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Transitional FER-X Decree: operating rules published

published on 13 June 2025 | reading time approx. 9 minutes

On May 20, the operating rules supplementing Ministerial Decree 30 December 2024 (the so-called transitional DM FER-X) were published on the website of the Ministry of the Environment and Energy Security (Ministero dell’Ambiente e della Sicurezza Energetica - MASE), thus confirming the long-awaited launch of incentive procedures for electrical energy production plants powered by so-called traditional renewable energy sources.

Publication of the operating rules

Expected within ninety days of the entry into force of the transitional FER-X Decree (which took place on February 28, 2025, the day after its publication on the MASE institutional website, and therefore two and a half months later than the deadline set by the decree), these rules determine in detail the procedures for accessing auctions to obtain incentives by owners of electricity production plants from photovoltaic, wind, hydroelectric-fueled plants and plants powered by gas residues from the purification process, as well as the rules for expressing interest in participating in such procedures.

The operating rules regulate incentives for energy production plants from the aforementioned renewable sources with a capacity exceeding 1 MW, for which incentives are accessed through auctions. On the other hand, with regard to plants below the megawatt threshold incentivized through direct access to tariffs following the submission of a notice of commencement of work, Article 4 of the transitional FER-X Decree provided that, by the end of May 2025, the Regulatory Authority for Energy, Networks, and the Environment (Autorità di Regolazione per Energia Reti e Ambiente - ARERA) would determine the relevant award prices.

These parameters were introduced by ARERA on June 6, 2025, with Consultation Document No. 239/2025/R/EFR, based on the findings of the GSE's Study on the cost of generating renewable energy plants up to 1 MW ("Studio sul costo di generazione di impianti FER fino a 1 MW") of May 2025. Interested parties may submit their comments on the document in question via certified email within July 4, 2025.

In addition to explaining the practical procedures for accessing the FER-X Portal and submitting the necessary documentation, the operating rules specify that each auction for each type of plant corresponds to:

a call for expressions of interest;
a call for applications to participate;
a minimum power quota;
a target power quota;
a maximum power quota;
a ranking list, drawn up by the Energy Service Manager (Gestore dei Servizi Energetici - GSE) on the basis of the percentage reduction offered compared to the exercise price above the auction base price and the possible application of the priority criteria referred to in Article 7.6 of the transitional FER-X Decree, in the event of the submission of applications for participation that exceed the quota available for each procedure. This ranking list shall be published within 90 days of the closing date of the auctions.

Procedures for accessing auctions

Alongside the operating rules, the GSE has published calls for expressions of interest for each category of eligible plant (corresponding to the different types of renewable energy sources covered by the transitional FER-X Decree). Expressions of interest can be submitted online from June 3 at 12:00 noon until June 24 at 12:00 noon, and the actual auctions should open shortly thereafter.

We remind you that the obligation to submit expressions of interest in advance in order to participate in the auctions for access to incentives has been established by Articles 5.3 and 6.3 of the transitional FER-X Decree. The operating rules reiterate that failure to submit expressions of interest in and within the established manner and deadlines will make it impossible to apply for participating in the auctions.

Upon submission of expressions of interest, a contribution for administrative costs, which varies according to the power of the plant, must be paid to the GSE. This contribution will be equal to: 100 euros for plants with a capacity of less than or equal to 50 kW, 180 euros for those with a capacity of more than 50 kW and not exceeding 200 kW, 600 euros for those with a capacity of more than 200 kW and not exceeding 1 MW, 1,420 euros for those with a capacity of more than 1 MW and not exceeding 5 MW, and 2,300 euros for systems with a power output higher than 5 MW.

Expressions of interest submitted via the FER-X Portal must contain:

The CENSIMP Code and Request Code assigned by TERNA when registering the plant in the GAUDÌ system, which may be used for no more than one expression of interest per single auction;
The type of plant and the category of intervention to be carried out;
The power values of the plant (nominal, cumulative nominal, the required share of power and, for new buildings), any power required to comply with the obligation to use renewable energy to improve the energy performance of buildings referred to in Article 26 of Legislative Decree 199/2021;
The location data of the plant;
The administrative data for the payment of the above-mentioned preliminary investigation costs.

With regard to subsequent requests to participate in auctions, to be submitted if the expression of interest is deemed eligible and within the time frame indicated in each call for applications (dates to be published), the operating rules aim to specify in detail the information and documentation to be provided upon request:

With regard to the security deposit – to be provided in the form of a bank or insurance guarantee, or a non-interest-bearing security deposit – the details of the provisional deposit must be included, as well as a commitment to submit the final security deposit at a later stage. The specific characteristics to be met with regard to the security deposit are set out in point 4.4 of the operating rules. Specifically, the provisional security deposit shall amount to 5 per cent of the estimated investment cost for the construction of the plant's capacity (equal to the share of the plant's capacity for which participation in the auction is requested multiplied by the specific investment cost for each type of plant, as outlined in point 3.2.1 – Table 3 – of the operating rules). The final deposit, on the other hand, will be equal to 10 per cent of the investment cost for the construction of the approved plant capacity;
with regard to the plant requirements, the characteristics of the plant and the work to be carried out must be indicated in order to assess their compliance with the provisions of the transitional FER-X Decree;
an indication of any priority criteria applicable to the plant;
the percentage reduction offered on the higher auction price;
the other attachments that must be submitted in accordance with Annex 2.a to the operating rules (e.g. authorization and definitively accepted estimate for connection to the grid).

Determination of tariffs

For power plants above 1 MW, the operating rules have specified that the incentive mechanism will consist of an efficient reverse auction using the intersection between the demand and supply curves for each auction. This method is intended to avoid allocating power at excessively high prices in auctions with low volumes of power requested. It is possible that not the whole quota originally put up for auction will be allocated, but only that requested by those plants that maintain their bids within the price and capacity limits corresponding to the intersection between the demand and supply curves, as illustrated in the graph included in the operating rules. This is intended to ensure that the lowest possible price is awarded.

On the other hand, as regards power plants producing electricity from ‘traditional’ renewable sources below the 1-megawatt capacity threshold, as mentioned above, on June 6, ARERA published its proposals for criteria for determining the prices at which incentives are awarded. As already specified in the Decree, the award prices were determined by the authority taking into account the cost of the intervention in order to ensure fair remuneration of investment and operating costs.

The proposed price for photovoltaic plants is 70 EUR/MWh, regardless of the size of the plant, and adjustments are applied to this price depending on the region where the plant is located and in the case of specific characteristics of the plants receiving incentives (photovoltaic plants replacing asbestos or asbestos-containing roofing or on water surfaces).

For wind power plants, the proposed award price is 91 EUR/MWh, while for hydroelectric plants it depends on the type and capacity of the plant: for those on aqueducts with a capacity of less than 250 kW, it is 145 EUR/MWh, while for those above and up to 1 MW, it is 110 EUR/MWh; for those using flowing water with a capacity of less than 250 kW, it is 180 EUR/MWh; between 250 kW and 500 kW, it is 154 EUR/MWh; above 500 kW and up to 1 MW, it is 136 EUR/MWh; for regulating-outflow plants, it is always 90 EUR/MWh. Finally, for biogas-powered plants, if the power is below 300 kW, the price is 115 EUR/MWh, while if it exceeds this threshold up to 1 MW, it is 96 EUR/MWh.

In the event of refurbishment, the incentive gradation coefficient referred to in paragraph 3 of Annex 1 to the transitional FER-X Decree applies to all plants.

Some closing remarks

In light of the delay in adopting the operating rules, it is likely that the procedure starting next June will be the only auction before the transitional FER-X Decree expires (Alessandro Noce, Director General of Markets and Infrastructure at MASE, already mentioned this on May 12).

In this auction, according to the Decree of the Directorate-General for Energy Markets and Infrastructure – Energy Department of the MASE no. 12 of April 1, 2025, the minimum total quota is 0.831 GW, the target quota is 1.462 GW, while the maximum available quota will be 11.52 GW (of the total 14.65 GW provided for competitive procedures by Article 5.6 of the transitional FER X Decree). However, it is understood that, as specified in the operating rules, after the submission of expressions of interest during the first procedure scheduled for next June, the quotas will be recalculated for each type of plant as the minimum between the sum of the capacities of all expressions of interest submitted, reduced by 10 per cent, and the values indicated in Directorial Decree no. 12/2025. In the (remote) event of a second procedure, therefore, the maximum remaining quota under the transitional FER-X Decree will be 3.13 GW in total.

Finally, the long-awaited definitive FER-X Decree should regulate incentive procedures until the end of 2029 and, among other things, should incorporate provisions requiring compliance with the so-called non-price criteria set out in the Net Zero Industry Act (EU Regulation No. 2024/1735) and related rules adopted by the European Commission. Pending further developments regarding the future decree, the only transitional FER-X procedure in 2025 is expected to be very crowded at the starting line and, consequently, likely to be highly competitive in terms of the bids submitted.