Abstract

The exponential increase of the energy production from renewable sources and in particular the variability and low predictability characteristics of wind and solar technologies and the growth of distributed generation are calling the current design of the Italian electricity systems into question. This paper analyzes the economic and regulatory issues arising from the recent development of the Italian power system and discuss the answers provided by the Government and the regulatory authority with specific reference to the renewable support schemes and to the regulation of the dispatching service and unbalancing charges. Finally, some policy implications are drawn.