A resource-limited country, Italy has always been very sensitive to its use of energy and materials. After WWII the Italian textile industry purchased used Russian Army coats to make special pressed wool for Italian clothing. To avoid re-dying the wool, colored threads were obtained from American used clothes! Eighty percent of the lead in automobile batteries was recycled. FIAT was famous for the “500” car, small light, saving fuel. The Italian economic miracle was in full bloom in the late '50s and early '60s, however, thereafter growth began to slow. A far-thinking manager Aurelio Peccei co-founder of the Club of Rome began to signal concern with the funding of the research and book, The Limits to Growth, by Dennis Meadows in 1972. Shortly thereafter the world was shocked by the Six Days Kippur war and the oil prices that tripled. Italy was in trouble, for lack of resources, and attempted to build on its nuclear expertise. The birth of an Italian nuclear power industry was obstructed (from inside and outside) and finally abandoned also as a result of the Chernobyl accident. To this nuclear research organization, CNEN, large research programs in solar and energy efficiency were added in the early 1980s along with the fusion research activities. The renewed organization, ENEA grew in size and permitted Italy to take a leadership role in these new fields.
In the latest survey in 2018, Italy tied with Germany as the number one country having the best energy efficiency policies and performance, out of 25 of the world’s top energy-consuming countries, (Castro-Alvarez et al. 2018). The primary energy consumption per GDP of Italy comes in 12 percent less than the Euro Zone average, 6 percent less than Germany, and about 45 percent less than the US energy intensity, in 2018. Although Italy has immense work to reach carbon neutrality, the “lessons” Italy learned over the years may be of interest to others preparing to initiate more intensive green activities.
First, Italian initiatives were usually stable and with long-term financing. The public and industry required time to learn them, to use them, and to gradually change the parameters according to evolving needs. Stop and go programs prove to be confusing and harmful to industry. Italy, for example, has been using tax deductions for stimulating investments in energy savings in the housing sector for fifteen years, and this year the most popular program is an updated version.
It has been observed that joining energy managers into a strong national network has been very effective. The FIRE (Italian Federation for the Rational Use of Energy) was founded in 1987 with the objectives of supporting and qualifying energy managers, sharing application experiences, and most importantly advising the government of successes and shortcomings of its programs. FIRE has managed the appointment of energy managers, which are required by law for firms over a certain size, for the Ministry of Economic Development since 1991. The Federation has performed a continuous analysis of the sector to grasp its evolution and remove barriers.
Exhaustive information is essential for energy efficiency since energy can potentially be saved at any point of use. Italians have worked on energy information and planning primarily within enterprises in connection with the white certificate initiatives. Through careful physical planning for the use of heat and electricity, 55 percent of the country’s electricity produced from fossil fuels is achieved by cogeneration (of heat and electricity). Increasingly investors need information about the energy (and environmental) characteristics and policies of public companies. Climate-related disclosure standards for public companies that are now voluntary, such as the TCFD in the US, should be made obligatory and uniform between trading blocks. With this information, capital will move to the firms, and sectors, requiring and achieving energy efficiency.
The most popular, and highest impact program provides tax deductions to the user making specified investments in energy savings with the building sector. The tax deductions are taken over the life of the investment, usually ten years. Since its introduction the deduction has been utilized by four million persons, condominiums, or companies, incentivizing 43 billion euro of investment.
In 2005, Italy was one of the first to introduce a white certificate scheme in Europe. The white certificates are combined with an obligation to achieve a certain target of energy efficiency by large energy distributors and they certify an achieved amount of energy savings. The certificates can be traded, which helps achieve the least-cost energy savings, one of the key advantages of the system. The investments realized through the program have permitted an annual 6 million tons oil equivalent savings to be achieved by 2019. The Italian scheme, like others, requires complex management and is currently being revised. In the US, Connecticut, Pennsylvania, and Nevada have adopted similar systems along with the UK, France, and Belgium in Europe. An in-depth comparison of experiences is appropriate.
Over the last two decades, the European Commission has promoted collaboration with the European industry of household appliances to introduce energy-saving labels for the public with corresponding product improvements. Italy and Germany, the countries with the leading appliance makers, were key participants in these efforts. The program has been quite successful in reducing the average energy consumption of home appliances by more than one-half. The European public generally favors purchasing higher quality, more efficient products. Fortunately, this type of program was followed by the US and other developed countries and should be continued in the future.
An unanticipated benefit from the pandemic has been smart work and opening up of our ideas of urban design, use of time, and means of travel. Since 2014 the EU has funded the project of Smart Cities and Communities involving 27 lighthouse cities and 30 followers. The role of the automobile is evolving. it is becoming less polluting, less urban, and more rentable (less of an object of desire to be owned). In Italian gasoline and diesel fuel taxes have always been high with final prices more than double that of the US, designed for penalizing imported goods, also more accurately reflecting the health and environmental costs. This is freeing up urban design and favoring quality public transport and small, more energy-efficient, private mobility. Today in any large European city there are more bike lanes, more rental possibilities for efficient transport, and better public transport, also with the development of high-speed trains. Urban planning is being re-conceptualized.
We are beginning to appreciate the benefits of being near urban green spaces. A recent meta-analysis of 143 studies in 20 countries shows that living near green space (defined as open land with natural vegetation, including urban parks, open public spaces as well as street trees) is associated with multiple health benefits. "Statistically significant health denoting associations between high versus low greenspace exposure groups were identified for self-reported health, type II diabetes, all-cause, and cardiovascular mortality, diastolic blood pressure, salivary cortisol, heart rate, heart rate variability (HRV), and HDL cholesterol as well as preterm birth and small size for gestational age births. Reductions were also found for the incidence of stroke, hypertension, dyslipidemia, asthma, and coronary heart disease" (Twohig-Bennett & Jones, p. 633, 2018). People living nearer to nature have lower levels of stress and report being in good health. Two years ago, the city of Milan launched the initiative “ForestaMi” to plant three million new trees in the city by 2030.
Italy continues to excel among the European nations when it comes to the circular economy. The Italian economy has one of the highest generated economic values per unit of material consumption in the EU. Sixty-eight percent of all waste is recycled compared to the European average of fifty-seven percent. Italy is the second largest employer for the circular economy with over 517, 000 workers. Since the country has no significant reserves of coal for making steel, scrap iron is imported and fused in electric arc furnaces for over fifty percent of the national steel production. The paper industry also has the tradition of utilizing substantial amounts of used inputs. Recent policy initiatives have included a plastic tax, incentives for re-cycling packaging, and for the purchase of used products (Circular Economy Network 2020).
As the Director of FIRE, Dario Di Santo recently illustrated in a video conference that energy and energy efficiency are being seen in a new light. Substantial improvements are possible, potentially in all phases of the business: from energy and materials supply, local energy production and storage, product/service production using the Internet of Things and Big Data, transport logistics, final packaging, recycling, reuse, and disposal of the final product. The entire business organization is undergoing eco-friendly design, with the analysis of energy efficiency being an integral part. Moreover, an environment with proper energy management is more comfortable, healthier, more secure, less polluting, less expensive to manage, and more coherent with sustainability (Di Santo, 2021).
On December 17, 2020, the EU’s long-term budget, coupled with NextGenerationEU, the shorter-term €750 billion instrument designed to boost the recovery was approved. It will be the largest stimulus package ever financed through the EU budget. A total of €1.8 trillion ($2.2 trillion) will help rebuild a post-Covid-19 Europe. Green investments must comprise 37 percent of the NextGenerationEU, anticipating part of the European Green Deal, and are presently being planned in detail. The Biden administration is preparing its new green initiative: this is the moment for reciprocal consultation.
Castro-Alvarez, F., Vaidyanathan S., Bastian H., King, J., 2018, The 2018 International Energy Efficiency Scorecard Report, American Council for an Energy-Efficient Economy, June.
Circular Economy Network, 2021, Rapporto sull’Economia Circolare in Italia – 2020, accessed Febuary 20, 2011.
Di Santo, D., 2020, Perché usare bene l’energia produce valore? December 22, accessed February 15, 2021.
Twohig-Bennett, C., Jones A. 2018, The health benefits of the great outdoors: A systematic review and meta-analysis of greenspace exposure and health outcomes, Environmental Research, volume 166, pages 628-637.