Climate Change Regulation 2026 Comparisons

Italy participates in the multilateral climate change legal regime both individually and as a member of the European Union (EU), which acts as a negotiating bloc.

Individually, Italy is an Annex 1 party to the United Nations Framework Convention on Climate Change (UNFCCC). It ratified the Kyoto Protocol with Act No 120 of 1 June 2002 and the Paris Agreement with Act No 204 of 4 November 2016.

In implementing the Paris Agreement, Italy has participated in recent COPs, advocating for cross-sectoral solutions and building resilient partnerships, thereby contributing to the management of the ever-increasing risks associated with climate change.

In this regard, Italy announced at COP28 that it would contribute concrete financial commitments, including EUR100 million for Loss & Damage.

Italy also sent the largest number of delegates to COP29, demonstrating its commitment and the importance of its participation during the conference.

However, during COP30, Italy adopted a more skeptical position regarding the roadmap for phasing out fossil fuels.

Furthermore, through its competent ministries, Italy responds to its commitments through the conclusion of international agreements at a bilateral and multilateral level.

Regarding the areas of interest for the conclusion of agreements, traditionally, Italian foreign policy has oriented its co-operation and development work, including on climate issues, towards the Mediterranean and Africa. Decree Law No 92/2021 established the role of the Special Envoy for Climate Change to ensure more effective Italian participation in international events and negotiations on environmental issues.

Italy, as a member state of the EU, participates in the drafting of EU policies for combating climate change.

In fact, EU Treaties, in particular Article 191 of the Treaty on the Functioning of the European Union (TFEU), identify “combating climate change” as an important objective of EU policy. Competence in this area is shared between the member states and the EU.

The European Green Deal

The European Commission’s political guidelines place climate action at the top of its agenda, in particular with the European Green Deal, announced on 11 December 2019.

The objective of the European Green Deal is to make Europe the world’s first climate-neutral continent. Italy has (in particular) taken a position on decarbonisation, believing that it should be pursued in an effective but progressive manner.

The National Recovery and Resilience Plan (NRRP)

The aforementioned sectors are also involved in the funding under the NRRP. This programme has set aside an amount of EUR59 billion for Mission No 2 (green revolution and climate change mitigation/adaptation objectives). In absolute figures, Italy’s NRRP is the largest national plan under the unprecedented EU response to the crisis triggered by the COVID-19 pandemic. Italy’s NRPP was updated on 8 December 2023 to introduce a REPowerEU chapter in order to respond to the global energy market disruption caused by Russia’s invasion of Ukraine.

On 10 October 2025, Italy submitted a request to the European Commission to amend the Italian National Recovery and Resilience Plan (PNRR), invoking Article 21 of Regulation (EU) 2021/241, which allows for amendments justified by objective circumstances. The proposed revision of the PNRR, approved by the PNRR Steering Committee on 26 September 2025, provided for a financial realignment of EUR14.15 billion (while maintaining the total budget of EUR194.4 billion), specifically regarding 34 measures (investments and reforms).

The Mediterranean Area

At present, within the framework of transnational inter-regional co-operation (such as the Interreg EURO-MED programme or other forms of co-operation), adaptation strategies and plans have not been developed for the Mediterranean area.

In July 2025, a regional meeting on climate change adaptation was held, during which experts from the Contracting Parties to the Barcelona Convention agreed on an updated Regional Climate Change Adaptation Framework (RCCAF) for the period 2026–2035, which calls for a strengthened regional response aimed at improving climate resilience in the Mediterranean’s coastal and marine areas.

It remains necessary for Italy to assume a new role in the Mediterranean area for co-operation in the actions necessary to tackle climate change, considering that due to its geographical position Italy is exposed both to direct impacts and to the consequences of these impacts in countries on the Mediterranean’s southern shores.

In this regard, on 2 January 2026, Italy deposited its instrument of ratification of the Protocol on Integrated Coastal Zone Management (ICZM) in the Mediterranean, which establishes a common framework for the integrated management of the Mediterranean coastal zone.

The Protocol entered into force for Italy on 1 February 2026, making Italy the 13 Contracting Party to the Barcelona Convention to ratify it.

Italy’s national climate change policy is determined by the multilateral and regional EU regime.

The EU regime sets out the objectives, standards and key strategies of the national legislation according to the evidence of climate change science.

To this end, the Joint Research Centre (JRC) served as the European Commission’s scientific and knowledge service. In addition, it participates in international programmes such as, among others, the Intergovernmental Panel on Climate Change (IPCC).

At a national level, the Ministry of the Environment and Energy Security (MASE) relies on the Higher Institute for Environmental Protection and Research (ISPRA), providing it with technical and scientific support.

In October 2022, MASE, in collaboration with ISPRA, launched the National Platform on Adaptation to Climate Change which aims to facilitate the exchange of information between the central government, local authorities and all stakeholders on the topic of climate change adaptation, thereby serving as the primary information resource in Italy on this issue.

Furthermore, since ratifying the Paris Agreement, the EU block has enacted an ambitious, binding, legislative framework for delivering on its initial NDC, updated on 16 October 2023, taking into account the “Fit for 55” legislative package with the scope to cut its net greenhouse gas (GHG) emissions by at least 55% by 2030 compared to 1990 levels.

Until recently, Constitutional case law had long recognised the environment as a fundamental value of the Italian legal system, on the basis of Articles 9, 32, and, more broadly, Article 2 of the Constitution, even though environmental protection was not expressly mentioned in the constitutional text.

With Constitutional Law No 1/2001, among other things, the regulatory competencies in the field of environmental and ecosystem protection have been attributed exclusively to the State (Article 117(2), letter s), Constitution).

It was only with Constitutional Law No 1/2022, however, that Articles 9 and 41 of the Italian Constitution were emended, expressly introducing environmental protection to the constitutional values.

The Article 9(3) of the Constitution now states that the Republic “protects the environment, biodiversity and ecosystems, also in the interests of future generations. State law regulates the types and forms of animal protection”. In its ruling No 105/2024, the Constitutional Court held that the government’s granting of extraordinary authorisation, without time limits, to keep the plant operating even though it was harmful to the environment, was contrary to Article 9 of the Constitution. Furthermore, the new reference to the principle of sustainable development opens up new scenarios for protecting future generations from climate change.

The environmental legal framework is mainly (but not only) set forth by Legislative Decree No 152/2006 (also known as the “Environmental Code” or “Environmental Consolidated Act” – ECA).

However, the ECA does not provide a specific discipline on combating climate change. Climate change regulation is instead implemented through a combination of EU law, sectoral legislation and strategic planning instruments.

Key national instruments include Decree-Law No 111/2019 (the “Climate Decree”), introducing urgent measures for climate policy co-ordination and air quality improvement, as well as budgetary measures establishing dedicated climate funding (ie, the Italian Climate Fund under Law No 234/2021, as amended).

At the strategic level, climate policy is framed by the Integrated National Energy and Climate Plan (Regulation (EU) 2018/1999), the Ecological Transition Plan (Article 57-bis ECA), and the National Action Plan for the reduction of GHG emission levels (Kyoto Protocol ratification No 120/2002), which support the implementation of Italy’s EU and international climate commitments.

Mitigation

Climate change mitigation in Italy is primarily driven by EU law and its national implementation.

The central instrument is the EU Emissions Trading System (EU ETS), transposed into Italian law by Legislative Decree No 47/2020. The ETS establishes a cap-and-trade system covering energy-intensive industries, power generation and aviation, accounting for approximately 40% of national GHG emissions. Operators are required to surrender emission allowances and comply with monitoring, reporting and verification obligations, subject to administrative penalties in case of non-compliance.

Non-ETS sectors are regulated under the Effort Sharing Regulation (Regulation (EU) 2018/842, as amended), which imposes binding annual emissions-reduction targets on member states. Italy is required to achieve a 43.7% reduction in emissions from non-ETS sectors by 2030 compared to 2005 levels.

Carbon pricing is therefore primarily achieved through the EU ETS, as Italy does not operate a standalone national carbon tax. The EU Carbon Border Adjustment Mechanism (CBAM) also applies indirectly to Italian operators as part of the EU framework.

Adaptation

Italy’s adaptation framework is based on the National Strategy on Adaptation to Climate Change (2015) and the National Adaptation Plan (2023), which operationalises and updates the Strategy into sector-specific measures.

Adaptation policies are mainstreamed across key sectors. In agriculture, measures aim to increase resilience to climate impacts through improved resource management and support for climate-resilient farming systems, also in the context of the Common Agricultural Policy Strategic Plan under Regulation (EU) 2021/2115.

In water management, the National Adaptation Plan identifies a set of priority measures focused on efficiency, risk prevention and non-structural (“soft”) adaptation interventions. Biodiversity protection is addressed through Italy’s Biodiversity Strategy aligned with EU objectives for 2030, aimed at restoring ecosystems and enhancing ecological resilience.

Flood risk and ecosystem protection are not regulated through a standalone adaptation framework but are addressed indirectly through water management planning, civil protection systems and broader environmental planning instruments.

Climate Considerations in Permitting

Climate change considerations are integrated into environmental assessment and permitting procedures.

Under Directive 2014/52/EU, as transposed into Part II of the ECA, Environmental Impact Assessments (EIAs) must consider both:

• the impact of projects on climate (including greenhouse gas emissions); and
• the vulnerability of projects to climate change.

Strategic Environmental Assessments (SEA) do not explicitly regulate climate change, but climatic factors are considered in practice through general environmental assessment requirements and national technical guidance.

In addition, the “Do No Significant Harm” (DNSH) principle under Regulation (EU) 2020/852 (EU Taxonomy) applies to relevant projects, including those financed under the NRRP, ensuring consistency with EU climate mitigation and adaptation objectives in permitting and authorisation procedures.

Political Developments and Potential Backlash

Italy generally remains aligned with EU climate policy objectives. However, recent legislative developments suggest increasing attention to the economic impact of decarbonisation measures on domestic industries.

In particular, Decree-Law No 21/2026, converted into Law No 49/2026, introduced a compensation mechanism related to the EU ETS. The measure may be subject to review by the European Commission under Article 108 TFEU as potential State aid, and appears aimed at mitigating the economic effects of carbon pricing on affected operators.

The following are the key policy, administrative, governance and regulatory authorities in Italy.

Ministry of Environment and Energy Security (MASE)

The government body in charge of environmental policies is the Ministry of Environment and Energy Security (Ministero dell’Ambiente e della Sicurezza Energetica – MASE). It is also responsible for issuing policy on climate change.

The MASE is formed of different Directions, such as the General Direction on European and International Activity (Direzione Generale attività europea e internazionale – DG AEI). The third division of the AEI is dedicated to “international strategies for sustainable development and the climate” and participates in all activities proposed by international authorities for combating climate change. It also supports the actions of the Special Envoy for Climate Change.

Institute for Environmental Protection and Research (ISPRA)

The MASE has a policy and supervisory role over the activities of the Institute for Environmental Protection and Research (Istituto Superiore per la Protezione e la Ricerca Ambientale – ISPRA). ISPRA is part of the National Network System for the Protection of the Environment (Sistema Nazionale di Protezione dell’Ambiente – SNPA), together with the Regional Agencies for the Protection of the Environment (Agenzie Regionali per la Protezione dell’Ambiente – ARPAs). As regards climate change, ISPRA’s tasks include issuing and updating climate statistics and indicators in Italy, and drawing up the emissions inventory, which is essential for verifying compliance with international climate targets.

ETS Committee

When it comes to regulatory authorities, an important role is played by the competent national authority for the implementation of the ETS. The ETS Committee is an inter-ministerial body composed of the MASE and the Ministries of Economic Development and Infrastructure, established by Legislative Decree No 216/2006. With the most recent ministerial decree of 17 January 2024, new rules for the operation of the ETS Committee were established.

Inter-Ministerial Committee for Economic Planning and Sustainable Development (CIPESS) and Inter-Ministerial Committee for Ecological Transition (CITE)

The CIPESS aims at updating the National Plan for the reduction of GHG emissions. Since October 2019, this Committee has been renamed by referring to sustainable development. Previously, it was known as the Inter-Ministerial Committee for Economic Planning.

The CITE is responsible for approving the Plan for Ecological Transition and has the task of co-ordinating national policies and all related plans.

Both the CIPESS and the CITE are composed of the President of the Council Ministers and the competent ministries.

On the Appropriateness Authorities and Bodies for Dealing With Climate Change

Overall, while the institutional architecture is comprehensive and technically robust – particularly in terms of monitoring and EU alignment – its effectiveness is mixed. Italy’s 2026 ISPRA projections (“Greenhouse Gas Emissions in Italy: Targets and Emission Scenarios”) confirm that, under current policies adopted up to 2022, Italy is not on track to meet its 2030 emissions reduction target (-43.7% v 2005 levels). Even including additional PNIEC measures, a significant gap remains.

In recent years, climate change litigation has become increasingly common. The aim of such litigation is to bind the state by a court ruling to fulfil its climate obligations and to order the public authority to compensate individuals for the damage caused by its failure to do so. Such litigation is usually brought by NGOs and citizens’ groups. In spring 2023, several NGOs sued a major Italian energy company, together with its main shareholders, demanding that it be held liable for the damage caused by climate change and ordered to reduce its greenhouse gas emissions. The court stayed the proceedings pending clarification from the Court of Cassation on jurisdictional issues, highlighting early procedural uncertainty in climate litigation.

This uncertainty has since been partially addressed. On 18 July 2025, the Joint Divisions of the Italian Court of Cassation issued a landmark order affirming, for the first time in a structured manner, the potential jurisdiction of Italian civil courts over climate-related claims, including actions seeking damages. The decision also provided important procedural guidance on admissibility and jurisdictional allocation in climate litigation.

At lower court level, the Civil Court of Piacenza (Order No 1439/2024), influenced by evolving European human rights jurisprudence, further expanded the conceptual basis for such claims. Following the April 2024 ruling of the European Court of Human Rights, the court held that environmental protection in the context of anthropogenic climate change necessarily includes climate change mitigation. It further recognised that the fundamental right to a healthy environment – linked to human dignity – encompasses a right to a livable climate, including both macro-climatic conditions and urban microclimates.

Overall, Italian climate litigation is still at an early but rapidly developing stage, with courts progressively clarifying jurisdictional foundations and expanding the substantive scope of environmental rights in line with European jurisprudential trends.

As an EU member state, Italy applies Regulation (EU) 2024/3012 establishing a Union certification framework for permanent carbon removals, carbon farming and carbon storage in products (Carbon Removal and Carbon Farming Regulation – CRCF).

Under the CRCF Regulation, carbon removals and soil emission reductions shall be eligible for certification where they are generated by an activity that complies with the quality criteria set out in its Articles 4 to 7, and as far as are independently verified. On this last point, in order to ensure harmonisation for the certification schemes provided at national level, the Commission has adopted Implementing Regulation (EU) 2025/2358 of 20 November 2025, laying down rules on certification schemes, certification bodies and audits under Regulation (EU) 2024/3012 of the European Parliament and of the Council.

Further, at a national level, the Ministry for Agriculture and Ministry for Environment have adopted Joint Decree 15 October 2025, which sets up guidelines for the implementation of a National Public Carbon Credit Registry. The Registry is administered by the National Council for Agricultural Research and Analysis of Agricultural Economics (Consiglio nazionale per la ricerca in agricoltura e l’analis dell’economia agraria – CREA).

The Italian jurisdiction intends to participate in the carbon market evolving under Article 6 of the Paris Agreement.

It may be assumed that the most relevant future developments will concern:

• the EU ETS, which will be extended to other sectors such as maritime, construction and road transport; and
• the implementation of the Carbon Border Adjustment Mechanism (CBAM), adopted by the Regulation (EU) 2023/956.

The CBAM is a mechanism designed to put a fair price on carbon emissions generated during the production of carbon-intensive goods entering the EU, with the aim of also promoting cleaner industrial production in third countries.

At first, the CBAM will only apply to a selected number of goods at high risk of carbon leakage – iron and steel, cement, fertiliser, aluminium and electricity generation – to be gradually extended to other goods.

Under the Regulation, importers of goods subject to the CBAM (or their indirect customs representatives) are required to apply for the status of authorised CBAM declarants, in addition to complying with a number of other obligations.

On 3 July 2025, the Commission announced a plan aimed at mitigating the risk of carbon leakage for exporters. The goal is to support producers of goods exposed to this risk and ensure equal treatment for all goods, whether they are produced and sold in the EU, imported into the EU or exported.

According to Dossier No 61 of 18 February 2022, prepared by the Italian Chamber of Deputies, Italy is one of the member states with the highest percentage of imports in the CBAM sectors, with 26.6% for steel, 3.7% for cement, 7.3% for fertilisers and 19% for aluminium. Considering that, it can be assumed that this may cause an increase of the prices of imported goods belonging to the categories subject to the CBAM Regulation.

However, recently, Italy has asked the European Commission for the immediate retroactive suspension of the CBAM – the Carbon Border Adjustment Mechanism, set to take effect on 1 January 2026 – for certain sectors. This is because the situation has been exacerbated by the war in the Middle East and the resulting rise in gas prices, as well as difficulties in importing certain goods.

Sustainability Reporting Mechanism

Under the Corporate Sustainability Reporting Directive (CSRD), companies shall comply with to European Sustainability Reporting Standards (ESRS). CSRD provisions apply from the 2024 financial year, for reports published in 2025. Italy has implemented the CSRD through Legislative Decree 6 September 2024, No 125.

More recently, Directive (EU) 2026/470 amended, among other instruments, Directive 2013/34/EU and the CSRD, with the aim of reducing compliance burdens on companies. The reform seeks, on the one hand, to reduce the number of companies subject to reporting requirements and, on the other hand, to streamline the information to be included in sustainability reports.

National Policy

The TCFD has scarcely influenced the Italian legal system. Instead, this has occurred mainly via EU law. In 2017, the TCFD issued its first recommendations, which were implemented by the European Commission via the “Guidelines on non-financial reporting” (Communication 2017/C 215/01). Regulation (EU) 2019/2088 (the “Sustainable Financial Disclosure Regulation” – SFDR), Regulation (EU) 2020/852 (the “Taxonomy Regulation”) and Directive (EU) 2024/1760 on corporate sustainability due diligence (the so-called “CSDDD”) may be considered as (indirect) implementations of such non-binding tools. It is noteworthy that EU institutions have implemented TCFD recommendations through regulation – ie, self-executing acts.

Prior to such recommendations and regulations, the EU co-legislature issued the Non-financial Reporting Directive (EU) 2014/95 (NFRD), amending Directive (EU) 2013/34 (the “Accounting Directive”) which has been transposed into Italian legislation by Legislative Decree No 254/2016. At the regulatory level, Italian institutions have appeared more prompt to embrace TCFD guidelines autonomously.

For instance, the National Institute for the Supervision of Insurance (Istituto per la Vigilanza sulle assicurazioni – IVASS) issued Regulation No 38/2018 on the system of governance of insurance undertakings and groups. Regulation No 38/2018, among other provisions, aims at rationalising the existing regulatory framework; it also introduced new provisions relating to social and environmental factors in the definition of the strategic plan and the activities of insurance undertakings. In particular, Article 4(2) establishes that the controls relating to the corporate governance system shall cover each type of corporate risk, including those of an environmental and social nature, “generated or borne”. Article 47(2)(b) also stipulates that those undertakings may introduce remuneration systems, for the variable component, based on non-financial indicators, such as criteria based on social and/or environmental performance or the management of customer service.

Further, the 2024 Report on Non-Financial Reporting by Italian Listed Companies (published in July 2025), prepared by the National Commission for Companies and the Stock Exchange (CONSOB), reported that many companies had also followed the TCFD guidelines on the disclosure regarding climate-related risks and opportunities.

It is difficult to assess the impact of the influence of civil society on investment and industrial operational decisions. However, according to the Bank of Italy’s Occasional Paper No 545/2020 and the subsequent action plans adopted in 2025, so far there has been little growth in awareness of the risks linked to climate change and the opportunities linked to the transition towards a low-carbon economy.

Italian legislation does not provide for a specific form of liability related to the impacts of climate change. National legislation only includes some provisions, relating either to civil/administrative or criminal liability in cases of significant adverse impacts on certain natural resources (respectively, liability for environmental damage and for environmental criminal offences). With regard to climate change litigation, the Civil Court of Rome recently held inadmissible an action brought by some environmental NGOs to declare the civil liability of the Italian state for failing to properly fulfil its international obligations under the Paris Agreement. The Court dismissed the lawsuit as it has no jurisdiction to hear the case insofar as it concerned the exercise of political or administrative discretion.

The Environmental Liability Directive 2004/35/EC (ELD) was transposed into national legislation by the ECA (see Articles 298-bis–318). “Environmental damage” means a measurable adverse effect on:

• protected species and natural habitats;
• water, including marine waters; and
• land (Article 300 ECA).

On the other hand, pursuant to Criminal Code Articles 452-bis and ff, the scope of environmental criminal liability is broader, since the criminal offences provided therein also encompass harm to air and ecosystems.

Environmental liabilities for damages as well as for criminal offences are thus not specifically referred to in climate change legislation. That said, both may be deemed as protecting some of the natural resources encompassed by climate change legislation.

Civil Liability

As regards directors’ liability for the impact on climate change of their companies, the ordinary provisions of the Italian Civil Code shall apply. Pursuant to Civil Code Articles 2392 and 2476, companies’ directors may be held liable for negligence in complying with their (occupational) duties. Therefore, directors may only be convicted for the negative impact their companies have on climate change where such impact results from negligence.

Pursuant to ECA Article 311(2), operators may be held liable for environmental damage. ECA Article 302(4) provides for a broad definition of “operator”. It encompasses “any natural or legal, private or public person who operates or controls the occupational activity having environmental significance or to whom decisive economic power over the technical functioning of such an activity has been delegated, including the holder of a permit or authorisation for such an activity or the person registering or notifying such an activity”. Directors, often jointly with the company, may thus be held liable pursuant to the ECA (Articles 298-bis and ff), where the above-mentioned requirements provided for by Civil Code Articles 2392 and 2476 are met.

Criminal Liability

Criminal environmental liability is strictly personal. Traditionally, legal entities shall not be held liable for criminal offences (societas delinquere non potest); only directors, or the other natural person who took the relevant decision(s), shall be held liable for criminal offences committed by the company. However, under Legislative Decree No 231/2001, even legal entities, where they are not able to demonstrate that specific organisational measures have been adopted, may be held liable for a number of criminal offences (including environmental offences) committed in their interest or to their advantage by their directors or by another natural person exercising, even de facto, management and control over them.

Infrastructure investments and/or financing arrangements capable of producing negative climate change impacts may become relevant under corporate social responsibility (CSR) law. Legislative Decree No 231/2001 embodies a CSR instrument, as it pushes companies to adopt organisational measures to prevent the commission of certain criminal offences, including environmental offences (even though these are not criminal offences specifically related to climate change).

For environmental civil liability (ECA Articles 298-bis and ff), shareholders and parent companies may be held liable where:

• they fall within the definition of “operator” provided for by ECA Article 311(2) and (b); and
• their conduct causes environmental damage pursuant to ECA Article 300.

Under the Civil Code, shareholders may only be held liable for damages caused by the company pursuant to ECA Articles 298-bis and ff where they are unlimitedly liable for the acts of the company (ie, where that company is a partnership). For criminal environmental offences, shareholders may be held liable where their personal conduct constitutes a criminal offence, in accordance with the principle of personal criminal liability.

For parent companies, pursuant to Civil Code Article 2497-ter, every decision taken by the subsidiary company in accordance with the parent company’s directives should be analytically motivated and contain precise indications of the reasons and interests whose evaluation affected the decision. Consequently, in so far as it is ascertained that the environmental damage caused by the subsidiary company was due to a directive from the parent company, the latter may be held liable. Similarly, in the case of an environmental criminal offence caused by a subsidiary company due to a directive from a parent company, even the latter may be held criminally liable pursuant to Legislative Decree No 231/2001.

In recent years, climate change litigation has become increasingly common. The aim of such litigation is to bind the State by a court ruling to fulfil its climate obligations and to order the public authority to compensate individuals for the damage caused by its failure to do so. Such litigation is usually brought by NGOs and citizens’ groups. In spring 2023, several NGOs sued a major Italian energy company, together with its main shareholders, demanding that it be held liable for the damage caused by climate change and ordered to reduce its GHG emissions.

Unlike France or Germany, Italy has not implemented any specific legislation on environmental due diligence.

The Bank of Italy’s Occasional Paper No 545/2020 has highlighted that, so far, there has not been adequate growth in the awareness of the risks linked to climate change and the opportunities linked to the transition towards a low-carbon economy.

Between May and July 2025, the Bank of Italy continued its efforts to highlight best practices and share insights through a series of publications, including action plans on integrating climate and environmental risks into the business processes of large systemically important institutions (LSIs) and non-bank intermediaries.

Despite this, even at a transaction level, climate-related financial risk (CRFR) disclosure is still unsatisfactory.

However, these issues are not limited to Italy. The Directive (EU) 2024/1760 on corporate sustainability due diligence (the so-called “CSDDD”) was adopted in response to concerns that voluntary action had not produced sufficient progress across a number of sectors and jurisdictions.

Italy has not yet adopted the provisions necessary to transpose the directive, which must be implemented by 26 July 2028.

The directive, as amended by Directive (EU) 2026/470, aims to ensure that large companies operating in the European market contribute to the economic and social transition toward sustainability by adopting “due diligence measures” designed to prevent and, where possible, eliminate the adverse impacts on human rights and the environment resulting from their activities and the value chains in which those activities are embedded.

At a national level, companies conducting environmental due diligence currently are concerned with general environmental legislation. To such extent, not every component is to be considered as strictly related to climate change. Typically, climate change-related issues may include:

• IPPC/industrial emissions permits;
• environmental impact assessment/strategic environmental assessment;
• air pollution, brownfield sites, waste, etc; and
• renewable energy/energy efficiency.

Renewable Energy Policy

At a policy level, the government, in accordance with the Italian Integrated National Energy and Climate Plan (PNIEC), is committed to a new approach in resource and environmental management with a focus on aspects of energy security, self-production and consequent resilience. Consistent with its commitment to reduce GHG emissions by 2030, Italy is committed to a transition towards renewable energy sources (including biofuels and hydrogen), to the energy efficiency of its infrastructure and to the adoption of smart technologies aimed at energy efficiency and resilience in a cybersecurity framework.

The PNIEC is structured into five lines of action, which will be developed in an integrated manner: from decarbonisation to energy efficiency and security, through to the development of the internal energy market, research, innovation and competitiveness. The goal is to create a new energy policy that ensures the full environmental, social and economic sustainability of the national territory.

Renewable Energy Legislation

The main piece of legislation for renewable energy is currently Legislative Decree No 199/2021 (hereinafter “Renewable Energy Decree II”). It transposes into the national legal order the Renewable Energy Directive (EU) 2018/2001 (RED II). In 2024, Renewable Energy Decree II provisions on permitting were extensively amended by Legislative Decree No 190/2024, which now encompasses the renewable energy plants permitting legal framework.

Renewable Energy Regulation

Regulation for the renewable energy sector is structured into two types of instruments.

Permitting procedures mainly encompassed by Legislative Decree No 190/2024

The related competence is assigned to regional authorities. Such procedures were already regulated within Legislative Decree No 387/2003 and Renewable Energy Decree I, both amended by Renewable Energy Decree II. The administrative procedures for granting renewable energy plant permits aim at ensuring proportionality, transparency and simplification. Pursuant to Article 11-quaterof the Legislative Decree No. 190/2024, procedures for the installation of plants in suitable areas are provided with further simplification tools. Moreover, specific provisions are devoted to the procedure for the installation of biofuel production plants.

Furthermore, Legislative Decree No 190/2024 has rationalised the permitting legal framework. It lays down three legal schemes, each of them applied to different kind of interventions: open activities scheme, without prior notification nor written authorisation; simplified authorisation scheme, where the applicant may initiate the activity 30 days after having submitted a communication to the competent authority; single authorisation scheme, for interventions that need a prior written authorisation issued by the competent authority. Under the simplified authorisation scheme, competent authority is the municipality; under the single authorisation scheme competent authority may be the regional authority or MASE, depending on the intervention.

A regulatory framework is provided for the financial incentivisation of the production of renewable energy

In this context, Ministerial Decree of 30 December 2024 (so-called “FER X”) has introduced a new support scheme for renewable energy technologies based on competitive auction procedures, with differentiated incentive levels depending on the technology and project characteristics. Alongside this new mechanism, the existing incentive framework has been rationalised by Renewable Energy Decree II. The most important incentive instruments are the following.

• “Green certificates” – companies producing or importing electricity from non-renewable sources must feed into the grid an amount of energy produced by plants fuelled by renewable sources. Green certificates were introduced by Legislative Decree No 79/1999 Article 11, but are now replaced by a new form of incentive provided for by Ministerial Decree of 6 July 2012.
• “All-inclusive tariff” (introduced by Law No 244/2007 and amended by Law No 99/2009) – unlike certificates allocated on the basis of energy produced, the tariff is recognised only for the amount of energy actually fed into the grid, excluding the portion possibly intended for self-consumption.
• “Energy account” – specifically dedicated to photovoltaic energy and introduced by Legislative Decree No 387/2003, it is based on the granting of an incentive for the amount of energy produced (therefore also self-consumption, like the green certificates, but unlike the all-inclusive tariff).

The Italian jurisdiction provides other regulatory instruments and support for the uptake of other forms of climate-friendly investment. In particular, national policy makers are paying attention to mobility issues and photovoltaic energy.

At a policy level, the Italian mobility strategy hinges, in line with the European Green Deal, on the development and enhancement of sustainable forms of transport, both private and public, as well as of sustainable freight logistics, in order to reduce pollutant and CO₂ emissions.

Recently, the so-called PNRR Decree 3 (Decree-Law No 13/2023) establishes an easier permitting regime for photovoltaics, identifies areas suitable for the installation of plants powered by renewable energy sources more widely and establishes a new perimeter for free building interventions and interventions without Environmental Impact Assessment (EIA) until 2024.