Legislative and regulatory framework

The main legislative and regulatory measures in 2021 with the greatest impact for the businesses managed by the Iren Group are shown below.

Di seguito si rappresentano i principali provvedimenti normativi e regolatori intervenuti nel 2021 di maggior impatto per i business gestiti dal Gruppo Iren.

EUROPEAN FRAMEWORK

“EU Taxonomy” Regulation 2020/852

Regulation (EU) 2020/852 (“EU Taxonomy Regulation”), which entered into force on 12 July 2020, is part of a series of measures aimed at creating a sustainable financial ecosystem in line with the objectives of the Green Deal. In particular, the EU Taxonomy is a transparency tool, intended for companies and investors, based on scientific criteria of technical screening that establish whether a given activity can be classified as “environmentally sustainable”.

The delegated regulation on climate change was adopted on 4 June 2021, while the adoption of the delegated regulations on the other environmental objectives of the EU Taxonomy was postponed until the first half of 2022.

The Taxonomy will be implemented gradually, with simplified reporting in 2022 (covering the 2021 financial year), partial reporting in 2023 (2022 financial year) - which implies the indication of the share of Turnover, Opex and Capex in line with climate change mitigation and adaptation criteria - and full implementation, covering all the environmental objectives of the Taxonomy, which will come into force in 2024 (2023 financial year).

Next Generation EU / National Recovery and Resilience Plan (PNRR)

Through Regulation (EU) 2020/2094 (Next Generation EU) and Regulation (EU) 2021/241 (Recovery and Resilience Facility), the European Union established the framework for the recovery of the economy following the Covid-19 pandemic. On 13 July 2021, the Council of the European Union approved the assessment of the Italian PNRR.

The measures in the Plan are structured around 6 tasks: 1. Digitalisation, innovation, competitiveness, culture and tourism; 2. Green revolution and ecological transition; 3. Infrastructure for sustainable mobility; 4. Education and research; 5. Cohesion and inclusion; 6. Health.

Italy is the first beneficiary, in absolute value, of the two main instruments of the NGEU, the Recovery and Resilience Facility (RRF), with an amount of 191.5 billion euro, and the Recovery Assistance Package for Cohesion and European Territories (REACT-EU), with an additional 13 billion euro. In addition to these resources, there are approximately 30.62 billion euro deriving from the Supplementary Fund, aimed at financing specific actions that supplement and complete the Plan through ordinary state resources. All interventions must be completed by 2026.

The action plan is accompanied by a package of structural reforms in the areas of simplification of authorisations, procurement code, justice, public administration and competition. The first piece of legislation adopted by the Government is the Simplification and Governance Decree (Decree Law no. 77 of 31 May 2021), which contains a series of measures aimed at simplifying the process of environmental authorisations.

Fit for 55 package

On 14 July 2021, the European Commission adopted the "Fit for 55" climate package, which makes legislative proposals to achieve the Green Deal goals by 2030. In particular, the reduction of greenhouse gas emissions by 55% compared to 1990 levels, with the aim of achieving "carbon neutrality" by 2050. The package contains 12 initiatives, both amendments to existing legislation and new proposals, including amending the Energy Efficiency Directive, revising the Renewables Directive, revising the Emissions Trading System, and the Strategic Implementation Plan to support the rapid deployment of an alternative fuels infrastructure.

Gas-Hydrogen Package and proposed Regulation to reduce methane emissions in the energy sector

On 15 December 2021, the EU Commission presented the gas-hydrogen package, which includes in particular a proposal for a regulation and a directive. These proposals aim to decarbonise gas consumption and propose the necessary measures to support the creation of optimal, dedicated infrastructure and efficient markets. The measures put out for consultation create the conditions for a gradual phase-out of natural gas, aiming to facilitate the penetration of renewable and low-carbon gases in the energy system. In parallel with the gas-hydrogen package, a proposal for a regulation to reduce methane emissions in the energy sector was submitted. The documents are in the consultation phase.

Directive (EU) 2020/2184 (in force since 12 January 2021) concerning the quality of water intended for human consumption for all countries of the EU

This Directive regulates the means available to Member States to introduce the necessary measures to provide water intended for human consumption that is healthy and clean, providing for this purpose very precise quality characteristics that meet the requirements set out in the Annex to the Directive.

The supply, treatment and distribution of water intended for human consumption must therefore be based on a risk assessment, with an approach covering the whole supply chain, from the catchment area to distribution.

Finally, the Directive highlighted the need to make consumers more aware of the implications of water consumption, requiring Member States to ensure that all users receive, periodically, certain information such as the volume consumed by the household, trends in annual household consumption and a comparison of the household's annual water consumption with the average consumption of a similar household.

NATIONAL FRAMEWORK

CODE ON PUBLIC CONTRACTS

 

Decree Law no. 77 of 31 May 2021, "Governance of the National Recovery and Resilience Plan and initial measures to strengthen administrative structures and speed up and streamline procedures" (Decree Law "Semplificazioni bis"), in force as of 1 June, and the subsequent Law no. 108 of 29 July 2021, converting the decree itself, introduced various extensions and innovations regarding public tenders.

Specifically, the following are extended:

  • the simplifications provided for by Decree Law no. 76/2020 for contractual determinations made by 31 December 2021 to 30 June 2023 (e.g. exemptions for contracts below the thresholds, simplified anti-Mafia checks, etc.);
  • the exemptions introduced by Decree Law no. 32/2019 "Sblocca cantieri" to 30 June 2023;
  • to 30 June 2023 the possibility of making changes also to projects subject to preventive archaeology, as well as the measure that allows for the approval of changes to final projects already approved by CIPE, without having to go through the latter again, if they do not exceed 50% of the value of the project.

The main amendments introduced by the conversion law are described below.

  • the new thresholds for the direct awarding of contracts for works (150,000 euro) and services and supplies (139,000 euro) are confirmed until 30 June 2023. In relation to direct awarding, the identification of qualified economic operators must be guaranteed, for which the necessary application of the rotation criterion is reiterated.
  • with regard to subcontracting, until 31 October 2021 the exemption that raised the limit on the subcontracting of services to 50% was applied, whilst from 1 November 2021 the new regulations no longer provide for a general limit but rather specific limitations introduced by the measure.
  • with regard to the provisions that specifically regulate purchases falling wholly or partly within the scope of the funding established by the PNRR, measures are provided for allowing contracting authorities to include in the call for tenders bonus criteria designed to facilitate small and medium-sized enterprises in assessing the offer.

Law no. 106 of 23 July 2021 reintroduced into our legal system, albeit on an extraordinary and one-off basis, the revision of prices on a legal basis in public contracts, in order to deal with the exceptional increases in the prices of certain construction materials that occurred in the first half of 2021, setting up a special Compensation Fund of 100 million euro for this purpose. The institution applies to all contracts in progress as of 24 July 2021. This measure was also extended to the second half of 2021 through the 2022 Budget Law.

2022 Budget Law - Law no. 234 of 30 December 2021 - State budget for the financial year 2022 and multi-year budget for the three-year period 2022-2024

The measure takes action on the following issues, among others:

  • Energy Efficiency (Superbonus/Bonus): see specific paragraph in the section "Energy Efficiency";
  • Environmentally friendly hydropower generation from aqueducts: see specific paragraph in the section "Water Service";
  • Industry 4.0: with regard to the incentives provided by Plan 4.0, the tax credit for capital goods in Annexes A and B to the 2016 Budget Law are extended until 2025 with different articulations.
  • high utility bills, replicated for the first quarter of 2022 some measures already introduced during 2021, such as:
    • application of reduced rates of the ASOS and ARIM components;
    • cancellation of the rates of the RE, RET, GS and GST components as well as the UG3 and UG3T components for all users in the gas sector;
    • application of reduced VAT of 5% to the supply of gas for civil and industrial use;
    • for domestic customers who find themselves in arrears, payment in instalments of their electricity and gas bills issued from January to April 2022, for a maximum period of 10 months and without interest.

Law no. 233 of 29 December 2021, converting, with amendments, Decree Law no. 152/2021 on the implementation of the National Plan for Recovery and Resilience (PNRR) and for the prevention of Mafia infiltration (Decree Law "Attuazione PNRR")

The measure takes action on the following issues, among others:

  • implementation of PNRR projects (administrative simplifications): in particular, it is envisaged that the declaration of public utility of the work will be automatically recognised following the final determination of the Services Conference/Council of Public Works;
  • greater protection: assignment times for the Gradual Protection Service and provisions for sellers regarding vulnerable customers (see specific paragraph in the section on "Electricity");
  • environment: a reduction in the time required for the Strategic Environmental Assessment procedure is envisaged;
  • measures to support the development of renewable energy sources: accessibility to residual power quotas from the auctions of the Energy Services Operator (GSE) is extended.
Gas
Gas Energy Management

Resolution 134/2021/R/gas - Review of the processes for defining commercial relationships between balancing users and distribution users. Revision of the processes of conferring capacity at redelivery points on the transport network

Resolution 147/2019/R/gas had reformed the process of allocating capacity to gas transmission network exit points that feed into distribution networks (City Gate), effective 1 October 2020.

Resolution 134/2021 intervened on this matter, postponing the entry into force of the reform to 1 October 2022.

Gas Networks

Consultation Document 250/2021/R/gas - Natural gas infrastructures: pilot projects for management optimisation and innovative uses - Final guidelines

The regulator wants to promote actions to optimise distribution and transportation networks. The projects proposed by the operators will be evaluated by an independent Commission according to two macro-environments: the prospective dimension of energy, environmental and economic performance and the experimental dimension of the project. Full or partial coverage of costs will be through tariff and extra-tariff awards. The Authority has introduced an indicative ceiling for the extra-tariff contribution of no more than 35-40 million euro. The duration of the testing will be a maximum of three years and the Owner of the project will have to submit to ARERA appropriate monitoring reports of the activities.

Consultation Document 263/2021/R/gas - Smart metering gas: regulation of outputs and performance of the metering service and billing obligations - Final guidelines

Among the measures put out for consultation, the Authority provides for class G4/G6 smart meters to collect readings on a monthly basis. In addition, it introduces new compensation, both for end customers (G4/G6 class meters) and for sales companies (meters of class greater than or equal to G10 and meters of class less than G10 with AC greater than 5000 scm).

Resolution 512/2021/R/gas - Reorganisation of gas measurement activities at entry and exit points of the transmission network

The Authority approved the "Regulation of the metering service on the natural gas transmission network (RMTG)".

The person in charge of the metering activity, i.e. the owner of the metering plant, is subject to minimum and optimal requirements in terms of plant engineering, performance and maintenance, which are relevant in case of non-compliance with the service quality standards. In fact, these standards are associated with a system of economic fees consistent with the costs to the transportation system generated by measurement errors. The fees will apply beginning in 2024.

Resolution 287/2021/R/gas and Determination DIEU 3/2021 - Criteria for the decommissioning of traditional meters replaced with smart meters and determination of the amount to recover lost depreciation on class G4/G6 meters

The measures define the operating procedures for recovering the residual depreciation resulting from the reduction of the useful life of traditional meters to fifteen years.

Electricity
Market

Decree Law Milleproroghe 2020

The Decree introduced amendments to the primary legislation (Competition Law No. 124/2017) concerning price protection. It established the postponement of the end of the protection period to 1 January 2021 for small and medium-sized businesses, and to 1 January 2022 for micro-businesses, and mandated the Ministry of Economic Development (MiSE) to establish by decree the measures to encourage the transition to the deregulated market in addition to defining the Sellers List (parties authorised to sell electric power and natural gas).

Law no. 233 of 29 December 2021, converting, with amendments, Decree Law no. 152/2021 on the implementation of the National Plan for Recovery and Resilience (PNRR) and for the prevention of Mafia infiltration (Decree Law "Attuazione PNRR")

The provision envisages that from 1 January 2023, on a transitional basis and pending the performance of the competitive procedures for the assignment of the graduated protection sales service, domestic customers will continue to be supplied via the protection service, in accordance with the guidelines defined by decree of MITE. ARERA is responsible for adopting the necessary provisions for the assignment of the service with gradual protections for domestic customers, through competitive procedures to be concluded by 1 January 2024, guaranteeing the continuity of supplies.

If, on 1 January 2023, the measures are not adopted as provided for in Legislative Decree no. 210/2021 for vulnerable customers aimed at aligning the prices applied to them with those of the wholesale market, the protection service will continue to be applied to these types of customers on the basis of the specific guidelines defined by MiTE decree.

The date of 1 January 2023 is confirmed for the transition to the free market of all micro-businesses with committed power less than or equal to 15 kW through the transition, also for these customers, to the service with gradual protections assigned by auction with procedures similar to those already governed by Resolution 491/2020/R/eel.

Resolution 491/2020/R/eel - Provisions for the provision of the gradual protection service for small enterprises in the electricity sector pursuant to Law No. 124 of 4 August 2017 (Annual market and competition law)

The resolution (as amended) substantially confirmed the approach envisaged during the consultation process. In the first phase of application (1 January 2021 - 30 June 2021) the Gradual Protection Service was temporarily entrusted to the local exercising higher protection that provided it according to methods defined by the Authority (contractual conditions similar to PLACET, financial terms and conditions calculated on ex-post PUN). In the second phase (1 July 2021 - 30 June 2024) the service is entrusted to operators selected through competitive procedures by means of double round auctions, with access to the second round reserved for the two best bidders and with Cap and Floor for the assignment of lots of users in the SME segment divided into homogeneous territorial areas in terms of number, power used, and unpaid ratio. An antitrust cap exists on the volume that can be awarded (35% of the total amount in the tender).

In addition to SMEs, the service benefits all BTAU points with a power output of more than 15 kW (pursuant to Resolution 604/2020).

Resolution 32/2021/R/eel - Provisions relating to the mechanism for recognising general system charges not collected from end customers and already paid to the distribution companies

The measure outlines the criteria for compensating transmission users for the portion of charges paid but not collected to end customers and the related procedures for submitting the application to CSEA.

Charges are subject to recovery:

  • not already the subject of other reintegration mechanisms;
  • shown on invoices with payment deadlines that have expired for at least 12 months;
  • for which the commercial counterparty has provided notice of default and at the same time has followed specific company procedures for the management of arrears and credit protection.

Access to the compensation mechanism may take place in two different ways: through the ordinary regime (where the user is required to indicate precisely the amount of uncollected charges relating to the period of reference of the request) or through the so-called simplified regime (where the amount of compensation is determined on the basis of the best estimate of uncollected charges to which a corrective discount of 25% is applied to their total). The offsets are disbursed on an annual basis with reference to the previous year's accrual; for the session relating to the 2021 annuity, provision has been made to also request the amounts of charges relating to the entire period between 1 January 2016 and 30 June 2020.

Legislative Decree No. 210 of 08 November 2021 implementing Directive (EU) 2019/944 (Market Directive)

The decree establishes common rules for the energy market and cross-border infrastructure, putting end users at the centre of it all.

The new directive introduces the possibility of maintaining, until 2025, price protection mechanisms for supplies to vulnerable customers (customers over 75 years of age and/or in a condition of economic or physical hardship and/or located in areas affected by calamitous events): each sales company with more than 200,000 users served is required to offer vulnerable customers who so request a supply of electricity at a price that reflects the price of energy in the wholesale market and with costs and contractual conditions defined and updated by ARERA. Regarding the freedom of choice of supplier, the directive provides for the possibility for end customers to sign a supply contract with any operator, even if operating in a different EU country; moreover, with a view to simplifying the entire process, by 1 January 2026 the directive provides for the possibility of concluding the switching operation within 24 hours of submission of the request.

In order to increase the capacity and participation of the end customer in energy markets with the aim of making final consumption more efficient, a number of new instruments are introduced: (i) "dynamic price" contracts (in which prices have hourly granularity and reflect the trend of spot markets); (ii) demand aggregation mechanisms (citizens' energy communities - CECs - aggregators) that make it possible to maximise participation in the market both from the point of view of the development of new shared plants and/or storage, and from the point of view of the provision of energy services to the system also in terms of balancing services.

Production

Decree Law no. 4 of 27 January 2022, published in Official Gazette no. 21 of 27 January 2022 (Decree Law "Sostegni Ter")

Title III of the Decree provides for "Urgent measures to contain electricity costs" through various interventions.

The first concerns the cancellation, for the first quarter of 2022, of the rates relating to general system charges applied to users with available power equal to or greater than 16.5 kW.

The second relates to the reduction of bills for energy-intensive businesses whose energy costs have undergone an increase in cost of more than 30 % relative to 2019, which are granted an extraordinary contribution to partially offset the higher charges incurred, in the form of a tax credit for 20% of the expenses incurred for the energy component purchased in the first quarter of 2022.

The third section concerns the introduction of a cap on the selling price of electricity produced by renewable plants incentivised with mechanisms not linked to market trends. In particular, it provides for the application, as from 1 February 2022 and until 31 December 2022, of a two-way compensation mechanism on the price of energy, with reference to the electricity fed into the grid by photovoltaic plants with a capacity of more than 20 kW that benefit from fixed premiums deriving from the Energy Account mechanism, which do not depend on market prices, as well as on the electricity fed into the grid by plants with a capacity of more than 20 kW powered by solar, hydroelectric, geothermal and wind sources that do not have access to incentive mechanisms.

For this purpose, the GSE is responsible for calculating the difference between a reference price equal to the average of the hourly zonal prices recorded from the date on which the plant enters into operation until 31 December 2020 and the hourly zonal electricity market price. If the difference is positive, the Manager shall pay the relative amount to the producer. If negative, the GSE adjusts or requests the corresponding amounts from the producer.

The provisions do not apply to energy covered by contracts concluded prior to the date on which the decree came into force, provided that they are not linked to price trends on the energy spot markets and that, in any event, they are not entered into at an average price 10% higher than the average value previously mentioned.

Terna Pilot Projects

In implementation of ARERA Resolution No. 300/2017/R/eel, Terna launched a series of pilot projects aimed at expanding the number of resources admitted to participate in the market for dispatching services.

Following approval by the Authority (with Res. 215/2021/R/eel), Terna also published the documentation needed to start the pilot project for the provision of the secondary frequency/power regulation service.

Resolution 218/2021/R/eel and Terna Grid Code update

The resolution approves the changes to Terna's Grid Code and amends Annex A to the Res. 111/06 to regulate issues related to the new structure of the intraday market (MI), the new methods of coordination between the MI and the Dispatching Services Market (DSM) and the new price caps. In particular, the measure is functional to the implementation of the single coupling of the intraday electricity market.

Resolution 109/2021/R/eel - Regulation of the transport and dispatch of electricity withdrawn for subsequent feed-in to the grid

Resolution 109/2021/R/eel provides that, from 1 January 2022, withdrawals for subsequent feed-in from storage systems may be treated as negative energy input.

For the application of the new regulation, producers had to submit to the distributor an application (with a sworn expert's report) by 31 July 2021 (existing plants) or before the end of the connection process (new plants).

Resolution 560/2021/R/eel deferred from 2022 to 1 January 2023 the provisions of resolution 109/2021.

Hydroelectric concessions

Large hydroelectric derivation concessions

With reference to Regional Law Piedmont Region No. 26/2020 “Allocation of large derivations for hydroelectric use”, issued in declared implementation of the new art. 12 of Legislative Decree No. 79/1999, as amended by art. 11 quater of Decree Law No. 135/2018 converted into Law No. 12/2019, which introduced the regulation of the annual fee for Large Derivation concessions for hydroelectric purposes applicable from 2021, the appeal by the Government before the Constitutional Court is still pending.

Regional Regulations No. 5/R (regulation of fees) and No. 6/R (obligation to supply energy free of charge from large hydroelectric derivation plants) of 18 December 2020 were published. They were issued in implementation of article 21 of RL 26/2020.

Small hydroelectric derivation concessions

In 2021, the Metropolitan City of Turin, noting a lack of complete regulatory compliance in the Decree Law "Semplificazioni", submitted a question to the AGCM, believing, in particular, that art. 12 of the Services Directive should be applied to small derivations and that therefore they should be renewed through a competitive procedure.

In Opinion No. AS1780, published in Bulletin No. 32/2021 of 09 August 2021, the Authority confirmed the applicability of Article 12 of the Services Directive, and therefore the need for a competitive procedure, also in the matter of renewal of concessions of small hydroelectric derivations and has underlined the irremediable opposition with this provision of the rules of domestic law which, on the contrary, provide for automatic renewal, such as article 30 of the Piedmont Region Regulation no. 10/2003 (the content of which is similar to article 28 of Royal Decree no. 1775/1933).

Electricity Networks

Determination 2/2021 and Consultation Document 515/2021/R/eel - Reactive Energy

The determination established the submission to ARERA of the 2017-2024 investment plan aimed at improving voltage and reactive energy control. In addition, Consultation 515/2021/R/eel, which proposed the completion of the tariff regulation of withdrawals and inputs of reactive energy, has recently concluded and provides:

in the short term (from July 2022): introduction of fees for reactive energy fed into the F3 band only and a strong active involvement of end customers by the DSO;

in the medium term (2023-2024): possible differentiated fees per geographical area and promotion of multi-DSO and DSO/user groupings on ancillary services to reduce reactive inputs, as well as exemption from fees in case of reactive investments on all primary substations.

Resolutions 279/2021/R/eel and 124/2021/R/eel - Changes to the tariffs of non-domestic low-voltage users

Extension until July 2021 of network tariff concessions and general charges for low voltage non-domestic customers with power over 3 kW.

Resolution 106/2021/R/eel - 2G commissioning plans for companies serving up to 100,000 users

Resolution 106/2021/R/eel has provided - for distribution companies serving up to 100,000 users - the installation from 2022 of only 2G smart meters. The unit cost recognised is 145 euro/2G and will be recognised over 15 years in decreasing instalments.

Resolution 201/2021/R/eel - IRETI 2G commissioning plan

With resolution 201/2021/R/eel, ARERA approved the commissioning plan of the 2G smart metering systems presented by IRETI, agreeing to the start-up of the massive phase in the 2nd half of 2021, confirming the expected expenditure admitted to the recognition of capital costs in line with that planned by the Company (129.2 euro/2G).

Resolutions 63/2021/R/com, 257/2021/R/com, 396/2021/R/com and 635/2021/R/com - New regulations for bonuses for economic hardship and supplementary social bonuses

As of 1 January 2021, all social bonuses for economic hardship (electric, gas, water) were automatically recognised to citizens/families who were eligible for them for the entire period of the bonus. Effective 1 October 2021, an additional compensation component was introduced through 31 March 2022.

ENERGY EFFICIENCY
Superbonus and other building bonuses

Decree Law no. 77/2020 (so-called "Decreto Rilancio") and Budget Laws

The Decree provided for the increase of the deduction to 110% for expenses incurred from 1 July 2020 to 31 December 2021 for specific interventions (energy efficiency, seismic risk, installation of photovoltaic systems, installation of charging infrastructure for electric vehicles), with use of the deduction in 5 equal annual instalments or option for transformation into a tax credit or discount for the amount corresponding to the deduction.

The 2021 Budget Law provided for the extension of the measures until 30 June 2022 and, only for condominium owners that have completed at least 60% of the work by June 2022, until 31 December 2022.

The 2022 Budget Law then included the following provisions:

  • Superbonus of 110% also extended for trailed works, with extension to the Third Sector, at the end of 2023 (reduction to 70% in 2024 and 65% in 2025) for works of condominium owners on common parts of condominiums and on apartments. For single-family units 110% superbonus extension to 31 December 2022, subject to carrying out works for at least 30% of the total by 30 June 2022 (based on the project status report);
  • installation of photovoltaic systems: extension of the 110% deduction to 30 June 2022;
  • updating of the reference for the primary energy conversion factors to be applied for the A.P.E. (energy performance certificate) annexed to the appraisal required to benefit from the Superbonus;
  • deductibility of expenses for the issue of compliance statements and certifications/assessments. Deductions do not apply to interventions (i) of free building and (ii) of amount < 10 thousand euro, on single units or common parts, excluding interventions on building façades zone A or B;
  • Ecobonus (energy efficiency and building renovation): extension of deductions to 31 December 2024;
  • Façade bonus: remodulation from 90% to 60% on full 2022;
  • extension of the option to transfer credit or discount on the invoice to 2025 for Superbonus, to 2024 for "ordinary" building interventions (Ecobonus, Sismabonus, renovations, façade bonus, installation of columns and photovoltaic panels);
  • abrogation of Decree Law no. 157/2021 (Anti-fraud) with implementation of the text, including reference, pro appraisal congruity expenses, to the maximum values (MD MiTE approved on 14 February 2022).
DISTRICT HEATING

Resolution 478/2020/R/tlr - Regulation of metering in the district heating and cooling service for the regulatory period 1 January 2022 - 31 December 2024

The resolution defines the regulation of the quality of measurement in district heating service, supplementing the regulation of the commercial quality of service, for the 1 January 2022 - 31 December 2024 regulatory period.

Resolution 463/2021/R/tlr - Provisions on connection fees and procedures for exercising the right of withdrawal for the second regulatory period

This is an update to the TUAR, the Consolidated law on connection fees, for the regulatory period 1 January 2022 - 31 December 2025.

Resolution 526/2021/R/tlr - Provisions on the commercial quality of district heating and cooling services for the second regulatory period

This is the update of the District Heating Commercial Quality Framework (RQCT) for the regulatory period 1 January 2022 - 31 December 2025.

WASTE

Standard UNI/PdR 123:2021

Effective 16 December 2021, the standard covers a test method for determining the quality of organic waste to be recovered through anaerobic digestion and composting processes.

New technical annex Anci - Conai - Corepla on plastic packaging and ANCI-CONAI framework agreement

ANCI, CONAI and COREPLA, taking into account the changes made to Legislative Decree 152/2006 by the implementation of the European directive on waste and packaging, have signed the new Technical Annex (AT) for plastic packaging provided for by the Anci/Conai Framework Agreement 2020-2024. The Technical Annex shall be in force from 1 January 2021. The ANCI-Biorepack agreement was also signed.

Decree Law no. 41 of 22 March 2021 - Urgent measures in the field of support to businesses and economic operators, labour, health and territorial services, related to the COVID-19 emergency converted, with amendments, by Law No. 69 of 21 May 2021 (so-called "Decreto Sostegni")

The measure, in addition to economic support measures, also includes important provisions regarding TARI and the deadline by which the choice of non-domestic users who produce urban waste to use the public service or the market must be made. The choice of non-domestic users must be communicated to the municipality, or to the waste service manager in the case of a paid tariff, by 30 June of each year, with effect from 1 January of the following year. For the year 2021 only, the choice had to be reported by 31 May effective 1 January 2022. An extension has been established for 2021 to 30 June for the approval by the Municipalities of the rates and regulations of the TARI and the corresponding tariff.

ARERA Resolution 363/2021/Rif - Update of the MTR for the second regulatory period (2022-2025)

The Authority approved the update of the Waste Tariff Method (MTR) for the II regulatory period (2022-2025), which also includes the tariff regulation of treatment plants. Key aspects include:

  • the preparation of a four-year EFP and the extension of the mechanism of cost recovery adjustments;
  • the introduction of an asymmetric tariff regulation of the treatment plants for residual urban waste (RUR) and organic fraction (OFMSW) that distinguishes the "minimum" plants, i.e. subject to tariff regulation at the gate from the "additional" ones, for which transparency obligations are envisaged.

To this end, the standard outlines to be used for preparation of the four-year EFP and the accompanying report were published, as well as some clarifications regarding MTR2 (Determination DRIF 2/2020).

Consultation documents 72/2021/R/rif and 422/2021/R/rif - First and final guidelines for the regulation of the quality of the management service for urban and assimilated waste

The consultation documents set out the general framework elements and guidelines that the Authority intends to follow in regulating the contractual and technical quality of the municipal waste management service, providing for its entry into force on 1 January 2023 (the final resolution - 15/2022/R/rif- will be published in early 2022).

Ministry of Ecological Transition Circular No. 35259, 12 April 2021

The circular clarified some issues related to the application of the TARI following the enactment of Legislative Decree no. 116/2020. Among the various information provided by the Circular, it is clarified that industrial activities also produce urban waste, with consequent application of the TARI.

Decree Law no. 73 of 25 May 2021 ("Decreto Sostegni bis")

The decree contains various provisions on environmental matters, including: the extension to 1 January 2022 of the provisions on the tax for plastic products with a single use, known as the plastic tax, and concessions relating to the TARI.

Decree Law no. 77 of 31 May 2021 on “Governance of the national recovery and resilience plan and initial measures to strengthen administrative structures and accelerate and streamline procedures” (the so-called “DL Semplificazioni")

Title 1 is dedicated to the "ecological transition and speeding up of environmental and landscape procedures" (EIA and SEA) and chapters 6 and 7 are dedicated to the acceleration of procedures for renewable sources and energy efficiency. Chapter 8 contains regulations regarding simplification for the promotion of the circular economy and hydrogeological contrast, including changes regarding the end of waste status. Finally, important changes are introduced to Part IV of the Consolidated Environmental Act, and the updated list of wastes is attached.

Circular on Register of environmental managers no. 16 of 30 December 2021 regarding "Application of article 3-bis of Law no. 159 of 27 November 2020, converting Decree Law no. 125 of 07 October 2020, in force since 04 December 2020 - Extension of the state of emergency"

The circular establishes that enrolments in the Register of Environmental Managers expiring between 31 January 2020 and 31 March 2022, remain valid until 29 June 2022.

Ministerial Decree no. 396/2021 - Allocated 1,500 million euro of which 60% allocated to Centre South in favour of EGATOs (Government bodies of the optimal territorial area) and Municipalities for the financing of the following possible projects:

improvement and mechanisation of the urban waste disposal network (max. 1 million/proposal);

treatment and recycling plants of municipal waste from separate collection (max. 40 million/proposal);

adaptation of existing plants and construction of new innovative treatment/recycling plants for disposal of absorbent materials for personal use (PAD), purification sludge, leather and textile waste (max. 10 million/proposal).

Ministerial Decree no. 397/2021: Allocated 600 million euro of which 60% allocated to Centre South in favour of companies for the financing of the following possible projects:

  • adaptation of existing plants and construction of new plants for i) collection, logistics and recycling of WEEE (150 million, of which 60 million in the North); ii) collection, logistics and recycling of paper and cardboard waste (150 million, of which 60 million in the North);
  • construction of new plants for the recycling of plastic waste (through mechanical and chemical recycling, "Plastic Hubs") with a total contribution of 150 million (of which 60 million in the North);
  • infrastructure for the collection of pre- and post-consumer textile fractions, plant modernisation and construction of new recycling plants for textile fractions with a contribution of 150 million (of which 60 million in the North).

Consequently, calls for proposals and notices linked to the activation/selection procedures for PNRR projects were published (on the "Italia Domani" portal).

National Waste Management Programme (PNGR)

Legislative Decree no. 116/2020 introduced national planning. In December 2021, the Preliminary Environmental Report was submitted by MiTE as part of the SEA process. The PNGR is expected to be adopted by mid-2022.

With regard to planning at the regional level, the state of progress is reported for each reference region:

  • Apulia Region: Approval of the 2021-2025 Plan on 14/12/2021;
  • Emilia-Romagna Region: Adoption of the 2022-2027 Plan on 27/12/2021 (expected approval in 2022);
  • Liguria Region: Adoption of the 2021-2026 Plan on 10/12/2021 (expected approval during 2022);
  • Piedmont and Tuscany Region: Started respective update processes.
INTEGRATED WATER SERVICE

Law no. 234 of 30 December 2021 - State budget for the financial year 2022 and multi-year budget for the three-year period 2022-2024

The 2022 Budget Law introduced, in Legislative Decree no. 152 of 03 April 2006, art. 166-bis (Use of water for potable supply), whereby the managers of the integrated water service, holders of concessions for the potable use of water, with reference to the water resource granted for potable use and already exploited in existing canals or pipelines, may submit a request to the competent authority for the production of hydroelectric energy within the same water systems.

Resolution 639/2021- Criteria for the biennial update (2022-2023) of tariff arrangements

The resolution in question, while confirming the criteria already provided for by MTI-3 (third regulatory period of the Water Tariff Method), introduces some significant new profiles. In light of the significant increases in electricity prices, the Authority introduces flexibility mechanisms aimed at preserving the financial balance of operations, through a better alignment between costs incurred and costs recognised in the tariff. The finance and tax expense coverage rate (OF-OFisc) is updated to 4.80%, from the previous 5.24%.

A Fund for the promotion of innovation in the integrated water service was set up at CSEA, whose criteria for use and management procedures will be defined by subsequent provisions.

Finally, the judgements of the Council of State concerning:

  • implementation of rulings regarding the Transitional Tariff Method (MTT): the Authority provided, limited to the two-year period 2012-2013, for the possibility for the operator to submit a request for recognition of the financial costs regarding adjustments, instead of mere recognition of inflation;
  • implementation of the sentence regarding remuneration restitution criteria: application, subject to acceptance of the petition, of criteria substantially similar to those provided for the MTT regarding the calculation of financial and fiscal tariff charges, in place of those provided for by Resolution no. 273/2013;
  • implementation of the sentence regarding the RQTI: regarding the modification of the criteria for calculating linear water losses in order to also include the length of the connections, with consequent adjustment of the classes and improvement objectives, the Authority has provided for standardised criteria; the possibility for the operator to submit a request to apply a punctual value has been recognised in case of availability of geo-referenced data.

Resolution 609/2021 - Integration of the regulations on the measurement of the SII (integrated water service) (TIMSII-Consolidated Text for the regulation of the metering service for the integrated water service at national level)

Updates made by the Authority include:

  • equating the validated self-metering with the metering collected by the operator (with consequent fulfilment of the obligations relating to collection attempts);
  • the obligation to give advance notice of attempted metering collection now limited to non-accessible or partially accessible users only. Effective 1 January 2023, specific standards are introduced regarding compliance with the minimum number of attempts to collect the metering and the minimum notice time for attempts to collect the metering from end users with a non-accessible or partially accessible meter;
  • the introduction of regulation regarding hidden losses, providing for common minimum levels of protection;
  • the inclusion of obligations aimed at reinforcing transparency and awareness of consumption and offering tools to condominium administrators for a more consistent allocation of consumption at the level of individual housing units in accordance with TICSI (Integrated Text for Water Service Fees) criteria;
  • the introduction of the single supply code.
OTHER GENERALMATTERS
Incentives

Decree of the Ministry of Ecological Transition 21 May 2021 on “Determination of the national quantitative energy saving objectives that can be pursued by electricity and gas distribution companies for the years 2021-2024 (so-called white certificates)”.

The decree provides some macro issues of reform of the mechanism of EECs:

  • reduction of 2020 obligations from 7.09 MEEC to 2.84 MEEC (-40%) and extension of the expiry date of the 2020 obligation year to 16 July 2021; ARERA ruling no. 6/2021 redetermined the obligations for DSOs;
  • determination of 2021-2024 targets (in sharp decline compared to historical trends);
  • introduction of a new downward auction system;
  • new types of upgrades eligible for incentives.

Resolution 547/2021/R/efr

The resolution defined the exceptional rate contribution (AC) to be recognised to distributors for the obligation year 2020: Exceptional CA, in addition to the Tariff Contribution, equal to 7.26 euro/EEC, for each EEC delivered at the end of the 2020 obligation year, valid for the updated target.

Legislative Decree No. 199 of 08 November 2021 transposing Directive (EU) 2018/2001 on renewable energy sources (RED II)

The measure defines the instruments, mechanisms, incentives and the institutional, financial and legal framework necessary to achieve the objectives of increasing the share of energy from renewable sources by 2030. In particular, the Legislative Decree provides for the strengthening of incentives for green gases by extending the incentive system to gases other than biomethane (i.e. hydrogen) and by extending the scope of application to green gases produced for injection into the network. Currently, the incentive is provided only for biomethane for the transportation sector.

As far as renewable energy sources are concerned, penetration targets on demand are defined in accordance with the PNIEC and the incentive scheme based on downward auctions for large plants through two-way difference contracts is maintained; in addition, it is defined that network managers (TSOs and DSOs) must plan the development of the networks taking into account the development targets of RES. Finally, as far as small-scale RES generation is concerned, the instrument of Renewable Energy Communities (RECs) is strengthened and stabilised through the extension of the perimeter to the primary substation and incentives for configurations containing plants up to a size of 1MW. The new incentive systems will in any case have to combine storage with RES plants. Simplifications of an authorisation nature are also provided (simplified authorisation procedure - AS) for the installation of RES plants in areas defined as suitable and identified by the regions based on criteria established by the Ministry of Ecological Transition.

Coverage rates of financial and capital costs

Resolution 614/2021 - TIWACC 2022-2027

With this document, the Authority approves the criteria for determining and updating the rate of return on invested capital for energy infrastructure regulations in the second regulatory period (II PWACC). The duration of the regulatory period is 6 years, with an infra-period update in 2025; in the event that conditions are determined such as to entail cumulative effects on WACC higher (in an absolute sense) than 50 bp, an update would also be carried out on an annual basis.

The main methodological discontinuities from TIWACC 2016-2021 concern the following parameters:

Risk free rate (in real terms): the previously envisaged floor level (50 bp) has been removed, in the belief that the condition of even negative real rates can no longer be considered extraordinary. A number of risk compensation factors have also been introduced (forward premium, uncertainty premium, convenience premium).

Cost of debt (in real terms): the kdreal value is now determined based on an average of spot yields and average yields over the past 10 years of market indices of BBB-rated non-financial bonds. Acknowledging the comments made by the operators, the Authority has provided for a tiering mechanism between the criterion set forth herein and the cost recognised under TIWACC I PR.

The Authority aligned the minimum systematic risk parameter βASSET to 0.4 and also updated the marginal tax rate level.

In the case of gas distribution, the WACC rate fell from 6.3% to 5.6% and for electricity distribution from 5.9% to 5.2%.

With respect to the WACC update to be applied to the waste sector, the resolution provides for a value of 5.6%. In addition, the resolution also sets some specific parameters of the integrated waste cycle sector for the regulatory period 2022-2025, while it remains pending the determination of beta and gearing.

Regulation of energy network tariffs

Consultation document 615/2021/R/com - Guidelines for the development of ROSS-base regulation to be applied to all regulated infrastructure services in the electricity and gas sectors

The Authority published the first consultation document regarding the introduction of new methods of recognising costs for infrastructure services in the electricity and gas sectors, based on a "total expense" approach. In particular, the consultation document envisages the application of the "ROSS-base" from 2024 for electricity distribution and from 2026 for gas distribution. Moreover, with regard to electrical distribution, application of the "ROSS-integral" is envisaged for companies that exceed a certain size threshold, to be defined as part of the consultation process in question.

The process of defining the general criteria for determining the recognised cost according to the "ROSS-base" methodology is expected to be completed by the end of 2022. Instead, the "ROSS-integral" approach, which also includes business plan analyses, will be the subject of specific proceedings to be initiated in 2022.

Short limitation

Resolutions 603/2021/R/com and 604/2021/R/com - Billing of amounts relating to energy consumption over two years old and 610/2021/R/idr - Billing of amounts relating to water consumption over two years old

Through these resolutions, ARERA complied with the sentences of the Lombardy Regional Administrative Court.

In particular, on the energy side, a new process is outlined through which the distributor is required to send, in addition to the metering flows, information on the presence of causes hindering the application of the limitation, on a transitional basis within seven days of the supplier's request downstream of the end customer's objection and, when fully operational, at the same time as making the metering flow available.

The seller, in turn, is obliged to send two separate communications to the end customer, in the event of the presence or absence of causes that may affect the right to limitation, and to the distributor, to communicate promptly any objection of limitation on the part of the user. In addition, Resolution 604/2021/R/com defines the methods for offsetting settlement items deriving from exceptions to the two-year statute of limitations raised by the end customer and the seller. On the distributor side, the introduction of penalties (limited to the electricity sector) was confirmed for items for which the presence of obstructive causes was not communicated.

Information obligations are also introduced on the water side in favour of end users considered worthy of greater protection:

  • in cases of invoicing of amounts relating to consumption over two years old that may be declared time-barred, indicating the procedures for contesting the limitation;
  • in cases of invoicing of amounts referring to consumption over two years old, but for which the operator considers that there is a cause for suspension of the statute of limitations, the operator itself adequately informs the end user of the precise reasons for the (presumed) non-accrual of the statute of limitations.
CONCESSIONS AND ASSIGNMENTS OF THE IREN GROUP
HYDROELECTRIC PRODUCTION

The major hydroelectric shunt concessions and the related expiries for the Iren Energia plants are summarised below.

 

Region Plant Average rated concession power (MW) Expiry
Piedmont Po Stura ‐ San Mauro 5.58 31 December 2010
Piedmont Pont Ventoux ‐ Susa 47.42 13 December 2034
Piedmont Agnel ‐ Serrù ‐ Villa 12.53 31 December 2010
Piedmont Bardonetto ‐ Pont 8.92 31 December 2010
Piedmont Ceresole ‐ Rosone 32.92 31 December 2010
Piedmont Telessio ‐ Eugio ‐ Rosone 26.10 31 December 2010
Piedmont Rosone ‐ Bardonetto 9.71 31 December 2010
Piedmont Valsoera ‐ Telessio 1.76 31 December 2010
Campania Tusciano 8.49 31 March 2029
Campania Tanagro 12.84 31 March 2029
Campania Bussento 17.06 31 March 2029
Campania Heat 3.27 31 March 2029
NATURAL GAS DISTRIBUTION

As regards the natural gas distribution service sector, operated by the Group in the area of the Municipality of Genoa and neighbouring municipalities and in the Emilia Romagna provinces of Parma, Piacenza and Reggio Emilia, the concessions are currently under an extension regime pending the launch of public tenders.

During 2021, tenders have been launched and are currently underway for the assignment of the service in ATEM Genoa 2 and ATEM La Spezia.

The Group also operates in numerous other areas throughout Italy through assignments or concessions given to mixed capital companies in which IREN Group companies have a direct or indirect investment.

The main assignments and concessions are:

  • Province of Ancona / Macerata - ASTEA S.p.A. (in which a 21.32% stake is held by the G.P.O. Consortium, 62.35% of which IRETI controls in turn): Municipalities of Osimo (AN), Recanati (MC), Loreto (AN) and Montecassiano (MC) assignment expired on 31 December 2010 and is being extended;
  • Municipality of Vercelli and other municipalities in the Province - ASM Vercelli S.p.A. (formerly ATENA S.p.A., 60% owned by IRETI): the 1999 concession expired on 31 December 2010 and is being extended;
  • Province of Livorno - ASA S.p.A. (in which IRETI has a 40% stake); Provinces of Livorno, Castagneto Carducci, Collesalvetti, Rosignano Marittimo and San Vincenzo – assignment expired on 31 December 2010 and is being extended;
ELECTRICITY

Ministerial electric concessions have an expiration date of 31 December 2030.

IRETI manages the public electricity distribution service in the cities of Turin and Parma.

Through local mixed companies, the Iren Group is also present in the following main areas:

  • Municipality of Vercelli, with the subsidiary ASM Vercelli S.p.A., which manages the public electricity distribution service in the City;
  • Marche area, with DEA S.p.A., controlled by ASTEA S.p.A., manages the public electricity distribution service in the municipalities of Osimo (AN), Recanati (MC) and Polverigi (AN).
DISTRICT HEATING

Iren Energia manages the district heating distribution service through concession, award or authorisation to lay networks in the following areas:

  • Municipalities of Turin and Moncalieri (TO);
  • Municipality of Nichelino (TO);
  • Beinasco (TO);
  • Reggio Emilia;
  • Parma;
  • Piacenza;
  • Genoa;
  • Rivoli;
  • Collegno;
  • Grugliasco

In the Grugliasco area, until 31 December 2021, the service was managed through the company NOVE, controlled by Iren Energia. With effect from the same date, the company was merged into Iren Energia.

Moreover, Asti Energia e Calore was entrusted with the sub-concession of the district heating service in the city of Asti.

 

INTEGRATED WATER SERVICE

Liguria area

IRETI S.p.A. holds the management assignment for the integrated water service in the 67 municipalities of the Province of Genoa. The assignment was granted by Decision no. 8 of the Genoa ATO Authority on 13 June 2003 and will expire in 2032.

The integrated water service in the territory of the Municipalities of the Province of Genoa is managed by IRETI through the safeguarded operators. The authorised and/or safeguarded companies of the Iren Group that perform the function of operator are Iren Acqua (60% controlled by IRETI), Iren Acqua Tigullio (66.55% controlled by Iren Acqua) and AMTER (in which Iren Acqua, again, has a 49% stake).

IRETI also provides the drinking water distribution service in the Municipalities of Camogli, Rapallo, Coreglia and Zoagli in the Genoese ATO.

The company manages only the segment of the water service in the following ATOs:

  • Savona area, in the municipalities of Albissola Marina, Albissola Superiore, Quiliano, Vado Ligure, Celle Ligure, Noli, Spotorno, Bergeggi, Savona, Stella, Varazze;
  • Centre West 2 ‐ comprises all the municipalities located on the Po valley side, managing the service, through the C.I.R.A. Consortium in the municipalities of Altare, Cairo Montenotte, Carcare, Cengio;
  • as regards the Province of Imperia: Bordighera, Camporosso, Isolabona, Dolceacqua, Perinaldo, Vallecrosia, San Biagio della Cima, Vallebona, Seborga, Soldano. For AIGA, IRETI manages in prorogatio a part of the territory of the Municipality of Ventimiglia.

Finally, in La Spezia and its Province, in 29 municipalities, the Iren Group manages (through ACAM Acque) the water service with a concession valid until 31 December 2033.

On 20 December 2021, Acam Acque signed the minutes of the takeover of Varese Sviluppo S.r.l., with effect from 1 January 2022 in the management of the Integrated Water Service in the Municipality of Varese Ligure, which therefore from that date joins the municipalities already managed.

Emilia Romagna area

The Group provides the Integrated Water Service on the basis of specific assignments granted by the respective Local Authorities, governed by agreements signed with the competent ATOs.

Based on the laws of the Emilia Romagna Region, water service Agreements provide for 10‐year assignments, in a safeguarding arrangement, except for the agreement relating to the Parma ATO, which sets the expiry of the assignment at 30 June 2025, by virtue of the disposal to private entities of 35% of the AMPS capital by the Municipality of Parma in 2000 through a public offering.

The Integrated Water Service in the Parma, Piacenza and Reggio Emilia ATOs is managed by IRETI. Ownership of the assets and networks of the water segment was transferred to companies wholly owned by public entities. These companies made their networks and assets available to the Iren Group on the basis of a rental contract and against the payment of a fee.

On 3 December 2019, ATERSIR published in the Official Journal of the European Union the Call for Tenders, concerning "Restricted procedure for the selection of the operating private partner of the company to be established to which the concession of the integrated water service for the Province of Reggio Emilia will be entrusted".

Main elements:

  • Value of the Concession: 1,550,000,000.00 euro
  • Duration of Concession: from 1 January 2021 to 31 December 2040 => 20 years;
  • Award criterion: most advantageous cost-effective offer (70 points technical‐qualitative part + 30 points to the financial portion);

As regards the Management model, it provides ‐ from the corporate point of view ‐ for the incorporation of a limited‐liability company, to be called “Azienda Reggiana per la Cura dell’Acqua” (Reggiana Company for Water Treatment), abbreviated to ARCA. The private partner ‐ selected with the dual‐purpose procedure ‐ will hold 40% of the quota capital of the company in question, while AGAC Infrastrutture S.p.A. will be the public partner with 60% of the quotas.

The tender procedure provides for an obligation for the private partner to create a territorial operating company (100% held) for management of the operating tasks assigned with the tender procedure. This company will not be linked to the mixed company through an equity investment, but only through an agreement that governs the assignment by ARCA S.r.l. to the operating company of the specific operating tasks identified in the tender procedure.

As part of the tender procedure, a provisional award was made in favour of IRETI. The public evidence procedure is currently underway.

The table below summarises the data on the existing agreements in the Group’s main areas of operation:

 

ATO Regime Signing date Expiry date
Genoa area ATO/operator agreement 16-4-2004/5-10-2009 31 December 2032
Reggio Emilia ATO/operator agreement 30 June 2003 31 December 2011 (*)
Parma ATO/operator agreement 27 December 2004 30 June 2025
Piacenza ATO/operator agreement 20 December 2004 31 December 2011 (*)
Vercelli ATO/operator agreement 13 March 2006 31 December 2023
La Spezia ATO/operator agreement 20 October 2006 31 December 2033

(*) Service extended until new agreements are defined following the tender procedure

Other geographical areas

The Iren Group also operates in the Integrated Water Service sector in other parts of Italy through assignments or concessions given to mixed‐capital companies in which it has a direct or indirect investment. The main assignments and concessions are:

  • ATO Toscana Costa – ASA S.p.A. (in which IRETI has a 40% stake) Integrated water service in the Municipality of Livorno and other municipalities in the Province;
  • Ambito Territoriale Marche Centro, Macerata (ATO3) - ASTEA S.p.A. (21.32% owned by Consorzio GPO, which is in turn 62.35% controlled by IRETI) only for the municipalities of Recanati, Loreto, Montecassiano, Osimo, Potenza Picena and Porto Recanati;
  • Municipality of Ventimiglia: AIGA S.p.A. (in which IRETI has a 49% stake);
  • Municipality of Imperia: AMAT S.p.A. (in which IRETI has a 48% stake);
  • Alessandria ATO: ACOS S.p.A. (in which IRETI has a 25% stake) for the Municipality of Novi Ligure; Cuneo ATO: Mondo Acqua S.p.A. (in which IRETI has a 38.5% stake) – manages the Municipality of Mondovì and 7 other municipalities in the Cuneo area.
ENVIRONMENTAL SERVICE MANAGEMENT

The Iren Group provides waste management services on the basis of specific service assignments from the Local Authorities, governed by agreements signed with the provincial ATOs. The table below contains details of existing agreements in the Group’s main areas of operation:

ATO Regime Signing date Expiry date
Reggio Emilia ATO/operator agreement 10 June 2004 31 December 2011 (*)
Parma ATO/operator agreement 27 December 2004 31 December 2014 (*)
Piacenza ATO/operator agreement 18 May 2004 31 December 2011 (*)
Turin ATO/operator agreement 21 December 2012 30 April 2033 (*)
Vercelli (Municipality) Municipality/operator agreement 22 January 2003 31 December 2028
Other Municipalities in the Vercelli area (except Borgosesia) Procurement contract with C.O.Ve.Va.R. 01 February 2011 31 January 2019
La Spezia (Municipality) Municipality/operator agreement 10 June 2005 31 December 2028 (collection and sweeping)30 December 2043 (waste disposal)

(*) Service extended until new agreements are defined

(**) the term is 20 years running from the end of provisional operation of the Waste‐to‐Energy plant of TRM S.p.A.

ACAM Ambiente, controlled by Iren Ambiente and operating in La Spezia and its Province, manages the service of the integral waste cycle, in 20 Municipalities of the Province (including the Municipality of La Spezia). In addition, it performs the activity of waste disposal, with award in a contract/on a time‐and‐materials basis/in‐house, in 12 other Municipalities of the said Province.

We can note that Iren Ambiente presented a tender for “The award in concession of the public service of integrated municipal and similar waste management in the territorial catchment area of Parma” (44 Municipalities) and for the analogous award in Piacenza.

After a long pause dictated by the well-known emergency situation, ATERSIR, in the context of the tender procedure for the concession of the public service of integrated management of urban and assimilated waste in the Parma basin, opened the envelopes containing the technical and economic offer on 5 June 2020. The offer submitted by Iren Ambiente was provisionally first in the ranking (total score of 100 points), exceeding 4/5 of the maximum score obtainable both from a technical and economic point of view.

On 19 June 2020, the session was held for the evaluation of the anomaly threshold of the offer, and the awarding commission - departing from a first expressed orientation, in that the current legislation (Legislative Decree no. 50/2016, Article 97, paragraph 3) does not provide for verification obligations on the part of the Commissioning Body where the number of admitted bids is less than three - considered that Iren Ambiente's bid, exceeding the aforementioned 4/5 of the maximum score obtainable, was to be subject to the procedure.

The anomaly assessment procedure was activated on 2 July 2020 by the Project Manager and on 25 September Iren Ambiente sent the last requested justifications.

ATERSIR is also proceeding with the verification of the possession of the general capacity requirements pursuant to art. 80 paragraph 3 of the Legislative Decree no. 50/2016 and anti-mafia checks.

With respect to the similar tender for the concession of the public service for the integrated management of urban and similar waste in the territorial basin of Piacenza, Iren Ambiente was first in the ranking. ATERSIR activated the procedure for evaluating the anomaly of the offer on 11 September 2020 and on 25 November the company sent the last requested justifications.

With regard to the perimeter of the investee companies of the so-called "Unieco Waste Management Division", subject to acquisition in 2020, it is noted that the associate SEI Toscana is the owner, under an agreement with ATO Toscana Sud, of the integrated waste management in 104 municipalities in the provinces of Grosseto, Siena and Arezzo, which expires on 27 March 2033.

 

Services provided to the Municipality of Turin

Iren Smart Solutions is party to the following conventions:

  • Agreement signed with the Municipality of Turin for the assignment of street lighting and traffic light services in the Municipality of Turin, expiring on 31 December 2036;
  • Agreement stipulated with the Municipality of Turin for the assignment of the management service of the municipal heating plants;
  • Agreement stipulated with the Municipality of Turin for the assignment of the management service of the electrical and special systems of the municipal buildings.

With regard to the assignments of the management service of municipal thermal systems and of the management service of electrical and special systems of municipal buildings, expiring on 31 December 2020, the Municipality, by Executive Resolution of 24 December 2020, has extended the deadline to 30 June 2021.

At the end of 2020, Iren Smart Solutions submitted a new project financing proposal pursuant to Article 183 paragraph 15 of the Public Contracts Code for the assignment of the service: with a Resolution of the Municipal Council of 15 December 2020, the proposal was declared of public interest and Iren Smart Solutions was identified as the promoter. The Municipality of Turin launched the tender for the assignment of the concession and Iren Smart Solutions submitted its offer within the deadline, which expired on 15 December 2021. As of today, the bid review is ongoing.