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The Decreto Semplificazioni: Many amendments for the Green Economy

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published on 4th December 2020

 

Law no. 120 of September 11, 2020, with some amendments, has transformed Legislative Decree no. 76 of July 16, 2020 (the so-called Simplification Decree - Decreto Semplificazioni) and contains urgent measures to simplify digital innovations; it was published in the Official Gazette of the Italian Republic on Monday, September 14, 2020, and came into force the following day.

 

The law introduces, with slight but important deviations, various innovations related to the green economy, including the long-awaited limitation of the control powers with which GSE S.p.A. is endowed as manager of public funds for renewable energies and energy efficiency. These control powers were introduced by art. 42 of Legislative Decree no. 28 of 03.03.2011 and have been very widely interpreted by GSE.  The law finally puts them into clear limits.

 

A part of the provisions provides for several measures. These include, among others, the approval procedure for the construction of plants and electricity storage facilities, the consumption of „smart” energy, as in the case of so-called other net-metering (scambio sul posto altrove) or electromobility. They serve to make this sector more attractive for investment and consumption.

 

The following is a brief overview of the most interesting innovations.

 

1. APPROVAL FOR CHANGES TO RENEWABLE ENERGY SYSTEMS

 

a) Simplification of the Environmental Impact Assessment (EIA) procedure

A first important change aims at streamlining the EIA procedure for renewable energy installations, especially in the case of changes to already authorized installations, by limiting the scope of the EIA to the sole assessment of the environmental impact of the changes to the project under assessment.

 

In this way, the amendment to the law avoids the need to reassess the entire plant, which would result in an extension of the procedure.

 

The new provision applies to the following changes to renewable energy installations:

  

  • Complete reconstruction

  • Restoration

  • Reactivations

  • Performance increases (revamping or repowering)

     
The above amendment aims to ensure that as many plants as possible can continue to operate after the end of revamping or repowering subsidies and to do so under the simplest possible conditions. Subsidies will be phased out for many plants over the next few years. What is sometimes missing, however, is similar legislation for the operating permit itself, which in many regions has been granted for a limited time.

Other changes relate to the introduction of deadlines for the EIA, which must be met by the licensing authority (these are not discussed here).

b) Permitting procedure
With the aim of further simplifying procedures, the approval procedures for existing renewable energy plants or those to be built that have already been approved will be revised. The importance of this is to be emphasized for already approved but not yet realized plants, where often a new approval or modification of the building permit became necessary if the final planning had to be adjusted for technical reasons.

Changes to already approved plants (already constructed or still to be constructed):

  • For „substantial modifications” of plants for which a single permit (Autorizzazione Unica) has already been granted, the renewal of the AU is foreseen. By ministerial decree, it is still to be determined for which type of plant and which energy source this should apply, as far as it has not already been determined by law decree 152/2006.
  • For „other than substantial modifications”, both for projects that have only been approved and for those that have already been implemented, it is understood that they are subject to the simplified approval procedure (Procedura abilitativa semplificata - PAS) or the declaration of commencement of works in the actual state (Dichiarazione di inizio lavori - DILA), as detailed below.


Non-substantive changes to be approved by PAS
Non-substantial changes to projects and existing PV and hydropower plants are considered to be non-substantial changes: Interventions that do not result in changes:

  • the physical size of the equipment;
  • the volume of the structures;
  • the installation location of the plant; and
  • the secondary trade.


In such cases, however, a new environmental impact assessment may become necessary.

Currently, there is no uniform Italian legal regulation on when changes are substantial and when they are not. The new law does not change this and leaves it up to subsequent laws to be introduced to create a clear legal framework. The extensive discussions that have emerged from the consultation documents for the new law also do not give rise to any hope that this law will be passed soon. However, the new law provides clarity in the area of repowering and revamping by defining separate categories of so-called minor changes.

Non-substantial changes (so-called minor changes) that are approved by DILA:
Work on existing facilities and changes to approved projects are classified as so-called minor changes. Here it is sufficient to submit an affidavit of commencement of works (DILA) to the municipality if the following conditions are met:

  • These are changes that do not lead to an increase in the area occupied by the installations and their ancillary works, regardless of the electrical power achieved by the works, or

  • These are changes that fall into one of the following categories:


    a) Wind farms: Replacement of rotors, which involves an increase in the physical dimensions of the blades (this term is probably used to refer to the circumference of the rotor blades) and in the volume of operation of no more than 15% each;

    b) PV open space: interventions which, even after replacing the modules and other components and changing the design of the installation, do not cause a change in the volume of operation of more than 15% and a change in the maximum height above the ground of not more than 20%;

    c) PV rooftop installations: replacement of modules on buildings for productive use and, in the case of buildings for residential use, interventions that do not involve changes in the angle of inclination between the module surface and the roof surface or those that reduce the distances.

    d) Hydroelectric power plants: modifications that, without increasing the amount of water discharged, resulting in a change in the physical dimensions of the components and in the volume of the structures that house them, not exceeding 15%.

The declaration is submitted by the owner of the land or by the person who may dispose of the area on which the plant and its ancillary structures are located, in paper or digital form. It must be accompanied by a report signed by a qualified designer and the relevant design documentation certifying compliance with safety, seismic safety, and sanitary and hygiene regulations.

Finally, the law specifies that the modifications, for which a simple DILA is sufficient, can also be carried out on installations that receive a subsidy. However, it is specified that the increase in electricity production resulting from an increase in capacity above the thresholds specified in the Ministerial Decree of 23.06.2016 will not be subsidized. The GSE will now adapt the guidelines for modifications to existing installations accordingly and, if necessary, establish specific control provisions.


Approval of new PV roof systems
DILA is also intended for projects of new PV systems on roofs of rural buildings and buildings for productive use and residential buildings, as well as for roofs where the complete removal of asbestos or asbestos is carried out. This is provided that these buildings do not fall within the areas designated as Zone A in the urban planning and except for buildings protected under the Cultural Heritage and Landscape Protection Act.

In such cases, the declaration must also be accompanied by the technical planning documents prepared by the grid operator for connection to the electricity grid.

Finally, it should be noted that the new Act has supplemented the original provisions on a single permit in such a way that the permit now also covers the demolition of buildings or restoration works necessary for the rehabilitation of the areas where the facilities are located.

In the same vein, the provision introduced just before the final adoption of the law aims to ensure that storage systems connected to renewable energy installations are considered ancillary facilities. The purpose of the provision is again to simplify the procedure and to accelerate the spread of this type of technology. 

 

2. PHOTOVOLTAICS ON BUILDINGS WITH ASBESTOS, ON AGRICULTURAL LAND AND QUARRIES AND LANDFILLS

With the transformation of the Simplification Decree into law, some provisions have been introduced to facilitate the promotion of certain PV systems installed after the removal of asbestos or located in certain areas.


Law no. 120/2020 recognizes subsidies in the form of bonuses and priority participation modalities for those who install PV systems after asbestos removal, and establishes the following:

  1. it is not necessary that the area where the replacement of asbestos has taken place is the same as the area where the installation is made, provided that the latter is installed on the same building or other buildings adjacent to it in terms of cadastre, provided that they are in the availability of the same person;
  2. photovoltaic installations may occupy an area larger than that of the asbestos replaced, in which case the additional benefits for asbestos replacement shall be reduced proportionally on a flat-rate basis.

The law also provides for exceptions to the ban on support for PV systems on arable land. In particular, this prohibition does not apply to PV systems to be erected:

                     
  • to areas that have been declared areas of national interest, provided they have been approved;

  • on abandoned and restored landfills and landfill lots, quarries, or quarry lots that are not eligible for further use and for which the authority responsible for granting the permit has certified the completion of the environmental rehabilitation and restoration measures provided for in the permit, in compliance with the applicable regional regulations.


The above provision is decisive for projects for which funding is to be applied for under the so-called FER1, which was previously excluded under the wording of the law. The plants can now participate in the auctions and registers of the law of July 4, 2019. In both cases, it is stipulated that no further certificates and declarations are required for access to the subsidies.


3. IMPORTANT NEWS ON GSE CONTROLS

 

Law 120 of 11.09.2020 fundamentally changes the control powers of the GSE. This change is undoubtedly one of the most important that has been introduced.

To be able to declare the expiry of subsidies in the field of electrical and thermal energy and energy efficiency and to order the recovery of sums already paid out, the GSE must comply with the requirements of article 21-nonies of law no. 241/1990:

 

  • there must be reasons of public interest that outweigh the conflicting private interests to be weighed
  • a reasonable period must be observed, which in any case may not exceed 18 months from the adoption of the measures approving or granting the economic advantages.


Only in cases where the measures result from „misrepresentation of the facts or false statements/certification and/or false affidavits as a result of conduct constituting a criminal offense and established by a final judgment”, the annulment may also take place beyond the 18 months.

 

In the field of energy efficiency, it is also foreseen that, without prejudice to the already approved reports (RVC), they will be communicated when the GSE has established the non-conformity of the audited project in the field of verification activities carried out by the requirements of art. 21-nonies.

 

This applies to all types of projects: standardized, analytical, and lump sum.

 

The provisions introduced have a retroactive character and apply to renewable energy and energy efficiency projects that are subject to ex officio cancellation procedures that have not yet been completed and - at the request of the owners concerned - to those where the GSE has already canceled subsidies but the measures have been challenged in court and have not been decided by a final judgment. This principle has already been confirmed by the Consiglio di Stato and the new standard was applied in favor of the plant operator in a judgment of 11.09.2020.

However, by the provisions of Article 21-nonies, this regulation is not applicable in cases of criminal law.

 

Legal and investment security is thus enormously improved, although the law should not be interpreted as a free ride. The control powers of the GSE were previously so broadly defined that one could sometimes speak of arbitrariness or draconian punishments were imposed even for seemingly minor violations. Now the GSE must observe the principle of proportionality and impose appropriate sanctions for the offense. In practice, however, it will be up to the courts to fill the program sentence of the new law with life and to decide on a case-by-case basis whether the principles mentioned above have been taken into account. This applies in particular to the application of the 18-month rule or the question of when the period begins to run. The GSE would still be free to impose the reduction as a milder means of revoking the grant.

 

4. Spalma Incentivi (nOT PV)

The new law also introduces new regulations for plants that fall under the so-called first spalmaincentivi, concerning certain RES-E plants, not including PV plants that are or were eligible for subsidies - green certificates, flat rates, or premium rates - with or without modulation.
In particular, the following is envisaged:

 

a) In the case of installations that have chosen to continue using the incentives for the remaining period of eligibility, it will be possible to participate in the tenders published by the GSE after 17.07.2020 with projects on the same site as those already using subsidized installations, as well as in any other subsidy instruments based on electricity prices or tariffs approved later, including in execution of the National Integrated Energy and Climate Plan (PNIEC).


The plants that occupy a useful position in the ranking list will receive the support within the limits of the capacity that, in each procedure and for each group of plants, should not be allocated to plants other than those in question. There is a percentage reduction in the reference tariff, corresponding to a further reduction of 5 percentage points compared to the one offered by the operator. For register station installations, the tariff is reduced by 3 percentage points.        


b) In the case of installations that have opted for a remodeling of the incentive, participation in projects on the same site as the installations already provided with incentives as provided for in the above-mentioned prohibitions, without the limits provided for the above-mentioned installations.

 

 

 

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