You can’t cut energy bills with a decree

There is an Italian way of tackling the energy problem, which consists of pretending that the price is a tax. When the bill goes up, they scrape together a few billion, cut a component, neutralise an excise duty, promise a discount and wait for the storm to pass. The approach works politically, but far less so economically. If Italian businesses continue to pay significantly more for electricity than their European competitors, the problem isn’t this quarter’s bill: it’s the way we produce, purchase, transport and consume energy. The first possible revolution would therefore be to stop treating every kilowatt-hour as the same. Italy should become the most proactive European country in the smart management of demand. Factories, supermarkets, cold stores, offices, batteries, heat pumps and electric cars can shift part of their consumption to times when electricity is cheaper. So far, we have been asking power stations to chase after consumers; we should also pay consumers to chase after the cheapest energy. AI can forecast prices, loads and renewable availability, and automatically switch off, slow down or bring forward millions of small-scale energy uses. Not energy austerity, but energy arbitrage. Those who help the grid to save energy must receive a share of the savings.

Thirdly: to do with geothermal energy what we have done far too little with gas. Italy possesses a predictable, continuous, nationwide and almost forgotten resource. Yet it is absurd that a country which invented modern geothermal power generation has not turned this technology into a national industrial mission. Fast-track authorisations, research into deep geothermal energy, public guarantees against exploration risk and a tender to multiply capacity within ten years would be more useful than a hundred energy bill rebates. Fourthly: use artificial intelligence where the energy debate normally looks the other way – namely, within the grid. A significant proportion of the cost of electricity stems from congestion, inaccurate forecasts, inefficient dispatch, and the need to switch on costly power stations because cheap energy cannot reach where it is needed. Sensors, weather forecasts, management algorithms and distributed batteries can increase the amount of energy flowing through existing grids without having to wait twenty years to build new ones. Before spending a hundred on building new infrastructure, we should first assess whether, through software and automation, we can get a hundred and ten from what we already have.

Fifth: we need to break a taboo. Nuclear power should not be treated as a religion, neither in favour nor against it. It should be treated as a form of insurance. Italy should contribute financially to European nuclear projects in exchange for multi-decade supply contracts, whilst preparing regulations and sites for technologies that may become competitive in the 2030s. There is no need to promise today that a ‘miracle’ power station will be built on our doorstep. The goal is to secure the option of not being solely dependent on gas, solar and wind tomorrow. In short, the challenge is not to give Italians free energy. It is to build a system in which Italian energy costs less because it is procured more efficiently, distributed more efficiently, consumed more efficiently and produced in a more diversified manner. A bonus reduces a bill. An energy policy reduces the price. And this is the difference between managing an emergency and finally trying to eliminate it.