Terna unveils $18 billion investment plan for 2024-2028

Italian power grid company Terna has announced an ambitious €16.5 billion ($18 billion) investment plan over the next five years. The investment aims to integrate renewable energy sources into the Italian economy and improve the flexibility and digitization of the national power grid.

Terna increases capital spending by 65% and evaluates $1.5 billion acquisition

Capital spending outlined in Terna’s 2024-2028 plan marks a significant 65 percent increase over previous strategies. The new plan was developed under the leadership of the company’s new CEO, Giuseppina Di Foggia. Although the plan does not explicitly mention mergers and acquisitions (M&A), the CEO indicated that the company is considering the purchase of distribution assets. “New regulations provide incentives for power distributors to sell assets that could benefit our transmission activities. We are currently conducting preliminary assessments on this opportunity”, the manager commented, without providing further details. Recent media reports suggest that Terna may allocate about 1.5 billion euros to acquire distribution assets from various utilities in Italy. In its business plan, the company forecasts an annual increase of more than 8% in adjusted core earnings through 2028. Earnings before interest, taxes, depreciation and amortization (EBITDA) are expected to rise from 2.17 billion euros last year to 3.25 billion euros by 2028.

Terna supports Italian renewable energy goals

The Italian government has set a goal of generating 65% of its electricity from renewable sources by 2030, with plans to phase out coal by 2028 and reduce dependence on gas-fired power plants, as outlined in the draft energy and climate plan (PNIEC). Terna’s strategic projects include the development of several key infrastructures to support this transition. Notable projects include the Tyrrhenian Link, a submarine cable connecting Sicily with Campania and Sardinia; the Adriatic Link, connecting Abruzzo and Marche regions; and an interconnection between Italy and Tunisia. The company, which counts State Grid of China among its shareholders, also announced a new dividend policy. This policy guarantees a minimum 4% annual growth in dividends per share, using 2023 as the base year. For 2023, Terna will pay 0.3396 euros per share, while for 2024 the dividend per share will be whichever is higher between a 4% growth from 2023 or a 75% payout ratio. In addition, the group mentioned the possibility of issuing hybrid debt as a measure to maintain its credit rating.

“Terna Ideas” corporate entrepreneurship programme: Terna rewards sustainable innovation

Terna has rewarded the sustainable innovation projects developed in the company through the “Terna Ideas” corporate entrepreneurship programme. The company that operates Italy’s national transmission grid has also launched a new platform open to start-ups, researchers and innovative SMEs: the aim is to identify solutions and initiatives that can contribute to the energy transition.

The winning projects in the 2022 edition of “Terna Ideas”

“De-Icing”, “Terna Reliability” and “Orion” are the three winning business projects in the second edition of “Terna Ideas”, the corporate entrepreneurship programme launched by the company that operates Italy’s national transmission grid. An initiative that promotes a culture of innovation throughout the company’s workforce, giving employees the opportunity to act as entrepreneurs. The 2022 edition involved the entire corporate population and saw the participation of approximately 250 people. One of the main new features of this year’s edition is sustainability, which became one of the key and transversal criteria, both in the proposing and assessment stage. Terna has rewarded sustainable innovation in all three projects: “De-Icing” provides for the use of a remote-controlled heat box to melt the ice sleeves that form on the conductors of power lines in the winter months; “Terna Reliability” is a device that monitors the technical parameters of transformers and optimises activities; “Orion” is an AI algorithm that improves the resolution of the satellite images needed to identify promptly buildings and structures interfering with the easement bands of power lines. Furthermore, a special mention went to “Electrendicity”, a simulator game for training on the electricity market and the energy transition.

Promoting a culture of innovation: the purpose behind “Terna Ideas”

As part of the initiative, the company’s employees were invited to take part individually or in teams, presenting their idea or lending their skills to support one of the proposed projects. The second edition began in April 2022 and was structured with 10 events of the Innovation Roadshow around Italy. 250 people participated, with a total of 85 ideas published: ten projects followed dedicated incubation development, while the three winning initiatives will now go ahead with project development. As announced by the company, the 2023 edition will include an open innovation tool open to the external ecosystem. This is the reason why Terna has recently developed a new platform open also to start-ups, scaleups, innovative SMEs and researchers: the aim is to identify solutions and initiatives capable of contributing to the energy transition. To this end, on 15 December 2022, the company led by CEO and General Manager Stefano Donnarumma has launched a challenge on the new virtual space ternaideas.terna.it: the theme is Data Science for Resilience and the search for solutions to enhance the corporate data assets, supporting the company’s activities in the context of predictive maintenance and monitoring of electricity infrastructures. The approach of “Terna Ideas” is consistent with the Group’s vision in which technological and cultural innovation are considered key assets. It is also consistent with the 2021-2025 ‘Driving Energy’ Business Plan, whose update in March 2022 earmarked approximately 1.2 billion euros of investments – of the total of 10 billion – dedicated to innovation and digitalisation.

“Driving Energy”: Terna presents the Group’s 2021-2025 Industrial Plan Update

Terna's Board of Directors, chaired by Valentina Bosetti, met on 24 March 2022 to examine and approve the Group's 2021-2025 Industrial Plan Update. "A major increase in investment in developing and modernising the electricity grid, further strengthening the Group's role in driving the energy transition", CEO and General Manager Stefano Donnarumma said while presenting the Update.

Terna's 2021-2025 Industrial Plan Update: +10 billion euros in investment

Promoting decarbonisation through the integration of renewables and the electrification of consumption. With this in mind, Terna continues to accelerate its commitment to the energy transition of Italy, while contributing to the country's decarbonisation and energy independence. This is the picture which emerges from the Update of the Group's 2021-2025 Industrial Plan, which was presented on 24 March 2022. With a further capex acceleration of 10 billion euros, the company led by CEO and General Manager Stefano Donnarumma will strengthen its role in driving the Italian electricity system, in accordance with the objectives set in the PNIEC (Italy's Integrated Energy and Climate Plan) and the targets in the European Green Deal, which aim to reach a greenhouse gas emission reductions target for 2030 of at least 55%. How is Terna accelerating its commitment? Sustainable investment is the key driver of "Driving Energy", the Group's 2021-2025 Industrial Plan: the company's capital expenditure - 99% of which is classified as sustainable according to the EU Taxonomy - targets the development of renewable sources. With regard to this, the decarbonisation goals set in the Green Deal require the installation of approximately 60-70 GW of renewable capacity (wind and photovoltaic) by 2030.

Terna's CEO Stefano Donnarumma: "Our capital expenditure will allow us to integrate renewable sources and electrify consumption"

The Update of the 2021-2025 Industrial Plan is "a major increase in investment in developing and modernising the electricity grid, further strengthening Terna's role in driving the energy transition", CEO and General Manager Stefano Donnarumma said during the presentation. He also pointed out that "an even more sustainable future with zero emissions" and "a plan to make the Country more energy independent thanks to more rapid development of renewable energy" are the goals which the company has set itself, forming the basis for the Update of "Driving Energy". "Goals that mark a concrete commitment both as a business and as a public service provider", the CEO and General Manager added, while stressing that Terna is "a company that provides a public service for the Country and the community, for the benefit of all the geographical areas in which we operate and the environment". Its capital expenditure has "a key role to play in enabling Italy and Europe to meet the goals that have been set", he observed, and "will allow us to integrate renewable sources and electrify consumption and to guarantee ever greater security and efficiency of supply, a system that is fit for purpose and improved quality of service, whilst cutting costs for consumers and businesses". As explained during the presentation, the Group's capital expenditure will also target the development of new interconnectors with foreign countries (France, Austria, Tunisia and Greece), joining the 26 existing cross-border power lines. This will enable Italy to reinforce its role as a European and Mediterranean electricity transmission hub.

Luigi Ferraris (Terna): agreement with The Mobility House

Terna continues its commitment to sustainable development: led by Luigi Ferraris, the company signed a new agreement finalized for development and roll-out of innovative intelligent charging solutions for electric vehicles.

Terna continues its commitment to sustainable development: the national operator led by Luigi Ferraris aims to guide the energy transition, therefore will work with The Mobility House for integration the renewables with the grid and development of e-mobility.

Luigi Ferraris: Terna Energy Solutions signs with the Mobility House

Special attention to local areas, respect for the environment, meetings with local communities and the use of advanced technology are the guides that will move Terna forward over the coming years. A kind of proactive approach will make the national electricity transmission system operator the leader of the ongoing energy transition, as Luigi Ferraris said during the presentation of the strategic plan (2019-2023). In this context, the latest news is the agreement between Terna Energy Solution (belonging to the Terna Group) and The Mobilty House, a young firm whose aim is to drive on the transition to the use of sustainable energy sources. Following this partnership, they will able to develop and roll out of innovative intelligent charging solution for electric vehicles. In addition, the Group led by Luigi Ferraris and young technology company will work together for identification and design solutions enabling integration of renewables with the grid, with prime focus on the smaller Italian Island, as the signed Memorandum of Understanding referred.

Terna: company profile and core business of the Group led by Luigi Ferraris

Considered one of the Italian excellences, Terna is among the leading electricity transmission system operators in Europe in terms of kilometers of lines managed. Led by the Chief Executive Officer Luigi Ferraris, the society manages the high voltage Italian transmission grid, one of the most modern and technologically advanced in Europe, as well as playing a central role in transforming the electricity market towards the use of eco-compatible sources, guaranteeing a secure and efficient supply to households and businesses. The company structure of the Group consists of the holding company, Terna S.p.A., and its two operating subsidiaries: Terna Rete Italia and Terna Plus. The service which the society provides in Italy is crucial to the operation of the entire electricity system and for guaranteeing the supply of electricity to all, companies and private individuals alike. In playing such a prime role, Terna has responsibility for supplying the entire country's electricity needs, not directly but via those companies that distribute and sell electricity to end-consumers. It is internationally oriented: the commitment is to make its role even more central within Europe to strengthen Italy's position as electricity hub between Europe and the Mediterranean and due to its strong effort in promoting a sustainable approach, it has been recognized as the global leader of the electric utilities sector with its tenth consecutive placing in the Dow Jones Sustainability Index. In addition, the Group led by Luigi Ferraris, is also present in other important international sustainability indices such as Bloomberg GEI, Euronext (World, Europe and Eurozone), FTSE4Good (Global and Europe), STOXX® ESG (Global, Environmental, Social and Governance), STOXX® Low Carbon, ECPI, ESI (Ethibel Sustainability Index), MSCI, United Nations Global Compact ("GC100"); and in the Italian indices FTSE ECPI Italia SRI Benchmark and Italia SRI Leaders, drawn up only from listed Italian companies.

Terna: Luigi Ferraris shows 2019-2023 plan

The electricity system will be reshaped by the energy transition under way: in this context Terna, and the other networks operator will play a leading role in leveraging innovation, skills and distinctive technologies for the benefit of all stakeholders. This is the mission defined in the new strategic plan of the Society. Between 2019 and 2023, they will invest 6.2 billion euros in Italy, which represents the highest ever economic commitment, as Luigi Ferraris reported.

Luigi Ferraris presents Terna 2019-2023 strategic plan

Considering a long-time horizon is essential in planning business strategies. Luigi Ferraris, Terna CEO and General Manager, explained the 2019-2023 strategic plan "Grids and Value- Accelerating a Sustainable Growth", which details the investments that the Group plans for the next five years. It marks an important stake in the difficult path towards achieving the energy transition objectives, with a strong focus on land development, grid security and service quality. For the five-year period, a substantial financial commitment has been prepared: 6,2 billion in investments, which represents the highest ever economic commitment, as Luigi Ferraris reported. The strategic plain is based on the development of the national electricity grid, with works on the rationalization of power lines, interconnections with foreign countries and the construction of new underground or undersea cables with lower environmental impacts. Terna CEO also emphasized the important contribution of everyone to achieve this goal: "As a shared goal on global scale, decarbonization can only be successfully achieved is everyone involved contributes. Terna plays a leading role in the Italian National Electricity System. A role we carry out by managing the system and investing heavily in grid infrastructure".

Terna: company profile and core business of the Group led by Luigi Ferraris

Italian excellence, Terna, managed by Chief Executive Officer Luigi Ferraris, is among the leading electricity transmission system operators in Europe in terms of kilometres of lines managed. They manage the high voltage Italian transmission grid, one of the most modern and technologically advanced in Europe, as well as playing a central role in transforming the electricity market towards the use of eco-compatible sources, guaranteeing a secure and efficient supply to households and businesses. The company structure of the Group consists of the holding company, Terna S.p.A., and its two operating subsidiaries: Terna Rete Italia and Terna Plus. The service which the society provides in Italy is crucial to the operation of the entire electricity system and for guaranteeing the supply of electricity to all, companies and private individuals alike. In playing such a prime role, Terna has responsibility for supplying the entire country's electricity needs, not directly but via those companies that distribute and sell electricity to end-consumers. Because of its strong effort in promoting a sustainable approach and their performances, it has been recognized as the global leader of the electric utilities sector with its tenth consecutive placing in the Dow Jones Sustainability Index. In addition, the Group led by Luigi Ferraris, is also present in other important international sustainability indices such as Bloomberg GEI, Euronext (World, Europe and Eurozone), FTSE4Good (Global and Europe), STOXX® ESG (Global, Environmental, Social and Governance), STOXX® Low Carbon, ECPI, ESI (Ethibel Sustainability Index), MSCI, United Nations Global Compact ("GC100"); and in the Italian indices FTSE ECPI Italia SRI Benchmark and Italia SRI Leaders, drawn up only from listed Italian companies.

Luigi Ferraris, Terna: development and welfare can be driven by energy and infrastructure investments

"Terna is ready to face the challenge of making the country's network more secure, more efficient and more resilient": CEO and General Manager, Luigi Ferraris, on an article published by The Voice of Business focused on energy and infrastructures. Moreover, he shows the business model of his Group based in particularly on sustainability and dialogue with their stakeholders.

Terna: CEO and General Manager Luigi Ferraris writes an article on energy and infrastructure

"Investments are an opportunity to support the growth of the Italian economy. We are strongly committed to playing a leading role as an infrastructure operator for the Country", according to Terna CEO and General Manager, Luigi Ferraris. On a recent article published by The Voice of Business, the Italian top manager recalled Terna's strong commitment aimed at guaranteeing "ever-increasing electricity service-quality levels and to support the current energy transition with innovative technological solutions". Ferraris also believes that an acceleration in investments in infrastructure is the enabling factor for a rapid transition. Terna has allocated over the next ten years 12 billion euro for investments destined entirely for the benefit of the Country, "with positive economic and social impacts for Regions and local communities". These investments are to achieving increasingly interconnected and technologically-developed power systems, thus reducing environmental impact. As of today, it is well known that electricity from renewable sources fosters sustainable and climate-friendly economic development. Moreover, renewables lead to a shift away from a traditional energy system, towards a more complex integrated one.

Terna: Luigi Ferraris, "Sustainability is driving our business model"

In its article, CEO and General Manager Luigi Ferraris confirms that sustainability is driving the business model of Terna. "We are well aware that business needs to be ever mindful of human rights and of the environmental impact of operations. Running a business is not only a matter of adding value to the enterprise itself, but also of disseminating positive values and minimizing conflict", added Luigi Ferraris. For this particular reason, Terna introduced an inclusive business model which listens to local communities and stakeholders. The dialogue with their stakeholders is the strength of Terna, as the CEO stressed: "Here at Terna, dialogue with our stakeholders forms the basis of everything we do. We take a proactive approach to engagement with interested parties, such as national and local authorities, municipalities, the general public, trade unions and environmental organizations, and we firmly believe that the stakeholder involvement is key to delivering our business objectives and to improving social welfare as a whole". Terna's strong effort has widely been recognized: with its tenth consecutive placing in the Dow Jones Sustainability Index, the Group led by CEO Luigi Ferraris ranked first in the global Electric Utility sector for its sustainability performance. In addition, Terna is also present in other important international sustainability indices such as Bloomberg GEI, Euronext (World, Europe and Eurozone), FTSE4Good (Global and Europe), STOXX® ESG (Global, Environmental, Social and Governance), STOXX® Low Carbon, ECPI, ESI (Ethibel Sustainability Index), MSCI, United Nations Global Compact ("GC100"); and in the Italian indices FTSE ECPI Italia SRI Benchmark and Italia SRI Leaders, drawn up only from listed Italian companies.

Dow Jones Sustainability Index: Terna, managed by Luigi Ferraris, leads worldwide the Electric Utilities area

Terna received its highest ever score in the 2018 Dow Jones Sustainability Index: 91/100, against an average score of 46/100. The Italian company managed by CEO Luigi Ferraris and Chairman Catia Bastioli leads the Electric Utilities sector.

Dow Jones Sustainability Index: Terna is world leader in the Electric Utilities Sector

The commitment of Terna to sustainability is growing faster: the Italian company managing the National transmission grid is world leader in the Electric Utilities Sector according to the 2018 Dow Jones Sustainability Index. The Group led by CEO Luigi Ferraris received its highest ever score (91/100, against an average sector score of 46/100). This is the tenth confirmation for the company, with an improvement of 4 points on the previous year score. Terna comes in first place for the Electric Utilites area for the following economic criteria: Materiality, Risk and crisis management, Policy influence; for the environmental criteria: Environmental reporting, Operational eco-efficiency, Transmission and distribution, and in the social criteria: Social reporting, Human capital development, Corporate citizenship and philanthropy. RobecoSAM, the Swiss sustainability rating agent, also confirmed Terna's inclusion in the World and Europe indices. The achievement is something to be proud of, as expressed by CEO Luigi Ferraris, who stated that "for Terna, sustainability represents a strategic lever that guides our business towards a more sustainable energy paradigm that is capable of continually adding value for companies and society as a whole." The manager also added that the placement on the Dow Jones Sustainability Index "is the recognition for our efforts to introduce an inclusive model to our business, paying attention to the requests of the local communities and our stakeholders." The company is, in fact, present in the following international sustainability indices: Euronext (World, Europe e Eurozone), FTSE4Good (Global e Europe), STOXX® ESG (Global, Environmental, Social e Governance), STOXX® Low Carbon, ECPI, ESI (Ethibel Sustainability Index, MSCI, United Nations Global Compact ('GC100').

The company profile of Terna

Terna is one of the main European electricity transmission grid operators. The company managed by CEO Luigi Ferraris plays a central role in transforming the electricity market towards the use of eco-compatible sources, guaranteeing a secure and efficient supply to households and businesses. The public service mission, as the majority owner of the Italian high voltage and very high voltage electricity National Transmission Grid, is to secure the transmission and dispatching of electricity throughout the country. Terna is listed on the Stock Exchange since 2004 and focuses on efficiency, profitability and performance. Sustainability is a key value for the company, as stated by the motto: "Energy is our responsibility. Responsibility is our energy". Terna is focused on developing renewable sources, which is crucial in helping Italy through a complete energy transformation as decarbonization is already at the door. The mission is, in fact, to play a leading role for this transition, leveraging innovation, skills and distinctive technologies with the goal of generating value for all stakeholders. The company managed by Luigi Ferraris is internationally oriented: the commitment is to make its role even more central within Europe to strengthen Italy's position as electricity hub between Europe and the Mediterranean