Sets out Policy Recommendations on Reduction of Gas Consumption, Diversification of Supply, Methane Emission Reduction and Enhance Sustainability 

Rome, January 24, 2024 – The Istituto Affari Internazionali (IAI) has today released a significant new report titled, "Reconciliation of Energy Security and Climate Objectives: The Case of Italy." Its publication comes at a time of renewed global focus on energy transition to enhance energy security and decrease reliance on fossil fuels. It draws attention to the particular challenges faced by Italy, especially its growing reliance on gas for electricity generation, which saw a significant increase from 37% in 2000 to 50% in 2021.  

Commissioned by international non-profit, Environmental Defense Fund Europe, the report provides a detailed analysis of Italy's evolving energy and climate policy landscape. It sets out policy recommendations for enhancing resource efficiency and diversifying energy sources, including the potential role of hydrogen. Additionally, it underscores the critical need to reduce methane emissions as key to Italy's energy transition, and essential for securing its stable and sustainable energy supply.  

The report examines the following policy areas:  

• Resource management: In 2022, Italy reduced its gas consumption by 10% compared to 2021 (-7.5 bcm) to 67.3 bcm. However, natural gas continues to be an essential component in Italy's energy mix that exposes the country to price volatility. To protect consumers and industries, Italy has allocated 92.7 billion euros - representing 5.2 percent of its GDP - in subsidies since September 2021. Future resource management must consider Italy's limited fiscal capacity and develop sustainable strategies to protect and develop the industrial sector by investing in the energy transition.  

• Diversification stands as a crucial component of Italy's energy strategy, with the primary goal of reducing dependence on Russian gas imports. This strategy is geared towards reestablishing Mediterranean countries as central players in Italy's energy framework. Despite their comparative advantages, these Mediterranean partners face significant infrastructural and technological hurdles. Addressing these issues collaboratively is vital for transforming Italy into a pivotal energy hub, connecting Europe and Africa. This includes enhancing the safety and efficiency of both national and international networks, with an initial emphasis on the reduction of methane emissions.  

• Methane emissions: Italy has included methane emissions in the new version of its NECP (National Energy and Climate Plan), highlighting their reduction as an important way to tackle climate change, and as crucial in aligning energy security with emissions mitigation policies. This is per European regulations that will soon introduce measures for both the internal market and imports, providing a framework for action on emissions and creating a central link between Europe's climate goals and North Africa's economic and environmental interests.  

Flavia Sollazzo, Senior Director EU Transition Energy at Environmental Defense Fund Europe, says: "Methane is the second largest contributor to global warming, with more than 80 times the warming potential of carbon dioxide in the first 20 years after its release into the atmosphere.  

• "For Italy, reducing methane emissions is not just critical for aligning with its energy transition goals but also for ensuring its security of supply. The technologies needed to achieve this are already available and simple and cost-effective to implement. By tackling methane emissions, Italy can draw closer to its climate objectives, enhance market liquidity by injecting more gas into the grid, and reduce reliance on imports.  

• Hydrogen: Offers potential for collaboration within the Euro-Mediterranean region. But for hydrogen trade between the EU (specifically Italy) and North African nations to be mutually beneficial, it's imperative that hydrogen production for the EU market does not impede decarbonisation initiatives in the producing countries. Obstacles here are low capacity of renewable energy sources and the absence of standards and certification systems. In this context, Italy, together with the EU, should promote a sustainable use of hydrogen, first encouraging and supporting the decarbonisation of national energy systems in producer countries, and then creating export pathways.  

Pier Paolo Raimondi, researcher at the Istituto Affari Internazionali IAI, said: "Hydrogen can certainly contribute to decarbonisation, especially in those sectors where other technologies and solutions are not viable such as industry and heavy transport. The need to rapidly decarbonise comes together with the need to establish new partnerships with North African countries, creating important opportunities for hydrogen development. However, it is necessary for Italy to promote a sustainable use and development of hydrogen together with its Euro-Mediterranean partners in order to ensure the achievement of climate goals and socioeconomic development for North African countries. This strategy would enable greater Euro-Mediterranean integration."  

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For more information, please contact:     

Anne Visintin, Fourtold  anne.visintin@fourtold.eu  

Notes to editors  :

Environmental Defense Fund Europe  

A leading international non-profit organisation, Environmental Defense Fund Europe (edf.org and edfeurope.org) creates transformative solutions for the most serious environmental problems. To do so, EDFE links science, business, law and innovative partnerships with the private sector. With over 3 million members and activists and offices in the United States, the European Union, China, India, Mexico and Indonesia, scientists, economists, lawyers and policy experts work in 28 countries and across the European Union to turn our solutions into action.