Italy has secured approval from the European Commission for a €23 billion state aid scheme aimed at expanding renewable electricity generation across the country. The Clean Power Programme is designed to accelerate Italy’s energy transition and support the achievement of both national and European renewable energy objectives. Funding under the initiative will support the development of new onshore wind, solar, hydropower and sewage gas facilities. Once completed, the projects are expected to contribute more than 37 gigawatts of additional renewable electricity capacity, equivalent to around 48 percent of Italy’s existing renewable energy capacity. The approval was granted under the European Union’s Clean Industrial Deal State Aid Framework (CISAF), which was introduced to provide Member States with greater flexibility in supporting clean energy deployment, industrial decarbonisation and the growth of clean technology sectors.
Launched in May 2025, CISAF forms part of the broader Clean Industrial Deal, an EU initiative focused on accelerating decarbonisation efforts, improving industrial competitiveness and addressing climate-related challenges. The Italian programme will operate through contracts for difference (CfDs), a mechanism that provides renewable energy producers with support based on a predetermined strike price for every kilowatt hour supplied to the grid. If market electricity prices fall below the agreed level, the state will compensate developers for the difference. When prices rise above the strike price, developers will return the excess value to the state. The contracts will remain valid for 20 years, offering long-term revenue certainty while limiting the risk of excessive public support costs.
Financial support will be allocated through a transparent and non-discriminatory competitive bidding system in which developers submit strike-price bids required to make projects economically viable. Italy also plans to conduct a separate auction process for solar and wind installations exceeding one megawatt in capacity, with these projects subject to additional regulatory requirements. Smaller projects below one megawatt will be able to receive support without entering competitive auctions, with strike prices set administratively by ARERA, Italy’s energy regulator.
The European Commission stated that the €23 billion budget is based on current expectations for future electricity market prices, although the actual level of net public support could be lower if wholesale electricity prices remain stronger than anticipated. According to the Commission, the Clean Power Programme complies fully with CISAF requirements and will play an important role in helping Italy achieve its target of sourcing 39.4 percent of gross final energy consumption from renewables by 2030. The initiative is also expected to contribute to lower electricity prices over time, reduce reliance on imported energy and support the objectives of both the Clean Industrial Deal and REPowerEU in strengthening energy security and advancing a more resilient energy system.