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Energy Policies of IEA Countries: Italy 2016

In series:Energy Policies of IEA Countriesview more titles

Published on January 05, 2017

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Since the last in-depth review in 2009, Italy has made strong progress in the development and implementation of energy policy. The most notable improvement has been the publication of a comprehensive long-term energy strategy.

The adoption of the National Energy Strategy in 2013 sent a strong signal to stakeholders as to the government’s medium- and long-term objectives for the energy sector. It established clear goals: reduce energy costs, meet environmental targets, strengthen security of energy supply and foster sustainable economic growth. Nonetheless, the adoption of the Strategy is only a first step towards achieving the government’s ambitions. Monitoring implementation and maintaining momentum will present a challenge for the government.

Italy has experienced impressive growth in the renewable energy sector and has been successful in integrating large volumes of variable renewable generation. Containing costs is a priority, and policies need to focus on bringing deployment costs towards international benchmarks.

Italy has also continued to progress in terms of market liberalisation and infrastructure development, notably in the electricity market where transmission improvements between north and south, as well as market coupling, have resulted in price convergence throughout the country and wholesale prices tending towards those elsewhere in Europe. Development in the gas sector has been slower, and greater progress is needed if Italy is to be become a southern European gas hub. Furthermore, institutional arrangements within the energy sector remain complex and should be reformed and strengthened. Implementation of the National Energy Strategy provides a timely opportunity to address each of these challenges in a comprehensive way.

This review analyses the energy policy challenges facing Italy and provides recommendations for further policy improvements. It is intended to help guide the country towards a more secure and sustainable energy future.