EU Approves €23B Italian Renewable Energy Plan to Boost Climate Goals

The European Commission has approved a €23 billion Italian state aid scheme to support electricity generation from renewable sources. The measure, approved under the state aid framework linked to the Clean Industrial Deal, aims to accelerate the energy transition and contribute to achieving the European Union’s climate and decarbonization goals.

Italy’s €23B push accelerates renewable energy expansion and energy transition

The programme will support the construction of new plants powered by onshore wind, solar, hydropower and waste gas, with the aim of adding approximately 37.15 GW of new renewable capacity. This represents an increase of almost half (48% to be precise) of the current installed capacity from renewable sources in Italy and a significant contribution to the national target of covering 39.4% of gross final electricity consumption with renewable energy by 2030.

According to the Commission, the scheme will also help reduce the Union’s energy dependence on imports and promote greater energy price stability in the long term.

The support will be provided through two-way contracts for difference lasting 20 years . The mechanism therefore provides for a strike price for the renewable energy produced: when the market price is below this threshold, the State will pay the difference to the producers; when the market price is higher, the beneficiaries will repay the difference.

The aid will be awarded primarily through competitive, transparent, and non-discriminatory procedures. Solar and wind plants with a capacity exceeding 1 MW will be subject to dedicated tenders and additional pre-selection criteria, in line with the European Net-Zero Emissions Industry Regulation. Plants smaller than 1 MW will be able to access the scheme directly, benefiting from a strike price set by the Regulatory Authority for Energy, Networks, and the Environment.

The overall budget of €23 billion is based on current market price estimates, although the actual net disbursement could be lower if electricity prices remain above forecasts. Brussels has deemed the measure necessary, proportionate, and appropriate to support the transition to a net-zero emissions economy. The scheme also includes specific safeguards to ensure the proper functioning of the electricity market and avoid compensation to producers during periods of negative energy prices.

The approval is part of the new European State aid framework adopted in 2025 to promote the spread of renewable energy, industrial decarbonization, the development of clean technologies, and the mobilization of private investment necessary to achieve Europe’s climate goals.

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(Featured image by Fabian Kleiser via Unsplash)

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First published in ESG NEWS. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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