Luca Bragoli at the Italian Chamber of Deputies for the DL “Energia Bis” Hearing

Luca Bragoli, Chief Regulatory & Public Affairs Officer at ERG, recently participated in a hearing before the X Commission on Productive Activities of the Italian Chamber of Deputies to discuss Decree-Law 181/2023, known as the DL Energia Bis. The hearing provided a valuable opportunity to examine the urgent provisions for energy security, the promotion of renewable sources, and support for high-energy-consuming businesses. We interviewed him:

ERG embraced the decarbonization challenge ahead of schedule, undergoing a transformation from an oil operator to a leader in renewables. In this regard, what are the current challenges in implementing Article 1 of DL 181/2023: "Measures to promote the self-production of renewable energy in energy-intensive sectors at risk of relocation through the sale of renewable energy at fair prices to final energy-intensive customers," and how do you propose to overcome them?

We view it positively that the measure identifies long-term supply contracts (CfDs or contracts for difference) as the primary tool to stabilize electricity prices and ensure the development of renewable sources. However, we believe that the current wording of the article is complex to implement, and the determination of a price by the GSE could create distortions in the market, especially in Power Purchase Agreements (PPA). To overcome these limitations, we propose that the measure be more openly receptive to the contribution of industrial electricity operators, aligning the energy price with the actual costs of the renewable technologies to be installed. Additionally, we believe that within the measures outlined in this decree, it is crucial to promote repowering activities, an efficiency operation for wind assets involving the replacement of obsolete turbines with the latest generation, more powerful, and efficient ones. This strategy will significantly contribute to decarbonization, enabling a quicker transition to more modern and efficient technologies.

Article 4 of DL 181/2023 aims to incentivize regions to host renewable energy facilities. However, this provision could introduce additional taxation for companies producing energy from renewable sources. What are your concrete proposals to improve this provision, and how do you anticipate its impact on the renewable energy sector in Italy?

Our proposal is to link the activation of the measure to the issuance of DM Fer X (related to the new auctions 2024-2028 for Renewable Energy Sources), with auction bases commensurate with this new burden. It is also appropriate to allocate resources from this measure to the most deserving regions, those meeting the burden-sharing objectives on Renewable Energy Sources (FER) and introducing simplification mechanisms for authorization processes. Furthermore, we suggest directing funds towards streamlining the administrative procedures of public authorities regarding FER authorization proceedings. This would ensure targeted use of resources and effective support for the development of new renewable capacity.

In times of energy transition, there is talk of structural investments for offshore wind facilities. What is ERG's position on this, considering current infrastructure challenges and the industrial maturity of this technology?

It is crucial today to prioritize the implementation of a legislative and regulatory framework, starting with DM FER X, supporting mature renewable technologies such as onshore wind and industrial-scale photovoltaics. These more mature and established technologies can provide immediate benefits to consumers and businesses. Regarding floating offshore wind facilities, we believe that a gradual approach, focused on the medium to long term and supported by adequate planning and programming tools, can enable sustainable economic development of this technology after 2030.