Business Outlook

In the final quarter of 2022, the significant growth in investments will be confirmed, which will allow the Group to seize various development opportunities as envisaged in the Business Plan. The latter rests its rationale on three strategic pillars that guide investment choices: ecological transition, territoriality and quality of service. The goals of the green transition are to progressively decarbonise all activities and strengthen leadership in the circular economy. With territoriality, Iren wants to extend its perimeter of activity in the reference territories and be the reference partner for local stakeholders. Finally, with service quality, Iren aims to improve the performance of network services and maximise customer satisfaction in all businesses.


The last few months of 2022 in the Networks sector will be characterised by a major investment plan, which will be positively reflected in the remunerated invested capital (RAB) and, consequently, in tariff revenues. Investments in the integrated water system will encourage increased purification capacity, reuse of resources and reduction of water losses through increased efficiency. In the electricity and gas distribution network, the goal will be to increase the power supported by the first and replace the noncompliant material in the second, keeping in common the continuous improvement of the quality of the service.


With regard to the Waste Management sector, investments will be aimed at building the waste treatment and disposal plants envisaged in the business plan and at increasing the quality of the service by extending door-to-door collection and consumption-based pricing. These investments, together with the complete coverage of the waste cycle (from collection to treatment and disposal), will make it possible to increase the volumes of recovered material.


Regarding the Energy and Market segments, Iren will continue to implement a series of actions aimed at mitigating the impact of volatility in electricity and gas prices thanks to a hedging policy oriented to stabilising margins in the entire energy supply chain. The development of the generation park will benefit from the commissioning of the new production line of the Turbigo thermoelectric plant, the consolidation of the acquired photovoltaic plants and the organic development of new renewable capacity, accompanied by the growth of our customer base.


Finally, the Smart Solutions segment, focused on the energy efficiency of buildings, will be able to seize the opportunities offered by government incentives related to building requalification, to the development of electric mobility and will be able to act as the main interlocutor for public administrations to ground complex urban requalification projects.


In relation to the international geopolitical crisis arising from the Russia-Ukraine conflict, it is difficult as well as uncertain to assess the effects and repercussions that could arise from the continuation of the international crisis. In such a scenario, there are three main risks to be borne in mind: the procurement of natural gas to replace the quantities previously purchased from Russia, the volatility of commodity prices and the simultaneous inflationary effect. Iren monitors the evolution of the situation on a daily basis, defining the possible risk scenarios for its activities and identifying, where possible, mitigation actions with particular reference to net financial debt.


In addition, in order to contain the impact resulting from the increase in commodity prices, whose upward trend took hold in the fourth quarter of 2021, the government has already approved measures aimed at controlling the imbalance between the production and sales prices of electricity and gas. On the so-called 'high bills' issue, further measures are being defined by the EU and the government, the impact of which cannot be estimated at present.