Italy's ARERA flags highest EU electricity prices and outlines 2026‑29 market reforms

The Italian regulator ARERA’s 2025‑2026 Annual Report shows wholesale electricity prices (PUN) at €115.9/MWh, the highest among major European exchanges. Domestic customers pay about 13 % more for electricity and 7 % more for gas than the euro‑area average, a gap ARERA attributes mainly to Italy’s strong reliance on gas‑fired generation.

In response, ARERA has created a new Energy Price Monitoring Unit to track wholesale and retail prices in real time and to coordinate with government and European bodies. The regulator’s four‑year strategy (2026‑2029) calls for reforms such as zonal pricing, a revised dispatch framework (the Integrated Dispatch Text), and greater integration of flexible resources like demand‑response, storage and distributed generation. Investment plans under the Ross (Regulation for Service and Cost Objectives) framework will target grid upgrades and new cost‑of‑capital rules.

The report also notes a 44 % rise in LNG imports, now covering one‑third of Italy’s gas supply, and a modest increase in renewable generation (48 % of electricity output in 2025). Social bonuses supported 4.3 million households, while water‑service investments reached €29.6 billion for 2024‑2029.