late March that a new Conto Energia would be introduced, it has now been confirmed on the Italian Ministry of Economic Development website that a  fifth renewable energy law – Conto Energia V – will come into effect for photovoltaics once the €6 billion FIT ceiling is reached, expected between July and October 2012. For hydroelectric, geothermal, wind, biomass and biogas, the new law will take effect on January 1, 2013.

The Italian Minister of Economic Development, Corrado Passera, the Minister of Environment, Corrado Clini and the Minister of Agriculture, Mario Catania, explained that the new law, aims at both "balanced growth of renewable energy",  and the completion of the EU’s 2020 energy targets – something Italy says it is on track to exceed.

The proposals

Under the new law, a number of proposals have been suggested, including a two to three GW cap on annual photovoltaic installations. Systems over 12 kilowatts (kW) will also have to register, and will only have the right to a FIT when they fall within the limits of the cap.

Systems between one and 12 kW will not be required to be a part of the register. However, the total installed capacity of all these systems will be counted on an yearly basis and put towards the next year’s annual cap. Consequently, the total cap for the next year will be reduced accordingly.

Criteria

In order for photovoltaic systems to be considered for the new register, it is believed that they will have to meet the following criteria:

  • Rooftop systems are to be staggered according to energy efficiency
  • Ground-mounted systems will only be allowed on contaminated land and landfills
  • Small systems will be allowed for agricultural organizations
  • Systems will be allowed for communities with fewer than 5,000 inhabitants
  • Systems will be allowed on greenhouses, pergolas, etc.
  • Size of the plant
  • Enrollment date in the register
  • Approval date

An exception is expected to be applied to the first Conto Energia V register, whereby the top criterion will be the date of commissioning.

FIT reductions

If the proposed changes are adopted, it is also expected that FIT cuts will be made. For instance, a three kW rooftop system will be eligible to receive 23.7 euro cents/kWh, instead of the current 27.4 euro cents/kWh. Meanwhile, a 200 kW rooftop system will be paid 19.9 euro cents/kWh, as opposed to 23.3 euro cents/kWh, and a one megawatt ground-mounted system, 16.1 euro cents/kWh, instead of 18.2 euro cents/kWh. Furthermore, it seems likely that the eight euro cents market price will be scrapped.

Reaction

A spokesperson for the Italian Photovoltaic Association, GIFI, told pv magazine that it is too early to comment on the proposed measures, since no official documents have yet been seen, just some slides detailing the measure. The association is expected to issue a response once it has seen the actual texts. They did say though that "there's a hard warning on sector prospects" in the Italian photovoltaic industry.

Commenting, New Energy Projects, a German-based photovoltaic project developer active in the Italian market, said that the industry will have to "wait and see" if the government actually adopts the measures. However, if they do go through, it will see a clear focus placed on the rooftop sector, while ground-mounted systems will be significantly limited.

The company added that systems on agricultural land will have to be quickly implemented, in order not to slip past Conto Energia IV or the first Conto Energia V register. It notes though, that even under the recently passed law, these plants must be online, by the latest, by September 21, if they are to receive a FIT.

With the expected continued price declines, grid parity is moving ever closer for large projects, which is also wanted by the Italian legislators, concluded New Energy Projects.


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