Italian offshore delayed by cap on capacity & poor financials

650MW limit until 2015 restricts project development

Italy is destined to fall behind other European countries in the development of offshore wind power due to a combination of unfavourable physical conditions and insufficient political support, according to a senior official at the Italian renewable energy association, APER.

Speaking to Windpower Offshore, Aper deputy chairman, Fabrizio Tortora, said a government decree on 6 July has dealt the sector a heavy blow. It introduces a 650MW cap on offshore capacity until 2015 and provides less-than-generous tariffs.

Offshore wind resources in Italian waters are not as strong as in other parts of Europe, with wind speeds generally in the range of 6-7m/s and availability averaging an annual 2,500 hours. The windiest sites off the western coast are also the deepest, making them more appropriate for as-yet experimental and expensive floating foundations. "Technology can overcome these hurdles," said Tortora, "but we need the political will to support the sector."

From 1 January 2013, a developer with a fully permitted site - of which there are none, as yet, in Italy - will have to participate in an auction held by state energy management agency GSE. The winning bid will be the project with the lowest cost, within a range of 2-30% below the tender rate. The developer of the selected project will be required to pay a down payment of 10% of the project's capex and will, crucially, face uncertain prospects on future tariffs.

Support for offshore wind will start at €165-€176/MWh on 1 January 2013 and fall by 2% a year. However, the decree only applies for three years, which means developers cannot know the financial conditions they would be operating under when their project is finally authorised, constructed and commissioned, stressed Tortora.

Italy's infrastructure ministry is ultimately responsible for authorising offshore wind farms, but local authorities have often shown fierce opposition to such projects, voicing the resistance of local residents and fears that offshore turbines risk hampering tourism.

This combination of technological hurdles, widespread political opposition and uncertain financial prospects appears likely to stall offshore wind power development in Italy for the time being. "I think Italy's time will come," said Elena Fiorentini of developer WPD. "But it will depend on the political will to make it happen." WPD has been developing the Gargano Sud offshore wind project in the Adriatic off the Apulian coast.

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