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Interview with Gert Gremes, president of GIFI

Mr. Gremes, how do you see the Italian market evolving in the next 2 to 3 years? Will Italy experience the same impressive growth as the Spanish market in 2008?

After a very good result in 2008 (338 MW connected to the grid), Italy, like most of the EU countries, is facing some slow-downs in terms of installed capacity, mainly due to the credit crunch that heavily hit the financial sector. In fact, during the last 5/6 months, we experienced a delay from banks and financial institutions in providing the necessary funding to build the already planned PV power generation plants. In addition to this, bad weather conditions prevented installers from regularly operating the construction of PV plants either on land or roof-tops. As a result, in the first three months of 2009 (Q1) only 10 MW were connected to the grid. According to data provided by the GSE, however, in April 2009 we already experienced a significant acceleration: 22 MW connected to the grid. PV is an extremely fast-changing market. Therefore making forecasts and providing data is always challenging. At GIFI (the Italian PV Industry Association) we presume that in 2009, most likely, there will not be the same growth pace as recorded in the last 2 years. However, installations will continue to be fostered thanks to the good level of incentives and companies still recruiting new professionals thus contributing to create social and economic benefits to the society as a whole.

How is the BIPV niche developing in Italy?

I would not say that BIPV is a niche. In fact, as of today 20% of the PV installed capacity in Italy is represented by BIPV. The full integration of PV modules often requires special technological solutions to be adopted especially in Italy where the distributed production of energy has to comply with the cultural and historical heritage needs. During the last edition of Solarexpo in Verona (Italy), several Italian companies presented the public with new and innovative solutions to fully integrate PV modules into buildings. For these reasons I believe that, in the coming years, BIPV will continue to grow and its market share will become increasingly more important.

The Feed-in Tariff (FiT) decree is expected to be modified in 2011. What do you think will change and what will GIFI’s position be during negotiations with the government?

From 2011, in Italy there will be a new Feed-in Tariff in force, which, together with the National Action Plans for RES and the so-called burden sharing, will pave the way towards the 17% of renewable electricity target allocated to Italy by the new RES Directive. GIFI has already established proper contacts with the key institutional representatives and negotiations will shortly begin. However the new Feed-in Tariff will be shaped according to different needs and will take different factors into account. First of all, the cost reduction trend of PV modules boosted by the Spanish “stop”. It will be important to find the proper balance between ground mounted plants, BAPV and BIPV and to allow the Italian PV industry to be stronger up-stream the value chain, namely in the production segment, by supporting the R&D. Therefore, the German model for the FiT, no annual cap and gradual decrease, will be the reference but it needs to be adapted to the Italian context where it is more appropriate to talk of Feed-in Premiums instead of Feed-in Tariffs.

Some people say Italy will reach grid parity in 2010. What are your views and what do you think will be the effects on the Italian market?

Grid Parity is definitely a milestone for the PV Industry as a whole. However an officially recognised definition of grid-parity has yet to be elaborated. Italy is seen to be one of the first countries in the world to have reached Grid Parity. However, this will not happen in 2010! We should always remember that the lengthy authorisation procedures and the fiscal system (VAT and land tax) for PV plants in Italy strongly contribute to postponing the reaching of Grid Parity. Therefore, a few more years are needed in order to make PV electricity competitive with traditional generation and, in the meantime, it is crucial to allow the Italian PV Industry to become stronger and more competitive in all market segments.