Italian Solar Portfolio Positioned to Benefit from State Support

Zenith Energy (LSE:ZEN) is seeking to capitalise on Italy’s newly approved €23 billion renewable energy support programme through its solar development subsidiary, WESOLAR.

The company currently controls a solar portfolio with a total capacity of 188.5 MWp and is focusing on projects below 10 MWp in strategically selected areas to streamline permitting procedures and secure grid access more efficiently. Construction of WESOLAR’s first 7 MWp project cluster in the Puglia region is scheduled to begin in July 2026.

Long-Term Revenue Support Could Enhance Project Economics

The Italian initiative, which has received backing from the European Union, is designed to accelerate the deployment of renewable electricity generation across the country. The scheme will provide successful projects with 20-year two-way Contracts for Difference (CfDs), offering greater revenue certainty and reducing exposure to power price volatility.

The programme is expected to support the development of approximately 37.15 GW of new renewable energy capacity, including solar installations. Zenith believes its WESOLAR projects could qualify for the scheme, potentially improving project economics and strengthening the attractiveness of its development pipeline.

Financing and Asset Values Could Receive a Boost

Should WESOLAR secure access to the programme, Zenith expects the enhanced revenue visibility to improve financing opportunities for its projects and support higher asset valuations.

The company believes this could further strengthen its build-and-sell business model, increasing the appeal of its renewable assets to lenders, infrastructure investors and institutional buyers as Italy continues to expand its renewable energy capacity.

Financial and Technical Challenges Remain

Despite the growth opportunity presented by the Italian renewables market, Zenith’s outlook continues to be weighed down by financial pressures. The company has reported recurring negative operating and free cash flow, returned to significant losses in 2026 and has seen debt levels increase.

Technical indicators also remain weak, with a negative MACD reading and the share price trading below key moving averages, suggesting a bearish trend. Valuation metrics remain constrained by the company’s loss-making position, resulting in a negative price-to-earnings ratio and no dividend support.

More About Zenith Energy

Zenith Energy Ltd. is an independent energy company with producing, exploration and development assets across North Africa, the United States and Europe. Listed in London, Oslo and on Sweden’s Spotlight market, the company focuses on acquiring and developing proven energy assets capable of generating cash flow while pursuing low-risk exploration opportunities in established producing regions.