The Italians must love the sun! The Italian solar market has been busy. It already has 17 gigawatts of PV installed, making it perhaps the second nation behind Germany (32 gigawatts) in terms of installed solar. But the Conto Energia V feed-in tariff—capped at 6.7 billion euros ($8.9 billion)—that’s made solar so attractive in the nation, is now fully fulfilled.

Under the Conto Energia FiTs power produced by solar installations was reimbursed at a rate above retail prices. “This program is set to be the last Conto Energia in Italy,” Solarbuzz Analyst Susanne von Aichberger said in a recent post. “As Conto Energia will not be continued, FIT funding for new PV projects in Italy will phase out in 2013,” she said. Now Italy is moving forward into a new world of incentives designed to keep incentivizing solar but at lower levels. In doing so it joins other European countries like Germany and Spain that have reduced their solar incentive plans in an attempt to bring them closer to the costs of conventional energy.

The FiT offering—as previous offerings have been—was successful. “As of 30 April 2013, GSE [i.e., the agency that handles renewable energy] listed a preliminary number of 450 megawatts of PV systems that had become operational this year, a number that is certain to go up though in the next months,” she said.

The times, they are a changing, at least in Italy. “After Conto Energia, Italy’s PV market will be based on promotional schemes like Scambio sul Posto (net-metering) in combination with tax rebates and increasingly on power purchase agreements (PPAs),” von Aichberger said. However, these systems aren’t completely ready to take over the incentives market quite yet. For instance, the PPA system is still being deliberated. “Among other things, the deliberation is meant to regulate Efficient User Systems (Sistemi efficienti di utenza (SEU), where producers of electricity from renewable sources are directly connected with the end customer,” she said.

In response to the current state of Italy’s incentive schemes, the amount of new solar applications has shrunk. And that’s not likely to pick up until after the program is solidified. At the earliest, the PPA scheme could start in September 2013. “The sooner the regulatory framework for PPAs is finalized, the higher the chance for a recovery of the Italian PV market although demand volumes are not anticipated to surpass 2012 levels over the forecast period,” von Aichberger said.