F. Farinosi, L. Carrera, J. Mysiak, M. Breil, F. Testella
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Tradable certificates for renewable energy: The Italian experience with hydropower
The paper reviews the economic incentives for the development of renewable energy sources in Italy, in particular in relation to hydroelectricity. The review addresses the impacts of the hydropower development incentivised by the Green Energy Certificates. The Green Energy Certificates were introduced in Italy in 1999 and modified several times. In 2011 the Italian Government decided to phase out the compliance market for certificates and to replace it with a system of auctions. The paper attempts to draw conclusions from the application of the compliance market in Italy, further discusses the performance in the light of the similar economic instruments put in place elsewhere in Europe and finally, offers a baseline for the comparison for the new policies to be implemented in the future.
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