Renewables: here is the new draft of the Fer X Decree

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Emma Potter

The Fer X Decree represents an important implementation tool that regulates the incentive system for the production of electricity from renewable sourcesincluding solar photovoltaic, wind, hydroelectric plants and residual gas treatment plants from purification processes.

This new version, developed by the Ministry of the Environment and Energy Security, introduces significant changes compared to the March 2024 draft, with the aim of adapting the support system to the needs of decarbonisation and the achievement of the objectives set for 2030.

What changes compared to previous versions and what opportunities does it open up for those who invest in renewables?

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Access to incentives for systems up to 1 MW

One of the main innovations of the Fer X Decree concerns direct access to the support mechanism for systems with one power up to 1 MW. The Decree establishes that these plants can obtain incentives without having to participate in tenders, with award prices already indicated. This represents an advantage for small plants, as easier and faster access to incentives is guaranteed.

An important change introduced in the October draft is the assignment to ARERA of the task of defining the award prices for this category of plants. These prices will be established in a manner proportionate to the cost of the intervention, differentiated based on the technology and size of the system, and updated every year.

For plants with a power greater than 1 MW, the Fer

These tenders will guarantee the assignment of incentives based on competitiveness criteria, where participants compete by submitting offers with strike prices.

An important change introduced in the October draft is the reduction of power contingents compared to what was previously foreseen. If the March draft covered the period 2024-2028, the new version limits the competitive procedures only to those announced by 31 December 2025, reducing the quotas to around a quarter compared to the previous estimate.

This means a more limited availability of incentives for large plants, at least until the end of 2025.

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Award prices and incentives for specific technologies

One of the most notable changes in Fer X Decree concerns award prices for renewable plants, with particular attention to specific technologies. In the October draft, the GSE will be responsible for setting the base prices for the auctions, and these will subsequently be updated. However, some types of systems, such as photovoltaic ones, will benefit from greater incentives in particular situations.

For example, photovoltaic systems installed to replace asbestos or asbestos roofing will be entitled to an increased award price of +27 €/MWh, compared to the +35 €/MWh envisaged in the March draft.

Another example is that of photovoltaic systems built on bodies of water, for which the award price will be increased by +5 €/MWh, a lower value than the +10 €/MWh of the previous version of the decree.

These variations signal a slight reduction in economic benefits for plants in particular contexts, but continue to guarantee significant support for the installation of sustainable technologies.

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New rules for price formation and production times

The Fer X Decree introduces more detailed regulations on formation of strike prices and on the determination of investment costs for the plants participating in the support mechanism. This review aims to ensure greater transparency and make the process of awarding incentives more fair and aligned with the real costs of the interventions, taking into account the different technologies and sizes of the plants.

Another important aspect concerns i implementation times of the incentivized plants. The decree establishes maximum times for implementation, with the introduction of an accelerated evaluation for large projects, for which a more streamlined process will be envisaged.

There is no longer any reference to the “conventional useful life” of the systems, which in previous versions of the decree was set at 20 years. This leaves greater flexibility in the long-term management and maintenance of renewable plants.

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Duration and limits of the incentive mechanism

The new draft of the Fer X Decree also introduces important changes regarding the duration of the incentive system. According to the October 2024 version, the decree will cease to apply on 31 December 2025or, in the case of plants up to 1 MW, upon reaching a power quota equal to 3 GW financed.

This is a significant reduction compared to the March draft, which called for a termination on 31 December 2028 or reaching 5 GW for plants up to 1 MW.

This change limits the time window during which plants will be able to access the incentives, making it more urgent for operators in the sector to plan and start their projects before the end of 2025 or the exhaustion of available quotas. Plants with a power exceeding 1 MW must instead participate in the competitive procedures within the dates established by the decree to benefit from the incentives.