Energy efficiency in the Italian Financial Act 2007 Provisions The present slides are exscusively meant to support the Author’s speech edited by laura modestino for the Italian Ministry of European Policies Sofia, March

introduction This paper presents the most recent measures taken by the Italian Government in the energy sector. They are specifically meant to support end-use efficiency and energy service Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria

Energy saving – consumers’ bill and environment Tax relief for energetic improvements of buildings Fund for boosting buildings at top ranking efficiency Contributions for refrigerators at high ranking efficiency Incentives for the installation of industrial engines at high efficiency and variable speed Administrative simplification for small self-producers of electric energy Tax relief for shopkeepers who chose either fluorescent lamps or vapour of sodium ones Reduction of tax on LPG and incentives for the use of gas cars Incentives for bio-fuels Interventions on energetic taxation pro social goals TVA relief for ecological energy supply Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Tax relief for energetic improvements of buildings 1/2 PROVISION Tax allowance increase of the percent - from 36% to 55% - for those interventions:  Meant to reduce energy consumption for thermal comfort in new buildings at least 20% less than current values as allowed for the new buildings ( up to € in 3 years)  Specifically done on walls and windows such as insulation (up to € in 3 years) Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Tax relief for energetic improvements of buildings 2/2 EFFECTS 30-40% reduction of thermal loss and consequential energy saving ranging between kilo tep/a (thousends of tons oil equivalent). Interventions to install solar panels (up to € in 3 years). Substitution of old heaters with new at high energy efficiency ones (up to € in 3 years). Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Fund for boosting buildings at top ranking efficiency 1/2 PROVISION The creation of a special Fund which will provide a financial contribution for the construction of new medium-large buildings (larger than m3) which can have a better energy performance, that is 50% less than what law in force allows. This contribution amounts at 55% of extra-costs borne for such new constructions. The whole fund amounts at 45 million €, and this should help the pilot construction of buildings at high energy performance, to be repeated in the national territory. Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Fund for boosting buildings at top ranking efficiency 2/2 EFFECTS Reduction of consumers’ energy bill (mostly families) Containment of the Country energy expense Industrial as well as employment impacts linked to the construction/installation of solar panels Development of qualified activities related to the field of bio-building (designers, artisans, installation firms, auditors, …) Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Contributions for refrigerators at high ranking efficiency 1/2 PROVISION A tax allowance in a single instalment for the substitution of refrigerators, freezers and combined with at least class A+ appliances bought in This allowance is 20% of what paid by the consumer and in any case its total amount cannot exceed 200 € Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Contributions for refrigerators at high ranking efficiency 2/2 EFFECTS Reduction in consumption:assuming that class A+ refrigerators achieve 15% of the whole sale, the reduction would be 85 GWh/a (millions kWh). Reduction in consumers’ bill. Industries would be encouraged in their research ans well as in producing devices at high energetic performance. Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Incentives for the installation of industrial engines at high efficiency and variable speed 1/2 PROVISION A tax allowance of 20% (in a single instalment) of the amount paid by a consumer. In any case the tax allowance cannot exceed 200 € for the purchase or substitution of engines at low-medim power (even those ones integrated in devices) with engines at high performance electricity ranged between Kw – for a total amount of € per engine (inclusive of installation); whereas the purchase/installation regards inverter on a plant ranged between 7,5 – 90 KW, the tax allowance cannot exceed 1500 € Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Incentives for the installation of industrial engines at high efficiency and variable speed 2/2 EFFECTS Reduction of electric energy consumption service being equal More competitive enterprises Energy saving up to 30% for speed converters to electric engines A potential reduction equal to 15 TWh/y, that is 10% of industry electric consumption Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Administrative simplification for small self- producers of electric energy 1/2 PROVISION The mechanism of “in place exchange” is extended to plants up to 200 kW, powered by renewable sources as well as co-generative ones. Such mechamism was in force only for very small plants, powered by renewable sources up to 20 kW. Simplification of fiscal procedures, abolition of some heavy administrative taxes, for an amount equal to 1 million € per year. Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Administrative simplification for small self- producers of electric energy 2/2 EFFECTS Improvement in the distribution of clean efficient small generation. Spreading of a “rational energy use” culture Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Tax relief for shopkeepers who chose either fluorescent lamps or vapour of sodium ones 1/1 PROVISION 36% tax relief for shopkeepers who change their shops’ lighting with more efficient systems Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Reduction of tax on gaseous hydrocarbons and incentives for the use of gas cars 1/2 PROVISION 20% less on LPG. The current tax is reduced to 227,77 € per kg of product Incentives for conversion of cars from fuel to gas, for the purchase of gas cars and/or LPG, with a fund of 100 million €/year for 2007, 2008 e Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Reduction of tax on gaseous hydrocarbons and incentives for the use of gas cars 2/2 EFFECTS Positive effects on SMEs in the sector of gas supply as well as on those transforming vehicles Increase of circulating gas cars (assessment for 2007: units) Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Incentives for bio-fuels 1/2 PROVISION Alignement of Italian law on bio-fuels with EC Directive 2003/30 In the selection of industrial projects, priority will be given to rural enterprises as well as to energetic efficiency of bio- fuels production (transportation costs included) Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Incentives for bio-fuels 2/2 EFFECTS Diversification of primary energetic sources Reduction of gas emission producing greenhouse effect Solution of the open case with the European Commission, and prevention of further infringement procedures Positive effects in agriculture as well as in industrial transormation sectors Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Interventions on energetic taxation pro social goals 1/2 PROVISION 100 million € per year for the creation of a fund (50 € million for ) to be used to cover cost reduction in energy supply for socially weak categories Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

Interventions on energetic taxation pro social goals 2/2 EFFECTS New opportunities for diversifying energetic sources Reduction of energetic bill Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

TVA relief for ecological energy supply 1/2 PROVISION Only in case of energy produced by renewable sources or by high performance cogeneration plants, the domestic use of thermal energy may benefit of TVA relief within the supply service contract Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government

TVA relief for ecological energy supply 2/2 EFFECTS Gradual improvement of the energetic sources diversification process Laura Modestino 2007 for the Italian Ministry for EU Policies Twinning Bulgaria Source: The Presidency of Italian Government