Turn toward decarbonisation by pursuing SBTi (Science Based Target Initiative) goals, through: the development of power generation with renewable sources, the gradual exit from the most emissive businesses, and the innovation of the district heating network with the intensification of Waste To Energy (WTE) processes.
Strategic guidelines, risks, and mitigation actions
Strategic guidelines, risks, and mitigation actions
A resilient, flexible, and sustainable plan to manage, between now and the next ten years, the risks implicit in the various trends.
70%
Regulated
15%
Semi-regulated
30%
Mandatory
80%
Sustainable
20%
External funds
Main implications on the new Plan
Main implications on the new Plan
The three strategic pillars in addition to translating the ambition of the Iren Group are also the most relevant implications of the new Business Plan.
- Derisking Decarbonisation
- Derisking for positioning in regulated or semi-regulated businesses
Maximising the level of cross-selling between businesses through: expanding the range of services and prioritising investments in areas of presence, addressing the needs of the target territory with a focus on inorganic and coordinated growth between businesses.
Diversified and resilient business model
Maximising service quality and customer experience for each business area through new digital solutions and new processes of call center insourcing.
Service quality and customer loyalty as resilience factors
Exposure of business areas to trends
Exposure of business areas to trends
Consistent with identified industry trends, strategic and cross-cutting guidelines are provided. Networks and Waste Management are actually the segments most favourably impacted by the expected trends. The exposures of the main business lines to industry macro-trends are presented below.
After browsing the table you can learn more about the risks implicit in the trends and the mitigation actions proposed by the 2021-2030 Business Plan for each Business Unit.
Networks
Waste management
Energy
Market
Smart Solutions
Corporate
Networks - Electricity
Networks - Gas
Networks - Integrated water system
Networks - DH
Networks - Cross Themes
-
Strategic risks implicit in trends
- Increased economic and reputational impact in the event of disruptions, affecting service quality
Mitigation actions
- Interventions to improve network quality and support energy transition
Derisking Target
Smart meter 2G, % utenze
-15%
Reduction in the frequency of interruptions by 2030
+40%
Power Capacity MVA
100%
2G smart meter digitization
-
Strategic risks implicit in trends
- Stranded assets to reduce consumption in the face of electrification
Mitigation actions
- Repositioning and reduction of overall exposure
- Consolidation of concessions with utility acquisition arrangements or strong operational synergies
- Hydrogen ready interventions to safeguard asset value
Derisking Target
Gas Network Hydrogenation
95%Rete hydrogen-ready
% by 20304.3
per 100 km of controlled network
100%
Smart meter digitization by 2030
-
Strategic risks implicit in trends
- Increased economic and reputational magnitude in case of failure to align network quality (e.g. loss levels) to benchmark/best performer
Mitigation actions
- Interventions for performance improvement (e.g. leakage reduction, increased drinking water rate)
Derisking Target
Water losses, %
Reuse of purification water, Mmc
+15%
Increase of purification capacity
District distribution of aqueduct networks, %
- Increased economic and reputational magnitude in case of failure to align network quality (e.g. loss levels) to benchmark/best performer
-
Strategic risks implicit in trends
- Reduced heat volumes for temperatures warming (climate change effect)
- Economic/reputational impact if emission mix not aligned with decarbonisation pathway and/or market standards
Mitigation actions
- DH network evolution through innovation (e.g. smart grids, thermal storage) and levers for decarbonisation (e.g. thermal waste, solar thermal, geothermal)
Derisking Target
Innovation applied to district heating and WtE / WtC
Contribution of renewable sources to the TLR networkCarbon intensity reduction, gCO2/MWh
16%
of investments in networks dedicated to TLR
Volume growth, Mmc
-
Strategic risks implicit in trends
- Impact of climate change and hydrogeological disruption on assets
- High competition in tenders
Mitigation actions
- Network resilience interventions; maintenance activities; structural interventions; 24-hour emergency response; redundant networks
- Creation of task force for tender preparation, development of innovative technical/economic solutions; preparation of broad development pipeline
Waste management - Collection
Waste management - Facilities
Waste management - Cross themes
-
Strategic risks implicit in trends
- Challenging regulatory targets (e.g. reduction in landfilling, levels of differentiated waste)
- Tariff conditions vs. private customers and institutional entities with lower margins
Mitigation actions
- Increased separate collection with timely pricing
- Application of the parameters provided by the regulation
- Creation of Group price lists
Derisking Target
Waste sorting, %
~3,3 Mn ton
waste collected by 2030
Inhabitants at a punctual rate, % of total inhabitants served
-
Strategic risks implicit in trends
- Capacity saturation of WTE facilities and landfills
- Delays in permitting processes for plant construction/ modification affecting incentives
Mitigation actions
- Development of new WTE and WTC facilities
- Oversight new chains of Waste as a service to citizens and productive fabric
- Continuous planning and monitoring, with dedicated cross-business task force for project authorisation and dialogue with entities
Derisking Target
Material recovery, kton
60 Mmc
biomethane produced from waste by 2030
<10%
landfilling by 2030
-
Strategic risks implicit in trends
- Change in prices of recycled materials
- Impact competitive dynamics on optimising sources and uses in the plastics supply chain
Mitigation actions
- Differentiation of flows and plant implementation plans on the different supply chains
- Renegotiation of contracts with Municipalities
- Increased collection base and treatment capacity
Energy - Renewable Energies
Energy - Thermoelectric
Energy - Cross Themes
-
Strategic risks implicit in trends
- Selling pressures and volatility of returns on new RES (Renewable Energy Sources) due to increased competitive pressure and changing market design
Mitigation actions
- Adoption of business model for minimising merchant exposure (e.g. leveraging retail portfolio and PPA)
Derisking Target
Renewable development, GW
(solar, onshore wind)~285 MW
renewable energy storage by 2030
-
Strategic risks implicit in trends
- Economic and reputational impact if the emission mix is not aligned with the decarbonisation pathway or market standards
Mitigation actions
- Disposal of emissive assets not functional for district heating
Derisking Target
Carbon intensity, gCO2 / MWh
-
Strategic risks implicit in trends
- Delays in permitting new facilities or modifications to existing facilities
- High competition on concessions for hydroelectric plants
Mitigation actions
- Planning, monitoring and dialogue with authorising agencies with dedicated cross-business task force for project authorisation
- Monitoring expiring concessions, proactive dialogue with entities and achievement of set targets, and preparing extensive development pipeline
- Delays in permitting new facilities or modifications to existing facilities
Market - Commodity
Market - Services
-
Strategic risks implicit in trends
- Pressures on margins/ churn due to increased competitive pressure (e.g. new player entry, including from adjacent sectors) and new quality standards/customer engagement
- CB reduction due to aggressive actions by competitors, extraordinary repricing actions, due to overcoming greater protection, ineffectiveness of business strategy (i.e. in terms of design and/or implementation)
- Energy commodity price and critical supply disruption (gas) risk
Mitigation actions
- Focus on raising service quality and personalisation; anti-churn policies and loyalty programs, selection of low churn sales channels (web, counter)
- Acquisition of customer packages to be regulated through participation in auctions, analysis and segmentation of customer base for campaigns/commercial actions, monitoring churn
- Portfolio hedged for current thermal season (hedges already acquired), liquid market expected
-
Strategic risks implicit in trends
- Pressures on margins/ churn by competition "any-to-any"1 ecosystems
- High competition on new products/developments (i.e. Iren Plus, Iren Go, Ecobonus 110%)
Mitigation actions
- Development of Iren platform of services for citizens (e.g. energy services, insurance), cities (charging infrastructure, Smart Cities, district redevelopment) and businesses (energy efficiency)
- Accelerated implementation of Iren Go, Iren Plus, Ecobonus 110% projects
Derisking Target
Customer Base, Mn
(Power & Gas)30%
sales penetration by 2030 for Iren Plus
Smart solutions - Smart solutions
Smart solutions - Cross themes
-
Strategic risks implicit in trends
- Changes in the legal/regulatory framework with negative effects on business (e.g. reduction of incentives)
Mitigation actions
- Monitoring regulatory developments regarding incentives for energy efficiency interventions and business reorientation
Derisking Target
Public electricity columns, k
80
PA redevelopment projects by 2030
7.000+
energy community projects
-
Strategic risks implicit in trends
- High competition on electrical and thermal plant concessions
Mitigation actions
- Monitoring expiring concessions, proactive dialogue with entities and achievement of set targets; preparing extensive development pipeline
Corporate - People
Corporate - IT
-
Strategic risks implicit in trends
- Loss of key skills with repercussions on achievement of objectives
- Difficulty in finding specialised professional profiles in line with evolving business needs and/or traditional profiles
- Difficulties in implementing non-inclusive policies/conduct
- Difficulties in implementing new leadership models in view of the changing environment with possible repercussions on the execution of strategic guidelines
Mitigation actions
- Critical skills mapping, retention and corporate welfare initiatives, compensation & benefits policies, back-up figures
- "Multi-channel" personnel selection (e.g. "IrenFutura," Linkedin, specialised sites, social pages); change management/training programs
- Diversity management initiatives and programs
- Leadership Project
-
Strategic risks implicit in trends
- Growing complexity of the transformation process, affecting project implementation
- Lack of resilience of IT/ OT systems due to causes attributable to vendors, cyber attacks, natural events, ...
Mitigation actions
- PMO skills acquisition and training
- Training/procedures; access control, backup and restore
- Business Continuity Management model implementation