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Italy

Italy

Government urged to confirm prices

ITALY: Italian renewable energy association Aper has called on the government to set the payment rates that will apply under the country's planned feed-in tariff (FIT) incentive system as soon as possible.

This is particularly important for projects operating under the green-certificates system that will have to move to the FIT system within the next few years, it says.

Setting rates now would restore investor confidence and encourage banks to resume financing the sector, it adds.

Under the FIT system, generators will get a guaranteed premium rate for the electricity they supply. Those operating under the certificate market rules get income from both the certificates they sell (with each certificate equivalent to a megawatt hour of output) and the electricity (at wholesale market rates). In the past few years, there has been an oversupply of certificates, so state energy management agency GSE has bought back excess certificates and will continue to do so in the run-up to the FIT system.

Operators of existing plants or facilities that come online by December 31, 2012 will continue to be issued green certificates until 2015, when they will be absorbed into the FIT system. Along with fellow renewables organisations Asso Energie Future and Ises Italia, Aper has called for a premium price of EUR0.083-0.087/kWh to be set for these companies under the FIT. This will reflect the average buyback price for green certificates in the 2011-15 period, it says.

Meanwhile, negotiations are likely to shift soon to the support scheme for plants coming online after 2012. The government says larger facilities will be required to participate in a competitive auction process to receive the FIT, with those seeking lower incentive prices favoured. It has not yet agreed the capacity threshold at which auctions will be set.

"We are very much against the auctions," says Tommaso Barbetti, head of Aper's markets and incentives division. He fears that the auctions could stunt market growth. "But since it is unlikely we can get rid of them now, we ask that the threshold be set at a high level."

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