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ENERGY

EXPLAINED: How much are energy bills rising in Italy?

Energy costs are rising in Italy - but just how high could they go? The Local looks at how residents and businesses are being affected by soaring bills.

Energy prices in Italy have soared since Russia's invasion of Ukraine in February.
Energy prices in Italy have soared since Russia's invasion of Ukraine in February. Photo by ALAIN JOCARD / AFP.

People in Italy are receiving bills this week for energy use in recent months – and they’re even higher than many people expected, leading to concerns about further increases over the coming winter.

Gas and electricity prices in Italy have soared in recent months, as Europe continues to be buffeted by a volatile energy market in the wake of Russia’s invasion of Ukraine.

Italy is particularly dependent on Russian gas, importing 95 percent of the gas it consumes, of which around 40 percent comes from Russia.

As a result, bills are rising at an alarming rate – and so far a series of government measures aimed at offsetting the costs have provided only a very thin cushion.

Families are currently paying approximately 70-80 percent more for gas than they did a year ago, according to an August report for the trade publication Qualenergia.it – raising the roughly €1,700-1,800 the average household would spend in a normal year to around €2,900-€3,240 this year.

But with Europe’s energy crisis showing no signs of abating, prices seem set to rise even higher than this.

Residents across Italy have reported seeing their gas and electricity bills for the second quarter of 2022 double or even triple compared to the same period last year.

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“Ours is usually €90 for our apartment, there’s 3 of us… July was €170,” says Italy resident Kav Kavanagh.

Another foreign resident who didn’t want to be named told The Local his own household energy bills have gone from €190 to €560 for two months of use – and that those for his workplace have risen tenfold, so that his employers have had to request rateizzazione (payment in instalments).

“So far we’re keeping our neck above water, so to speak, and had to up our prices by 30 percent, and unfortunately diminish our staff, therefore our service quality has gone down and unfortunately customers aren’t as understanding as of yet,” he said.

Prices are predicted to double again from October, says Qualenergia.it, as the cost of gas on the Amsterdam stock exchange rose from €84/Mwh at the start of July to more than €109/Mwh at the start of August.

Gas prices overall have risen more than tenfold in the last year, from around €27/Mwh in August 2021 to an eye-watering – and record-breaking – spike of €341/Mwh at the end of August 2022.

These increases mean Italian businesses are forecast to pay at least €106 billion more in 2022 than in previous years, according to a recent estimate from the Italian small and medium sized business federation CGIA.

The hikes have led to demonstrations from desperate business owners and local efforts from small companies and public administrations to cut costs by closing offices and reducing opening hours.

The French government has published guidelines on what to do if you are struggling to pay your energy bills.
Gas prices have increased by more than 1,000 percent in the past year. Photo by Ina FASSBENDER / AFP

Earlier this week, members of the Confcommercio business association in Perugia staged a protest against the soaring costs by burning their energy bills in a city centre piazza.

In June, the town council for Fluminimaggiore in southern Sardinia trialled shutting off its energy supply over the Republic Day bank holiday weekend – while remaining open for essential services – to save on costs.

Some consumers on fixed-rate energy contracts have so far been shielded from the increases, but that could soon be set to change.

One resident on such a contract reported receiving a letter from their energy company in June “proposing a contractual amendment” that would see their bill tied to national stock exchange gas prices from the start of December, and inviting them to sign a new contract if they didn’t want to accept the change.

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Italy on Tuesday announced new energy-saving rules designed to cut costs, including restricting thermostats in business premises to a maximum temperature of 19C over the winter and reducing the time the heating can be on by one hour a day and 15 days across the year.

The government has signed off on a series of aid packages over the course of the year aimed at buffering some of the shock, and new aid bill is currently under discussion.

For Italian residents and businesses, help can’t come soon enough.

“The combination of expensive energy and the increase in the cost of raw materials has brought about the perfect storm that we feared,” the Lazio general secretary for CISL, the Italian Confederation of Workers’ Trade Unions, told the local news outlet Ciociaria Editoriale Oggi last week.

“Urgent and substantial interventions are needed, to save income and wages, businesses and jobs.”

Member comments

  1. Does anyone know whether the price per Kwh that ENEL pays to those who generate solar power will increase in line with the hike in energy costs?

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For members

DRIVING

MAP: Where in Italy is car insurance cheapest – and most expensive?

Italy is one of the most expensive countries in Europe when it comes to vehicle insurance – but some parts of the peninsula are far pricier than others.

MAP: Where in Italy is car insurance cheapest - and most expensive?

Car insurance has been in the news in Italy this week following media reports of an emerging insurance evasion tactic that sees growing numbers of Italian motorists dodge steep coverage charges by having their vehicle registered in another EU country, with Poland being the most popular choice. 

The phenomenon, which is estimated to have already led to the presence of over 50,000 foreign-plate vehicles in the country, follows major increases in car insurance costs in recent years, with the average cost of third-party liability insurance (Responsabilita’ Civile or RC in Italian) rising by over 10 percent in the past two years.

But, as consumer groups say these increases are “totally unjustified”, how much does insuring a vehicle currently cost in Italy?

According to the latest available data from Italy’s insurance supervision authority IVASS, the average cost of the compulsory RC coverage – this only covers the costs of damage and injury to other parties – is 395 euros a year. 

For reference, minimum compulsory insurance costs motorists in Germany 304 euros a year on average, whereas drivers in Greece and Poland spend an average of 145 and 120 euros respectively every year, according to data from national auto repair shop association Federcarrozzieri.

READ ALSO: How can you lose your driving licence in Italy?

It’s also worth noting that motorists in Italy often choose to tack on one or more optional insurance policies (these are known as ‘additional guarantees’ or garanzie accessorie) to their basic RC coverage, with additional expenses amounting to somewhere between 400 and 500 euros in some cases.

While there is no publicly available data on how the costs of insurance add-ons vary around the country, IVASS regularly publishes a breakdown of the cost of RC coverage by Italian province.

The latest available report, which refers to data collected in February 2024, shows stark differences in insurance charges around the country, with a 280-euro gap separating the most expensive province (Naples) from the most affordable one (Enna, Sicily).

Besides Naples (569 euros a year on average), the list of ten most expensive Italian provinces for basic RC policies is completed by: Prato (565 euros), Caserta (508), Florence (483), Pistoia (482), Massa-Carrara (480), Lucca (464), Pisa (454), Roma (451) and Genoa (441).

Six of these provinces are located in Tuscany.

READ ALSO: The key vocabulary you’ll need for taking your driving test in Italy

On the other end of the spectrum, Enna (289 euros a year) is followed by: Oristano (297), Potenza (301), Pordenone (312), Vercelli (315), Biella (316), Aosta (316), Campobasso (321), Trento (322), Udine (324) and Gorizia (325).

What’s behind these differences?

The cost of Italy’s RC policy varies depending on the characteristics of the vehicle needing insurance as well as a driver’s personal details, with their location playing a major role in the final bill.

In particular, insurance costs are higher in areas with a high frequency of car accidents (hence why insurance tends to be more expensive in large metropolitan areas than in rural areas) and in areas with high rates of insurance fraud and insurance evasion (an estimated 2.6 million vehicles circulate in the country without the mandatory RC coverage).

Though Giuseppe Conte’s government in 2018 advanced plans to standardise the cost of basic RC insurance and apply the same charge (or tariffa unica) to all motorists around the country, these were later abandoned following consumer groups’ concerns that the new system would ultimately penalise drivers in “the more virtuous provinces”.

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