Apulia in the south east of Italy is the country's leading wind energy region. It had 460 MW of installed capacity at the end of 2006 and looks set to retain its pole position this year and perhaps for some time to come. A number of projects are under construction and the region has received an impressive number of requests to build more.
"Our regional energy plan is substantially based on a greater use of renewable energy sources and among these wind energy, both in its industrial version and with small-scale wind projects," says Michele Losappia, the official responsible for environmental issues in Apulia. The region has an objective of 5000 MW of installed renewables capacity, Losappia says, but has no deadline for reaching that figure.
"Apulia has a good electricity network, there's wind and there's a good consensus [on the development of wind]," says Roberto Vigotti of Inergia, which is close to completing a 36 MW wind plant near Lecce. "In many ways, it's ideal, so there's a lot of competition that has pushed up prices."
Sicily, a close second runner to Apulia with 452 MW of installed wind capacity at end-2006, now looks set to fall behind after issuing new guidelines for wind plant siting which the wind industry says are restrictive. Paolo Tabarelli of international wind plant developer/owner Babcock & Brown notes that two other potentially hot regions for wind, Molise and Basilicata have also experienced a strong slowdown. Molise is exiting from a moratorium on wind development that a Constitutional Court ruled against while Basilicata backed away from its own planned moratorium after that court ruling. "In this situation, Apulia in 2007 should certainly be the leading region for wind," he says.
Apulia's southern tip is the "heel" of the boot-shaped Italian peninsula. The territory is a mixture of plains, hill country and coastal land bordering on the Ionic Sea to the south and the Adriatic to the east. The densest population is concentrated around Bari, with about 500,000 residents in the city and surrounding metropolitan area. A handful of mid-sized cities and numerous smaller towns make up the rest of the region. Although it has a history of poverty, it is now seen as being relatively well-off economically compared to other parts of southern Italy.
Apulia's wind energy boom follows the end of a year-long moratorium that expired on June 30. The region said that the halt was necessary to provide a solid regulatory framework for wind plant siting given the large number of building requests received. As well as projects approved or underway, the region has also received building applications for about another 3000 MW, says Losappia. He adds, however, that less than a third of this 3000 MW is likely to end up being built. "So it's not true that there's savage growth."
Following a transitory regulatory scheme, new rules for the construction of wind plants are going into effect on April 4. As is the case elsewhere, there are restrictions on building in certain zones, but Apulia's rules are generally seen as balanced. Of most note in the new regulation is a requirement for municipalities planning to allow development in their area to draft implementation plans, the so-called Piani Regolatori per gli Impianti Eolici (PRIE). In the PRIE, towns must identify those areas in which wind plants cannot be located. Market players are expecting the impact of the new regulation to be felt in 2008.
Lamberto Custodi of EnerTAD, which is constructing a 20 MW plant in the region to add to those it now operates in Troia, says he expects the adoption of the PRIE should lead to no more than a moderate slowdown in the authorisation process and is optimistic on the prospects. "I believe the region has recognised that wind energy can bring large economic, social and industrial advantages," he says.
Home to Vestas
The south European manufacturing arm of Vestas has long been located in Apulia. Vestas Italia, with headquarters in Taranto, opened for business here in 1997, initially through a joint venture with state-controlled company Finmeccanica, which it bought out in 2001. The Taranto factory is the only which produces the Vestas 850 kW machine. "Certainly, the presence of Vestas has helped in the process of creating a culture in favour of wind," says Babcock & Brown's Tabarelli, who previously headed up the Vestas Italia unit.
Aside from Inergia and EnerTAD, a number of other developers -- and the turbine producers who are supplying them -- have provided details of projects underway in Apulia. Independently owned IVPC, the old hand in Italy's wind business and the country's leading developer, should soon finish a 30 MW plant in Poggio Imperiale. Later this year, Milan-based renewable energy players Maestrale Green Energy and Waste Italia will respectively add 21 MW and 36 MW to the Apulia total with plants in Martignano and Troia. Bolzano-based Fri-el, with its French partner EDF Energies Nouvelles, is putting up 40 MW in Minervino. Indeed, nearly all developers active in Italy have something in the works in the region. While the first projects about a decade ago were in the windy mountainous zones or hill country, the trend has been for developers to descend to lower-lying areas with easier access. Improvements in wind turbines for low wind operation lie behind the trend.
Towns within Apulia seem eager to follow the lead set by regional government. Cerignola sought expressions of interest from developers in building three wind farms with a combined capacity of between 167.5 MW and 201 MW. The company selected to build the first wind plant is Gierret and the town is now in the process of choosing developers for the other two projects. The town of Manfredonia said last month that two companies -- Lucky Wind 4 and Elce Energia SpA -- have been authorised to build 50 MW plants on its territory. A third company, Developed Srl, is installing wind turbines in the town's jurisdiction with a combined capacity of 87.5 MW.
While opposition to wind projects exists in Apulia, numerous municipalities back wind development, making Apulia unique among Italian regions. One of the reasons for the support is that local administrators have discovered that attractive royalties can be generated for their towns from wind plants located in their jurisdictions. Wind plants can also lead to local jobs. One hill town in the region, Alberona, is hoping to reverse a declining population with economic benefits from wind development. Industry players say that economics do not totally explain the greater level of tolerance Apulia for wind projects. At least some of the goodwill has come about as local people become familiar with the technology and realise it is not as disruptive as many fear.
Future growth is not expected only on land. Spanish turbine producer and developer Gamesa has a project to build a nearly 300 MW plant off the coast of Manfredonia, an area of relatively shallow water, a rarity for Italy. A pilot project is also planned off the coast of Tricase to study the use of placing turbines on floating platforms.
Rodolfo Pasinetti of Ambiente Italia, who worked with Apulia on its energy plan, says that the challenge now is to manage the growth in wind energy. "The problem in Apulia is to make sure that there is harmony between the various projects, mainly from the point of view of the natural surroundings," he says.
As is the case for the whole of Italy, strong financial incentives on offer from central government for the production of wind power form the basis of the market in Apulia. Wind producers gain income not only from selling their electricity but also from sales of green certificates. These they receive in proportion to the volume of electricity produced and they can be traded for a 12 year period. Buyers of certificates are electricity retailers who are required by law to source a small but growing proportion of their sales to renewable sources.
A reference price for certificate sales is set by the national electricity regulator each year and is currently running at just over EUR 0.12/kWh with the green power requirement set at 3.05%. The current government could adjust the incentive system, which currently offers the same price for all renewable energy sources, but developers generally expect prices will remain favourable for wind given the country's need to significantly boost its renewable energy production to meet international commitments to reduce carbon emissions.