Green manufacturing: the steps Italy is taking to reduce impact on the environment
From reducing energy consumption to carbon neutral production, Italian industry is making strides in becoming more sustainable and efficient
Green manufacturing is the commitment to lessen harmful effects on the planet, to reduce waste and pollution from industrial processes and to eliminate damaging emissions. The manufacturing industry has long been the backbone of the Italian economy and the focus on turning it green is vital at a time when the UN is warning that carbon emissions must be cut by half in order to mitigate catastrophic climate change. By transforming processes and plants across the country, Italy is looking to long-term, sustainable success.
Italy's profile on the global sustainability stage has been cemented in recent years as it has embarked on a path to net zero, and next year the country will partner with the UK to co-chair the UN Climate Change Conference (COP26). Manufacturing has been identified as a target area and, powered by new technology and industrial innovation across the country, Italy has committed to raising the share of renewable energy to 30 per cent of the national gross final consumption of energy and to steadily reducing energy consumption by 20301. Foreign and domestic investment, particularity from SMEs, has been attracted to the sector by recent incentives, such as the ‘Industria 4.0 plan’, and funding for companies investing in research and development with a focus on smart machinery. The opportunities have been seized upon, with the number of greenfield investment sites established by foreign direct investment reaching 222 last year, up from 170 the previous year, and achieving $6,951 million in value2.
High Energy
This investment into and transformation of the manufacturing market is being underpinned by significant new initiatives, such as the integrated National Energy and Climate Plan (NECP) and Italy’s commitment to the European Green Deal, which have seen significant funds deployed to improve the green credentials of industry.
It is new innovation in manufacturing techniques that is propelling this move towards reducing pollution and emissions in Italy. The progress made using hydrogen has been key. A green energy source, hydrogen can be generated using renewable energy and can be transported, stored and treated like a gas. These enviable properties mean it could provide almost a quarter of all energy in Italy by 20503.
Charging Ahead
Policymakers and businesses alike have recognised the need for change, with major players in Italian industry embracing new methods of decarbonising their operations and citing carbon-neutral production as a serious target. The automotive sector has been a key area, and economic stimulus measures are focussing on driving sustainability, particularly in green transport and construction. The new initiatives include hefty discounts on electric vehicles (EVs), sales of which have surged across Italy – in August, sales of EVs were triple those for the same month in 20194.
Italy is seeing a growing number of plans to develop EV infrastructure, including the building of a network of charging stations and financial incentives for companies to invest in local projects. The industry has also seen a significant shift towards sustainability in the production of EVs and charging points, with major car plants across Italy announcing plans to switch to renewable energy sources in their factories5.
The continuing progress in renewable energy has had a significant impact on how factories and manufacturing plants are powered, with solar panels leading the way in energy production. The past decade has seen Italy emerge as the sixth biggest market for adding new solar capacity6, while the country has also recently emerged as the EU market with the highest demand for renewables power purchase agreements7.
Recent developments in industrial processes, a renewed commitment to sustainable industry and an increased focus on carbon footprint management are transforming Italy’s manufacturing sector. Process innovation in factories across the country is offering companies the opportunity to develop and use environmentally friendly materials, reusing goods and packaging to avoid landfill, decarbonising processes and using tech to increase the efficiency of plants.
With transformative initiatives to promote sustainability in the manufacturing sector, and a dedication to make environmental, social and corporate governance (ESG) policies part of the DNA of Italian manufacturing companies, investors are increasingly attracted by the transition to a strong, countrywide low-carbon, circular economy in Italy which is well under way.
1 https://ec.europa.eu/info/sites/info/files/2020-european_semester_country-report-italy_en.pdf
2 https://santandertrade.com/en/portal/establish-overseas/italy/foreign-investment
3 https://www.snam.it/en/hydrogen_challenge/potential_hydrogen_italy/
6 According to research by BloombergNEF
7 https://leveltenenergy.com/blog/ppa-price-index/q3-2020/
