Italy Emissions Reduction Policy

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Italy: The Energy Efficiency Scorecard and the Conto Termico

According to the International Energy Efficiency Scorecard (IEES) Italy ranked second for its energy efficiency policies and programs in both 2014 and 2016. Two key policies put in place by the Italian government are the energy efficiency certificate (EEC) trading scheme that targets energy service companies (ESCO) entities and the Conto Termico, that targets the building sector. For the purpose of this report the EEC trading scheme will be analyzed.

Energy efficiency certificates, also known as white certificates, impose energy saving targets on energy companies and allow the trade of energy savings certificates between high and low performers. In other words, it gives incentives to energy companies to identify and address some of the market failures that occur in the markets for energy-efficiency.

From 2006 to the end of 2013 the program released 23,479,144 EEC saving a total of 17,646,778 million tons of oil equivalent in primary energy. Until 2012, most of the savings occurred within the residential and commercial sectors. However, starting in 2012 the industrial sector is the one providing the most savings, accounting for 62% of total savings in 2015.

The EEC mechanism is the key policy tool to reach the 20% reduction in energy use by 2020 as mandated by the European Union (EU): the EEC will account for about 60% of the required savings.
The EEC policy was first implemented in the UK in 2002 and then other countries such as Italy and France adopted similar schemes in 2005 and 2006 respectively. These are national policies that vary across countries in terms of target, eligible projects, enforcement mechanism and overall governance. Thus, the high degree of flexibility in terms of target and governance allows any country to set up similar schemes to achieve national energy efficiency goals.

In Italy, the energy efficiency certificate scheme was put in place in 2004 by the Italian government through a Ministerial Decree. Subsequent amendments followed in 2009 and 2012 to increase the energy savings goal, update technical regulations, and expand the coverage to include large projects. Over time the government revised the target for the EEC system to mandate more stringent goals and raise the bar for energy efficiency savings even higher. For example, if in 2013 total energy savings goal is 5.51 million total, for 2016 the figure is 9.61, over a 40% increase.

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