Italy has approved an additional €1.7bn energy package to reduce electricity and gas bills of households and businesses. Around €1.2bn will come from proceeds from carbon permit auctions and will be aimed to reduce system-cost levies on companies (which can account for more than 20% of retail energy bills); additional resources will come from a clawback of profits from some operators benefiting from fixed-tariff solar power incentives.
In September 2021, Italy unveiled a plan worth €4bn to curb increases in energy prices until the end of 2021 with a focus on the poorest and most vulnerable households. The country, which had already set aside €2bn in its 2022 budget to help households overcome rising energy prices, announced in December 2021 that it would double that amount to €4bn as energy cost pressures continue to drive consumer price inflation. In addition, in January 2022, the Italian energy regulator Arera increased electricity price by 55% and gas price by 42% for the first quarter of 2022, due to the rise in the prices of wholesale energy products and CO2 emissions permits. Without the intervention of the government, which cancelled general charges and reduced VAT rates on gas bills for 35 million domestic customers and enhanced social bonuses and the possibility of paying in instalments for families in difficulty, electricity prices would have increased by 65% and gas by 42%.