Sardinia's geography and the scarce availability of local natural resources have meant that up till now the region has depended on external sources for 94% of its energy. The lack of natural gas also means that Sardinia's energy procurement mix is dominated by oil (74%) and coal (23%), the most polluting of the fossil fuels. Roughly 44% of its energy is consumed by industry, in particular the high energy-intensive sectors (40%) of metal working and refining, the island's two basic industries*.

In such circumstances the Galsi pipeline and the subsequent conversion of Sardinia to methane will deliver huge growth opportunities for the island's economy bringing benefits such as:

  • Availability of natural gas through a distribution network directly at the user’s place with more practicality and savings on the bills for citizens and companies. In Sardinia, the cost of energy, also due to the lack of natural gas, is higher than the average of the other Italian regions. The availability of a natural gas distribution network for domestic and manufacturing use, replacing current, more expensive systems (LPG networks, propane air, diesel, electric water boilers, etc.) shall mean a reduction in the energy bill, with savings of 30-40% for Sardinian households and companies. AIEE* estimated that the average annual cost for a Sardinian household in energy bills is around €600, so they can therefore save € 270 a year by replacing, for instance, propane air and electric water boilers for domestic use with natural gas. For a school with 500 children or a hospital with 100 beds, replacing a traditional diesel or fuel oil boiler with a methane condensing boiler will generate annual savings of € 17,000 and €35,000, respectively. Industries will achieve economic gains from the use of methane of approximately € 200 million per year.
  • Safer energy supply. The Galsi gas pipeline will be the first pipeline for importing natural gas to Italy directly from the producing country. Sardinia in particular will be the first Italian region to be supplied by gas coming from Algeria and will therefore be able to rely on the maximum security of supply.
  • Differentiation of energy sources with not only economic but also environmental benefits. The use of natural gas as an alternative to oil and coal, the most polluting fossil fuels and currently the most widely used in Sardinia, will help reduce the level of harmful emissions in the atmosphere thus contributing to improve the quality of air and the environment. According to AIEE estimates, the use of methane for industrial and civil use and in transport will lead in Sardinia to a 14% reduction in current CO2 emissions.
  • Opportunity for the industrial development of Sardinian energy consuming companies. Savings in energy costs will give a significant positive stimulus to Sardinian economy. It will help the currently high energy consuming Sardinian companies since they will use more efficient and less expensive energy.
  • Establishment of new industrial operations linked to a higher availability of energy. The methanization of Sardinia, as was the case of Southern Italy, will foster the setting up of new industrial operations linked to the presence and greater availability of energy, such as in the ceramics, paper, wood, food and agriculture industries and the building material industry.
  • Positive consequences for Sardinian economy and business circles during the gas pipeline construction stage. During the construction stage, positive consequences are expected for Sardinian companies with respect to contracts and subcontracts within the framework of civil works and transport which account for around 30% on an overall investment of € 700 million for the construction of the gas pipeline in Sardinia.
  • Increase of business activities generated for the creation, management and maintenance of local gas distribution networks. Significant and lasting benefits are already resulting from the creation of (secondary and urban) local gas distribution networks for which AIEE estimates 3500 jobs on the whole dealing with the construction. Once the pipeline is operational, further impulse will come from network and domestic system management and maintenance activities with no less than 2000 active new jobs.

* * source: Regional Environmental Energy Plan - Region of Sardinia, August 2006

* AIEE, Associazione Italiana Economisti per l'Energia, "the arrive of natural gas in the sardinia's economy", november 2009