By Giuseppe Fonte and Gavin Jones
ROME -Italy’s government on Friday approved measures worth around 6 billion euros ($6.81 billion) to help consumers and firms hit by a rise in energy bills, as part of an 8 billion euro package to support the economy.
The latest price-capping scheme in the energy sector comes on top of some 10 billion euros budgeted since last July to try and soften surging oil and gas prices.
Prime Minister Mario Draghi told a news conference the government had also found resources to help the struggling automotive sector.
With public finances better than forecast, funding for the latest spending could be found elsewhere in the state budget without resorting to extra borrowing, Economy Minister Daniele Franco said at the news conference.
“This year’s deficit will not exceed the target of 5.6% of gross domestic product,” Franco said.
Ministers provided little detail of the latest measures, but a draft of the decree seen by Reuters showed some 3 billion euros of the energy package will go to cut a range of “system-cost” levies.
The levies, which help finance measures ranging from solar power subsidies to nuclear decommissioning, typically account for more than 20% of Italian retail energy bills.
Employers association Confindustria has estimated that energy bills will cost industry some 37 billion euros this year compared with 20 billion euros in 2021.
Rome also plans to introduce simplification measures to speed up the construction of renewable power plants, Ecological Transition Minister Roberto Cingolani said at the news conference.
Cingolani detailed measures to boost domestic gas production to around 5 billion cubic metres from the current output of 3.2 billion. He said the government is also studying ways to have Italy’s gas storage system filled to at least 90% of capacity starting in the storage year 2022-2023.
Storage currently stands at around 40% of capacity.
Italy has 20 billion cubic metres of storage capacity, of which 4.5 billion cubic metres are strategic reserves overseen by the government which can only be used in emergency situations.
Gas storage is typically filled during the summer season before being used in the winter.
Industry Minister Giancarlo Giorgetti said the Cabinet had set aside 1 billion euros per year for eight years to support the automotive sector.
Additional funds will be allocated to support research and development in microprocessor technology, Giorgetti added.
Intel and the Italian government are in talks over investments expected to be worth around 8 billion euros to build an advanced semiconductor packaging plant.
($1 = 0.8816 euros)
(Additional reporting by Stephen Jewkes in Milan; editing by David Evans and Leslie Adler)