Energy & Sustainability Newsletter No. 13

Baker McKenzie just released the second edition, updated and with new chapters, of its PVR Guide. This is a one-of-its-kind resource, that allows comparison between the plant variety protection...

Energy & Sustainability Newsletter No. 13

Baker McKenzie releases the second edition of the first multi-jurisdiction guide on the protection of new plant varietiesBaker McKenzie just released the second edition, updated and with new chapters, of its PVR Guide. This is a one-of-its-kind resource, that allows comparison between the plant variety protection frameworks in 27 countries across the world (including Italy, EU, USA, Brazil, China, Australia), for the first time in one single tool and in English.Industrial Property Code: approved new draft law simplifying the procedure for granting new plant varietiesThe draft law (disegno di legge) approved by the Council of Ministers on 6 April 2022 is the first result of the strategic intervention lines on industrial property for the period 2021-2023, as defined by the Ministry of Economic Development, and is part of the strategic intervention on industrial property foreseen in the National Recovery and Resilience Plan.Article 12 of the draft law has amended Article 170 of the Industrial Property Code (Legislative Decree No. 30 of 10 February 2005) to simplify the procedure for granting new plant varieties.EIB and Florimond Desprez sign EUR 40 million loan agreement to finance research into new climate change-resistant crop varietiesThe European Investment Bank and Florimond Desprez Group have announced, with the European Commission's support, the signing of a EUR 40 million loan agreement to fund research, development and innovation activities focusing on breeding new crop varieties capable of coping with changes in agro-climatic conditions.In order to promote sustainable agriculture and counteract climate change, these new plant varieties will reduce the environmental footprint of farming and, at the same time, safeguard agricultural yields as well as the margins and viability of businesses in the sector.This partnership is set up under the European Fund for Strategic Investments (EFSI), the central pillar of the Investment Plan for Europe, which provides first-loss guarantees enabling the European Investment Bank to invest in more and in riskier projects.

The projects and agreements approved under EFSI should mobilize EUR 546.5 billion of investment and support more than 1.4 million small and medium-sized enterprises across the European Union. The new Green Transition Fund By the decree of 3 March 2022, the Ministry of Economic Development established the Green Transition Fund ("Fund"), endowed with EUR 250 million for funding transactions aimed at improving the use of renewable sources, sustainable mobility, energy efficiency and storage and waste management. Eligible transactions should have a maximum duration of five years (plus another five years for management of the portfolio) and should not concern activities related to fossil fuels, generating greenhouse gas - GHG emissions beyond the relevant parameters, relate to landfills or incinerators or any other activity whose long-term waste disposal could damage the environment.

The Fund will be handled by an asset management company, under an agreement to be signed by 30 June 2022 with the Ministry of Economic Development. The Ministerial Decree is available through this link. Electricity from renewables: new decree for administrative streamlining On 17 May 2022, Law Decree No.

50/2022 ("Aid Decree") was published in the Official Journal of the Republic of Italy. It introduces new regulations on renewable resources installations and relevant authorizations, to streamline legal procedures, mainly by way of better cooperation between the competent administrative authorities. With reference to electricity production from renewable resources, Article 7 provides that when a project is subject to a state environmental impact assessment, the latter can be fully replaced by a Council of Ministers' deliberation.

Another important change in the environmental impact assessment regulations regards the possibility of prorogation, which no longer allows the amendment of the assessment originally released, except when the environmental situation has in the meantime changed. The Aid Decree is available through this link. Aid Decree: renewable resources and energy communities The Aid Decree is provided for additional support to the installation of renewable energy plants on the rooftops of agricultural production facilities that have power exceeding the average annual electricity consumption.

Thanks to the Aid Decree, the Ministry of Defense has been authorized to overcome the 1 megawatt threshold provided for by Law Decree No. 17/2022 (converted in Law No. 34/2022) for the constitution of renewable energy communities from military state assets.

Furthermore, the Aid Decree has extended the subjective perimeter of renewable energy communities regulations, by empowering the Italian Port System Authority (Autorità di sistema portuale) with the same faculties granted to the Ministry of Defense. However, these provisions remain subject to the approval of the European Commission and are required to maintain compliance with the European Union's internal state aid regulations. Agrivoltaic systems: UNI reference practice coming soon Through the National Recovery and Resilience Plan, Italy has formally opened the door to agriphotovoltaics innovation.

The plan reserves a precise line of investment for medium and large agrivoltaic plants, with the goal of installing at least 1.04 gigawatts of new solar power capacity by the end of the decade. In this regard, precise regulations and guidelines are needed so as not to compromise the use of land for agriculture or animal farming. Therefore, the Italian Unification Authority announced that it will work on a new reference practice for agriphotovoltaic systems, proposed by the National Agency for New Technologies, Energy and Sustainable Economic Development, Università Cattolica del Sacro Cuore and REM Tec, which is one of the results of the multidisciplinary "Sustainable Agrivoltaics" task force set up by the national agency in May 2021.

More information is available through this link. Case Law Electricity from renewable sources: no time limits for energy services manager's supervision powers By judgment No. 5172 of 28 April 2022, the Regional Administrative Court of Rome stated that the energy services manager is entitled to re-quantify the amount of solar incentives and consequently claw-back the indebted surplus, even when the photovoltaic installation has been already dismissed and/or the relevant incentive regime is expired.

Despite the claimant society arguing that the supervision activity of the energy services manager was vitiated by lack of power (carenza di potere) as relating to a dismissed energy plant, the court rejected the complaint, since the manager's supervision should not be limited by time. The supervision can, therefore, be exercised even after the incentive regime expiring and/or the dismissal of the energy plant, with the consequence that the energy services manager could "claw-back the incentives unduly received, in any case within the limit of ten-year prescription". EU Maxi Repower EU plan: the most relevant news Through the Repower EU plan, the European Union intends to reduce the importation of fossil fuels from Russia within five years.

The four main planned actions include switching gas suppliers (and getting the necessary infrastructure in place), promoting a faster growth of renewable resources by increasing the 2030 target from 40 to 45 percent, implementing more measures for energy savings and establishing a new solar strategy. Presented in its essentials on 8 March 2022, the plan worth EUR 300 billion (EUR 225 billion in financing and grants, EUR 75 billion as loans) and consists of legislative initiatives, non-binding schemes and recommendations for reducing gas imports from Moscow by two-thirds by the end of this year and bringing energy dependence on Russia to zero by 2027. More information on the Repower EU plan is available through this link.

New EU Solar Strategy unveiled by the European Commission On 18 May 2022, as part of the Repower EU plan, the European Commission unveiled the new EU Solar Strategy for increasing solar energy deployment, with the goal of quadrupling the current capacity by 2030. The photovoltaic strategy consists in three concrete initiatives: a solar rooftop plan; a large-scale European partnership to develop a skilled expertise in the sector; and a legislative proposal to simplify authorization procedures. The Repower EU plan also sets out the creation of a new alliance, as the one created for batteries, aimed at supporting photovoltaic module production (the so-called European Solar PV Industry Alliance).

The European Commission Communication on the new Solar Strategy is available through this link. EU regulatory proposals on renewable hydrogen On 23 May 2022, two new delegated acts clarifying the European Union rules on renewable hydrogen and introducing stringent constraints have been submitted for public consultation. The European Commission will collect citizens' and stakeholders' opinions until 17 June and then submit the two final texts to the European Parliament and the European Council, who will exercise a two-month scrutiny period over the document before its final adoption by the European Commission.

The first delegated act on Renewable Fuels of Non-Biological Origin (RFNBO) sets the criteria for products falling into the "renewable hydrogen" definition. Specifically, it sets out rules for accounting for green electricity used for powering electrolysers, either coming from a new dedicated capacity, from the grid or from power purchased through power purchase agreements. Therefore, to enter a "renewable hydrogen" status, all the relevant producers in Europe (and importers) should demonstrate the origin of the electricity and comply with the relevant criteria.

The second act concerns, on the other hand, the methodology for greenhouse gas savings and puts forward a detailed scheme to calculate the life-cycle emissions of renewable hydrogen as well as recycled carbon fuels. The text of the first delegated act is available through this link. The text of the second delegated act is available through this link.

EU's new Social Climate Fund, against energy and transport poverty On 18 May 2022, the European Parliament approved amendments to the European Commission proposal on the Social Climate Fund. The most interesting aspect is the introduction of a definition for transport poverty, which refers to families incurring high costs for transportation or having a limited access to affordable public services that is required to meet essential socioeconomic needs. The first set of Social Climate Fund measures concerns the direct income support by reducing taxes and charges on utility bills and fuels.

Member states will have to determine who is eligible for the facilitations, through the provision of national social climate plans, subject to European approval after a consultation stage with local and regional authorities, social partners and the competent civil society organizations. These measures will cover a maximum of 40% of total estimated costs according to national plans for the period 2024-2027 and will be gradually withdrawn, coming to a complete stop in 2032. Another set of measures (tax incentives, vouchers, subsidies and interest-free loans) will cover investments in building renovations, renewable energy and promotion of carpooling, car sharing, and bicycles.

More information on the Social Climate Fund is available through this link. Air pollution: Italy condemned by the EU By judgment of 12 May 2022, the Court of Justice of the European Union upheld the complaint of the European Commission (in Case C-573/19) and condemned Italy for the "systematic and continuous" violations of annual nitrogen dioxide thresholds and the omission of measures to ensure compliance with those limits. Air pollution is a serious problem in Italy that accounts for, according to the data provided for by the European Environment Agency, the premature death of about 60,000 people every year or 165 people per day.

The text of the judgment is available through this link. Administrative streamlining: the European Commission's caveat With reference to the aforementioned administrative streamlining, the European Commission Recommendation No. 822 of 25 May 2022 wants to urge the member states to speed up permit-granting procedures for renewable energy projects and facilitate power purchase agreements.

Speeding up the production of renewables is seen as vital for the European Union to reach 2030 target and GHG emission reductions. Rapidly increasing the sale and purchase of renewable energy is deemed crucial for addressing the problem of high energy prices and EU dependency on fossil fuels and phasing out the consumption of Russian gas. The text of the European Commission Recommendation is available through this link.

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