The European Commission has approved the draft decree for FER2, a regulation that promotes the construction of power generation plants from renewable sources that are not fully mature or with high operating costs. Eligible projects include zero-emission geothermal plants, traditional geothermal plants, offshore wind, biomass and biogas, floating photovoltaic on inland and offshore waters, as well as tidal, wave, and other forms of marine energy systems, and thermodynamic solar systems.
The support scheme will be implemented in the form of a two-way Contract for Difference (CfD). This will apply for each kWh of power produced from eligible projects and fed to the grid. Projects will be selected for the aid through a transparent and non-discriminatory tender procedure. Applicants will need to submit an offer for the incentive tariff they deem necessary to carry out their individual projects.
Under a bilateral CfD, beneficiaries will be paid the difference should the reference price come out lower than the exercise price. Conversely, beneficiaries will have to pay the difference to Italian authorities should the reference price be higher than the exercise price.
“The support scheme will ensure long-term price stability for renewable energy producers, guaranteeing a minimum level of return. At the same time, beneficiaries will not be over-compensated for periods in which the reference price is higher than the of operation” said the Commission in a statement.
The text will now be brought to the attention of the concerted Ministers for signature, in order to be transmitted to the Court of Auditors for registration and subsequent publication. Within thirty days from the date of publication, the Operational Rules will then be issued by decree of the Ministry to make the measure fully operational.
The measure will be in force until December 31, 2028 and will be financed through a rate included in the electricity bill of end-users.
The objective of the aid scheme is to incentivize the growth of renewable power generation capacity to a target of 4.6 GW. This will contribute to the achievement of EU’s strategic objectives as part of the European Green Deal and help to rudece the dependence on Russian fossil fuels.
Source: Ministry of the Environment and Energy Security and La Repubblica
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