Introduction
The European Union has followed a recurring pattern of economic crises interspersed with Keynesian measures. Mario Draghi’s 'Whatever it takes' speech kicked off the money printing to soothe the debt troubles of the PIGS countries. What’s wrong with Keynesian measures?
They are financed by:
• taxes
• debt
The sectors of the economy that receive the monetary injection might benefit from it while the rest of the taxpayers bear the burden in the form of:
• higher fiscal pressure,
• inflation
December 2018
The EU Directive 2018/2001, known as the Renewable Energy Directive (RED II), set some targets for “renewable” energy consumption for all member states
The directive included recommendations to facilitate the permitting of large-scale renewable farms and was presented as a measure to reduce greenhouse gas emissions, despite the fact that these had already been declining since the 1990s due to the deindustrialization of the Eurozone.
However, emissions did not disappear overnight — they were simply relocated elsewhere and, in fact, increased significantly worldwide.
January 2021
While the QE money printer was still humming, Mario Draghi found a job as the Italian Prime Minister. The pandemic crisis made it more acceptable for member states not only to copy the PIGS policies but to become one of them. Thus came the National Recovery and Resilience Plan.
Massive amounts of debt liquidity could now flood the economy — Draghi just needed to find suitable injection points. The pharmaceutical industry had already had its share. The defense industry was thriving thanks to the war in Ukraine.
November 2021
What better moment to promulgate Decree 199, which “simplified” permitting procedures for renewables — effectively supporting expropriations of private land for the “common good”.
The key concept of Draghi’s decree lies in the definition of suitable and unsuitable areas:
• Suitable surfaces and areas zones where an accelerated and simplified process is foreseen for constructing and operating renewable energy plants and related infrastructure.
• Unsuitable surfaces and areas zones whose characteristics are incompatible with the installation of certain types of plants.
We are neither able nor interested in analyzing the legal validity of the norm. But we can still analyze it in the light of logic, using the elementary set theory.
By definition, the Set of Suitable Areas is the complement of the Set of Unsuitable Areas. Formally:
Set of Suitable Areas = ¬(Set of Unsuitable Areas)
This means any given area A can belong either to the Suitable Areas set or to its complement (the Unsuitable Areas set), but not both simultaneously. This represents an exclusive or (XOR) relationship:
A ∈ Suitable Areas ⊕ A ∈ ¬(Suitable Areas)
Hence, if:
A ∈ ¬(Suitable Areas) is TRUE
then automatically:
A ∈ Suitable Areas is FALSE
In summary:
If A ∈ ¬(Suitable Areas) is true, then A ∈ Suitable Areas is false.
However, the decree also states:
“Areas not included among the suitable areas cannot be declared unsuitable for the installation of renewable energy production plants, either in territorial planning or in individual procedures.”
Let’s analyze this logically:
For the above statement to be true, both of the following must hold (logical AND):
A ∉ Suitable Areas is TRUE
A ∉ ¬(Suitable Areas) is FALSE
If A ∉ Suitable Areas is true, it means area A is not in the suitable areas.
If at the same time A ∉ ¬(Suitable Areas) is false, it means area A is in the complement of suitable areas (i.e., the “unsuitable areas” set).
Since by definition the Unsuitable Areas set is the complement of the Suitable Areas set, this is a logical contradiction. An area cannot simultaneously be outside and inside the Suitable Areas set.
Therefore, the two statements cannot both be true for the same area A, unless one accepts that:
FALSE = TRUE
May 2022
Draghi’s DL50-2022 simplifies permitting for renewable energy projects through several key measures:
- Consolidation of multiple authorizations into a single unified procedure that covers environmental and urban planning.
- 120-day deadline for granting authorizations for urgent energy infrastructure
- Council of Ministers can expedite approval and bypass the usual environmental impact assessment (VIA) process.
- Ministry of Culture to reduce subjective delays through the used of uniform criteria.
This was the beginning of a true gold rush: energy companies proposed over 54 GW of onshore and offshore wind and solar projects in Sardinia. Now, huge scale energy production projects could escape from industrial areas and land close to archeological and heritage sites, coastlines.
TERNA (a public company owned by the government’s Cassa Depositi e Prestiti) commissioned new HVDC lines (e.g., the Tyrrhenian Link) and upgrades of existing ones to remove transmission bottlenecks and access new energy markets like Sicily.
March 2024
They say 2024 was the hottest year ever known.
Alessandra Todde, former Deputy Minister of Economic Development in Draghi’s italian government, was elected President of the Sardinia Region — because when you start a job, you have to finish it.
June 2024
The Italian DM21 “FER2” introduced the “burden sharing” mechanism, setting a national target of 80GW of renewable energy production capacity to be achieved by 2030. Quotas were assigned to each Italian region and Sardinia (6.2 GW)
Instead of basing quotas on actual, declining energy consumption or promoting local generation close to dispatch points, the assignments were entirely arbitrary.
Currently, Sardinia has consumption peaks of approximately 1GW but a production capacity of about 3.6 GW:
- Sarlux (IGCC): 575 MW – provides roughly 47% of Sardinia’s electricity (around 4,000 GWh/year) in Sarroch Plant.
- Coal: ~900 MW – Fiumesanto and Portovesme Plants
- Hydro: ~250 MW
- Solar: ~1,800 MW
- Wind: ~1,800 MW
Three HVDC links transport the surplus production to mainland Italy and Corsica:
- SAPEI
- SACOI
- SARCO
DM 21 “FER2” was accompanied by old and new incentive mechanisms:
- An auction system where winners receive guaranteed tariffs up to specific caps (e.g., €105/MWh for offshore floating PV, €90/MWh for inland floating PV, and €300/MWh for solar thermodynamic systems).
- “White certificates” — energy efficiency credits that fossil fuel producers are forced to buy from “green” companies — even though the same entities often own both industries.
How to finance all of this?
- National Recovery and Resilience Plan (public debt and taxes).
- “ARIM and ASOS components of electricity bills (more taxes, tariffs, inflation).
July 2024
Todde’s government took 4 months to approve an 18 month moratorium for all renewable projects. Her Italian bosses did not like that and lapsed the initiative.
October 2024
Several committees opposing “energy speculation” gathered 210,054 signatures supporting a popular initiative bill called Pratobello24, aimed at using residential, industrial, and commercial rooftops for solar panels to reach the 6.2 GW target.
December 2024
Instead of supporting Pratobello24 initiative, The italian government of Sardinia, cobbled together its Law 20/2024 in two months only.
That consisted of a liability waiver for mayors, in charge to identify expendable areas sacrificed to the gods of green transition.
October 2024
As expected, Law 20/2024 — flawed by design — was rejected by the Constitutional Court. But surely, it achieved the goal of blocking Pratobello24.
Now
Some now describe the current situation as a “regulatory void” where companies are racing against time to get their projects approved. Yet, as seen above, the reality is not an absence of regulation — but an excess of it, combined with suffocating incentives that fuel taxpayer-subsidized appropriation of private property.