Italian white certificates scheme Rino Romani ENEA Environment

Italian white certificates scheme Rino Romani ENEA Environment Department romani@casaccia. enea. it

Italian white certificates scheme Summary: • Energy efficiency decrees • Eligible projects • White certificates • Sanctions • Measurements and verification of energy savings • Main results

Italian economy’s energy intensity Casaccia 13. 06. 2006 3

Energy efficiency decrees (1/6) • Issued in April 2001 • Innovative strategy that combines a command control approach with a market based instrument Casaccia 13. 06. 2006 4

Energy efficiency decrees (2/6) • Distribution System Operators* (DSO) are required to achieve quantitative targets of energy efficiency improvements in enduses • The way for achieving these objectives is left to the market forces (energy efficiency titles or white certificates) * < 100. 000 customers at Dec. 2001 Casaccia 13. 06. 2006 5

Energy efficiency decrees (3/6) • On July 2004 was issued an amended version of the two decrees with the following main changes: – Modifications in the distribution of annual quantitative targets; – Postponement of the implementation period (from 2005 to 2009) – Introduction of flexible mechanism in the deadline for achieving the annual savings Casaccia 13. 06. 2006 6

Energy efficiency decrees (4/6) Annual Targets (Mtoe) year 2005 2006 2007 2008 2009 electricity annual comulative 0, 1 0, 2 0, 4 0, 8 1, 6 gas annual comulative 0, 1 0, 2 0, 4 0, 3 0, 7 0, 6 1, 3 Casaccia 13. 06. 2006 7

Time persistence of energy savings Casaccia 13. 06. 2006 8

Energy efficiency decrees (5/6) • The annual target (*) for each DSO at (t) year is proportional at the share of energy distributed in the year (t-2) by each distributors (*) at least 50% of savings must be achieved in the field where DSO works Casaccia 13. 06. 2006 9

Energy efficiency decrees (6/6) • Energy saving targets can be achieved through projects implemented by: – DSO, directly or via controlled companies – Energy Service Companies (ESCOs) Casaccia 13. 06. 2006 10

Eligible projects • All energy saving projects Casaccia 13. 06. 2006 11

Energy Efficiency Titles (TEE) or White Certificates (Wh. C) • 1 Wh. C for 1 toe of saved primary energy Casaccia 13. 06. 2006 12

White Certificates (Wh. C) • Wh. C are issued by Electricity Market Operator (GME) once it has been certified that a defined amount of energy saving will be attained by project implementation Casaccia 13. 06. 2006 13

Typology of Wh. C • Type 1: certificates savings of electricity • Type 2: certificates savings of gas • Type 3: certificates savings of other fuels Casaccia 13. 06. 2006 14

Sanctions • proportional and in any case greater than the investment needed to compensate the noncompliance • established and applied by the Authority for Electric Energy and Gas (AEEG) Casaccia 13. 06. 2006 15

Process to recognize energy saving Phases and Actors Implementation of the project DSO and ESCO Request of verification Entitled project Assessment and certification AEEG Issue of Wh. C GME Exchange of Wh. C Transfer of Wh. C to AEEG DSO and ESCO DSO Casaccia 13. 06. 2006 AEEG to DSO Economic contribution 16

Measurements and Verification of energy savings (M&V) • The definition of technical rules, the implementation, monitoring and enforcement of the whole mechanism are under the responsibility of the Authority for Electric Energy and Gas (AEEG) Casaccia 13. 06. 2006 17

Measurements and Verification of energy savings (M&V) • The AEEG developed three evaluation methods: – Default method (no measurement; installed units are considered according to their average energy saving) – Engineering method (some measurement of technical features) – Energy monitoring plan (direct measurement of consumption before and after the project) Casaccia 13. 06. 2006 18

Measurements and Verification of energy savings (M&V) Project threshold (Mtoe/year) Method Default Engineering Energy monitoring DSO/ESCOs 25 ESCOs 50 100 DSO 100 200 Casaccia 13. 06. 2006 19

First year period (2005) (1/2) Main results: • • • 300 projects implemented; 0. 28 Mtoe of energy saving achieved (with respect to a target of 0. 15 Mtoe); 0, 75 Mton of CO 2 reduced (equivalent to a CO 2 emitted from a central power of 160 MW) Casaccia 13. 06. 2006 20

First year period (2005) (2/2) Main results: • • about 50% of projects have been implemented by distribution system operators, while the other 50% by ESCOs; more than 400 ESCOs achieved the authorisation to operate in the scheme by the Regulatory Authority Casaccia 13. 06. 2006 21

Second year period (2006) Target: about 311. 000 toe of energy saving of which: • 191. 949 in the electricity sector • 119. 809 in the gas sector Casaccia 13. 06. 2006 22

Measurements and Verification of energy savings (M&V) • On January 2006, in implementation of the Ministerial Decrees, the Authority has decided to draw on the services of ENEA (Italian National Agency for New Technologies, Energy and the Environment). Casaccia 13. 06. 2006 23

Measurements and Verification of energy savings (M&V) The main activities carried out by Enea will be: 1) technical verification and evaluation of the projects; 2) monitoring to ensure that the energy saving projects under evaluation are being implemented correctly; 3) the adoption and up-dating of detailed, standardised technical worksheets for use in evaluating projects and quantifying results. Casaccia 13. 06. 2006 24

Italian white certificates system Thanks for your attention Casaccia 13. 06. 2006 25