London (Platts)--8Nov2012/812 am EST/1312 GMT

Italy's environment, agriculture and industry ministries Thursday said they have approved an incentives' scheme for renewable heat.

A spokesman for the industry ministry said the text of the decree was going to be released later in the day.

The decree seeks to promote the production of green heat from biomass, heat pumps and thermal solar, as well as accelerate the efficient use of heat in public buildings, the ministries said in a joint statement.

Incentives are to cover around 40% of investment, payable over a two-year period rising to five years for large projects.

According to the statement, renewable heat projects are expected to have an average cost of "several thousand euro."

The incentives are to focus on small-scale projects for domestic and small commercial use, including greenhouses, which have received little state support to date.

The scheme, seen as "a fundamental step to reaching and exceeding the European environmental objectives through 2020," will seek to promote Italian leadership in renewable heat technology, the ministries said.

With regard to energy efficiency, the scheme would target improvements in government buildings, the statement said.

The decree has to be passed by the State-Regions Conference -- the body that liaises between central and local government -- before final approval. In July, the government approved two decrees on incentives to solar and other renewable sources.

--Beatrice Bedeschi, beatrice_bedeschi@platts.com --Edited by Martin O'Rourke, martin_orourke@platts.com