Industry Minister Corrado Passera warned at the weekend that the government would have to reconsider subsidies given to the renewable energy sector following steep price increases announced by Italy’s gas and electricity authority.

“The bills Italian people are paying are too high,” he told reporters at the margins of a conference in Cernobbio on the shores of Lake Como on Saturday.

Monti, who acknowledged in a speech in China that some of the government’s measures had been “rough,” is already facing stiff opposition from unions to labor reform proposals he says are needed to boost employment and attract foreign investment.

But a significant jump in energy prices could further undermine wavering popular support for painful economic reforms which growing numbers of critics say have hit ordinary Italians the hardest.

Italy’s energy authority last week called for a rethink of green energy subsidies, which it estimated would cost 10 billion euros or 70 euros for each family in 2012, saying that “titanic” efforts were already being demanded of companies and citizens.

The call came as the authority announced a 5.8 percent rise in household electricity charges in the second quarter, not including subsidies for renewables which it said added an additional 4 percent to consumer bills.

It said the rise was mainly due to higher oil prices as well as the effect of the spell of cold weather in February.

Environment Minister Corrado Clini rejected the demand for cuts to renewables, which he said risked damaging a key sector, but the government faces growing pressure from a public becoming increasingly angered at the costs they are being asked to bear.

“It’s a worry which I share 100 percent and it’s for that reason that it’s important not to mistake the target,” Clini told the La Repubblica daily on Sunday.

The gas and power price rises come on top of a series of government-imposed austerity measures aimed at reining in Italy’s huge public debt, including higher health care costs, hikes to housing and fuel taxes as well as caps on pensions.

Appointed in November as financial market turmoil risked dragging Italy into a Greek-style debt crisis, Monti has won widespread plaudits abroad and helped restore confidence to the markets but he faces an increasingly difficult battle at home.

Opinion polls have shown his popularity has been dented badly by the battle over labor reforms which would give companies greater freedom to fire employees. Higher energy prices could undermine support even further.

“We are getting to an explosive point. You have inflation going up and families’ purchasing power going down,” Francesco Avallone, vice president of consumer rights organization Confconsumatori told SkyTG24 television.

“The energy authority has just put gas and electricity prices up and that has an influence on all prices.”

Economic data last week showed consumer price inflation running at 3.8 percent in March, the fastest since October last year, lifted mainly by higher energy prices. At the same time, separate data showed wage rises being outpaced by inflation for the third month running.