Italy Postpones Gas, Power Liberalization Until January 2022

The Italian government will push back the full liberalization of its retail power and gas market from its deadline of June 2020 to January 2022, with the timeframe becoming too tight to carry out the move.

The delay was included as an amendment to the 2020 budget, approved in parliament Thursday, S&P Global reported.

The change means that commercial consumers on the regulated market with demand greater than 16.5 kilowatt-hour will move to the free market by July 2021 and domestic consumers by January 1, 2022 for both the power and gas markets.

Economic Development Minister Stefano Patuanelli told a senate hearing last month that the timeframe has become too short for both buyers and possible sellers, meaning that a step-by-step rollout might be better.

Of Italy's 16.5 million power consumers, 56% were still on regulated tariffs in 2018 as well as half of the 10.2 million gas consumers in the country.

Patuanelli said the government would aim for a gradual process than merely push back the start date and face the same situation further down the line.

The timeframe extension would also allow the sole buyer (Acquirente Unico) the possibility of analyzing price dynamics in the mid- to long-term and give it the opportunity to fix a strategy between spot bourse purchases and longer term bilateral contracts directly with suppliers, the document said.

Italy's regulator, Arera, said December 10 that it supported a gradual move to end the regulated market, which currently is "highly concentrated, with a low movement of clients and advantageous for incumbent suppliers."