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Energy


The start of the new legislature coincided with a considerable push to legislate on the utilities companies sector. Through government and parliament initiatives, by adopting EU laws and enforcing international commitments, the legislator kick-started a radical reorganisation of the laws governing the activity of electricity and gas markets.

The key features of this legislative overhaul are:

  • acceleration of the energy markets liberalisation process with emphasis on the legal separation of integrated entities (especially gas infrastructures) and evolution of the role of the regulator (with greater powers, although in keeping with the dynamics of a free market). Once the related bill (so-called Bersani bill) has been approved, the EU laws regulating the final opening to the demand of national energy markets scheduled for 1 July 2007 will be finally adopted.
    In keeping with the above-mentioned policy objectives that were set by the new Government while drawing up of the Long-Term Economic and Financial Planning Document, the liberalisation will be accompanied by the rationalisation of sectors such as natural gas distribution, which are sensitive to overall efficiency increases. The benefits will be reaped by users and by the economic system. Therefore, the legislator plans to introduce incentives (still undefined) for the aggregation of industrial entities as well as measures to counteract the fragmentation and uncertainty that characterised the first phase of the "opening to market competition" of gas distribution.
  • the reorganisation of the institutions regulating the markets and the consequent rationalisation and gradual expansion of the independence and transparency in regulation to sectors so far characterised by uncertainty. An example is the proposal to extend the powers of regulating the water sector to the Authority for Electrical Energy and Gas, which apparently was not mentioned in the market reform implemented through the so-called Lanzillotta Law (as mentioned later in this document).
  • the proposed reform of the system of incentives for renewable sources (Ronchi Bill) including the adoption of a "direct benefit" model against the current "market system" (i.e. certificates corresponding to implicit contents of renewable sources and energy efficiency, exchanged on specific markets). The purpose of the reform is to correct the distorsions caused by contradicting and uncoordinated laws, which have raised the costs of the system considerably without apparently increasing the use of alternative sources. The direct support system (mandatory withdrawal prices, diversification by source) tested by more advanced countries in terms of penetration of renewable sources, is said to have the benefit of transparency, of predictability and capacity to "discriminate" in favour of truly renewable sources. This system, however, raises a few issues around stability of the industry (which has invested in a totally different framework) and around the respect of acquired rights.
    It is important to point out that the debate on the total reorganisation of the system of incentives to the use of renewable sources seems to have been made sterile, if not completely outpaced, by some occasional interventions that anticipated some aspects of that reform. We are talking about the Finance Bill for 2007, which established direct economic support for raising awareness of renewable sources through dedicated funds but excluded from the "incentives and public funds" support those sources that are not explicitly mentioned in article 2 of the Directive no. 77/2001/CE. The regulation, which influences especially the production of electricity from assimilated sources, for example CIP6 and waste, had no effect on the plants "authorised and effectively under construction", thus safeguarding the acquired rights.
  • the improved definition of policies concerning energy efficiency and the technologies that said efficiency promotes. More specifically, the legislative decree adopting the EU regulation on promoting quality cogeneration was finally approved, whereas the adoption of the framework regulation on energy efficiency targets is currently under discussion. One of the noteworthy elements of this regulation is that it overcomes the limitations of a target allocation policy that applies only to electricity and gas distributors, typical feature of the current national laws. It is worth mentioning also the repeal of a previous regulation developed in a totally different context (the previous law concerning the reorganisation of the energy markets, so-called Marzano law). According to this law, local distributors were not allowed to promote energy efficiency projects and plans in the post-meter phase, which was clearly in contrast with the fundamental EU principles of competition, and did not enable to comply with the obligations set by the related Ministerial Decrees approved in July 2004.