Southern Italy facing energy transition. Opportunities and challenges for the greenest areas of Italy

Article by Francesco Miano, in English.

Photo by Zbynek Burival on Unsplash

1. The unprecedented challenge of climate change: economic and social constraints 

Climate change is an unprecedented challenge for contemporary and future generations, and some of its immediate effects will have an irreversible impact on the planet. The most brilliant meteorologists and environmental analysts have incessantly warned us how decades of unregulated human activity have led to the proliferation of extreme, large-scale shifts in weather conditions. Against this backdrop and in line with the commitments pledged by the EU within the Paris Agreement, the groundbreaking Green Deal announced by the von der Leyen Commission in 2019 aims at concretely combating the climate crisis introducing disruptive socio-economic policies transforming our European societies. The ultimate goal is to turn the EU-27 “into the first climate-neutral continent by 2050.”[1] A further and yet far-reaching pledge is the recent decision by the Member States to deliver a 55% cut in Greenhouse gas (GHG) emissions “by 2030, compared to 1990 levels.”[2]

Within the energy sector, the transition process will eventually lead to an unprecedented transformation of clean technology, ensuring “green jobs as a necessary component of the transition away from fossil fuels.”[3] Nevertheless, considering the different pace at which industrial and technological development goes within the urbanised and outermost areas of Europe, we may wonder to what extent just transition in the energy sector will be accomplished comprehensively and without deepening the long-standing dichotomy between North and South in Italy. 

Therefore, one argument playing against just transition is rooted in the emergence of a job versus environment dichotomy, especially in those peripheral areas of Europe where the cross and intra-generational unemployment is high. Just transition will require Member States (already burdened by a limited social security tax base) to resort to new restorative justice solutions. A large-scale reskilling and upskilling process is thus required to accelerate the transition and avoid repercussions on the labour market and social distress. The EU budget shall indeed play a vital role to facilitate the setting up of social policies in the years to come.[4]

2. Energy Transition in Southern Italy: opportunities and challenges for seemingly disadvantaged lands

The necessity to accelerate the energy transition in the less urbanised areas of Europe faces one of its demanding challenges in the efforts in the Southern regions of Italy, currently implementing the technological, regulatory, and financial aspects envisaged by the Green Deal. We, thus, intend to investigate the status of the most recent energy transition programs undertaken by both the public and private sectors in those areas of Italy. Then, we discuss the most notable endeavours to accelerate the energy transition and move away from fossils fuels in Sicily, Calabria, Basilicata, Campania, and Sardinia.

The article concludes with a reflection on the most common and specific burdens faced by each of the aforementioned regions. Despite being endowed with unique natural resources, which may enable the South to become a solid hub driving the energy transition, political risk and constrained resources coupled with long-standing plagues such as local criminal organisations, and widespread corruption may constitute a credible threat to meet vital targets.

2.1. The current status of the energy transition in Southern Italy: opportunities within the renewable energy sector

The entry into force of the third energy package, the novel provisions regulating the electricity market, and the groundbreaking Green Deal have motivated Southern Italy’s revived commitments and efforts to reduce green-house emissions producing a higher proportion of clean energy. As part of the energy transition plan in Italy, energy demand will be met by electricity produced by low cost and renewables energies. On a national scale, energy demand is higher in the North due to intensive industrial activity. “About 67% of generation capacity is located in the North, especially in Lombardy and Piedmont. In the [S]outh and on the islands, only Puglia and Sicily have sizeable values.”[5] This significant disproportion points out the presence of fewer industrial plants located in the main industrial sites in the South, namely, Taranto in Puglia, “Priolo Gargallo (Syracuse), Augusta (Syracuse) and Porto Torres (Sassari) on the islands.”[6]

2.2. Recent efforts within the electricity sector 

Despite lower electricity capacity, the regions of Southern Italy demonstrate the potential to become leading hubs stimulating energy transition thanks to their favourable climate/geographical characteristics. Indeed, all the Southern areas attract significant investments in clean energies and green technologies, translating into unprecedented growth opportunities for their underperforming economies. Numerous have been cases of private national, and foreign entities investing in low-cost renewable energy technologies, namely solar photovoltaic (PV), wind and hydroelectric power, along with the highly sustainable solar thermal technology to generate low-temperature heat. 

It is worth mentioning Terna’s plan to boost energy renewables in the South so as to bring forth a Mediterranean electricity hub. Terna, an Italian transmission system operator, has pledged 18.1 billion euros to be invested in the next decade to boost and renovate “the country’s grid and support the integration of new clean energy projects.”[7] Furthermore, Terna is committed to enhancing the overall “connections between the mainland and islands.”[8] More specifically, the venture envisages the building up of “the €3.7 billion Tyrrhenian Link, a 500kV high voltage direct current link that will connect Sardinia to Sicily and the latter to Italy’s mainland.”[9]Furthermore, “the 380kV Bolano-Paradiso 2 connection between Sicily and Calabria will allow the exchange of electricity between the island and mainland to be increased to a total of 2GW, benefiting the development of clean energy developments planned for the [S]outh of the country.”[10]

2.3. Solar energy in Sicily: the most irradiated region of Italy

Insofar Sicily is leading energy transition in South Italy when it comes to solar energy. Indeed, fourteen remote islands—the so-called Eolian and Egadi islands archipelago situated off Sicily’s South and North coast—have contributed to scale up employment of solar energy over the past decades. For instance, Volcano is home to one of the first photovoltaic fields introduced in 1984, showing significantly stable efficiency[11]. Another remarkable case is “Lipari, the largest of the Eolian islands, [which] hosts one of the world’s largest PV plants installed so far in remote islands.”[12] The field inaugurated in 2013 supplies “at least 20% of the electricity needed by the new desalinator.”[13]

Nevertheless, some of the main barriers to preventing further “sustained and significant penetration of renewable energy in Sicily’s islands are”[14] worth noting. Firstly, we should not neglect “the subsidies paid by Italy’s Government to the utilities for each kWh of electrical energy produced burning diesel fuel.”[15] Secondly, the weak and often overlooked “regional regulations … almost forbid the adoption of PV and wind energy systems in these islands.”[16]

Besides, a further delay preventing the utilisation of “massive adoption of PV distributed generation in Sicily’s islands is the old regional regulation.”[17] More specifically, current regulation requires “every building’s owner willing to install solar modules to undergo a tedious authori[s]ation route with authorities in Sicily’s mainland.”[18] In addition, officers employed in regional administrations may lack the expertise and guidelines required to integrate photovoltaic systems in households.[19]

2.4. How to transform Calabria with renewable energies

As far as investments within the public sector are concerned, Calabria can offer exemplary energy transition initiatives from fossil fuels to green energies supported by groundbreaking technologies. However, as stated by Nicola Leone, Dean of the University of Calabria, “this land is a disadvantaged region.” Still, its regional administration has remarkably channelled the funds under the Multiannual Financial Framework (MFF) of the European Union. Indeed, to contribute to setting up a model for helping the socio-economic growth of the whole region, the local University has heavily relied on sustainable energy. 

The University of Calabria had worked to transform the campus’s energy infrastructure between 2014 and 2020. Overall, the energy project was worth more than 18 million euros, and the European Cohesion Policy played a crucial role in providing the campus with substantial funding. Significantly, the new system envisages the employment of up-to-date “geothermal, photovoltaic and solar thermal energies”[20] which have ultimately resulted in a remarkable reduction of “energy bills by hundreds of thousands of euros a year.”[21] It is worth mentioning that the new campus relies on “an intelligent system of lighting. Some 33[,]000 remotely controlled LED lights illuminate its 96 buildings.”[22]

A further contribution worth of notice is the recent agreement between the Department of Energy, mechanic, and management engineering at the University of Calabria and seven municipalities of the region. The protocol calls for integrating the region’s civil society, researchers, and students to develop innovative bottom-up solutions and speed up decarbonisation in Calabria.[23]

2.5. Basilicata: a new legal framework to encourage decarbonisation 

As far as Basilicata is concerned, the region is infamously known as one of the areas of Southern Italy where energy transition might experience further delays and heavy repercussions on the local labour market. More precisely, almost “80 % of Italy’s crude oil is extracted from the Val d’Agri area of … Basilicata,”[24] which has already resulted in significant consequences for the environmental and urban dimensions.[25]

 Nevertheless, the regional administration has concretely sought to change its legal framework to meet the targets envisaged by the Paris Agreement and the novel Green Deal. In 2018, the Basilicata Regional Authority enacted “the regional law on ‘Decarbonisation and regional policies on climate change (Basilicata carbonfree)’.”[26] The regional law envisages the “achievement of stringent GHG emission reduction targets”[27] through a set of “measures that promote adoption of the Kyoto Protocol mechanisms, technological innovation, and an increase of energy efficiency in both the private and public sectors.”[28]

Following the entry into force of these provisions, the Basilicata has gone even further, and has put forward a mechanism of regional incentives aiming at boosting “the production of electricity from renewable energy, achieving energy self-sufficiency in 2020.”[29] It is worth noting that “between 2007 and 2018 electricity production from wind power plants has increased about tenfold, going from 262 GWh to 2124 GWh.”[30]

2.6. Campania and energy potential from thermoelectric solutions and solid biomass

In the Campania region, the most outstanding achievement insofar achieved regarding energy transition comes from the private sector. In 2019, Edison presented a plan of 370 million euros aimed at constructing “a natural gas-powered thermoelectric power plant in Presenzano.”[31] The venture “involves the partnership between Edison and Ansaldo Energia, … two of Italy’s leading industrial companies committed to promoting the country’s development, innovation and sustainability”[32] in a region currently experiencing precarious socio-economic challenges. More specifically, the Power Plant is expected to ensure “atotal capacity of about 760 MWand will adopt the best technology currently available, capable of ensuring an energy efficiency of approximately 63%, which makes it possible to obtain 40% less specific CO2 emissions compared to the average of Italian thermoelectric power plants.”[33]

As far as biomass utilisation is concerned, a recent study by Moliner and colleagues points out the merits of exploiting solid biomass production in the Campania region. Biomass can reliably promote a business with the perspective to foster the region’s economy and jobs abundance. However, according to the study, Basilicata and Campania are not considering the benefits of solid biomass. Indeed, they produce only 3% of the electricity that this renewable energy of their territory can allow. While Basilicata has already achieved energy independence due to its large production of hydroelectricity and wind electricity, Campania primarily relies on imports of substantial amounts of energy. Thus, it should seize the benefits of encouraging reliance on its solid biomass.[34]

2.7. Sardinia considering the installation of natural gas transport pipeline?

With regards to Sardinia, the region is recently considering the construction of a gas pipeline. The region is indeed the only area of Italy that lacks gas transport infrastructures. Nevertheless, the current “proposal to build a 585km pipeline from Cagliari in the [S]outh to Porto Torres in the [N]orth”[35] is still widely debated in the country’s political landscape. The main issue at stake lies in the envisaged venture’s inconsistency with the scope of the energy transition. Furthermore, the laying down of the pipeline constitutes a lost opportunity for implementing renewable energies in a region rich in unique natural resources. The Southern section of the venture supposed to connect “Cagliari to Oristan[o] received clearance from Italy’s environment ministry”[36] in the summer of 2020. Nonetheless, the laying down of the pipeline has been put on hold as it lacks formal authorisation by the national economic development ministry. Besides, the venture envisages the high cost of €600 million likely to create social discontent, as taxpayers would mostly finance it through further levies in energy bills.[37]

The solution for Sardinia might be found in the road map towards decarbonisation exemplified by Francesco Starace, current Renewables Super Major at Enel, which accounts for Europe’s largest utility. Firstly, Starace has added, the extensive decarbonisation of “the island’s power supply – as well as its heating, transport and heavy industry – would require the closure of the coal plants.”[38] Secondly, to generate new green energy, further investments are required to add “4-5GW of new renewables capacity and 700MW-1GW of batteries to help balance the grid.”[39] It is worth noting that, thanks to the region’s unique natural resources, the envisaged “4-5 GW of extra power would be supplied by onshore wind, solar, and hydro[electric power plants].”[40]

3. The role of EU funds in South Italy: a system that may slow down energy transition

From an institutional angle, the structuring of the EU funds envisages two pillars: co-financing and reimbursing of unutilised funds. Firstly, the rationale of the two pillars can be found in the necessity to use the funds for actual projects without dissipating crucial resources. Indeed, under the MFF, the local government is bound to take part in investment spending. Similarly, it encourages the employment of funds for territories in desperate need of technological innovation and infrastructures with a perspective to boost local employment rates. Moreover, the management of the funds constitutes an additional commitment for local and decentralised decision-makers facing the risk of seeing the funds withdrawn in case of partial or inefficient utilization. Therefore, co-financing is not a solution due to the regions’ few resources; hence decision-makers focus on current expenditure instead of committing themselves to a long-term vision. 

Second, the slow pace of the regional bureaucracy constitutes a further impediment to the timely implementation of the projects in line with the road map envisaged by the European Union. The EU has nevertheless extended its timeframe as a last resort to complete the utilisation of funds. However, the result is discouraging as a good deal of the funds are not being utilised and thus return to being invested in more resourceful territories, more likely to ensure application efficiency.[41]

This background permits us to conclude that the most perilous hindrance preventing South Italy from exploiting its potential to become the future hub of green transition is nothing but its internal administrative management and the lack of transparency of its local decision-makers. Regrettably, the current mechanism designed in Brussels falls short of expectations in Southern Italy, already infamously known for its bureaucratic inefficiency and exposure to a wide range of corruptive practices.

Indeed, growing academic literature on the topic seeks to establish a relationship between large transfers of resources in South Italy and the increased unlawful acts in the beneficiary local administrations.[42] More specifically, De Angelis and colleagues have examined “administrative data on criminal episodes in Italy and matche[d] them to the records of all the transfers from the EU to each single municipality over the period 2007–2014.”[43] Conversely, one should not neglect the structural limitations of Southern Italy, where its technological infrastructures cannot keep up pace with the average EU territories, let alone the most developed ones. Hence, if the EU is genuinely seeking to transform its least developed areas into hubs driving the energy transition, it should propose a new mechanism of management of its funds that envisages a more robust presence of EU authorities with a perspective to support local decision-makers and provide instructions and expertise to the latter so as to maximise invested resources.

[1] European Commission, “Delivering the European Green Deal,” Accessed on 16 October 2021.

[2] Ibid.

[3] Darren McCauley and Heffron Raphael, “Just transition: Integrating climate, energy and environmental justice,” Energy Policy 119 (2018): 1.

[4] Ibid.

[5] Gestore Servizi Energetici, “Assessment of the national and regional potential for the application of high-efficiency cogeneration and efficient heating,” December 2016: 65, Accessed on 16 October 2021.

[6] Ibid.: 53.

[7] Jules Scully, “Italy’s Terna outlines US$21bn grid investment plan to support renewables integration,” PVTECH, 8 July 2021, Accessed on 16 October 2021.

[8] Ibid.

[9] Ibid.

[10] Ibid.

[11] Rosaria Ciriminna et al., “Solar energy for Sicily’s remote islands: On the route from fossil to renewable energy,” International Journal of Sustainable Built Environment 5, no. 1 (2016): 132. Accessed on 16 October 2021.

[12] Ibid.: 134.

[13] Ibid.

[14] Ibid.: 135.

[15] Ibid.

[16] Ibid.

[17] Ibid.: 136.

[18] Ibid.

[19] Ibid.

[20] Aurora Velez, “How building the greenest campus in Italy has transformed Calabria,” Euronews, 5 July 2021, Accessed on 16 October 2021.

[21] Ibid.

[22] Ibid.

[23] Ibid.

[24] Salvatore Tatarella, “Environmental situation in Basilicata linked to oil extraction,” European Parliament, 2 October 2008. Accessed on 16 October 2021.

[25] Ibid.

[26] Senatro Di Leo et al., “Contribution of the Basilicata region to decarbonisation of the energy system: results of a scenario analysis,” Renewable and Sustainable Energy Reviews, no. 138 (2021): 2, Accessed on 16 October 2021.

[27] Ibid.

[28] Ibid.

[29] Ibid.: 11.

[30] Ibid.

[31] Edison, “Edison invests 370 million euros in Campania in support of the country’s energy transition and sustainability,” 29 November 2019, Accessed on 16 October 2021.

[32] Ibid.

[33] Ibid.

[34] Cristina Moliner, Elisabetta Arato, and Filippo Marchelli, “Current Status of Energy Production from Solid Biomass in Southern Italy,” Energies 14, no. 9 (2021):  1-21. Accessed on 16 October 2021.

[35] Heather O’Brian, “Why Sardinia’s gas plans make little climate or economic sense,” Energy Monitor, 6 October 2020, Accessed on 16 October 2021.

[36] Ibid.

[37] Ibid.

[38] Leigh Collins, “Sardinia will become a net-zero island as soon as 2030 and this is how: Enel boss,” Recharge, 21 July 2021, Accessed on 16 October 2021.

[39] Ibid.

[40] Ibid.

[41] Salvatore Perri, “European funds and southern Italian regions: a critical view,” Telos, 26 June 2020. Accessed on 16 October 2021.

[42] Ilaria De Angelis, Guido de Blasio, and Lucia Rizzica, “Lost in Corruption. Evidence from EU Funding to Southern Italy,” Italian Economic Journal 6 (2020): 5-6. Accessed on 6 October 2021.

[43] Ibid.: 15-16.

Published by LA REGIONISTO

La Regionisto focuses on regional economic, political or cultural issues. Its aim is to enable everyone to deepen their curiosity for various regions of Europe and beyond, in a classic or fun way. We welcome articles written in any language and from any approach!

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