The European Commission has given its approval to a €23 billion Italian State aid scheme intended to accelerate electricity generation from renewable energy sources. The measure is expected to advance the European Union’s Clean Industrial Deal objectives while supporting the bloc’s renewable energy targets for 2030. The Italian renewable energy aid scheme was authorized under the Clean Industrial Deal State Aid Framework (CISAF), which was adopted by the Commission on 25th June 2025. Through this initiative, Italy aims to move further toward a net-zero economy, reinforce energy security, and reduce its reliance on imported fossil fuels.
Under the Italian renewable energy aid scheme, support will be directed toward new renewable energy projects based on onshore wind, solar, hydropower, and sewage gas technologies. Collectively, these developments are projected to contribute approximately 37.15 GW of additional renewable electricity capacity. According to the European Commission, this increase would amount to nearly 48% of Italy’s current renewable energy capacity. The Commission indicated that the scheme will be instrumental in helping Italy meet its objective of obtaining 39.4% of its gross final energy consumption from renewable sources by 2030. In addition, the measure is expected to contribute to lower electricity prices and reduce Europe’s reliance on imported fossil fuels while advancing wider EU decarbonization goals linked to both the Clean Industrial Deal and the REPowerEU strategy.
Financial assistance within the Italian renewable energy aid scheme will be delivered through two-way Contracts for Difference (CfDs). Through this mechanism, renewable energy producers will receive compensation whenever electricity market prices fall below a predetermined strike price. When market prices rise above that strike price, beneficiaries will be required to repay the difference. These contracts will remain valid for 20 years.
Most funding will be awarded through transparent and non-discriminatory competitive bidding procedures, allowing project developers to bid for the strike price needed to carry out their projects. Italy will organize a dedicated competitive process for solar and wind projects with capacities exceeding 1 MW, and applicants in these tenders will need to satisfy additional pre-selection criteria established under the Net-Zero Industry Act and related implementing regulations. Renewable energy facilities below 1 MW will be permitted to participate directly without competitive bidding, with strike prices set administratively by the Autorità di Regolazione per Energia Reti e Ambiente (ARERA).
The European Commission noted that the €23 billion budget has been calculated on the basis of projected market conditions and that actual public spending could be considerably lower if electricity prices remain above current expectations.
