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EU Approves Italy's EUR 23 Billion Renewable Energy Aid Scheme to Add 37 GW Capacity by 2030

EU’s scheme is expected to support the construction of new onshore wind, solar, hydropower and sewage gas facilities, adding 37.15 GW of renewable electricity capacity to Italy's energy system.

June 09, 2026. By Abha Rustagi

The European Commission has approved a EUR 23 billion Italian state aid scheme aimed at boosting electricity generation from renewable energy sources, marking one of the largest clean energy support measures endorsed under the European Union's new Clean Industrial Deal framework.

The scheme is expected to support the construction of new onshore wind, solar, hydropower and sewage gas facilities, adding 37.15 GW of renewable electricity capacity to Italy's energy system. The additional capacity represents nearly half of the country's current renewable energy generation capacity and is expected to play a key role in helping Italy meet its target of sourcing 39.4 percent of gross final energy consumption from renewables by 2030.

The approval comes under the Clean Industrial Deal State Aid Framework (CISAF), adopted by the Commission on June 25, 2025, to accelerate investments in sectors critical to the EU's transition to a net-zero economy.

Under the Italian scheme, renewable energy producers will receive support through two-way contracts for difference (CfDs), a mechanism that guarantees a fixed "strike price" for electricity generated and supplied to the grid over a 20-year period.

If market electricity prices fall below the strike price, the state will compensate producers for the difference. Conversely, producers will return excess revenues when market prices exceed the agreed level.

The aid will primarily be awarded through competitive auctions in which developers bid for the lowest strike price needed to make their projects viable. Italy will run separate tenders for solar and wind projects with capacities exceeding 1 MW, incorporating additional pre-qualification criteria aligned with the EU's Net-Zero Industry Act.

Smaller renewable energy installations below 1 MW will be eligible for direct participation without competitive bidding, with strike prices set administratively by Italy's energy regulator, ARERA.

The European Commission said the measure includes safeguards to prevent overcompensation and ensure efficient market functioning, including provisions that avoid rewarding producers during periods of negative electricity prices.

"The scheme is necessary, appropriate and proportionate to accelerate the clean transition and facilitate the development of economic activities that are important for the implementation of the Clean Industrial Deal," the Commission said in a statement.

While the scheme carries a headline budget of EUR 23 billion, Brussels noted that actual public expenditure could be significantly lower if wholesale electricity prices remain above expected levels, reducing the amount of support required under the CfD mechanism.

The approval underscores the EU's broader push to reduce dependence on imported fossil fuels, lower long-term energy costs and strengthen domestic clean energy industries following the bloc's REPowerEU strategy.

The CISAF framework allows member states to support renewable energy deployment, industrial decarbonisation, clean technology manufacturing and strategic energy infrastructure projects through the end of 2025 as part of the EU's efforts to achieve climate neutrality.

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Business

European Commission

Clean energy supply

Clean energy support measures

Clean Industrial Deal framework

EU Net Zero Industry Act