Recovery & Resilience Funds

Italy

Overall assessment

The National Recovery and Resilience Plan of Italy earmarks 2,2 billion euro in support for energy communities (RECs) and self consumptions schemes (SCSs), aiming at a target of 2,500 Gwh of clean, community-led energy produced in Municipalities with less than 5.000 inhabitants. The call for proposals is currently being prepared by the Ministry of Ecological Transition (MASE). Grants of up to 100 percent are provided for the development and use of renewable electrical and thermal sources. Eligible expenses range from technical and technical-scientific assistance to the purchase of all components essential to the realisation of the energy production, distribution and sharing facilities; included in the list are the purchase costs of storage systems and that for legal and administrative assistance for the definition of agreements.

However, the Ministerial Decree which should finalise the implementation of the Legislative Decree 199/2021, which in turn provided the final transposition of the REDII directive, is still pending. In particular, this Ministerial Decree should set the premium tariff for the “shared energy” and should also define the legal conditions to combine this incentive with potential non refundable financing schemes, including the Recovery plan ones or other regional ones. Reportedly to the draft Decree that has been recently sent to the EU Commission for a final check, in order to keep the right to access the premium tariff for energy sharing, RECs' investments costs should have been covered with non refundable funds up to a maximum of 40% of the total amount. Additionally, the premium tariff for energy sharing will be decreased proportionally to the percentage of investments covered by capital funds.

Nevertheless, the Ministerial Decree should have been approved in June 2022 and is still not in place, which in turn is preventing the implementation of the Recovery Fund specific initiative for RECs. This situation is causing great uncertainty for community energy initiatives that are under development and have already benefitted from, or are currently applying to, access the non refundable funds that cover up to 100% of their project costs (e.g. structural funds earmarked by regional administrations through specific calls).

Aside the specific call for RECs and SCSs, within the Recovery Fund Mission 2 (Green Revolution and Ecological Transition) there are at least two other calls, already launched, which can indirectly support the setup of RECs: Green Islands (M2C1I3.1), which allocates 200 M€ for the 13 Municipalities of the 19 small islands not interconnected with the Italian national electricity grid, and Green Communities, which allocates 135 M€ for the setup of 30 "green communities", namely groupings of local administrations who join and work together to implement sustainable development plans.

Detailed assessment

General: allocation, definition, transposition

Specific allocation for energy communities

Yes, the Italy Recovery and Resilience Fund earmarks 2,2 billion euros in support for energy communities, setting a target of 2,500 Gwh of clean, community-led energy produced in Municipalities with less than 5000 inhabitants.

Definition of energy communities in line with EU legislation

The definition of energy communities in the Italian RRF is in line with EU legislation. The specific reference to the definition of RECs is included in the Legislative Decree 199/2021 (article 31), which is in line with the REDII definition.

Proportionality of share of total fund allocated to energy communities

Investment dedicated towards energy communities is proportional to total funds dedicated to renewable energy in the context of the Italian RRF.

Availability of tailored financing tools

At the moment only capital grants (non refundable resources) are envisaged to support energy communities. Other financing tools that fit different situations (loans, guarantees, blended finance) are not presently available.

Link to a wider scope of activities and objectives

Link between energy communities, building renovation and energy efficiency

According to the provisions included in Legislative Decree 199/2021 (article 31), RECs can: produce, share, store and sell renewable electricity, produce and share other forms of renewable energy (e.g. thermal energy), promote energy efficiency and home automation interventions, offer EVs charging services to their members and offer ancillary and flexibility grid services. Building renovation is not explicitly mentioned, even if in principle some building renovation interventions could be included in the "energy efficiency" measures category. Nonetheless, the current legislative framework provides workable provisions only for electricity production, sharing, storage and selling, while specific regulation for the other activities have not been yet implemented in the legislation.

Recognition of energy communities under multiple objectives

Energy communities are recognised under multiple objectives. In particular GHG gas reduction, energy savings and tackling energy poverty. Energy communities are also identified as a strategic tool to support rural areas & small Municipalities.

Transparency and inclusiveness

Holistic strategy to provide financing across different levels of project development

A holistic strategy is in place to support energy communities through the Italian RRF. Financing is provided for capacity building, legal, technical and administrative support, as well as project development.

Transparency of the design and communication of the schemes and measures

There has been a public consultation procedure on a draft version of the Ministerial Decree which should finalise the implementation of the Legislative decree 199/2021 at the end of November 2022. Specific consultations on the Recovery Fund measure for RECs haven't taken place up to now, since the operational definition of this measure will be directly influenced by the provisions of the Ministerial Decree, which has not yet been approved.

Selection criteria and the prioritisation of various social components

For the access to the Recovery Fund resources, the general already established criterion is the number of inhabitants: only RECs established in Municipalities with less than 5.000 inhabitants will be able to receive funds. Further criteria which will limit or facilitate the access to funds have not been yet defined.

Decentralised tender process

The design of the tendering to assign the recovery fund resources will be defined solely by the Ministry (MASE).

Existence of procedures to facilitate the participation of energy communities in open calls

There are procedures in place to help energy communities access the Funds under the RRF. For example, the Lazio Region signed an agreement with the Engineering Department of the Sapienza University of Rome to organise information sessions and offer capacity building and technical advice. Another example is the one of Veneto Region, that made an agreement with Provinces to implement information and training activities and setup an information desk at the local level.