Investment in renewable energy: successes and failures
In recent years, Italy has witnessed a tangible increase in renewable energy investment. The search for alternative sources has become more urgent due to both the global raw materials crisis and Italy’s genuine need to achieve energy independence.
These trends run parallel with the European Union’s guidelines, which focus on the need to provide families and businesses with secure energy sources, including the diversification of supplies where possible.
Encouraging figures on renewable energy investment
As mentioned above, Italian companies are increasingly focusing on renewable energy investment. A recent study confirmed this, reporting that 264 new solar and wind-based utility scale projects were launched in the year 2021 alone.
This figure is especially impressive as these initiatives have enabled Italy to reach the EU’s target of 20 Gigawatts of energy in three years produced exclusively from renewable sources.
All this has been possible thanks to generous grants for research and development involving new technologies. There has been an increase of over 13.5 million euros (+48% compared to 2020), with Italy now able to generate 15 GW of power (+37% compared to 2020), using 400 plants located across the country (+72% compared to 2020).
The leader in this sector is photovoltaic energy, with a value of 6 million euros and the capacity to generate around 8.4 GW. The performance of windfarms is a close second, although they have not significantly affected the overall value of the renewable energy sector.
As for organic growth operations, these account for 81% of the total, reaching a value of 8.2 billion euros and an energy capacity of 10.6 GW. External lines are also increasing and now cover 28% of the total, with an increase of 4.7 billion compared to 3.8 billion in 2020.
When bureaucracy hampers results
Although the positive market impact of the increased focus on investment in renewable energy is illustrated by the share prices of Italian pure renewables (increases as high as 100 percent in a year), there are still many issues to be resolved.
Out of 264 projects mentioned in the study, 188 are still blocked at the developmental phase, as they are currently awaiting the necessary authorisations to proceed. In other words, 70% of initiatives are being hampered by frequently over-complicated and needlessly long bureaucracy.
This highlights the fact that the figures mentioned in the study refer to theoretical capacity, while the real numbers should be calculated using projects that have already got the go-ahead from the relative authorities (barely 30%).
Furthermore, if we consider the actual impact on the national power grid, we can observe that only the largescale projects (around 18% of the total) are able to make an active contribution towards the development of the renewable energy sector (in the case of the photovoltaic sector, out of a potential capacity of 8.4 GW, only 1.4 GW of power is currently being generated).
Despite current limitations, investors continue to be interested in sustainable energy: the achievement of European targets involving decarbonisation by the year 2030 and the complex international geopolitical situation which threatens gas supplies (with a corresponding increase in prices) are added incentives for finding valid and profitable alternatives.
