The incentives available to companies for improvements in energy efficiency

The FER Decree, the National Energy Efficiency Fund (Fondo Nazionale di Efficienza Energetica), and regional calls for applications for micro enterprises and SMEs. There is an extensive and diverse range of support measures available to companies for reducing energy consumption or installing renewable energy generation systems.

Published on 11 May 2020

Incentives to improve energy efficiency in companies

Italian companies have a variety of options to access incentives aimed at facilitating energy efficiency improvement activities. However, the picture is somewhat fragmented with concessions available at both national and regional levels, and access procedures often complicated and difficult to understand. Let’s try to summarise the main provisions.

Those looking to install a renewable energy generation system at their company site must turn to the so-called FER 1 Decree, which came into force in July 2019 and provides incentives for four types of systems: newly-built photovoltaic installations, on-shore wind turbines, hydroelectric plants and systems for utilising residual gases from wastewater treatment processes. More specifically, the decree establishes a variety of ways in which the incentives may be accessed depending on the power output of the systems and the group they belong to, details of which we’ve already described here. Requests for access to the incentives may be submitted exclusively via 7 calls for applications, for which companies can sign up by registering in the client area on the website of the State-controlled Energy Services Operator (Gestore dei Servizi Energetici, GSE). Two calls have already expired. Another two are to be opened in 2020, one from 31 May to 31 June and the other from 30 September to 30 October.

Another incentive mechanism for those looking to implement energy efficiency improvement initiatives is the white certificates scheme; these certificates are negotiable credits, each one equivalent to saving one Toe (tonne of oil equivalent), allocated to companies by the Electricity Market Operator (Gestore del Mercato Elettrico, GME) on the recommendation of the GSE. White certificates may be exchanged and used via an exchange platform, and may not be cumulated with other incentives, with the exception of local, regional or EU incentives, such as those connected with the ERDF ROP issued by Regional Authorities.

Projects must be submitted to the GSE before the investment is initiated and must be supported by a daily data measurement campaign conducted for at least one year.

For this reason, projects must be designed either by an ESCO (Energy Service Company) with UNI 11352 certification, or[MN1]  a company that has a UNI 11339 certified energy management expert, in order to establish the requirements for correct management. The system is described in detail on the GSE’s website.

An energy improvement incentive for companies is also provided for by the National Energy Efficiency Fund, managed by Invitalia, with a financial allocation totalling € 310 million. The request may regard activities aimed at reducing the energy consumption of production processes, upgrading buildings’ energy efficiency, as well as installing district heating networks and improving the efficiency of public services and infrastructure, including street lighting. Last February, the Italian Ministry of Economic Development announced the approval of the first 10 projects to be financed by the fund, amounting to a total of € 7.4 million.

It’s also possible to access regional calls for applications, often set up in synergy with European structural funds provided for by the 2014/2020 ERDF ROP programme. The Lombardy Regional Authority, for example, has opened a call for applications for SMEs to run until 31 March 2022, with a financial allocation of € 2,238,750: grants cover 50% of the expenses sustained by companies in conducting energy audits or in adopting the ISO 50001 energy management system.

In January, the Veneto Regional Authority approved a call for applications for SMEs wishing to access incentives for reducing energy consumption and the emissions of climate-changing gases, including through the installation of renewable energy generation systems. Requests can be submitted until 10 September. In Piedmont there is an open call for applications for improving energy efficiency and for installing renewable energy systems, which provides for loans to cover up to 80% of project costs in addition to grants for the remaining 20%.

Other Regions – like Apulia, Lazio and Tuscany – are offering access to subsidised financing channels or loans for micro enterprises and SMEs that invest in improving energy efficiency or in the production of energy from renewable sources. The Lazio Regional Authority has also launched an ERDF ROP call for applications to promote and utilise Environmentally Equipped Production Areas (Aree Produttive Ecologicamente Attrezzate - APEA) with the objective of supporting investments aimed at reducing energy consumption, CO2 and greenhouse gas emissions, and other environmental impacts resulting from company activities.

It’s clear to see that there is a plethora of incentives available to companies. However, navigating them isn’t easy: in order to find out how to improve energy efficiency whilst simultaneously reducing costs, it can be useful to enlist the help of a specialised consultancy, which should also take into consideration business sustainability.

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