The role of regional funding policies in the creation of Renewable Energy Communities in Italy

Abstract

In the last years, in Italy, several regional and municipal governments and private donors mobilised to financially support the activation of the Renewable Energy Communities (RECs) on the national territory.

Regarding public authorities, on the one hand, several municipalities took into consideration promoting and leading the local REC establishment process. On the other, some regional authorities decided to allocate public monetary resources, for their set-up. With regard to private donors, a list of bank foundations launched calls for funding for this purpose, compensating in some cases the absence of similar initiatives carried out by public bodies.  

These calls for proposals and funding mostly identify as eligible subjects the RECs’ lead partners, which are often municipalities. Evaluation of applications is characterized by a range of indicators, such as criteria, requirements, and rewards, declared in each call. The analysis of the formulation of these indicators and the consequent evaluations of applications represent a valuable opportunity to better understand the resource holders' orientation concerning public spending for the support of RECs’ establishment.

More specifically, the identified criteria, requirements, and rewards – included in the calls – may or may not prioritise the achievement of such social benefits as the alleviation of energy poverty. In doing so, these indicators can clarify which connotation of energy poverty is preferred. In this regard, Großmann and Kahlheber (2017) point out that the factors affecting energy poverty are insufficient income, housing accessibility, quality and affordability, energy policy and tariff. However, not just one aggregated indicator can measure energy poverty which also affects such aspects as human health and social stigma (Parreño-Rodriguez et al., 2023).

All this considered, this paper presents the analysis of the various approaches, indicators and the corresponding rating scores awarded to the proposals, criterion by criterion. The results of the analysis are collected in a unique database to provide a comprehensive assessment and comparison of various funding opportunities. This allows for identifying differences and recurrences to determine the general direction of the public action(s) concerned, in Italy over a given period. Furthermore, this analysis provides interesting elements to discuss alternative approaches to the definition of the RECs’ social benefits and in particular, to the management of the energy poverty phenomena, from the perspective of energy justice (Jenkins et al. 2016).

In fact, the issue of social benefits is framed within a broader reflection on a just energy transition, i.e. the fairness of the transition. Hanke, Guyet and Feenstra (2021) provide a useful classification of energy justice, which can be procedural, distributional, or recognitional. Procedural justice refers to equitable procedures that allow all local stakeholders to engage and participate in the energy transition in a non-discriminatory and inclusive way. Distributional justice investigates where energy injustices emerge, both in production and consumption. Recognitional justice refers to sections of society where social needs are ignored or misrepresented. This classification will orient the discussion regarding the above-mentioned direction of public action addressed to the RECs’ activation in Italy. 

The authors acknowledge financial support by Fondazione Cariparo (grant n. 59586 - ProECTO Project).