ROME, July 27 (Reuters) – Italy said on Thursday it planned to use EU money to fund an investment programme worth around 19 billion euros ($21 billion) to strengthen power and gas grids and make its economy greener.
The move is part of efforts by Prime Minister Giorgia Meloni to present a revamped and revised post-COVID recovery plan to European Union authorities next month.
“There will be a serious face-off with the European Commission,” EU Affairs Minister Raffaele Fitto said during a press conference.
Italy is due to receive some 191.5 billion in EU cheap loans and grants through 2026, but is falling behind schedule in terms of spending the cash it has already received and in meeting policy targets, which trigger the release of fresh payments.
The head of state Sergio Mattarella said on Thursday that a failure to fully invest the EU money would be a defeat for the nation, calling on all political parties to show responsibility.
To overcome some of the difficulties, Rome intends to remove from the post-COVID plan projects amounting to almost 16 billion euros that it will be unable to finalise by 2026, and replace them with others that can be completed on time, Fitto said.
Most of the funds freed up will go to fund the investments eligible for the REPowerEU scheme, which aims to end the EU’s dependence on Russian fossil fuels and boost the green transition.
A document released by the government showed that, as part of the overall 19 billion euros, some 2.3 billion euros would go to reinforce electricity and gas networks.
Rome has earmarked more than 400 million euros for gas grid operator Snam’s (SRG.MI) Adriatic pipeline project. Another 700 million euros will support planned investments to modernise power lines at power grid firm Terna (TRN.MI), while 900 million euros will fund projects to digitalise power connections.
Italy’s biggest utility Enel (ENEI.MI) and energy group Eni (ENEI.MI) are also expected to receive EU funds.
Additional 14.8 billion are designed to boost “green transition and energy efficiency”, including some 6.3 billion in tax breaks aimed at promoting renewables.
Fitto has insisted that Italy will receive and spend all money is entitled to, adding the projects that will be removed from the post-COVID plan will not be scrapped but funded with separate EU funds.
“We have not eliminated any funding. We are not cutting anything but reorganising everything,” he told reporters.
($1 = 0.9089 euros)
Reporting by Giuseppe Fonte; editing by Alvise Armellini and Keith Weir
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