Summary Presentation Luca Di Carlo Scientific Secretary ANEV - - PowerPoint PPT Presentation

THE WIND OF ENERGY TRANSITION Wind repowering in Italy: an industrial opportunity and an environmental need WEC Italy Summary Presentation Luca Di Carlo Scientific Secretary ANEV - Italian Wind Energy Association World Energy Council – WEC ITALY 29 November 2019, Rome - Italy 1

Objectives Italians medium to long term wind targets fixed an installed wind power equal to 12 GW at 2020 (SEN) and to 18 GW at 2030 (NECP). According with ANEV, these targets are achievable only with an incisive and strong program of existing plants repowering in addition with the construction of new plants development. In 2018, ANEV - National Energy Wind Association, in collaboration with the main important players of the Italian wind sector (such as ERG, E2i Energie Speciali, Enel Green Power, EON, Falck Renewables, IVPC, RWE), developed an industrial internal study to estimate the potential that could come from the repowering of the existing Italian wind farms , assessing the opportunities and convenience for operators, in addition to the benefits for the country. In order to achieve national production targets, considering the high level of aging of Italian's plants, the repowering of existing wind farm it is absolute necessary and require an new approach and policy. Without an inversion of current policy, the progressive decomissioning of the lines came to the end of life could be negatively impact on the environment, productive and occupational contexts. In the absence of effective semplificated authorization policies, tax and support tools aimed at the repowering of the existing wind plants, it is estimated that Italy could lose more than 3.4 GW of installed capacity at 2030 . The repowering has a strategic importance for Italy because, in addition with the construction of new plants development, could remarkably contribute to achieve the Italian wind targets 2

Italian NECP objectives for electric sector Objectives + 8 GW at 2030 compared to the 2019 installed power 2

Italian NECP objectives for electric sector Objectives RES Trajectories 2

The potential wind repowering in Italy In Italy the potential repowering at 2030 for energy wind power is estimated to be around 4 GW . The actual and previous Ministerial Decrees envisaged so far, have proved totally inadequate to reach this potential (the intervention’s categories actually possible are only remakes and whole reconstructions). Today, beyond the normative limits introduced by DM “ spalmaincentivi ” measures (Law 9/2014, Ministerial Decree 11/06/2014), for the operator is not able to carry out repowering operations on an existing facility without increasing the installed power. There are many benefits for the country that would result from the repowering with very positive economic impact to the environment and the territory . The repowering is necessary not only in order to avoid the production’s decreasing of today's existing wind plants that are progressively going towards their end of life (increasing lifetime extension), but even for enhancing the wind utilization, due to technological improvements . Other benefits are 1) the decrease of the cost for the incentive , 2) a saving by the reduction of the energy national price (PUN), 3) a higher percentage of wind in the energy mix , 4) a saving of occupied land related with the power installed and 5) more than 7.500 employees occupied in this specific sector. An strong policy for the repowering of the Italian wind farms requires not only new support tools, but also a simplification and rationalization of the authorization process. 3

The italian wind farms – The risk of decomissioning The Italian wind farm age The Italian wind farm is gradually getting older • Average age at 2019: 9 years • Average age at 2030: 21 years Decomissioning Assuming the absence of repowering interventions, a wind farm will be decommisioned between the 20 and 25 years of age (depending on the characteristics of the project), because there are not conditions for operating in a market / grid parity. It is estimated that the decomissioning of Italian wind power (50% of the plants will be disposed of after 20 years from their entry into operation and the remaining 50% after reaching the 25th year from the date of their entry into operation) could be equal to 3.4 GW at 2030. It will be equal to 1.6 GW at 2020. Considering the absence of the contribution of the construction of new plants development, the installed power would be equal to 7 GW , corresponding to the installed power at 2011 . A big step backwards for the Italian wind energy industry and for his contribution to achieve the EU and Italian targets as rappresented by the Italian Government in the National Energy and Climate Plan (NECP). 4

The potential of the wind repowering in Italy General characteristics of wind energy in Italy • Mature industry in Italy. • Peculiarity of the Italian case, penalized by the long approval/authorization procedures. • Territorial concentration of the potential increased production/wind. • Ways to increase the manufacturability up to 4 times for turbines with more than 15 years of seniority. The estimated repowering potential • 4.0 GW of repowering at 2030. • 1.6 GW of repowering at 2020 Critical elements • Spalmaincentivi measures (Law 9/2014, DM 11/06/2014). • Highly critical authorization procedures. • Regulatory environment (support) unfavorable. • Presence of environmental and infrastructure limits for retrofitting of existing sites . 5

Wind repowering: the critical points of the actual normative The regulatory framework and the wind power incentive choices will have significant effects on the future development of the wind sector and will affect the effective implementation of the estimated repowering potential. The “ Spalmaincentivi ” rulings constitute a major obstacle to the realization of the wind repowering programme . Operators who have not joined the DM “ Spalmaincentivi ” would be unable to access support schemes in the case of renpowering work on its own plants for the next 10 years. Positioning in relation to climate target • Gap of 2 GW of wind power to the objectives for 2020 ( 12 GW ). • Gap of 8 GW of wind power compared to the trajectory and 2030 ( 18 GW ) Critical elements • Risk of a progressive decomissioning of existing plants come to the end of its useful life. • Progressive reduction in the production RES and departure from assumptions European objectives. • Difficulties in allocating new wind power resources (limit of 5.8 billion € for incentives to RES). Difficulties in developing systems for grid parity in the current low electricity prices. • Obstacles / barriers to regulatory repowering . 6

Conclusions Italians wind targets from medium to long term can only be achieved through a targeted program of existing plants repowering ( 4.0 GW at 2030 ), in addition with the construction of new plants development. Maintaining the "as-is" would lead to the gradual decomissioning of the lines come to the end of life ( 3.4 GW at 2030 ). Several critical factors preventing investments in existing sites ( spalmaincentivi, complex permitting procedures, absence of support economic tools, environmental and infrastructure constraints ). There are many benefits for the country resulting from the repowering with very positive economic impact to the environment and the territory. It is necessary to modify the current policy and framework for concretely promote the repowering of the Italian wind farm. The main measures proposed : overcoming the absence of support incentive tools, simplifying authorization process, maxi depreciation for investments, bonus on production increases . The repowering program, in addition with the construction of new plants development, is essential to achieve the 2030 goals set by the EU and the Italian NECP 7