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MONEY

What you need to know about installing solar panels on your home in Italy

As energy bills continue to soar in Italy, more homes and businesses are turning to solar power. Here's what you need to know about investing in photovoltaic panels for your property and how you can use government funds to foot the bill.

Solar panels are an increasingly popular option for those renovating homes in Italy.
What you need to know about installing solar panels on your home in Italy - and the bonuses on offer to help pay for it. Photo by Bill Mead on Unsplash

Rising costs of living and energy bills continue to hit homeowners in Italy hard, made even worse by the knock-on effect of the war in Ukraine.

In response, the Italian government has taken various steps to bring down rising energy costs, such as extending an energy bonus to offset the price hikes.

READ ALSO: Who can claim a discount on energy bills in Italy?

As energy prices have soared over the past year, one option to save on future electricity and gas bills in Italy is to invest in solar panels for your home or business.

Aside from its money-saving potential, solar energy is more sustainable and, as such, the government is offering funds to encourage its uptake.

This is partly due to Europe’s climate goal of reducing greenhouse gases by 2030, according to research by the Eurac Research Institute for Renewable Energies.

Italy also has its own National Integrated Plan for Energy and Climate 2030 (Piano Nazionale Integrato per l’Energia e il Clima 2030 or PNIEC), which is focused on decarbonisation, energy efficiency and security and the internal energy market.

Solar panels are an increasingly popular option for those renovating homes in Italy. Photo by Jeremy Bezanger on Unsplash

The nation already ranks top worldwide for electricity consumption covered by solar panels according to the latest research.

The number of photovoltaic systems in Italy has increased by more than tenfold over the last decade – and growing numbers of Italians are considering installing their own solar-powered energy, according to market surveys.

As solar energy becomes more widely available in Italy, even stores such as IKEA now sell solar panels.

Some 40,000 solar panel systems had been installed in Italy up to the end of 2020 – but three million are said to be needed over the next decade to keep pace with climate change targets and the consequent energy source transitions.

READ ALSO: Italy plans to cut air conditioner use to save energy

Residential properties show the highest uptake, with the sunny southern region of Puglia and the wealthy northern region of Lombardy contributing the most to this growth, according to market research.

But how much will it cost and is it worth making the switch? Here’s a look at what to expect in terms of savings, plus how you can access government help to pay for installation.

What’s the cost of installing solar panels in Italy?

There are a multitude of options on the market and many combinations of products for a 3 kW photovoltaic system (standard household power in Italy).

As a general rule, the cost of a 3 kW photovoltaic system varies between €5,500 and €8,500, according to energy news reports.

These prices refer to the average cost of the photovoltaic system, including design, installation, paperwork and service.

This size of solar-powered system should suffice for a family of 3-4 people, producing around 3,500kWh per year, which roughly equates to the amount of electricity a family would use annually.

The cost of solar panels has steadily decreased over the previous decade according to industry data, reaching 0.30 euros per watt in 2020 for the average price of solar panel modules, compared to 2009 when it was equal to 2.5 euros per watt.

Costs can vary depending on the type of system you opt for too, such as the traditional version or those that are hooked up to the grid with back-up batteries.

READ ALSO: How and where to find your dream renovation property in Italy

The typical 3 kW photovoltaic system is cheaper but doesn’t have any energy storage systems. This means that the excess energy produced cannot be used, but can still be sold to the national energy distribution system, in exchange for deductions on your energy bill.

A house restoration project in progress.

There are bonuses available in Italy to pay for solar panels on your property. Photo: Nolan Issac on Unsplash

A 3 kW photovoltaic system with storage is more expensive than a conventional system, as it is equipped with an intelligent on-grid system for storing energy in powerful lithium batteries.

These types of solar panel systems can run to over €13,000 for 2022, reports suggest.

From an economic point of view, this is certainly a bigger commitment, but you do get a lot of power for your buck –  the storage batteries mean you can store your self-produced energy and consume it when you need it.

The final price is influenced by various factors including the power chosen – it is the solar panel power and not its surface area that defines the price.

Are there any subsidies for the installation of solar panels?

Yes. The Italian government has introduced and extended a raft of building bonuses in order to galvanise the construction industry following the economic downturn caused by the pandemic.

And included in this state aid are funds for solar panels.

There is no single package of incentives for installing solar panels in 2022 per se, but you can take advantage of other government bonuses.

You could use the renovation bonus (bonus ristrutturazione), which amounts to a 50 percent tax deduction spread over 10 years in your tax return – or through the so-called superbonus 110, a scheme that promises homeowners a tax deduction of up to 110% on expenses related to property renovation and making energy efficiency measures.

READ ALSO: Budget 2022: Which of Italy’s building bonuses have been extended?

The property must make at least a double jump in energy class or reach the highest efficiency rating when accessing this pot.

There’s a substantial amount of funds on offer to install your solar panels.

Using the renovation bonus, which would cover both the supply and the installation of the solar panels, there is a maximum total expenditure of €96,000 (per single housing, including condominiums).

A worker installs solar panels. (Photo by Ina FASSBENDER / AFP)

The renovation bonus has been extended until 2024 and, where solar panel installation is concerned, you can claim for the costs of labour, design, surveys and inspections, as well as VAT and stamp duty.

You must tell Italy’s energy and technology authority, ENEA, that you’ve done the works within 90 days in order to access the state aid for solar panel installation.

If you choose to use the superbonus route to claim funds for your solar panels, however, you can spread out the tax deduction costs over five years. Alternatively, you can apply for it as a discount on the invoice (sconto in fattura) or through the transfer of credit (cessione del credito).

The limit when using this bonus is €48,000, which can now be accessed for a while longer as the government extended the deadline for single family homes.

See HERE for details on how to claim it.

How much can I save on electricity bills if I install solar panels?

Depending on how much power you consume, your bill could even be reduced down to zero.

In any case, using the power generated by solar panels means you use less electricity supplied by the national power services, known as GSE (Gestore dei servizi energetici) – meaning savings on your bills as you’ve produced the power yourself.

You could also get deductions on your bill by selling the excess power your solar system has generated, but that you have not consumed, back to the national grid. (This may not be allowed, however, if you’ve taken advantage of the superbonus funding.)

READ ALSO: Do you have to be Italian to claim Italy’s building bonuses?

Variables such as how much power you use, when you consume it, the size of your installation and how well it’s positioned to receive as much sun exposure as possible and the quality of the system, will all affect how much you could eventually save.

At best estimates with a highly performing solar-powered system, consumers could save around €1,500 per year on average on their energy bills, according to research carried out by Solar Index Italy.

That means most systems are estimated to pay for themselves within 5-7 years, depending on the type you opt for.

After that you could start making a profit, with an average estimated annual financial return of 12 percent.

With solar panels lasting an average of 25-30 years, there are considerable savings to be made – if you plan on living in that property long-term.

If you plan to sell, the system is likely to be seen as a plus point by future buyers as the popularity of solar power continues to rise.

Can you install solar panels in any location?

There are regulations on where solar panels can be mounted, which could exclude some property owners from using this source of energy.

Owners of properties within condominiums are able to install a photovoltaic system without having to ask for prior authorisation, except for those in a listed area, according to legal accounts.

As long as the works don’t “prejudice the aesthetic decorum of the condominium”, solar panels are okay in these types of buildings.

The good news about installing solar panels is that it’s one less complex area of bureaucracy – you can proceed without having to ask for prior authorisation.

The full list of works that can be carried out without permission can be found in this government document.

However, if the building you want to add solar panels to is located in a historic area of a town centre (centro storico), you would have to ask for authorisation from an appropriate body, such as the local municipality or the Management for Architectural Heritage (Soprintendenza per i Beni Architettonici).

If you’re not sure whether your property falls under this remit, the authorities would check that the installation of the solar-powered system does not compromise the aesthetics of the landscape.

Outside of these historic areas though, it’s not important whether the panels are visible or not.

See more in The Local’s Italian property section.

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MONEY

How much does it cost to raise a child in Italy?

How big is the financial commitment parents have to make in Italy to pay for their offspring’s needs and expenses until they’re grown up and independent? Here's a look at the predicted costs.

How much does it cost to raise a child in Italy?

Family is the bedrock of Italian society, but it’s also an unbalanced economic crutch, propping up children who leave home much later than most of their European counterparts.

Various factors are at play, from a declining birth rate, youth unemployment, being unable to get on the property ladder to young Italians moving abroad in search of better financial opportunities.

It probably comes as little shock, then, that parents in Italy end up forking out huge sums of cash to support their offspring through childhood and early adulthood (and beyond).

Even just up to the age of 18, raising a child in Italy can cost upwards of €320,000, according to data from Italian consumer research body ONF (Osservatorio Nazionale Federconsumatori).

The average spend of raising a child from 0-18 years is €175,642, but it rises in families with high incomes, classed as over €70,000 per year.

READ ALSO: Italian class sizes set to shrink as population falls further

Researchers noted that the cost of bringing up children has jumped up following the effects of the pandemic too: compared to 2018, child-rearing expenses increased by 1.2 percent by 2020.

The decrease in expenditure related to transport due to spending more time at home, as well as those incurred for sports and leisure activities, was not enough to mitigate the increase in costs for housing and utilities, which increased by 12 percent compared to 2018.

Photo by Suzanne Emily O’Connor on Unsplash

Food prices rose by 8 percent compared to 2018 and education and care jumped by 6 percent for the same timeframe.

In fact, Italy ranks as the third most expensive country in the world for raising children, only coming behind South Korea and China, according to data from investment bank JEF.

The pandemic has contributed to extending an already growing phenomenon: the decrease in annual income of Italian households.

Household income dropped by 2.8 percent from 2019 to 2020, the report found, citing data from national statistics agency Istat. It marks a further squeeze for families, especially low-income and single-parent families.

Depending on earnings, the amount needed to bring up a child until the age of 18 varies considerably.

READ ALSO: ‘Kids are adored here’: What being a parent in Italy is really like

A two-parent family with an annual income of €22,500 spends an average of €118,234.15 to bring up a child until the age of 18; for the same type of family but with an average income of €34,000 per year, the total expenditure to bring up a child increases to €175,642.72.

For high-income families, stated as over €70,000 annually, raising a child costs €321,617.36 on average.

The figures mark an increase of around €5,000 for low- and middle-income families, and a much sharper rise of €50,000 for high-income families, compared to ten years ago.

The money gets spent on housing, food, clothing, health, education and ‘other’ categories. The report revealed that the average spend on a child aged 16 years old is almost €11,500 annually, amounting to €955.78 per month.

Almost €2,000 per year gets spent on food, €1,615 goes on transport and communication, €782 goes on clothing and €1,600 goes on education annually, the report found.

They begin small, yet the costs are anything but. (Photo by LOIC VENANCE / AFP)

For the ONF, “these data highlight how, today more than ever, having a child is becoming a luxury reserved for the few, which fewer and fewer Italians are able to afford.”

READ ALSO:

The numbers on supporting children after their 18th birthday are a little hazier, as when children eventually fly the nest varies – but figures from Eurostat show that Italy ranks third in Europe for the average oldest age at which children move out of the parental home, at 30.2 years old.

Only young people from Croatia and Slovakia wait longer to live independently, while the EU average for flying the nest is 26.4 years old.

Even then after eventually leaving home at over 30 years old, it’s not entirely clear how many Italians are fully independent once they get their own address, or whether their parents continue to bankroll their living costs.

Italy’s president Sergio Mattarella sent a message to Italy’s Birth Foundation (Fondazione per la Natalità) in May stating, “The demographic structure of the country suffers from serious imbalances that significantly affect the development of our society.”

In response to worsening economic circumstances, the Italian government has recently pledged to do more to help people have families and reverse Italy’s continuing declining birth rate.

It has introduced the Single Universal Allowance (L’assegno unico e universale), but along with it has dropped various so-called ‘baby bonuses’ that provided lump sums to new parents.

The new allowance is a monthly means-tested benefit for those who have children, or are about to have a child. It is payable from the seventh month of pregnancy until the child reaches the age of 18 or in some cases, 21. For more information on what it is and how to claim it, see here.

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