Italy has experienced significant growth in installed renewable energy capacity in recent years, primarily driven by the expansion of solar energy. According to the report “Il recente sviluppo delle energie rinnovabili in Italia” published by the Bank of Italy, the country installed 5.2 GW of new photovoltaic capacity in 2023, more than double the previous year, while another 3.3 GW were added in the first half of 2024. Despite this acceleration, the development of the wind energy sector has been slower than expected, raising concerns about meeting climate goals for 2030.
Sustained Growth, but Insufficient
The report highlights that the National Integrated Energy and Climate Plan (PNIEC) sets the goal for renewable energy to cover 63.4% of national electricity consumption by 2030. To achieve this, an additional 70 GW of renewable capacity will need to be installed compared to 2022 levels, with 54 GW from solar energy and 16 GW from wind energy. However, although the pace of photovoltaic growth has accelerated, it remains below the average required to meet these targets.
“While the pace of solar panel installation has reached levels in line with annual targets, the lag in the wind sector represents a significant barrier to the energy transition,” the report warns. In fact, in the first half of 2024, total renewable capacity growth was 10% lower than the PNIEC target, indicating the need to further accelerate investments in clean energy.
Geographical Distribution and Southern Concentration
The growth of renewable energy in Italy has been characterized by a strong geographical concentration. While photovoltaic installations have increased across all regions, wind energy development remains predominantly in the south, with Puglia, Sicily, and Sardinia leading connection requests.
The report emphasizes that 85% of connection requests for new renewable projects have been submitted in the Mezzogiorno, which could cause transmission grid congestion issues.
“Developing new installations must be accompanied by investments in electrical infrastructure that enable energy to be transported from producing regions to consumption centers,” the document states.
Challenges for the Power Grid
One of the biggest challenges for integrating renewable energy in Italy is the transmission grid’s ability to manage intermittency and the geographical concentration of projects. Currently, the grid faces congestion issues, leading to significant price differences between electricity wholesale markets in different regions.
In 2023, the electricity market was segmented into different zones 27% of the time due to transmission grid limitations, with northern regions facing higher demand and prices, while the south had an oversupply that could not be efficiently transmitted.
“Increasing renewable capacity requires modernization and expansion of the transmission grid, particularly to prevent overproduction in the south from causing energy losses and price disparities in the market,” the report warns.
Outlook and Next Steps
To ensure the stability of the electrical system and meet PNIEC objectives, Italy will need to accelerate investments in transmission and energy storage infrastructure. According to the report, new storage technologies and the expansion of electrical interconnections are expected to play a key role in the energy transition.
In the coming years, grid connection capacity will be a determining factor in the pace of renewable growth. Although the total connection requests exceed 341 GW, the report notes that almost 90% of these projects are still in the early stages of the authorization process, which could cause delays in their implementation.
“While Italy has made significant progress in expanding renewables, the success of its energy transition will depend on the country’s ability to remove regulatory barriers, improve infrastructure, and balance the geographical distribution of new installations,” the report concludes.
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