Italy - Repowering projects provide main hope

ITALY: Italy is likely to install about 400MW of new capacity this year, broadly in line with 2013 but well below the roughly 1GW annual growth in 2010-2012.

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The slowdown has accompanied a change in incentives, with project sponsors now competing for a feed-in-tariff.

The last auction foreseen in the current market framework takes place later this year, amid uncertainty about how wind power will be compensated after that. As most of the best wind sites have already been taken, market participants agree that it is time to look more seriously at repowering and for the government to streamline authorisation for repowered projects.

Last year, Italian firm Erg Renew became the country's leading wind power producer with the acquisition of a major wind portfolio from GDF Suez. It has about 1.1GW of Italian wind farms but, like many others, it is concentrating growth efforts outside Italy. Other news involved the closure of a Vestas nacelle plant in southern Italy. Some of the 120 jobs lost were saved by reconversion of the facility to blade production. Wind energy association Anev says Italy lost 4,000 wind energy-related jobs in 2013.

Current political backdrop Coalition preoccupied as Italy's economy lags. A new government is unlikely to change matters much

High point of 2013 Project development did not completely cease, as some investors continued to see selected growth opportunities despite significantly lower tariffs

Low point 4,000 jobs lost in the sector last year

Key influencer With green lobbies having little weight, power group Enel (which has substantial wind assets) and oil and gas giant Eni are seen having the ear of policymakers

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