Last updated: May 5, 2009 7:13 am

Mafia link to Sicily wind farms probed

Anti-Mafia magistrates in Sicily have opened a sweeping investigation into the wind power sector where local officials, entrepreneurs and crime gangs are suspected of collusion in the construction of lucrative wind farms before their eventual sale to multinational companies.

Italian and EU subsidies for the building of wind farms and the world’s highest guaranteed rates, €180 ($240, £160) per kwh, for the electricity they produce have turned southern Italy into a highly attractive market exploited by organised crime.

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Roberto Scarpinato, a veteran anti-Mafia prosecutor in the regional capital Palermo, told the Financial Times that his investigation, which began last week, was focused on the three large provinces of Palermo, Trapani and Agrigento.

An earlier investigation into a case near Trapani in western Sicily resulted in eight arrests in February, leading to accusations of a suspected nexus between a leading Mafia family that offered money and votes in exchange for permits to construct wind farms.

“Operation Wind” revealed Mafia promises to local officials in Mazara del Vallo of money and votes in exchange for help in approving wind farm projects.

The Mafia suspects were alleged to be linked to Matteo Messina “Diabolik” Denaro, a fugitive clan boss on ltaly’s most wanted list.

Prosecutors suspect the hand of the Mafia in fixing permits and building wind farms that are then sold on to Italian and eventually foreign companies.

Sicily map

In an effort to assert its control over the sector, the Mafia is suspected of destroying two wind towers that were in storage in the port of Trapani after their delivery by ship from northern Europe, local officials told the FT.

“It is a refined system of connections to business and politicians. A handful of people control the wind sector. Many companies exist but it is the same people behind them,” said Mr Scarpinato, whose investigations have focused on the evolution of the Mafia into a modern business organisation.

Sicily’s Cosa Nostrais evolving and finding new business opportunities, including the renewable energy sector, by exploiting its historic grip over territory, construction and ability to corrupt local officials.

Several wind farms built by companies suspected of being linked to the Mafia have not functioned for one or two years, in some cases because of shoddy construction. “This is the amazing thing, that developers got public money to build wind farms which did not produce electricity,” the prosecutor said.

The regional governments in Sicily, as well as Calabria and Basilicata on the mainland, have suspended the authorisation of new wind farms in part because of suspected criminal involvement and confusion over the real ownership of the ventures.

Most, if not all, of Sicily’s wind farms began as projects by local developers, some of whom speculated in a secondary market for permits. Once built, the majority were sold on through Italian intermediaries to multinationals. International Power of the UK is the largest wind power operator in Italy. Others include Italy’s Enel and Germany’s Eon through its purchase of part of Endesa of Spain in 2007. France’s EDF also has assets. While the international companies knew the identity of their Sicilian developers, there is no evidence they were aware of Mafia involvement.

Although Italy is lagging badly in meeting its EU 2020 emissions targets, the renewable energy sector is growing strongly and attracting considerable foreign investment. International Power became the single largest operator in 2007 with its purchase of the Maestrale portfolio of mostly Italian wind farms, including five in Sicily, for €1.8bn

Italy ranks fourth in Europe in terms of installed wind power capacity.

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