Business Outlook

The macroeconomic context continues to remain critical, particularly due to the inflationary effects of higher energy commodity prices, which are generating a significant increase in interest rates.  In this context, the strategic approach defined in the 2021 Business Plan is confirmed and reinforced in all strategic drivers: ecological transition, territoriality and service quality. The Group expects to invest more than EUR 1 billion in 2023, mainly for asset development in the networks, environment and renewable generation sectors.


On the strength of this development capacity, financial results are expected to grow compared to 2022 due to a recovery of the full value of the customer portfolio, the stabilisation of energy prices and the disappearance of the negative extraordinary items reported in 2022.


In particular, analysing the individual business units, the Networks will continue to be characterised by an increase in operating costs due to inflation, fully recoverable from 2024 and only partially offset by higher tariff revenues due to the increase in tariff invested capital (RAB). Investments in the integrated water system will favour the increase in purification capacity, the reuse of resources and the reduction of water losses due to greater efficiency. In the electricity and gas distribution network, the objective is to increase the power supported by the former and make the latter suitable for the distribution of hydrogen mixtures, while keeping in mind the continuous improvement of service quality.


As far as the Waste sector is concerned, investments will be aimed at the construction of waste material recovery plants as envisaged in the business plan and at increasing the quality of the service, extending door-to-door collection and punctual pricing. In particular, in 2023, we will have the full contribution of the organic waste treatment and biomethane production plant in Reggio Emilia and the start-up of the wood recovery and pallet production plants in Vercelli and the plastic selection plant in Turin.


In the Energy and Market segments, in 2023, the Group expects the full recovery of the value of the customer portfolio, which in 2022 was strongly affected by the volatile energy scenario and the contribution of the new combined cycle line of the Turbigo thermoelectric plant. Investments will focus on the development of new renewable capacity (photovoltaic and wind power) in combination with the growth of the retail customer portfolio.


Finally, Smart Solutions, focused on the energy efficiency of buildings, will act as the main interlocutor for public administrations to ground complex urban regeneration projects and develop renewable energy communities.


On the strength of a robust investment plan, expected growth in economic results, and the optimisation of net working capital, the Group can confirm the development trend and financial sustainability envisaged in its Industrial Plan.