The FINANCIAL – The Italian government will cut subsidies to the country’s fast-growing renewable-energy sector, Industry Minister Corrado Passera said Saturday.
Publicly funded incentives for renewable energy have produced “excessive” investment in solar and wind power, distorting prices, Passera said.
According to Borsa Italiana – London Stock Exchange Group, the government will “realign” the scale of its incentives to match European levels, he said on the sidelines of a conference in this town north of Milan.
“Italy has important goals to meet and even surpass,” he said of European Union pledges to boost the supply of renewable energy in coming years.
“But we need to do so without over-reliance on taxpayer resources,” he added.
Italy’s incentive scheme, based on investment rebates, spurred a deluge of solar and wind projects. The additional capacity has undermined the profitability of traditional power plants at a time of stagnant demand, Paolo Andrea Colombo, chairman of former electricity monopoly Enel SpA, said on Friday.
Italy currently gets about 26% of its electricity from renewable sources, according to a study published this week by environment group Legambiente.
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