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Powertis: Reducing Energy Poverty in Italy

Reducing Energy Poverty in Italy Through Solar PV Market
Powertis, a Spanish company that focuses on the development and investment of large-scale solar photovoltaic (PV) projects, has announced an expansion plan to enter Italy’s solar PV market. This shift will bring Powertis closer to its goal of reaching one gigawatt (GW) of ready-to-invest assets by 2023. In addition, it will support the National Plan for Energy and Climate (NECP), which has set a target of +30 GW of PV capacity by 2030. Powertis’ growth into the solar PV market will also serve as an opportunity to decrease energy poverty in Italy by reducing the price of electricity.

What is Energy Poverty?

Energy poverty refers to people who are least likely to have access to energy services. This increases their likelihood of remaining poor. Energy poverty affects health by increasing the risk of cardiovascular or respiratory disease and the number of excess deaths in the winter, especially in colder areas. In 2017, estimates determined that 1.1 billion people do not have access to electricity and nearly 3 billion people cook meals with polluting fuels, such as charcoal, wood, kerosene and dung.

The Aim for Efficient and Affordable Energy

In 2011, the former U.N. Secretary-General Ban Ki-moon launched the Sustainable Energy for All (SE4ALL) initiative to drive faster action towards achieving SDG7. SDG7 is the seventh goal of the 2030 Agenda for Sustainable Development. It is battling energy poverty by advocating for improved access to reliable, affordable, sustainable and modern energy for all. SE4ALL aims to double the global rate of improved energy efficiency and the global share of renewable energy by 2030. By working with government leaders, the private sector and civil society, SE4ALL hopes to ensure universal access to modern energy.

Energy Poverty and “Vulnerability”

The primary concern that Italy’s population faces when it comes to energy poverty is the uneven distribution of energy expenditure. The lowest 10% of Italian income-earners spend 4% of their budget on energy compared with the 1% that affluent households spend. This leads to a concept known as “vulnerability,” where the lowest 10% of Italian households have compressed purchasing power and reduced ability to purchase domestic or international goods and services.

Furthermore, as of 2017, Eurostat reported that 15.2% of Italy’s population cannot afford to adequately heat their homes. The inability of households to purchase an adequate amount of energy goods can have negative direct costs including increased stress on the health care system. It also has indirect costs such as a decrease in economic productivity and output in the community.

How Italy is Addressing the Issue

Italy’s government has created the National Energy Climate Plan (NECP) to address its energy poverty. The NECP aims to cover 30% of final consumption by renewable sources, reduce final energy consumption by 39.7% and aim for a 33% reduction in greenhouse gases. Italy introduced the NECP in December 2018 as a commitment and strategy to increase environmental protection and energy security while reducing polluting emissions, as the European Union put forward. So far, Italy has obtained “Medium” ratings in all of the categories after the Climate Change Performance Index (CCPI) evaluated it for 2020. This suggests that there has been a lack of implementing effective measures by the public sector.

Powertis’ Role in Reducing Energy Poverty

The CCPI evaluation also includes a “Low” rating for the “Renewable Energy – current trend” component, demonstrating the need to involve the private sector in producing more renewable energy for Italian markets. The inclusion of PV solar panels would improve Italy’s rating. According to Roberto Capuozzo, the Country Manager of Powertis in Italy, Powertis is one of many private firms working to address this need. It is operating as a leading company in the transition to a zero-emission economy. Powertis’ plans to develop PV projects in Basilicata, Puglia, Sicily, Sardinia and Lazio and increase its pipeline beyond over two gigawatts between Italy and Brazil.

Powertis is reducing the price of electricity by working with local community partners to structure the project’s financing and offer a lower price, in comparison to the cost of electricity for coal. Italy’s main issue is the inconsistent distribution of energy expenditure budgets for the bottom 10% of Italian income-earners in comparison with the top 1%. If prices for energy decrease, energy poverty should decrease. Powertis’ expansion to local communities in Basilicata, Puglia, Sicily, Sardinia and Lazio will offer these individuals more purchasing power and decrease their level of vulnerability. This will also benefit the economy by allowing them the ability to consume other goods and services. By increasing Italian households’ purchasing power, Powertis is increasing access to energy services and reducing energy poverty in Italy.

Powertis has expanded its reach into Italy’s solar PV market, thereby decreasing the price of electricity for Italian households. This has increased households’ access to energy services and subsequently increased their ability to dedicate more of their personal budget towards the consumption of other goods and services. The households’ lower level of vulnerability should also help to decrease energy poverty in Italy.

– Natasha Nath
Photo: Flickr