BUSINESS and POLICY

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• BUSINESS and POLICY
• BB1 Leading EU markets
• achieving the vision
• Wind Energy in Italy policy framework,
  incentives, industry and market development
• Luciano Pirazzi
• ENEA
• luciano.pirazzi_at_enea.it

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Policy framework (1)

• Legislative Decree 79/99, in force since 1999
• Mandatory RES ( renewable energy sources)
  quota and Tradable Green Certificates (TGCs)
• Legislative Decree 387/03
• Implementing RES Directive 2001/77/EC
• Renewable Energy Position Paper
• Presented in Brussels by the Italian
  government in September 2007

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Policy framework (2)

• 2008 Financial Law
• (Law 244 of 24 December 2007)
• Deliberation ARG/elt 99/08 issued by AEEG (the
  Regulatory Authority for Electricity and Gas) on
  23rd July 2008
• Ministerial Decree issued on 18th December 2008
• Incentives on electricity produced from RES

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Renewable Energy Position PaperPotentials for
Annual Production of RES

• Electricity
  2005
  2020
• Power (MW) Energy
  (TWh) Power (MW) Energy (TWh)
• Hydro 17,325
  36.00 20,200 43.15
• Wind 1,718
  2.35 12,000 22.60
• Solar 34
  0.04 9,500
  13.20
• Biomass, Landfill 1,201 6.16
  2,415 14.50
• Gas and Biological
• Purification
• Wave and Tidal 0
  0.00 800 1.00
• Total (MWh/TWh) 20,989 49.87
  46,215 104.18

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2008 Financial LawIncentives on electricity
produced from RES(1)

• Yearly increase of the mandatory quota of RES
  electricity from 0.35 to 0.75 percentage points
  in the period 2007-2012
• Size of all Tradable Green certificates (TGCs)
  reduced to 1 MWh
• RES plants online after 1st January 2008 will get
  TGCs for a period of 15 years (instead of 12 as
  older plants), in a number equaling the number of
  produced MWh multiplied by a coefficient, which
  is specific for each technology (e.g. 1 for
  onshore wind, 1.1 for offshore wind)

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2008 Financial LawIncentives on electricity
produced from RES(2)

• From 2008 on, the price of TGCs bought from GSE
  will be calculated as the difference between 180
  /MWh and the annual average market price of
  electricity (e.g. the calculated price for 2008
  was 112.88 /MWh)
• the above reference values and coefficients may
  be updated every three years

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2008 Financial LawIncentives on electricity
produced from RES(3)

• Until Italy has reached its RES electricity
  target according to Directive 2001/77/EC,
  Gestore Servizi Elettrici (GSE) must buy all
  unsold TGCs before their expiration date (3 years
  from issue), at a price equaling the average TGC
  price of the previous year.
• Feed-in tariffs for RES plants up to 1 MW
  (excluding PV) and wind plants above 200 kW
• comprehensive price for wind plants up to 200
  kW capacity, it is currently 300 /MWh

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Main constraints

• Complex terrain
• Italian wind farms are generally located on
  hills and mountains
• Grid connection
• mostly wind farms are built in rural areas
  on the Southern regions and large islands (Sicily
  and Sardinia)
• Permitting procedures
• Different regional rules and feeling towards wind
  energy

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Industrial development (1)

• Vestas in Italy (3 units)
• Vestas Italia S.r.l. is responsible for the
  selling, installation, commissioning and
  maintenance of the wind farms installed in Italy
  and other countries (Rome and Taranto)
• Vestas Nacelle Italia S.r.l. is specialized in
  the assembly of V52-850 kW and V90-3 MW turbines
  (Taranto)
• Vestas Blades S.r.l. is operating in the
  construction of the blades for V52 units
  (Taranto)

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Industrial development (2)

• Letwind
• Since 2008 Leitwind has been set up as a company
  belonging to the Leitner group
• First 1.2 MW prototype installed in 2003
• Leitwinds commercial products are two turbines,
  LTW 70 and LTW 77, respectively of 1.7 MW and 1.5
  MW
• Turbines installed in Italy, Austria, Bulgaria
  and India

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Courtesy of Leitwind
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Industrial development (3) Leitwind

• 35 LTW77 and LTW80 will be manufactured in 2009
• some units will be sold to Italy, France,
  Bulgaria and Canada
• Development of a multimegawatt turbine
• Installation anticipated in 2010

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Industrial development (4) Moncada Energy

• Next production of WPR 850/58, 850 kW
  direct-drive turbine
• Approval to build a 500 MW, 400 kV merchant
  electrical line across the Adriatic from Albania
  to Italy
• Planned and already authorized 500 MW wind farm
  in Albania
• 2 MW, 20 kW and 1.5 kW wind turbine models should
  be designed in the near future in its factory in
  Sicily

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Offshore

• Installation in 2008 of a small wind turbine on
  a floating foundation by Blue-H
• Blue H is currently building the first
  operational 2.5MW unit in Brindisi, the first in
  the planned 90 MW Tricase offshore wind farm
• Other initiatives aimed at setting up offshore
  wind farms are running along the coasts of
  southern Italy and Sicily
• Constraints difficult permitting procedures,
  increasing costs and some adverse judgements
  expressed by local authorities

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Capacity Factor of Italian Wind Farmsby Garrad
Hassan Italia S.r.l. Production based on TERNA
monthly reportsInstalled capacity based on ENEA
data
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Wind power capacity at the end of 2008 (MW)
9.9 (7.35)
Total installed 3,736 MW
1.35 (1.35)
12.5
3.5
Wind power added in 2008 (in brackets)
1,010 MW
13.7 (4.8)
28 (14)
1.5
168 (12)
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188(86)
946 (260)
467 (100)
209 (53)
687 (168)
187 (87)
795 (211)
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Market share of wind turbine manufacturers at the
end of 2008 (percentages of total online
capacity)
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Contribution by electricity producers from wind
at the end of 2008
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Thank you for your attention