By Decision no. 119 of 26 March 2010, the Italian Constitutional Court has declared the illegitimacy of Article 3, Paragraphs 1 and 2 of Apulia Regional Law 31/2008, pursuant to which renewable energy plants, including photovoltaic (PV) plants, with an output of up to 1 megawatt (MW) can be authorised through a simplified “start-of works” declaration (dichiarazione di inizio attività or “DIA”) instead of the lengthy “autorizzazione unica” procedure provided by federal law.
The following is a summary of the background and content of the Decision, as well as an analysis of its impact on previously authorised and new 1 MW projects in Apulia and other Italian Regions.
Federal Law 387/03 on Authorisation of Renewable Energy Plants
Article 12 of Federal Law no. 387 of 29 December 2003 provides that the construction of renewable energy plants is subject to a so-called single authorisation (autorizzazione unica or “AU”). Under the AU procedure, the regional government must call for a steering committee meeting (conferenza dei servizi) at which all interested administrative offices can express their views on the project. The AU must then be issued or rejected within a period of 180 days.
Article 12, Paragraph 5 of Federal Law no. 387/03 provides a simplified process for smaller renewable energy plants. In particular, PV plants with a power output of up to 20 kilowatts (kW) can be authorised following the filing of a start-of-works declaration (DIA) to the municipality, provided that the public administration does not raise any objections in the 30-day period that follows. Article 12, Paragraph 5 of Federal Law no. 387/03 provides that this threshold can be increased by a decree of the Ministry of Economic Development with agreement from the Ministry of Environment and Permanent Council of the Regions (Conferenza Unificata Stato-Regioni).
Regional Law 31/2008 on Renewable Energy Plants in the Apulia Region
Notwithstanding the fact that up until now the aforementioned ministerial decree has never been issued, certain Italian regions increased the DIA-threshold autonomously to facilitate the authorisation of renewable energy plants on their territory. In particular, the Apulia region increased the threshold for the simplified authorisation of ground-mounted PV plants to 1 MW, first by Article 27 of Regional Law no. 1/2008 and subsequently by Article 3 of Regional Law no. 31/2008.
As a consequence of the significant savings in time and money of this simplified procedure, a massive development of 1 MW PV projects started in the Apulia Region, and Apulia is currently the region with the highest amount of installed PV capacity in Italy.
Constitutional Court Decision no. 119/2010
On 31 December 2008, the Italian Government filed a claim with the Constitutional Court for the declaration of unconstitutionality of the aforementioned Article 3 of Regional Law 31/2008. The public hearing on this matter took place on 26 January 2010, and by Decision no. 119 of 26 March 2010, the Court declared the constitutional illegitimacy of Article 3, Paragraphs 1 and 2 of Regional Law no. 31/2008.
As expected, the Constitutional Court considered the authorisation of renewable energy plants falling under the “production, transmission and national distribution of energy” category, which, pursuant to Article 117, Paragraph 3 of the Italian Constitution is a matter of concurrent legislation between State and regions. In matters of concurrent legislation, the regions have legislative powers only within the framework of the basic principles laid down by the State.
The Constitutional Court argued that the establishment of criteria for the application of the simplified DIA procedure as opposed to the more complex Autorizzazione Unica falls under the basic principles to be imposed by the State, and that the Apulia region did not have the authority to derogate the power thresholds established by Federal Law no. 387/03.
Impact of Decision on PV Projects Authorised under Regional Law no. 31/2008
The decision of the Constitutional Court applies to Article 3, Paragraphs 1 and 2 of Regional Law no. 31/2008 as of the day after its publication. This means that, effective immediately, ground-mounted PV projects above 20 MW located in the Apulia region can no longer be authorised by a simple DIA procedure, but require an Autorizzazione Unica.
On the other hand, the repeal of the regional provisions does not affect vested rights and interests (situazioni consolidate) that already came to existence prior to the Decision. This means that PV projects that have already been fully authorised through the DIA procedure remain valid. Should these authorisations now be legally challenged, however, then the Constitutional Court’s decision would have sort of a retroactive effect insofar as the validity of the authorisation title can no longer be based on the repealed provisions of Regional Law no. 31/2008. Accordingly, projects that have already been authorised can be affected by the decision of the Constitutional Court if either of the following occurs:
- A third party with legitimate interest challenges the DIA or the construction of the plant.
- The public administration exercises its review powers (autotutela) and revokes the DIA.
In each case, a balance must be struck between the interests of each of the the parties involved. The legitimate reliance of the developer on the validity of the regional laws as they were in force during the authorisation process will have an important impact, as well as the investments already made in the project.
PV Projects Authorised under Previous Regional Law no. 1/2008
The decision of the Constitutional Court only repeals the provisions of Regional Law 31/2008. It does not extend to the previous Regional Law no. 1/2008 whose Article 27 already allowed for the authorisation of 1 MW PV projects by means of a simple DIA.
This does not mean, however, that older projects authorised under Artice 27 of Regional Law 1/2008 are automatically “safe”. In fact, Article 27 of Regional Law 1/2008 is itself the subject matter of an “incidental” recourse to the Constitutional Court, referred by the Regional Administrative Court (TAR) of Apulia on 24 September 2009, based on the same argument of violation of Article 117, Paragraph 3 of the Italian Constitution. It is obvious that the Constitutional Court will decide this case in the same manner as that of the constitutional illegitimacy of Regional Law 31/2008.
Moreover, if a third party challenges a 1 MW PV project authorised under Regional Law 1/2008 and the court (TAR Puglia) has doubts as to the constitutional legitimacy of Article 27 of Regional Law 1/2008, the court will either have to decide itself on its constitutionality or refer the question to the Constitutional Court. Again, it is easy to predict that the decision of the court will be the same as the recent decision on Regional Law 31/2001.
PV Projects in Other Regions with Increased DIA Threshold
Other Italian regions have enacted regional laws that, similar to those in Apulia, have increased the threshold for the simplified authorisation of PV projects by means of a DIA. For instance, a simple DIA is sufficient for ground-mounted PV plants of up to 1 MW in the Basilicata region, or for partially-integrated PV plants of up to 500 kW in the Calabria Region.
Again, the recent Decision no. 119/2010 of the Constitutional Court does not have any immediate effect on these regional laws, and as long as they are in force, PV projects falling under the increased thresholds can be authorised validly through the simplified DIA procedure.
That notwithstanding, the decision of the Constitutional Court on the regional provisions of Apulia gives a clear indication as to the likely outcome of a Constitutional Court decision regarding the constitutional legitimacy of such regional laws. As a consequence, the risk inherent to PV projects authorised through a simple DIA in other regions is comparable to that described above for DIA projects authorised under the previous Law no. 1/2008 in the Apulia region.