This paper studies the gaps in the continuity of electricity supply across Italy, a factor of competitiveness for firms and of welfare for households, and analyses its determinants and economic importance. Furthermore, it assesses how the recent changes in regulation and the measures outlined in the Italian NRRP and in REPowerEU may improve the supply of electricity.
Power supply interruptions result in a more pronounced productivity loss for less capital-intensive firms, which are likely less equipped with stabilizers and are more widespread in the south of the country. In this area, disruptions are more frequent and intense, reflecting a different endowment of grid infrastructures. Recent regulatory innovations, primarily targeting areas with greater room for improvement, and programmes of infrastructural upgrading could help to improve and standardize the quality of supply across the country, thus alleviating one of the local factors that reduce the attractiveness of the southern regions.
