329
million euro
of Ebitda generated by shared value
activities, 1/3 of total Ebitda
(+10% compared to 2016)
200
million euro
for shared value investments,
41% of total investments
70/100
customer satisfaction
The annual customer satisfaction
survey confirms the quality of Group
services

EBITDA from “shared value”

The Hera Group continues to report “shared value” EBITDA (started for the first time with the 2016 sustainability report), i.e. the portion of EBITDA resulting from projects and activities that respond to the “calls to action” classified in the three CSV Drivers: in 2017, this value totalled Euro 328.6 million (equal to 33.4% of the total), a 9.6% increase compared to the previous year. This result is in line with the 2017-21 Business Plan, created so that approximately 40% of EBITDA of 2021 derives from business activities that respond to the priorities of the global sustainability agenda.

The roughly 10% increase in “shared value” EBITDA is recorded against a 7.4% increase in the Group’s overall EBITDA (equal to Euro 984.6 million) compared to the previous year.

The prevailing contribution derives from activities and projects related to the efficient use of resources (Euro 218.5 million), followed by those related to innovation and contribution to development (approximately Euro 75.8 million). The smart use of energy accounts for Euro 64.4 million in 2017.

EBITDA from shared value

As pointed out in the diagram, around 66% of the “shared value” EBITDA generated in 2017 is mainly the result of activities and projects that meet the “calls to action” of the 2030 UN Global Agenda for an “efficient use of resources”. As regards “Impact Area”, the key role played by the Group in creating value with activities related to the transition to a circular economy (+11% compared to 2016) and to the sustainable management of water resources (+15% compared to 2016) emerges.

Around 23% of “shared value” EBITDA was instead generated from activities belonging to the Global Agenda areas that lead towards a “smart use of energy”. 75% of this share of EBITDA comes from initiatives aimed at the promotion of energy efficiency, through the development of commercial offers to Group customers and the reduction of internal energy consumption, with particular attention to water services, public lighting and district heating. The residual percentage of EBITDA for the smart use of energy is connected to the spreading of renewable energy achieved both with commercial activities and through the production of energy from renewable sources.

Lastly, the Hera Group generates about 20% of “shared value” EBITDA with reference to innovation, digitalisation and its contribution to an inclusive and environmentally friendly development. With regard to the “spreading of innovation and digitalisation”, shared value was achieved also through telecommunication services, via the Acantho company, and through projects for the digitalisation of operational processes. “Economic development and social inclusion” was especially achieved through generated employment and the outsourcing of environmental services to social cooperatives. This allows disadvantaged individuals to be employed and also leads to economic benefits for the Public Administration (lower welfare costs). Lastly, in terms of “air and soil protection”, the purchase of vehicles with a lower environmental impact and the district heating service were privileged.

“Shared value” EBITDA growth in 2017: an increase of Euro 28.6 million (+9.6%) compared to 2016
CSV Drivers Impact Area 2017 main results
Smart use of energy:

Euro -3.5 mln

Promotion of energy efficiency: + Euro 8.3 mln

 

Spreading renewable energy:

Euro -11.9 mln

● Further development of gas and electricity offers for customers with energy efficiency services. +16% in 2017 compared to 7% in 2016.
● Gradual increase in LED light points managed by the public lighting system: 14% in 2017 (7% in 2016)
● Saving from energy efficiency measures: over 8,300 toe saved at the end of 2017
● Increase in “Nature Package” customers which guarantees the renewable provenance of the electricity purchased: +9% in 2017 (7.4% in 2016)
● Reduction in electricity sold which is produced from renewable sources (national mix): 19% in 2017 (28% in 2016)
Efficient use of resources:

+ Euro 25.5 mln

Transition towards a circular economy: + Euro 12.1 mln

 

Sustainable management of water resources: + Euro 13.4 mln

● Further reduction in the use of landfills for municipal waste: 7% municipal waste collected and disposed of in landfills (7.6% in 2016)
● Further increase in the rate of packaging recycling: 68% in 2016 (64% in 2015)
● Aliplast acquisition (103 thousand tonnes of recycled plastic produced)
● Increase in industrial waste recovered by HASI (from 25% to 31%) and by Waste Recyling (from 17% to 28%)
Innovation and contribution to the development of the area:

+ Euro 13.0 mln

Spreading innovation and digitalisation: + Euro 8 mln

Economic development and social inclusion: + Euro 7.2 mln

Air and soil protection: – Euro 1.8 mln

● Innovation and digitalisation: investments in Utility 4.0 (business intelligence, data analytics, smart metering, etc.) in order to make operating processes more efficient and optimise management (remote reading for 22% of meters at the end of 2017 compared to 10% in 2016)
● Innovation and digitalisation: Acantho business development (telecommunications and connectivity)
● Social inclusion: 6% of customers with at least one instalment (stable compared to 2016)
● Social inclusion: 807 disadvantaged workers hired (+8% compared to 2016)
● Reduction of district heating margin only partly offset by the increase in the portion of energy from energy-to-waste plants and from cogeneration (60% in 2017; 54% in 2016)

The total deviations of shared value EBITDA do not correspond to the sum of the single deviations in the single drivers and in the single impact areas, due to activities that affect several components. Unlike 2016, in the calculation of the 2017 MOL, district heating was assigned to the impact area Air and soil protection.

Shared value EBITDA compared to total EBITDA

 

“Shared value” EBITDA growth 2017-21