of RES and micro CHP plants in the Italian power system Michele Benini*, Marco Borgarello*, Alberto Gelmini*, Santi Mariano Vitale 9th IAEE European Energy Conference, Firenze 10-12 Giugno 2007 *CESI RICERCA The increasing world energy needs deriving from the economic growth of both developed and, especially, of emerging countries such as China and India, together with the well known criticalities due to geopolitical instability, during the last years led to a significant raise of prices of fossil energy sources, as well as to growing concerns about security of supply. On the other hand, it appears more and more evident that a development model heavily based on fossil energy sources is becoming hardly sustainable, not only from the economic point of view, but in particular from the environmental one, taking into account its impact on climate changes and on air quality. Such problems are especially critical in Italy, due to its high dependence on imported energy sources (that led to the recent gas crisis) and to the stringent constraints deriving from the application of the Kyoto Protocol. To tackle these problems, besides actions aimed at increasing efficiency in end-uses, the main focus is on the development of renewable energy sources (RES), as well as on a more efficient use of fossil fuels through new technologies and combined heat and power (CHP) plants. Within this context, aim of the paper is to present the results of a scenario analysis on the development of the Italian electricity generation set till 2030, with a special attention on RES, taking into account their potential and the related incentivizing policy measures, and on the new paradigm of dispersed generation based on micro CHP plants. In particular, the analysis is aimed at: • verifying whether the current schemes and levels of subsidies are sufficient to saturate the different RES installation potentials over the considered time horizon; • verify the need of subsidies to foster the penetration of dispersed generation based on micro CHP plants.