Italy’s upcoming Fer Z mechanism introduces a new approach based on programmable production profiles supported by portfolios of renewables and storage. According to Piero Viganò, partner at ADVANT Nctm, the scheme will not only drive further renewable deployment but also play “a supportive role with regards to the energy grid”. He notes that “the flexibility provided by battery storage systems and related time-shifting products, including MACSE, will be key” to ensuring effective delivery under the mechanism.
The launch of Fer Z depends on EU clearance, which Viganò describes as “the key step in the process of starting the Fer Z mechanism, without which it cannot be implemented”. He recalls that the European Commission has “expressed reservations about the technological efficiency and compatibility of Fer Z with the EU State Aid Guidelines, as well as the effectiveness of the mechanism in relation to the planned maintenance aspects of the facilities”. Given the innovative nature of the model, he also expects that approval of the GSE and ARERA operating rules “could take quite a long time”.
As for its interaction with existing schemes, Viganò sees Fer Z not as conflicting with Fer X but as “competition among operators for the capacity quotas offered by the various schemes, and of simultaneous competition between the schemes themselves”. He adds that while “the Fer X capacity quota could over time decrease and be partially transferred to Fer Z”, “for the moment it is not possible to envisage migration scenarios because reference tariffs are not known”.
Published in icis.com:
New Fer Z incentive mechanism could reduce renewable curtailment in Italy
Complexity of new Italian Fer Z mechanism could delay implementation
