GSE received 559 applications from 3,400 industrial consumers for 23 TWh of RES-E with GOs at EUR 65/MWh for the next three years. The volumes of electricity requested exceeded 70 TWh.

The registration period ended on 3 March 2025.

The volumes of electricity assigned to each applicant will be announced by Italy’s energy services operator, GSE, at the beginning of April 2025, according to the Italian Ministry of Environment and Energy Security (MASE).

In return, companies will need to commit to building or repowering renewable energy assets within 40 months after their approval application and then producing at least double the volume of electricity that was secured via the auctions over the following 20 years. This can be done through third parties, such as utilities or developers, through signing PPAs.

Market impact

The key question is where the GO volumes that the GSE will allocate to the Energy Release beneficiaries will come from, as GOs will be automatically allocated and cancelled in the energy-intensive industries’ portfolios.

If the GSE removes 23 TWh of GOs from its auctions in favour of the scheme beneficiaries, it would reduce or even completely remove the GO volumes offered during the market sessions and could redirect market players to procure renewable electricity from traders instead.

A recent change to the Italian domain protocol supported market liquidity by enabling automatic GO cancellations on the GSE account, instead of through utilities that used to charge EUR 0.6-0.7, according to Veyt sources. This means that traders and brokers have a greater role to play in the Italian GO market.
For comparison, GSE offered close to 18 TWh during the 2024 auctions, selling 15.3 TWh, with most of the volumes remaining unsold as supply has been outweighing demand since 2023. Compounding the oversupply is the rollover of unsold volumes from previous auctions into the next ones.
As pointed out in our analysis of the Energy Release, the scheme has the potential to suppress the energy-intensive companies’ need to procure RES-E GOs, lead to undersubscribed auctions and decrease GO imports, with 2025, 2026 and 2027 contracts expected to feel the bearish sentiment.
Already, the market experienced the effects of the wait-and-see approach as industrials refrain from purchasing forward contracts amid the prospect of being selected under the Energy Release, resulting in GO demand stagnation. Veyt’s preliminary cancellation data for the 2024 disclosure period shows that Italy’s RES-E GO consumption has remained flat at just over 92 TWh, although the final number is expected to be slightly higher once full data is published.
Still, this could be somewhat counterbalanced by demand from energy-intensive consumers benefiting from the reduced electricity levy state aid if they source 30 % of electricity from renewables, using GOs and/or PPAs for compliance, among other options.
But since state aid can be combined with other aid mechanisms such as the state aid scheme for indirect emission costs, it is unclear whether state aid beneficiaries will be able to participate in both the Energy Release scheme and receive financial compensation through state aid. If positive, this can suppress demand for RES-E GOs for the next three years, as the green conditionality condition would be automatically fulfilled through automatic GO allocation by GSE.
While bearish for the GO market, the Energy Release could lend support to the PPA market. The maximum 138 TWh that will have to be returned over 20 years would constitute between 3.5 – 5.5 GW of new renewable capacity, according to Veyt estimates, while the Italian Energy Ministry puts the number at 5 GW. According to Italian project developers that Veyt spoke with, there is already demand for PPA projects in the country, although local market players are struggling to find developers willing to sign PPAs.