Italy is Poised for a Renewable Energy Renaissance in 2021
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- Oct 19, 2020 8:38 pm GMTOct 19, 2020 8:42 pm GMT
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New initiatives and technologies are pushing Italy to the forefront of carbon reduction within Europe. In 2018, renewable energy accounted for 18.9% of energy in the European Union. However, renewable energy use has varied between countries, which means that some countries vastly underperform on the sustainability index.
Italy, in particular, stands to benefit from new policies focused on renewable energy. The country recently submitted an application for a 330 MW wind farm. The benefits of the renewable energy will likely drive strong economic growth. This could be a great trading opportunity for CFD traders interested in taking long positions on the Euro or purchasing energy futures in the EU.
However, most countries are at least making progress on this front. Across the world, consumers and governments are coming to recognize the need to transition to alternative sources of energy. Of course, this isn’t a newly-discovered problem, but it’s one whose solution has been a long time coming.
Italy is one of the countries that has invested heavily in renewable energy over the last couple of years. This is one of the reasons we previously rated Italy as a top eco-friendly destination. The renewable energy industry is on the verge of a massive boom in 2021.
Why Renewable Energy is a Booming Business in Italy
Italy has an impressive track record of setting and meeting its own renewable targets. In 2019, it submitted a plan to the European Commission, detailing a forecast which will see rises in use of solar and wind power – respectively to 50 and 18 gigawatts by the end of 2030. This ambition matches that of previous pledges, including one to achieve 17% renewable use by the end of 2020 (a pledge which was ultimately met six years ahead of schedule).
The country has also increased investments in nuclear energy after forming partnerships with companies like Areva. However, its focus on renewable energy will differentiate it in the European energy markets.
A sizeable portion of the sector’s expansion will come from private investment. In August 2020, Sonnedix, the solar-power multinational, purchased two portfolios of new plants in the country. These include six photovoltaic plants in Terni and Atessa, with a total output of 5.2MW, and three ground-plants in Puglia, with a total output of 3MW.
RSM International provided the legal expertise which facilitated both transactions. Cristiano Lenti, a partner of the firm, was eager to praise the deal. "It is our great satisfaction to play such a significant role in Sonnedix's impressive growth in Italy, having already accompanied it in several acquisition transactions,” he said. “This enriches our qualified experience in the renewable energy sector, which will increasingly play a leading role in Italy and worldwide".
Further advances might be made possible through Italy’s technological collaboration with the United Arab Emirates, called InnovItalyUAE. Set to be launched on September 30, it will cover a broad range of technologies, including space research, cybersecurity, and – critically – renewable energy.
There are six effected sectors in total, each of which will be given special attention at an online forum between September and December 2020. Italy’s ambassador to the UAE, Nicola Lener, had this to say:
“[…] in light of the disruptive experience of the pandemic, we believe that the time has come to make a quantum leap in our relations, drawing on the depths of our cultural roots and our projection towards the future to focus more and more on a collaboration based on innovation, knowledge and connectivity.”
Much of the opportunity for innovation stems from what the country does internally. But it’s also worth considering the indirect environmental benefits the country might effect through trade across the Mediterranean.
According to a study by The European House-Ambrosetti and Italian gas group Snam SRG.MI, the country could significantly reduce its effective carbon footprint by importing hydrogen from North Africa, at around 10-15% of the cost of local production.
Green hydrogen can be produced using either wind or solar power, and has a considerable advantage that it can largely be supplied using Europe’s existing gas infrastructure. There are some technical issues to work out, and the cost of hydrogen is still far in excess of that of oil – but the gap has shrunk to the point that many experts expect parity within the next decade.
Renewable Energy is Going to Transform Italy
Italy is becoming more dependent on sustainable energy. The country will continue to invest in renewables in the coming year. This will help make a dent in the fight against climate change.