Renewable energy in Italy Going with the wind

Prospects for wind power are much better. Ten years ago wind’s part in satisfying power demand was tiny, but last year Italy’s turbines produced more electricity than its geothermal plants. According to Unione Petrolifera, wind farms could be generating 20.5TWh by 2020, about three times what they produced last year. And the association forecasts that the amount of electricity produced by biomass plants could almost treble to 11TWh over the same period.

Italy may not have much of its own gas and oil, but sun is rarely in short supply and this may offer the brightest long-term prospects. At the end of this year Enel, Italy’s state-controlled power company, will bring into service a five-megawatt solar-thermal plant that uses innovative technology. This is an area in which Enel has a record, having designed and built the first concentrating solar-thermal plant connected to a national grid over 30 years ago. It also completed Italy’s largest photovoltaic installation at Serre Persano near Salerno in 1999. Spain and Germany have recently trimmed their subsidies for solar power, leaving Italy’s among the most generous in the world.

The subsidies are so lavish because renewable energy is expensive and would not be competitive without them. Nomisma Energia, a think-tank, estimates that power from photovoltaic cells costs €0.40 ($0.56) per kilowatt hour (kWh). Even more established renewable sources such as wind (€0.07/kWh) and biomass (€0.08/kWh) produce electricity that costs more than that derived from coal (€0.05/kWh with coal at $60 per tonne) or gas (€0.06/kWh with oil at $55 a barrel). The higher costs are borne by electricity users in Italy, where tariffs are above those in other European countries, thanks mainly to the use of natural gas for power production but also to weak competition. Economies of scale and technological improvements mean that the price of wind power is falling, however, and it could close the gap with fossil-fuel generation, especially if Europe’s carbon price increases.

But Davide Tabarelli, chairman of Nomisma Energia, says forecasts of a boom in wind and solar are optimistic and that Italy will not meet the goal set by the European Union that renewables should provide 12% of energy consumption by 2010. Umberto Quadrino, the boss of Edison, Italy’s second-biggest utility, agrees. He thinks Italy will have to reverse its ban on nuclear power. In the meantime, Enel is investing in French nuclear power-stations, with a view to exporting the power to Italy. It also owns reactors in Slovakia.

The government, too, hopes to revive nuclear power. But Italy is held back by a leaden bureaucracy. The government says it will cut red tape to get new nuclear stations built. Reactors will face far more public resistance than wind farms and solar plants, however. For the moment, Italy’s leading position in import dependency looks secure.

Back to top ^^

Readers' comments

The Economist welcomes your views.

Click