Energy balance: Italy’s unexploited potential
The research conducted by Eurispes analyses the Italian energy balance in order to describe the levels of energy production and consumption in our country. The report opens with an analysis of the different supply sources (domestic and foreign), consumption levels and different forms of production present on the Italian territory. The study shows how the country is still heavily dependent on foreign energy, given that gross energy availability, an indicator of the country’s degree of dependence on foreign energy, has increased from 73.5% in 2020 to 74.9% in 2021. Furthermore, the predominant role played by fossil fuels, especially gas and oil, was confirmed, accounting for more than 73% of national energy availability in 2021 (40.9% and 32.9% respectively). This first part is followed by an analysis of the main regional differences in energy production and consumption.
In this context, the research dwells, on one hand, on the analysis of the production of electricity from renewable energy sources and, on the other hand, on the effects of the energy crisis that have contributed to an exponential increase in the gap between the North and the South of the country in relation to the accessibility to energy with consequences in terms of development and economic growth for the entire South.
Finally, through the examination of the prospects for future development of the energy sector in Italy, an attempt was made to understand the impact that certain policies could have both in favouring the decarbonisation process of our economy and in reducing our energy dependence on foreign countries as well as our country’s exposure to future energy shocks such as the one we have been witnessing in recent months following Russia’s invasion of Ukraine. In relation to the decarbonisation processes of our economic system, it should be noted that in Italy, in 2020, the share of renewables in final energy consumption reached 20.4%, compared to a target of 17%. Particularly positive results were achieved in electricity production, as 38% of the electricity produced in Italy in 2020 came from renewable sources. Almost 50% more than the 26% target declared for 2020.
Concerning the research methodology, it should be noted that almost all of the available datasets date back to 2021 and therefore do not directly take into account the changes that occurred following the outbreak of the conflict in Ukraine. Nevertheless, it is considered that many of the data pertaining to 2021 are equally valid for 2022, since the main changes that occurred during this year mainly concerned the dynamics of prices and foreign supply sources. For these two items, monthly or quarterly data published for 2022 were used when available. While estimates and projections were used when these data were not available.
The survey shows that the energy sector in Italy still has a number of historical weaknesses. Although Italy is the country with the greatest potential for renewable energy production in Europe after France, there are a multitude of bureaucratic impediments and legislative constraints that severely limit the achievement of our full potential. To this must be added the difficulties related to the realisation of new projects, which are too often blocked by small but incisive interest groups and by a policy that is more attentive to the feelings of public opinion instead of focusing on medium to long-term strategic planning. Just to give an example, while in Italy discussions continue on the impact that the colour of the regasifier ship could have on the landscape of the port of Piombino or on the mussel farms there, in Germany, since March of this year, the construction of six regasification plants (two of which are already operating) has begun.
The analysis then gives us a picture of a nation split in half in which the effects of the crisis, severely felt throughout the country, have not been evenly distributed. From this perspective, it is enough to think of the growth in energy poverty that threatens to further exacerbate the disparities between the North and the South of Italy. In this context, it should be pointed out that, already in 2021, between 10 and 18 per cent of the population living in the South had difficulties in purchasing energy services. A data that is between two and three times higher than those recorded by the regions of the Centre North, where the energy poverty indexes were all within a band that ranged from 5% in Veneto to 6.3% in Piedmont.
Moreover, the energy crisis triggered by the conflict in Ukraine had the effect of further accelerating the development of energy production plants from renewable sources, which, especially in the South, could bring great benefits both in terms of employment and access to cheaper energy. This would be especially the case if the problem of the lack of electricity transport infrastructures were to be solved, which would allow the energy produced by facilities, often located in the North of the country, to be transported in the South to the end consumers.
To summarise, while Italy needs to cope with short-term contingencies related to soaring energy prices, it must also take advantage of the favourable economic situation to accelerate the decarbonisation process of our economy as much as possible. Rising prices of non-renewable energy sources, European funding linked to the REPowerEU plan and Recovery Plan funds are creating the perfect conditions for the development and construction of energy production plants from renewable sources. However, for this to happen, funding and projects are not enough; what is required is a political class with strategic vision and a functioning bureaucracy capable of supporting the realisation and implementation of new projects.