Italy´s solar market, the world´s second-largest after Germany, has rapidly grown since 2007 when the government boosted production subsidies, attracting the world´s biggest makers of photovoltaic modules, which turn sunlight into power.
"As of June 30, we have already exceeded a national target set for 2020 of 8 gigawatts (GW)," Fulvio Conti, chief executive of Italy´s biggest utility, Enel , said at the official opening of a new solar modules manufacturing plant on Friday.
"Going ahead at the same pace, we can estimate that we can arrive at 30 GW in 2020," Conti said.
Rome cut incentives in May to reduce the burden on consumers who support the scheme through power bills. . However, market growth has once again picked up as investors and industry operators still see satisfactory returns.
Italy remains a very promising solar market for Japan´s Sharp Corp , Sharp Corporation President Katsuhiko Machida said at the ceremony.
Italy has an additional investment appeal as it is expected to reach the so-called grid parity - when solar power generation becomes competitive with traditional power generation and would not rely on incentives - in a few years, ahead of many other countries, industry executives said at the ceremony.
Sharp together with Enel´s renewable energy arm, Enel Green Power (EGP) , and STMicroelectronics , own the new plant near Catania on the island of Sicily, which will produce thin film photovoltaic (PV) modules with a total 160 megawatt capacity a year.
The production will start at the end of 2011 and the plant´s capacity is expected to rise up to 480 MW of modules a year by 2014. Total investment in the initial stage to bring the capacity to 160 MW amounted to 400 million euros ($572.2 million).
"We can arrive even at 1,000 MW a year (capacity) if the market absorbs it," EGP Chief Executive Francesco Starace said.
Modules produced at the plant will be sold by Sharp and EGP. They will also be used by another joint venture between EGP and Sharp, called ESSE, in projects to develop solar power in Italy, elsewhere in Europe, the Middle East and Africa.
Sharp aims to expand in southern Europe and the Mediterranean region, Sharp Representative Director and Executive Vice-President Toshishige Hamano said, but gave no details.
Manufacturing solar modules in Italy would reduce the local market´s dependence on foreign suppliers and help Enel and its partners to compete with major rivals. Those rivals include China´s Suntech Power Co Ltd , Trina Solar Ltd , Yingli Green Energy Holding Co Ltd and U.S. firms First Solar Inc and SunPower Corp .
Encouraged by an explosive growth of the solar market in Italy and many other countries, EGP has increased investment in PV power generation and may increase PV share in its energy mix, Starace told Reuters.