Four key takeaways on Italian PV from Key Solar event

A new energy strategy with solar at its core
Today (Friday November 10) at 12 noon the Italian government is expected to release the final version of a new energy strategy (Strategia Energetica Nazionale – SEN) that could place solar as one of the main pillars of Italy’s future Italian energy system for the period 2020 to 2030.

The new strategy could even envisage the deployment of between 30 GW and 50 GW of additional solar capacity over that period, as revealed during one of the fair’s conferences by scientific director of the event Gianni Silvestrini, who also happens to be one of the most prominent figure in the Italian solar and renewable energy landscape.

If confirmed, this target would undoubtedly bring Italy back to the club of world’s largest PV markets and help push average annual growth to around 3 GW. However, how this ambitious strategy will be implemented remains unknown, as the SEN lays down only general guidelines. Further, the role of the country’s future governments, and especially the one that will be formed after the upcoming legislative elections to be held in March, will be decisive for the setting up of the necessary regulatory tools that can make the target achievable. But while Italian politics remains an undecipherable variable, the target is clearly pushing Italy towards a future will less thermoelectric power generation.

A provisional roadmap to 2020 is needed
Although the SEN is raising big hopes for the long-term PV perspective, one of Europe’s largest economies should not spend the next two years neglecting to improve the current regulatory framework for solar and storage, as many current challenges need addressing before the SEN is implemented. This is the main request that the Italian solar industry has submitted to representatives of the Italian government that were present at the fair and its conferences.

The current regulatory framework, in fact, has allowed the local PV sector to stay afloat over the past three years thanks to annual growth ranging from approximately 300 to 350 MW (which may also be considered a good result if we take into account that there are no direct incentives for solar power generation), but it has not tapped the full potential of a country with a very high solar radiation, an industry hungry for cheap energy, and a consolidated ecosystem of installers, PV product providers and a large range of new potential players (especially aggregators and storage specialists) that are willing to enter the market.

Net metering (scambio sul posto) and PPAs for commercial and industrial PV (the so-called linee dirette) have so far enabled the market to achieve the above-mentioned levels of development, but as pv magazine learned from the operators spoken with at the fair, the linee dirette may even bring more growth between 2018 and 2019.

The secondary market
Although the growth of the past three years was quite limited compared to the years of the incentive programs Conto Energia, in which over 17 GW of PV capacity was deployed, the existing Italian PV plant portfolio, which was built hastily under tight schedules or the abrupt or anticipated closing of the Conto Energia schemes themselves, offers a wide range of  opportunities for O&M companies and for the retrofitting business in general. As pv magazine learned at the event, all the operators of the secondary market seem to be quite satisfied with the new rules the government-run energy agency GSE issued in late February this year. The new regulation, in fact, allows a 5% capacity increase for PV installations up to 20 kW, and of 1% for PV systems with a capacity over 20 kW, with the additional capacity having access to the FIT scheme.

This mechanism, as well as other provisions contained in the new rules, may be responsible for the fact that this year the newly installed capacity under this regulation may slightly exceed the combined capacity of new PV installations.

Many solar PV power generators (including solar parks) were evidently shabbily installed across Italy during the years of the Conto Energia, often with poor engineering, irregular mounting or attached under unfavorable conditions, such as in locations prone to shading or at a less than optimal inclination. Prior to the new regulation, however, very little was done in this field due to the lack of clear and favorable conditions.

One thing, however, that is raising a lot of concerns for the secondary market’s operators are the inspections that the GSE is making to check if repowering and revamping interventions were conducted properly. If infringement of rules are detected, the loss of all incentives may be an option. Talks with the Italian authorities, however, are currently being conducted in order to reduce the impact of possible sanctions.

Optimism
The most important message, however, to take from the Key Solar event is the moderate but crucial optimism that was perceptible across the show floor. According to Cecilia Bergamasco, a journalist active in the Italian renewable energy sector since the early stages of development of the local PV markets, the fact that a new event for the solar energy industry was put in place again is itself a signal that confidence in the future of PV in Italy is returning. “Despite all of the challenges, what is crucial now is a new start. We must create more awareness that PV is economically viable, even without incentives. The technology is mature, its costs have dropped drastically, now we only have to let citizens and enterprises know that the moment has arrived to change our role, we cannot remain passive consumers, we have to learn how to become prosumers,” Bergamasco told pv magazine.

The president of the association Italia Solar, Paolo Rocco Viscontini also highlighted the positive atmosphere of the fair. “Key Solar has showed,” he stressed, “that domestic and national operators now have a new idea of the Italian market. The interest is focused on new installations but also on revamping and the O&M business for existing solar facilities. In fact, thanks to the new rules of the GSE (which Italia Solar has contributed to), now the operators have the opportunities to implement revamping and repowering interventions following the provisions contained in the new regulation without incurring sanctions after an inspection of the GSE.”

Alberto Pinori, the president of Anie Rinnovabili, the renewable energy association of the General Confederation of Italian Industry (Confindustria), expressed an even stronger sense of optimism regarding Key Solar. “We are seeing a fair that is working out well, and that has attracted many exhibitors and visitors, as well as representatives of public institutions. We have a new energy strategy that may be more favorable to solar and renewables than we expected. The revamping business may result this year in a few hundreds of MWs, while storage is starting to show its potential. On top of this, the residential and commercial segments are performing well. It is almost impossible not to be optimistic.”