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    21.12.2023

    Supreme Administrative Court: for photovoltaic systems on greenhouses agricultural activity on the entire area and for the entire duration of the incentive is required


    In Judgments nos. 10811 and 10812/2023, the Supreme Administrative Court legitimized the GSE’s actions, overturning the decision rendered by the Lazio Regional Administrative Court (nn. 834 and 835/2021), which had ordered the remodulation of incentive tariffs at the conclusion of a GSE verification procedure, pursuant to Article 42 of Legislative Decree  no. 28/2011 and Ministerial Decree January 31, 2014.

     

    The GSE had originally granted the appealed company incentive tariffs for architecturally integrated plants located on greenhouses (pursuant to Ministerial Decree February 19, 2007). However, following the verification procedure, the GSE found that the facilities in question did not meet the requirements set by the regulations, since the greenhouse was not fully cultivated, and the company had not provided any useful documentation to prove that the greenhouse had been permanently used for cultivation since the plant was put into operation.

     

    Specifically, the greenhouse was found to be 70 % uncultivated, and there were three products housing the photovoltaic system’s inverters.

     

    In addition, the company had not provided the GSE with either tax documentation related to the purchase of raw materials and equipment and the sale of cultivated products to ascertain the significance of the economic activity resulting from the greenhouse crops since the plant started its operation, or any documentation showing the employment of personnel for agronomic activities.

     

    The Regional Administrative Court had upheld the company’s proposed appeals, holding that “the regulatory rules do not include, as a requirement for the admission and maintenance of the incentive, that the entire area of the greenhouse is used for cultivation, but only that the cultivation activity continues throughout the period of the incentives”.

     

    In addition, the first instance court underlined that “among the regulatory requirements for benefiting from the tariff for greenhouse photovoltaic systems, there is no requirement for the economic significance of the agricultural activity, nor is there any preclusion for a direct farmer, who relies exclusively on his own labor and allocates greenhouse products mainly for the needs of his farm.”

     

    The Supreme Administrative Court reconstructed the legal and jurisprudential framework applicable to the case referring to Article 20, para. 5 of Ministerial Decree August 6, 2010 (Interpretations and Amendments to Ministerial Decree February 19, 2007).

     

    Therefore, the photovoltaic system is only eligible for the more favorable incentives if it meets the following requirements:

     

    a) photovoltaic modules must constitute the construction elements of the roof or walls of the building (structural requirement);

    b) the structure must be used as a greenhouse dedicated to agricultural activity or floriculture (functional requirement);

    c) the agricultural use must persist for the entire duration of the incentives (temporal requirement).

     

    The Supreme Administrative Court also reaffirmed what was ruled in Judgment n. 7538 of August 30, 2022, of the same section, namely, among other things, that “the activity in question must take place in greenhouses, thus covering the entire area, or at any rate, reasonably a large part of it.

     

    In addition, regarding the direct cultivator status of the farmer, it is clarified that it cannot justify an exemption from the burden of proving the actual existence of the prerequisites for the recognition of the requested benefit.

     

    Thus, given the absence of evidence of both the functional and temporal requirements, the Supreme Administrative Court found that the denial of the incentive originally granted to the photovoltaic plants and the order to remodulate the incentive tariff were correct, recognizing that provided for photovoltaic plants installed on the ground.

     

    Thus, the Supreme Administrative Court’s rulings nos. 10811 and 10812/2023 provide a useful clarification regarding the regulation of greenhouse photovoltaic systems.

     

    In fact, on the one hand, the essentiality of agricultural cultivation on the entire area of the greenhouse and for the entire duration of the tariff is reaffirmed. On the other hand, relevance is given - for the purposes of the existence of the conditions for admission to the increased concessional benefits - to the tax documentation related to the purchase of raw materials (seeds plants, fertilizers, pesticides, machinery, etc.), as well as that related to the sale of cultivated products and the employment of personnel to carry out agronomic activities.

     

     

     

    This article is for information purposes only and is not, and cannot be intended as, a professional opinion on the topics dealt with. For any further information please contact Giovanni Battista De Luca

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