Italy Power Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

The Italy Power Market Report is Segmented by Power Generation From Source (Thermal and Renewable Power), End-Users (Utilities, Commercial and Industrial, and Residential), and Power Transmission and Distribution (Qualitative Analysis Only). The Market Sizes and Forecasts are Provided in Terms of Installed Capacity (GW).

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Italy Power Market Size and Share

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Italy Power Market Analysis by Mordor Intelligence

The Italy Power Market size in terms of installed base is expected to grow from 144.86 gigawatt in 2025 to 182.54 gigawatt by 2030, at a CAGR of 4.73% during the forecast period (2025-2030).

The expansion is anchored in rapid renewable energy deployment, grid-modernization spending of EUR 23 billion through 2030, and deliberate diversification away from Russian gas. Renewable generation satisfied a record 41.2% of national electricity demand in 2024, led by a 19.3% surge in solar output and a 30.4% rebound in hydro generation.[1]Terna S.p.A., “2024 Market Outlook,” terna.it Natural gas remains the dominant dispatchable resource, but streamlined permitting under Legislative Decree 199/2021 and corporate power-purchase agreements are accelerating photovoltaic additions. Grid-scale battery auctions scheduled for September 2025 will unlock 9 GW of storage by 2030, further supporting intermittent renewables. Persistently high wholesale prices—143.03 EUR/MWh in January 2025—underscore the urgency of supply diversification and cost-stable renewables.[2]Mercato Elettrico, “PUN Prices January 2025,” mercatoelettrico.org

Key Report Takeaways

  • By generation source, thermal power retained 59% of Italy's power market share in 2024, while renewables are set to record a 5.32% CAGR through 2030.
  • By end-user, the utilities segment led with 68.12% revenue share in 2024, whereas the residential segment is projected to advance at a 12.89% CAGR between 2025 and 2030.
  • Enel, Edison, A2A, and ERG collectively accountedfor a major share of generation capacity in 2024, reflecting a moderately concentrated competitive landscape.

Segment Analysis

By Power Generation Source: Gas Dominance Amid Solar Acceleration

Thermal power generation controlled 59% of Italy's power market size in 2024, supplying flexible baseload and balancing services.[4]Politecnico di Torino Energy Center, “Italy’s Gas Dependency Update 2024,” energycenter.polito.it Renewable, while accounting for roughly 41% of generation, is expanding fastest at a 5.32% CAGR through 2030 under declining module prices and streamlined permitting. Hydroelectric contribution rebounded to 35% of renewable output after wetter 2024 conditions, and wind reached 20% of renewable capacity with significant offshore upside. Coal slipped to 1.3% of total production and will exit by 2025.

Solar’s growth owes much to corporate PPAs and utility-scale projects, yet price cannibalization drives Enel to tilt its new-build mix toward 5.7 GW of wind versus 3.2 GW of solar by 2027. Biomass and geothermal provide baseload renewable capacity, which is increasingly valuable as coal retires and gas costs rise. The Italy power market share of dispatchable gas may decline beyond 2028 as storage and demand-response scale, but its role remains pivotal until HVDC links and batteries neutralize intermittency.

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Note: Segment shares of all individual segments available upon report purchase

By End-User: Utilities Leadership with Residential Momentum

The utilities segment held 68.12% Italy's power market share in 2024, reflecting control of large generation fleets and regulated distribution franchises. Residential demand, however, is forecast to post a 12.89% CAGR between 2025 and 2030, the fastest among customer classes. Distributed rooftop solar, community energy schemes, and electrified heat pumps drive this surge. Corporate PPAs exceeding 4 GW by 2025 illustrate commercial-industrial appetite for direct renewable procurement.

Market liberalization moved 4.5 million regulated customers to competitive supply in 2024, opening share gains for digital multi-utilities. The Superbonus 110% incentive ended in February 2023, but left a legacy of 1 GW of residential storage installations that enhance self-consumption. Energy Release 2.0 allows energy-intensive firms to secure 36-month 65 EUR/MWh contracts, boosting industrial competitiveness while mandating renewable additions. Utilities are responding with vertical integration and smart-meter rollouts to defend margins in an increasingly prosumer-centric Italy power market.

Italy Power Market: Market Share by End-User
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Note: Segment shares of all individual segments available upon report purchase

Geography Analysis

Southern Italy possesses abundant solar irradiation and onshore wind resources, generating surplus renewable electricity yet facing transmission bottlenecks that widen regional price spreads. Sicily and Sardinia rely on the Tyrrhenian Link to evacuate excess generation and import mainland support during low-output periods, a step that should cut curtailment once the cable becomes operational by 2030. Apulia hosts Italy’s densest cluster of utility-scale solar and wind projects, but grid congestion defers commissioning by at least 36 months, diluting developer returns.

Central Italy benefits from legacy hydro reservoirs that provided stability during the 2022-2023 drought and boosted output by 30.4% in 2024. These plants support frequency regulation essential for integrating more intermittent generation across the Italy power market. Northern regions remain consumption-heavy due to industrial clusters in Lombardy, Veneto, and Emilia-Romagna. Administrative efficiency enables faster permitting, explaining why rooftop PV adoption under the Superbonus program skewed north. Nonetheless, limited land availability and stricter landscape constraints slow large-scale renewables north of the Po River.

Coastal zones along the Adriatic and Tyrrhenian seas show emerging offshore wind pipelines such as Med Wind’s floating project. Delays in maritime spatial planning and EIA procedures hinder near-term capacity, but successful FER2 CfDs could accelerate build-out post-2027. Cross-border interconnections with France, Switzerland, Slovenia, and Tunisia will raise import-export flexibility from 16 GW to 39 GW, positioning the Italy power market as a Mediterranean trading hub and lowering reliance on pipeline gas.

Competitive Landscape

Italy's power market competition is moderate, with the top five generators holding roughly more than 50% capacity in 2024. Enel retained leadership despite a 17.4% revenue dip to EUR 78.947 billion, stemming from lower thermal dispatch and liberalized retail churn. Terna leverages its regulated-asset base to invest more than EUR 3 billion annually in grid upgrades, underpinning national energy security. Edison, A2A, and ERG pursue vertical integration and renewable expansion to offset margin pressure from volatile wholesale prices.

Digital entrants like eVISO apply AI-driven demand forecasting to win SME customers, projecting 40% CAGR in gross margins through 2027. Partnerships are reshaping strategy: Sosteneo and Enel agreed in June 2024 to deploy 1.7 GW of battery storage, underscoring storage as the next battleground. Italgas's EUR 5.8 billion purchase of 2i Rete Gas expands its gas-distribution footprint and highlights continued consolidation. White-space opportunities lie in hydrogen electrolysers, community energy management, and behind-the-meter storage, where regulatory incentives favor nimble developers over incumbents burdened by legacy assets.

Competitive intensity is also shaped by the January 2024 price-cap removal for 4.5 million households, prompting utilities to bundle broadband, EV charging, and rooftop-PV leasing into hybrid offerings that enhance stickiness. International oil majors like TotalEnergies entered through the EUR 1.57 billion acquisition of VSB Group to diversify away from hydrocarbons. These moves signal a pivot toward integrated, low-carbon portfolios in Italy's power industry.

Italy Power Industry Leaders

  1. Enel SpA

  2. Edison SpA

  3. A2A SpA

  4. ERG SpA

  5. Terna SpA

  6. *Disclaimer: Major Players sorted in no particular order
Enel SpA, Engie SA, PLT Energia SRL, ERG SpA, Electricite de France SA.
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Recent Industry Developments

  • February 2025: Cable laying began on the Tyrrhenian Link, the 1,000 MW HVDC project linking Sicily, Sardinia, and mainland Italy.
  • December 2024: TotalEnergies bought VSB Group for EUR 1.57 billion, adding 3 GW managed Italian assets and 18 GW pipeline.
  • December 2024: SUSI Partners acquired full control of Genera Group, deepening its renewable services presence.
  • July 2024: Sosteneo and Enel signed a 1.7 GW battery storage partnership.

Table of Contents for Italy Power Industry Report

1. Introduction

  • 1.1 Study Assumptions & Market Definition
  • 1.2 Scope of the Study

2. Research Methodology

3. Executive Summary

4. Market Landscape

  • 4.1 Market Overview
  • 4.2 Market Drivers
    • 4.2.1 Accelerated Permitting Reforms under Legislative Decree 199/2021
    • 4.2.2 Grid-scale Battery Capacity Market Auctions (Terna)
    • 4.2.3 Coal Phase-out by 2025 Creating Capacity Gap
    • 4.2.4 REPowerEU-funded HVDC Projects (e.g., Tyrrhenian Link)
    • 4.2.5 Corporate PPAs Surge among Luxury & FMCG Majors
    • 4.2.6 Superbonus 110 % Stimulus for Rooftop PV
  • 4.3 Market Restraints
    • 4.3.1 Grid Congestion in Apulia & Sicily (≥36-month Delays)
    • 4.3.2 Offshore Wind Tender Under-realisation (Adriatic)
    • 4.3.3 Gas-Import Exposure to Geopolitical Shocks (~90 %)
    • 4.3.4 Landscape-related Permit Litigation for Wind Farms
  • 4.4 Italy Renewable Energy Mix, 2024
  • 4.5 Regulatory Outlook
  • 4.6 Technological Outlook (Digitalisation, HVDC, Storage)
  • 4.7 Porter's Five Forces
    • 4.7.1 Bargaining Power of Suppliers
    • 4.7.2 Bargaining Power of Buyers
    • 4.7.3 Threat of New Entrants
    • 4.7.4 Threat of Substitutes
    • 4.7.5 Competitive Rivalry
  • 4.8 PESTLE Analysis

5. Market Size & Growth Forecasts

  • 5.1 Power Generation by Source
    • 5.1.1 Thermal Power (Natural Gas, Oil, Coal)
    • 5.1.2 Renewable Power (Solar, Wind, Hydro, Geothermal, etc)
  • 5.2 By End-User
    • 5.2.1 Utilities
    • 5.2.2 Residential
    • 5.2.3 Commercial and Industrial
  • 5.3 Power Transmission & Distribution (Qualitative)

6. Competitive Landscape

  • 6.1 Market Concentration
  • 6.2 Strategic Moves (M&A, Partnerships, PPAs)
  • 6.3 Market Share Analysis (Market Rank/Share for key companies)
  • 6.4 Company Profiles (includes Global level Overview, Market level overview, Core Segments, Financials as available, Strategic Information, Products & Services, and Recent Developments)
    • 6.4.1 Enel SpA
    • 6.4.2 Terna SpA
    • 6.4.3 Edison SpA
    • 6.4.4 A2A SpA
    • 6.4.5 ERG SpA
    • 6.4.6 Acea SpA
    • 6.4.7 Sorgenia SpA
    • 6.4.8 Hera Group
    • 6.4.9 Eni Plenitude
    • 6.4.10 ENGIE SA (Italy)
    • 6.4.11 Renantis (Falck Renewables)
    • 6.4.12 Vestas Wind Systems A/S
    • 6.4.13 Siemens Gamesa Renewable Energy SA
    • 6.4.14 Prysmian Group
    • 6.4.15 Sonnedix Power Holdings Ltd
    • 6.4.16 SunPower Corporation
    • 6.4.17 RWE Renewables Italia
    • 6.4.18 Iberdrola Renovables Italia
    • 6.4.19 InterGen SpA
    • 6.4.20 PLT Energia SRL

7. Market Opportunities & Future Outlook

  • 7.1 White-space & Unmet-Need Assessment
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Italy Power Market Report Scope

The scope of the Italian power market report includes:

Power Generation by Source Thermal Power (Natural Gas, Oil, Coal)
Renewable Power (Solar, Wind, Hydro, Geothermal, etc)
By End-User Utilities
Residential
Commercial and Industrial
Power Generation by Source
Thermal Power (Natural Gas, Oil, Coal)
Renewable Power (Solar, Wind, Hydro, Geothermal, etc)
By End-User
Utilities
Residential
Commercial and Industrial
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Key Questions Answered in the Report

What is the current size of the Italy power market?

Italy power market size reached 137.53 GW in 2024 and is projected to climb to 182.54 GW by 2030 at a 4.73% CAGR.

Which generation source holds the largest share of the Italy power market?

Natural gas is dominant with 45-50% Italy power market share in 2024, reflecting its role in balancing intermittent renewables.

How fast is solar growing in Italy’s power sector?

Solar photovoltaic capacity is forecast to grow at a 10-11.5% CAGR through 2030, the fastest among generation sources.

What infrastructure projects are critical for grid reliability?

Key projects include the 1,000 MW Tyrrhenian Link HVDC cable and Terna’s EUR 23 billion grid-modernization plan, both essential for north-south power flows.

How will the coal phase-out affect supply security?

Retiring 7 GW of coal by 2025 creates a short-term capacity gap filled by new gas turbines and accelerated renewable plus storage additions.

Who are the leading companies in the Italy power market?

Enel, Edison, A2A, ERG, and Terna are the principal players, together controlling roughly 55% of generation and transmission assets.

Page last updated on: July 4, 2025

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