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Hera will invest 5.5 bn€ in the 2025-2029 period. A significant share, of 2.1 bn€, will be dedicated to development capex, a real growth engine together with M&A transactions, which will absorb approximately 0.4 bn€.

Development projects have been selected, in terms of both type and size, to maximise return opportunities across Hera’s three areas of operation, through the allocation of resources independently of the area in which the Free Cash Flow funding them was generated. Through this mechanism, Hera can put into play an overall portfolio management approach, capturing the most attractive returns across different market segments at any given time while minimising potential adverse impacts from the external environment.
Over the 2025-2029 period, Hera will concentrate approximately 60% of development investments in regulated businesses.

Group EBITDA growth is driven to the same extent by the three different businesses
In 2029, Hera aims to achieve an EBITDA of 1,760 m€, meaning a purely structural 348 million increase compared to 2024. All businesses will contribute to this growth, providing balanced contributions by weight: 34% of the EBITDA increase is attributable to the Networks, 33% to Waste and 32% to Energy.

EBITDA growth across the strategic areas follows different dynamics

In Networks, Hera has planned to carry out a significant development capex and M&A program totaling 1.5 bn€, which will help support returns, having already achieved very high efficiency standards that are rewarded by Regulation. Looking at the most relevant operating metrics, over the Plan period, a reduction in network losses (from 31% to 28%) and an increase in reused water (from 11.9% to 14.5%) are expected. Predictive maintenance practices will reach an incidence of 99% by the end of the Plan (vs. 85% in 2024). Investments in decarbonisation made so far have already prepared Hera’s networks to accommodate hydrogen blends.

As a result of the investments envisaged in the Plan, the RAB of gas and electricity distribution and water cycle activities is expected to increase from 3.5 bn€ in 2024 to 4.7 bn€ in 2029. Therefore, the increase of 1.2 bn€ significantly exceeds the FCF of 0.9 bn€ generated by Network activities.

Networks' EBITDA is expected to grow at a structural weighted average annual rate of 4%, by leveraging development investments and a thorough asset management that fully allows for benefiting from regulatory returns.

Water, the business that will see the highest concentration of investments, will also be the one expected to make the most significant contribution in terms of EBITDA (+64 m€ over the Plan period).

In the Waste area, Hera will pursue a strategy of increasing its market share by leveraging the factors that have already contributed to gaining a leading position. Its current presence in waste treatment services, around 10%, can be significantly strengthened, given the fragmented structure of the competition. The main path that Hera will continue to follow will certainly be the one of M&A – as confirmed by the latest transaction signed to acquire Sostelia. The other two options that Hera will continue to consider are the expansion of plant capacity – an activity that is limited by lengthy authorization processes – and the establishment of new partnerships.

The Plan envisages Hera fully capturing the opportunities arising from growing demand for circularity, also driven by EU directives, by leveraging the strengths already built in certain specialised segments, such as high-quality plastics (PE, PET and rigid plastics) and carbon fibres. The objective is to expand treatment capacity in response to already saturated order backlogs. Volumes of treated special waste, which represent the highest value-added part, are expected to increase from 3.3 to 4.6 million tonnes over the Plan period.

Equally promising are the developments in volumes and margins in soil remediation activities, a business in which Hera has mapped the presence of 13,000 sites in Italy requiring intervention. The integrated system made available by the Group to support the activities of its subsidiary ACR, which specialises in this sector, further enhances the return profile of this business, for which strong expansion dynamics are expected (with soil remediation volumes increasing from 309 thousand to 435 thousand tonnes over the five-year Plan period).

Waste FCF over the 2025-2029 period, expected to account for a total of 800 million euro, will be entirely reinvested in the business itself.
Based on these investments, EBITDA in the Waste segment is expected to grow at a weighted average annual rate of 8% over the five-year period.

In the Energy area, Hera will continue to place the customer at the heart, with a major upgrade of its CRM system and the introduction of Salesforce, already widely used in the Waste area. Artificial Intelligence applications will also be increasingly used in the 200 shops across the country, where the process of listening to customers will be enhanced by the ability to define increasingly targeted offers, with value-added services. Through a personalised approach, Hera expects to enhance its competitive advantage. This effort, combined with the traditional high loyalty profile of its customer base, will enable attractive growth in terms of EBITDA.

The total number of customers expected by the end of the Plan is 4.5 million: the change compared to the 4.6 million of 2024 reflects the conclusion of approximately 200,000 two-year contracts resulting from tenders won in the last resort segments - abandoned as they are no longer profitable in the new context - and the churn rate of Gradual Protection Service customers, who are set to switch to a free market contract on April 1, 2027, with an estimated exit of 300 thousand units vs. 500 thousand expected in the previous Plan. Over the period, the acquisition of 100,000 new customers is also expected, along with the addition of 300,000 customers through external growth.

Net of 175 m€ in temporary opportunities seized in 2024, EBITDA in the Energy segment is therefore expected to achieve “structural” growth at a weighted average annual rate of 4% over the five years of the Plan. A wide range of factors will drive this growth: expansion in the free market segment, increased energy efficiency and VAS activities and generation will be the most significant, together with the contribution of acquisitions. This will largely offset the expected reduction in trading margins and, more generally, the effects of margin reduction due to the gradual normalisation of energy markets.
The Free Cash Flow of 1.7 bn€, in excess of the reinvestment requirements of the business itself, which will require an absorption of approximately 600 m€ over the five years of the Plan, will be used to fund a significant share of the investments in the Networks and the distribution of dividends.

Attractive returns against a controlled risk profile
The Group Return on Investment is expected to reach 9.3% in 2029: a higher level compared to the 9.2% of 2024, adjusted for the contribution of Temporary Opportunities. Group ROI at 2029, calculated on net invested capital growing by 2 billion, is the combined effect of a slight reduction in returns on regulated businesses, due to tariff updates set by the Authority, returns holding up in the Energy business, and growth of 2.6 percentage points in the waste treatment business, which will benefit from greater operational leverage due to commercial expansion and growth of Global Waste Management's circular services.