Italy awarded more than 1.1 gigawatts of capacity to 88 solar projects in its first auction limited to installations built without Chinese-manufactured equipment. The scheme, marking a shift in European industrial policy, closed with an average tariff of €66.38 per megawatt hour, 17% higher than that of Italy’s previous unrestricted auctions.
First implementation of the Net-Zero Industry Act in Europe
This auction is among the first in Europe to apply non-price criteria inspired by the European Union’s Net-Zero Industry Act, designed to reduce dependency on low-cost solar components from China. According to consultancy Green Horse Advisory, about 94% of solar modules and cells installed in the European Union in 2023 were sourced from China.
Awarded developers include international players such as Enel Green Power, J.P. Morgan-backed Sonnedix, and KKR-backed energy group ContourGlobal. All awarded projects must be operational within 36 months of receiving the tender.
An investment lever estimated at €10bn
The programme is part of a series of recent renewable energy auctions in Italy, including the battery storage capacity awarded in October. The combined initiatives represent an investment potential estimated at €10bn ($12bn), according to a Sonnedix representative.
Italy awarded nearly 9 gigawatts of renewable capacity in total through this auction and the one concluded in early December for standard solar and wind projects. According to ContourGlobal, such mechanisms lower curtailment risks, introduce stable and affordable capacity to the grid, and reduce the cost of capital for new projects.
