by Gert Gremes
PV Market Development in Italy
The first governmental program in support of the photovoltaic market in Italy was launched in 2001. The program, so called ¡®10,000 PV roofs¡¯, demonstrated a limited capability in developing PV installations. In fact, the regions were transferred the competences for the management of the program itself and this has led to delays in allocating the funding of the PV projects.
In 2003 the lobbying activities pursued by the industry represented by GIFI (the Italian Photovoltaic Industry Association) contributed to achieve an important objective. The Italian government adopted a comprehensive legislation for the promotion of the renewable energies. Among others programs, the feed-in tariff for the promotion of the solar electricity from PV plants was envisaged within this legislative framework.
However, we had to wait until 2005 before the feed-in tariff entered into force. In 2006, the incentive scheme was revised but only in February 2007 an improved feed-in tariff/premium was adopted.
As a consequence of this policy development, the Italian PV market has been rather weak until 2006: only few MWs each year. Instead, from 2007 the number of installations and the power installed started to increase rapidly: 70 MW in 2007, 338 MW in 2008 and 720 MW in 2009. Today we have more than 100,000 PV plants installed with a total capacity connected to the grid of more than 1.6 GW. In 2010 and in the years to come, the PV market in Italy is poised to keep developing steadily.
Forecasts and Trends for the PV Market in Italy
In 2010 the Italian PV market will rank again the second position worldwide in terms of newly installed capacity. Recently, the government approved a resolution which will allow all PV plants installed by December 31, 2010 and connected to the grid by June 30, 2011 to be granted with the 2010 tariffs. This means that, compared to 2009, the annual PV market in 2010 will, most likely, double and score something close to 1.5 GWp.
Within the next three years, at least 3 GWp of new capacity will be connected to the national grid: 1 GWp/year on average. This, of course, represents the cap set by the legislation in force from January 1, 2011 to December 12, 2013. However, considering the latest trend, this cap might be filled by H1 2013: afterward, thanks to the grace period, from 500 to 1,000 MWp might be added to the grid.
As for the technology used in the Italian market we experience the same pattern as in many other countries in Europe with a difference: from 2011 the Concentrated Photovoltaic (CPV) systems will be incentivated. In terms of market segments, the rooftop installations (both residential and commercial) will continue to drive the market. At the same time, the power plants will play an important role for the next three years. In the long term, however, the BIPV will be the dominant segment.
The Newly Approved Legislation: Feed-in Tariff 2011 and the Guidelines for the Licensing Process
The 2011 will represent a very important year for the Italian photovoltaic industry. The new Feed-in Tariff (Conto Energia 2011) coming into force from January 2011 allows businessmen to plan their investments over the next three years only: a rather reduced time frame to meet the needs of industry logic and planning over the medium term.
In 2011, the feed-in tariff will be reduced gradually in three steps, every 4 months: by 5-25% for rooftop installations and by 5-27% for ground-mounted systems. This reduction is generally in line with the cost trend of PV components. Therefore, the impact on the next year market will be limited and the main challenge will come from the three feed-in tariff value changes which might jeopardize a steady growth and, most likely, cause bureaucratic problems.
The 3 GWp cap is mostly a virtual limit. In fact, if the cap will be reached before the December 31, 2013, the so-called ¡®grace period¡¯ will open. The grace period varies between 14 months for the private owners and 24 months for the public owners (such as municipalities and regional/local administration). The grace period allows all PV plants installed and connected to the grid by the December 31, 2013 to be granted with the FiT provided by the legislation in force.
The bureaucratic burden linked to the licensing and grid-connection procedures will still be a challenge also in 2011. However, the long-waited National Guidelines for the licensing and authorization procedure (the so-called ¡®Autorizzazione Unica¡¯) have now been published in the Official Journal. Three months after the actual publication the Guidelines will necessarily have to be adopted by all regions, otherwise the National Guidelines will apply directly. Therefore, we expect a 2011 where the differences will be eliminated thus allowing the market to growth equally in all regions.
Regarding potential development up until 2020, the target of 8,000 MWp of solar photovoltaic power, currently identified by the government in the National Action Plan for the Renewable Energy Sources, could be particularly restrictive as the market is expected to grow exponentially to at least 15 GWp of installed capacity by 2020, thus contributing decisively to the achievement of the EU objectives related to the climate and energy package (17% of primary energy from renewable sources).
The 2020 Targets: Challenges and New Frontiers for the Industry
At the same time, the attention of the industry and the government is now focused on the fact that the development of electricity production from renewable sources of energy, especially solar photovoltaic, will not be able to make its contribution to achieving the EU objectives for 2020 until a proper integration of these systems in transmission and distribution grid is carried out. Such integration could be achieved by transforming the existing grid into a ¡®smart¡¯ system capable of accommodating non-programmable energy and combining traditional centralized production systems with distributed generation, typical for renewable sources.
Substantial investments have been made to the grid since 2005, particularly in the renewable energy sector, making it possible to connect to the grid 4,601 MW of renewable energy. In order to modernize the electricity distribution grid and render them more flexible and intelligent, encourage the increase in production from renewable sources and promote the efficient use of resources for the benefits of the end users, the very same AEEG (the Italian Regulatory Authority for Electricity and Gas) has taken steps (resolution no. Arg/elt 39/10) to allow selective incentives, by means of a specific tariff remuneration, for investment into the grid and the installation of intelligent metering systems (smart metering) that are essential for the promotion of smart grids.
One of the major bottleneck is the fact that the development of non-programmable source of energy, specifically solar photovoltaic energy, is taking place in Italy mainly in areas already congested of connection requests and with a weaker grid infrastructure (especially in southern Italy). Hence, there is a clear and understandable urgency for action to make sure that an adequate development of the electricity grid and a national policy is taken into consideration by all stakeholders. This will ensure an equitable distribution of renewable sources across the territory of Italy and a sustainable development of the sector towards the binding EU targets up to 2020.
Gert Gremes, President of GIFI (www.gifi-fv.it) since 2006, has been one of the co-founders of the association in 1999. He is active in the PV sector for about 20 years and has worked for several companies Europe-wide. He is now the CEO of Tecno Spot (www.technospot.net), a leading PV systems and components distributor with the headquarters in Brunico (Italy) and branch offices in Austria and the U.S.A.
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