The Italian environmental sector is part of a transformation dynamic driven by a strong public commitment to ecological transition. Italy has placed a “green revolution” at the heart of its post-Covid recovery plan, notably mobilizing European Next Generation EU funds (€191.5 billion for 2021-2026) to finance sustainable investments. Meanwhile, the Integrated National Energy and Climate Plan (PNIEC) sets ambitious targets for 2030 in terms of energy efficiency, renewable energy, emission reductions, and sustainable mobility. This proactive political framework, combined with substantial funding, creates a favorable environment for environmental solutions and generates numerous business opportunities for companies in the sector.
Key figures and leading sectors
Italian environmental indicators reflect both challenges and progress. In terms of climate, Italy emitted 417 million tonnes of CO₂e in 2022 and aims for a target of 233 Mt by 2030 — a drastic reduction requiring sustained efforts, especially in lagging sectors such as transport and construction. On an individual level, emissions are about 7.1 tonnes of CO₂e per capita, a moderate level for an industrialized economy but still needing reduction to achieve carbon neutrality by 2050.
Water management is a major challenge. Italy’s distribution network, spanning 425,000 km (60% of which is over 30 years old), suffers from severe aging, causing significant losses: over one-third of potable water withdrawn (9.14 billion m³ in 2022) is lost each year through leaks. Additionally, about 29% of households distrust tap water enough not to consume it, highlighting a perceived quality issue.
Regarding waste, Italy produces nearly 29.1 million tonnes of municipal waste annually, plus 164.9 Mt of industrial waste (including construction). The selective collection rate is relatively high (64% of household waste in 2022), but only 48.1% of total municipal waste is effectively recycled — leaving considerable untapped potential. Air quality has improved in recent years, though the country still falls short of the European targets set for 2030.
Water: a strategic issue
Faced with increasingly marked climate risks, water resources are critical in Italy. The aging infrastructure results in massive wastage — 3.4 billion m³ of potable water wasted annually. This inefficiency, combined with public distrust of tap water, underscores the urgency to modernize the network and improve water management. Investment needs are significant, estimated at €5 billion per year to renovate and maintain hydraulic infrastructures.
In this context, opportunities for specialized companies abound. Authorities and local operators seek innovative solutions to enhance network reliability (leak reduction, smart sensors), improve water treatment, and restore consumer confidence in tap water. Projects funded by the Recovery and Resilience Plan (PNRR) and other schemes aim to modernize aqueducts, develop water quality monitoring systems, and optimize resource use. Thus, the Italian market is especially promising for efficient water management technologies — be it treatment, distribution, or resource preservation.
Waste: towards a circular economy
In waste management, Italy shows some delays but also strong potential for improvement. With 29.1 Mt of urban waste and nearly 165 Mt of industrial waste produced annually, the challenge is twofold: increase the share of valorized waste and create value through recycling and reuse. While selective sorting is well established (64% of municipal waste collected separately), actual recycling remains insufficient (only 48.1% of urban waste recycled). Aware of this gap, local actors and public authorities are working to catch up on both upstream and downstream waste management stages. Several segments remain underdeveloped: for example, recovery of electronic waste, textiles, and end-of-life vehicles is still insufficient, and no dedicated sector exists yet for specific residues such as silica sands from construction.
To accelerate the transition towards a genuine circular economy, Italy has strengthened its regulatory framework by transposing the latest European directives. In 2021, new legislative decrees were adopted: one implementing directives 2018/851 and 2019/883 on port waste management, another transposing directive 2019/904 aimed at reducing the environmental impact of certain plastics. Meanwhile, public and private investments are encouraged to develop recycling and energy recovery capacities. Projects aiming for “zero waste” and valorization of materials previously landfilled or incinerated are emerging, signaling a paradigm shift.
This context opens real market opportunities for companies offering smart waste management solutions: automated sorting systems, advanced recycling processes (especially for plastics, metals, bio-waste), or valorization technologies (biogas, alternative fuels, etc.). The national objective is to reduce the volume of non-valorized waste, so any innovation turning waste into a resource finds a favorable environment in Italy.
Growth prospects
In summary, the Italian environmental market offers promising growth prospects across the entire sector. The combination of strong political ambition and unmet concrete needs creates fertile ground for new solutions. To meet its climate goals (reducing annual CO₂ emissions from 417 Mt to 233 Mt by 2030), a surge in green investments is inevitable, particularly in lagging sectors like transport and construction. More broadly, the country’s green transition — from renewable energy deployment to clean mobility — benefits from significant support through the PNRR and regulatory incentives (PNIEC and other national plans).
Italy’s industrial fabric, made up of numerous SMEs and local companies, is open to innovation to improve competitiveness. This means the market is receptive to external technologies and expertise capable of addressing environmental challenges. In this context, French companies in the sector, with their technical know-how, have a real opportunity to establish or strengthen their presence in Italy. Whether it’s modernizing water networks, optimizing waste management, contributing to pollution reduction, or supporting the energy transition, business opportunities abound. By providing innovative and locally adapted solutions, they can not only capture new markets but also contribute to Italy’s ambitious environmental goals.
Contact:
Emmanuel Galland
Ecological and Energy Transition Advisor
Business France
emmanuel.galland@businessfrance.fr