Green light for the Transition 5.0 Programme

With the publication of Decree-Law no. 19 of 2 March 2024, a new tax credit was issued for investments made in the two-year period 2024-2025 in relation to the “Transition 5.0 Programme”. The aim of the measure is to support the digital and energy transformation of enterprises.

With the publication of Decree-Law no. 19 of 2 March 2024, a new tax credit was issued for investments made in the two-year period 2024-2025 in relation to the “Transition 5.0 Programme”. The aim of the measure is to support the digital and energy transformation of enterprises.

With the publication of Decree-Law no. 19 of 2 March 2024, a new tax credit was issued for investments made in the two-year period 2024-2025 in relation to the “Transition 5.0 Programme”. The aim of the measure is to support the digital and energy transformation of enterprises.

Industry 5.0 will be a Collaborative Industry approach, that is, a business model characterised by cooperation between machines and people, with the ultimate aim of giving added value to production, creating tailor-made products that meet the needs of consumers. For Italian enterprises, the Programme is without doubt an opportunity for innovating processes and products, but also a great challenge that requires significant investments, adequate know-how and a strategic vision.

Overview of the Programme

To exploit the reliefs, investments must permit a reduction of energy consumption of at least 3% for a production unit or at least 5% for a process. They include all technologically advanced capital, tangible and intangible assets, training activities, as well as assets for the self-production and self-consumption of energy from renewable sources. The maximum limit of admissible costs is 50 million euro/year. See the table for details.

The benefit is subject to the submission of suitable certifications issued by an independent body certifying, ex ante, the reduction in energy consumption as a consequence of the investments; ex post: the effective completion of the investments. Credit not used by 31.12.2025 can be carried forward and used in 5 equal annual portions.

Resources 2024-2025

Overall, the Programme provides funds for 6.3 billion euros divided as follows: 3,780 million for investments aimed at energy efficiency, 1,890 million to facilitate self-consumption and self-production and 630 million for training. The tax credit introduced to favour digitalisation and the green transition of enterprises resident in Italy is attributable regardless of the size of the company and the regime adopted.

Operating repercussions for machinery manufacturers

The measure is very important for relaunching investments in plant and machinery in Italy. The assets invested in must comply with 4.0 (with the relative rules), but also be part of a project that guarantees an energy saving of at least 5% with respect to the previous situation.

The “process involved in the investment” concept is crucial for defining the perimeter on which to evaluate the 5% energy saving required as a minimum limit. A restrictive interpretation which limits the perimeter to the asset replaced or directly affected by the investment would simplify evaluations and calculations. If the interpretation of the term, “process involved in the investment”, were restrictive, analysis could be focused on the specific activities or machines directly involved in the investment. This would simplify the calculation of the energy saving, as there would be a clear basis of comparison between the situation before and after the implementation of the new technologies.

On this front, Ucima (Italian Packaging Machinery Manufacturers’ Association) has started talks with the Ministry to explore the possibility for an interpretation of the term in question that coincides with the desired “restrictive” perspective.

Apart from this aspect, Ucima has, nevertheless, proposed a subdivision of the packaging process that should not be considered as an inseparable whole, but needs to be divided, at least, into:

• Machinery for primary packaging
• Machinery for secondary packaging
• Machinery for the Tertiary Sector (packaging for transport and end-of-line)
• Product labelling, coding and marking
• Product inspection and quality control
• Product feeding, handling and internal logistics
• Machines for washing, sterilisation, etc.
• Product assembly

Manufacturers’ approach to customer companies

The substantial difference from the 4.0 benefit is that, while in the first case there are 7 technical prerequisites that the asset must meet, in the case of 5.0, all depends on an evaluation of the difference (-5% of energy consumption) between the customer’s production situation before and after the introduction of the new machinery.

To achieve the objective much will depend on the degree of greater or lesser obsolescence of the goods currently in use. In this sense, a manufacturer company of machines will not be able to declare beforehand (as was possible with the 4.0 scheme) that its machinery ensures a determined benefit in terms of energy saving in order to obtain the relief. As a result, with regards to requests received from customers, the most correct approach according to Ucima is the following:

1. In the case of investment in replacing other existing assets, to request the customer to provide information on the existing situation, that is, annual consumption for 2023 with relation to the process that is planned to be affected by the investment. This is information that the customer company must have and will become the basis for every evaluation.
2. In the case of investment that does not replace any process, but adds to existing ones (in actual fact not expressly referred to by DL no. 19 of 2 March, but which should be resolved as follows, according to Ministerial indications) the situation beforehand will always be evaluated for similar processes existing in the company or, if not present, it will be necessary to refer to and compare with the guidelines values that will be issued shortly with a specific Decree.

How to prepare

In the meantime, what a plant and machinery manufacturer can do to respond to the requests of customer companies is to obtain technical data sheets, opinions, expert reports or other documentation that certify the correct design of the new machinery in terms of energy efficiency, detailing the reasons and preparing indicators to this effect.

To help companies, Ucima is preparing a “Technical Energy Efficiency Certification” guideline with the information considered as best serving as evidence and qualifying for this purpose, which the Association can draw up at the request of interested companies. This certification can obviously also relate to the particular situation of the factory, thereby becoming an a priori validation to be delivered to the customer to support its 5.0 practice. The Association is also developing a global service aimed at assisting machinery manufacturers and customers in the tax credit application procedure relating to the Transition 5.0 Programme.