1. assoRinnovabili HYDRO ENERGY EMPLOYMENT SCENARIO IN ITALY assoRinnovabili, Via Pergolesi, 27 Milan, October 27 th, 2015

2. Since 1987 assoRinnovabili has brought together and has represented the producers of electricity from renewable sources, the providers of professional services, technology and active components in the renewable energy industry with the aim of defending their rights and promoting their interests at national and international level. We are the main representative and the focal point within the sectors for:  assoRinnovabili lobby | technical support | studies and analysis | training center 2 o bioenergy (biomass, bioliquids and biogas) o wind power o solar energy o hydropower o components and services for the industry

3. 3 We are members of:  EPIA (European Photovoltaic Industry Association)  EWEA (European Wind Energy Association)  The General States of the Green Economy  RES4MED  Kyoto Club  Coordinamento FREE (Green Energy and Energy Efficiency) We are partners of European projects:  KnowRES  PV GRID  RESTOR HYDRO  KEEP ON TRACK!

4. 4 Representation and safeguarding  activities and services assoRinnovabili represents the renewable energy industry at all institutional levels, constantly monitoring the decision-making and law-making processes that steer the development of renewable energy. Communication assoRinnovabili is constantly in touch with political and governmental institutions, with citizens and other stakeholders to facilitate a transition towards a sustainable society and economy. Follow us on Twitter, Facebook, LinkedIn, Google+ and Youtube.

5. 5  activities and services Constant Support and Updates assoRinnovabili guarantees its members continuous updates on laws regarding approval procedures to create electric production plants that make use of renewable sources, on how to enter the electricity markets, and on the incentive systems, through: - Flash news, newsletters, specialist guides and the Parliamentary agenda; - Source-centred meetings and workshops (meetings of a technical nature among members to explore specific topics); - Direct channel of communication with the Gestore dei Servizi Energetici (GSE – the Italian authority on renewable energy); - Assistance in handling changes in rules and regulations and coordination for possible legal actions.

6. 6  activities and services International Opportunities assoRinnovabili supports its members in their international development thanks to consolidated relations with governmental, financial and industrial institutions in the most attractive countries, starting from those of the Mediterranean area through our partnership with RES4MED. Training assoRinnovabili offers training courses to explore the most interesting topics of the industry with expert advice from accomplished professionals.

7. 7 Regional distribution of hydro power capacity at the end of 2013 Source: GSE – year 2015 18,366 MW – 75% in the North  Energy situation in Italy

8. 8 Regional distribution of the number of hydro power plants at the end of 2013 Source: GSE – year 2015 3,250 hydro power plants – 55.5% in the North  Energy situation in Italy

9.  In recent years, despite a continuing increase of the installed power, hydropower production has performed very variable for reasons related to: climatic conditions and hydrological details management factors (eg. introduction of the DMV) economic factors  Of the 173 new plants started in 2011, 131 have an installed capacity of less than 1MW and flowing water CONSIDERATIONS:  Il 55,5% of HP are placed in the Northern area. 9

10. 10 Source: GSE – year 2015 Evolution of installed capacity and number of hydropower plants in Italy, 2000 to 2013  Energy situation in Italy

11. Number of hydro plants by capacity 2010 +480 New plants 11 Fonte: GSE – anno 2011; elaborazione APERSource: GSE – year 2015; elaboration by assoRinnovabili  Energy situation in Italy

12. The analysis of the average size shows a progressive decrease in the size of the equipment installed. Evolution of average size hydroelectric plants in Italy 2000-2011  Energy situation in Italy More and more small plants are installed. Between 2010 and 2011 the high number increased by 6% (+173 facilities), while the increase in power is equal to '1% (+216 MW). 12 Fonte: GSE – anno 2011Source: GSE – year 2015

13. Hydro plants from 01/01/2013 (Ministerial Decree July 6, 2012) Plants > 60 kW and <10 MW Access to incentives through Register subscription Plants > 60 kW and <10 MW Access to incentives through Register subscription Plants > 5 MW Access to incentives through a mechanism based on “Dutch auction model” (descending- price auction) Plants > 5 MW Access to incentives through a mechanism based on “Dutch auction model” (descending- price auction) Plants < 60 kW Free access to incentives Plants < 60 kW Free access to incentives Maximum capacity threshold per year: 20132014 2015 70 MW Maximum capacity threshold per year: Hydro plants 20132014 2015 Capacity50 MW0 MW 13  The incentive framework

14. 14  How does the Register work?  There are 2 Registers with different maximum capacity threshold, the first one (RG) is for new, totally rebuilt, reactivated or repowered plants, whereas the second one (RR) is for refurbished plants;  Both registers are open once a year for the enrolment of small hydro plants;  Every year both for RG and RR incentives are granted to those hydro plants which manage to get within a certain position in the register rankings drawn by following these specific priority criteria: 1) Smaller installed capacity; 2) Date of permit achievement; 3) Date of enrolment in register.  Registers close when - by summing up the installed capacity of the enrolled plants - the maximum capacity threshold is reached. Owner Power capacity Permit achievement Enrolment in register Owner A100 kW 2012Nov 2013… kW Owner B100 kW 2012Feb 2014… kW Owner C100 kW 2012Mar 2014… kW Owner D200 kW2012Nov 201370 MW Owner E350 kW2012Mar 2013 Owner F400 kW2013Jan 2014 Owner G450 kW2013Jul 2013 Excluded Maximum capacity threshold 70 MW

15. It counts the yearly indicative support cost which is the sum of all form of incentives granted yearly by GSE to all plants belonging to RES different from PV. The maximum yearly indicative support cost as been fixed in 5,8 billion €, after reaching this threshold, if no other Decree on RES incentives will be published, there will not be any other chance to get incentives. The yearly indicative support cost on 31 july 2015 is: 5,73 billion € Waiting for new support scheme, only the free access plants (wind plants ≤ 60 kW) can get the incentives… What does it count? What next?  The RSE-E Counter 15

16. 16  Draft of new Decree… We are waiting for the approval of a new support scheme, in the coming weeks there could be news about it; The structure of the new Decree is similar to the previous system, with Dutch Auctions and Registers; The most important aspect of this Decree is his lifetime: one year or even less if the cost of renewable energies will reach 5,8 billion; In 2017 there may be a further Decree in line with the guidelines of the European community. Large uncertainty among the producers

17. 17 Since early 1900 hydropower represented the most important electricity source in Italy. Electrification process started with big hydropower plants in the Alpin region. Big plants and low technological development level required workers on site.  Hydropower evolution in Italy Nowadays, the potential for big plants installation has been mostly already employed and the normative and economical framework encourage smaller installations. Moreover, the technology is now largely employed to control an monitoring activities, which before were performed by physical presence of workers on site.

18. 18 Employment in hydropower sector is now more sparkled and related with work on site (carpentry, masonry), design and engineering of components to maximise the efficiency and by respecting even more straight environmental constraints. The most difficult challenge is related with development in extra UE rural areas, where high flexibility is required mostly for civil and electrical engineers and for construction site supervisors.  Employment situation

19. Thank you for your attention info@assorinnovabili.it www.assorinnovabili.it 19