Ascopiave — Management Reports 2024

Mar 18, 2024

STRATEGIC PLAN 2024-2027

Pieve di Soligo, 18 March 2024

Content

Ascopiave at a glance

Ascopiave Group, listed on the STAR segment of the Italian Stock Exchange, is a solid, reliable and transparent counterpart for its stakeholders

Gas distribution

Gas distribution activities (874 k PDR¹ ) represent the core business of the Group, currently leader in the North-East and 5th largest operator at national level

Technological partnership in the Integrated Water Service business, synergistic with the other Group activities

Renewable energy production

Portfolio of hydroelectric and wind power plants and photovoltaic projects for development

Portfolio of investments in retail companies (EstEnergy and Hera Comm)

Retail gas and

Energy Services

consumption

electricity

The plan envisages a growth path that will allow to increase company profitability, maintaining a balanced financial structure and a stable and profitable dividend distribution

LONG-TERM GOALS

Sustainable business growth from an economicfinancial, social and environmental point of view

INTERMEDIARY GOALS

Opportunities for growth and improvement provided by the dynamics of the sectors of interest

STRATEGIC LEVERS

Exploitation of the current positioning and enhancement, strengthening and development of the resources and internal competences

Economic and financial objectives are combined with those of key stakeholders and integrated with social and environmental objectives in order to achieve sustainable success

Ascopiave Group's strategy is based on sustainable growth, developing resources and skills in order to seize the opportunities generated by new market trends

The «Sustainable Development Goals» identified by Ascopiave through dialogue with its Stakeholders represent the elements on which the Group will base its sustainable growth path

The sustainability path undertaken by Ascopiave Group is inspired by the Sustainable Development Goals (SDGs) related on the one hand to its business activities (SDGs 6, 7, 8 and 9) and on the other hand to the impact and effects that the Group exerts on the territories in which it operates (SDGs 10, 11, 12 and 13). In this context, Ascopiave's strategy incorporates the concept of assuming responsibility that the 2030 Agenda requires of every reality, not only in terms of what it carries out at the business level, but also as an activator of change with a view to creating sustainable systems both locally and globally.

Ascopiave Group holds a balanced portfolio of assets with a low risk profile

Gas distribution – Positioning and operating data

Thanks to its size and favorable territorial positioning, Ascopiave Group has been and will continue to be among the protagonists of the consolidation of the sector

Group Consolidation

• Ascopiave Group has completed 13 company acquisitions since 2000
• Significant increase in the customer base and in the municipalities served
• Expansion of the geographic basin

Current territorial presence

• 5 th largest national operator in the sector
• Regional leader in North-East Italy
• Significant presence in some areas of Lombardia

Friuli Venezia Giulia Other regions

Competitive context in Veneto¹

Ascopiave Group – Operating data 2023

^{445 492 541 777 778 890 874} 2017 2018 2019 2020 2021 2022 2023 K customers

Customers served

Ascopiave Group – Strategic Plan 2024-2027 10 Source : ¹Ascopiave elaboration on MISE data 31.12.2012 and other industry sources.

Gas distribution – Main economic-financial data

Gas distribution is a regulated business, characterized by a low level of risk and mostly stable and predictable economic results

Sound financial results and cash flows ensured by stable regulation and increased EBITDA supported by the increase in the number of users managed over the years

There is an excellent profitability of operations, confirmed by a return on investment (ROI) higher than the regulator's expected rate of return (regulatory WACC)

Ascopiave Group – Strategic Plan 2024-2027 11 Notes: ¹Titoli di Efficienza Energetica – Energy Efficiency Certificates; ²EBIT adj. (adjusted for the amount of fees paid to local governments and for alignment between accounting and tariff depreciation) / RAB.

Investment in EstEnergy – Gas and power retail

Ascopiave holds a stake in the EstEnergy group, leader in northeastern Italy in the sale of gas and electricity

25%¹ 75% EBITDA 69 m€ Electricity sold 1,835 GWh Gas sold 736 mSmc Retail customers power 382 k Retail customers gas 646 k Extraordinary transaction completed with Hera in December 2019 EstEnergy – Operating data 2023 ▪ Strategic repositioning of the Group ▪ Valorisation of sales activities ▪ Risk mitigation of commercial activities

Dividend distribution

€ ▪ Annual distribution of 100% of generated profits

Ascopiave Group – Strategic Plan 2024-2027 12 Notes: ¹Post-transaction stake of 48%, reduced to 25% in 2023 following the partial exercise of the put option exercised on Company's capital

EstEnergy and Hera Comm – Put option

Ascopiave holds a put option on its current holdings in EstEnergy and Hera Comm, which are characterized by excellent conditions in terms of value and flexibility of exercise.

The plan assumes a full exercise of the puts on the holdings for the purpose of financing the planned investment plan

• Option that can be fully or partially exercised by December 2026
• Strike price equal to the maximum between:
• ➢ Fair market value;
• ➢ Floor price: value of initial investment increased by 4% (net of dividends distributed);
• ➢ Initial investment value (48% of Esternergy): equal to 395 m€.
• In 2020, Ascopiave subscribed a 32.5 m€ capital increase in EstEnergy to service the tax relief of the higher value of the equity investments it acquired compared to the net book value. The benefits for Ascopiave will come in the form of higher dividends in fiscal years 2023-2032.
• In 2022 and 2023, Ascopiave partially exercised its put on its stake in Estenergy, transferring an 23% share of the company's capital to the Hera Group, collecting 216.7 m€
• Option that can be fully or partially exercised by December 2026
• Exercise price equal to the value of the initial investment (54 m€) increased by 5% (net of distributed dividends)

Option exercise strategy

1. Maximisation of the strike price

2. Reinvestment of the proceeds from the sale

Power generation from renewable sources

In the period 2021-2022, Ascopiave entered the renewable energy sector through some extraordinary business acquisition transactions and the establishment of partnerships for the development of new generation facilities

Plant portfolio: number of plants and installed power¹

Investment in Cogeide – Water management services

Ascopiave is active in the Water Service in the Province of Bergamo, through its subsidiary Cogeide. Synergies with the gas distribution business operated by Ascopiave in the same geographic area

Synergistic activities

• Sharing the technology platform for managing the data flow detected by smart meters

• Integration at the level of the information system used to manage active users

Cogeide – 2023 Data

Group debt and financial structure

The low debt in relation to the risk profile of the assets held allows to seize new investment opportunities in line with the strategic pillars

Ascopiave underwrote a bond loan through a private placement "shelf program" with Pricoa Capital Limited to ensure additional funding for the Investment Plan

Key elements that lead to the operation:

• Very long maturities (up to 15 years)
• Extremely competitive economic conditions
• Diversification of funding sources
• Possibility of partially reducing the use of bank finance, in light of new extraordinary transactions
• Introduction of a new long-term counterpart of excellent standing, with knowledge of the Group and the will to support it in future growth

Main features of the shelf program:

• Total amount of the shelf program: 200 \$ / mln
• Duration of each issue: up to 12 years
• Period for use: 3 years
• Financial covenants: NFP / Ebitda, NFP / Net Equity, RAB

Sustainability of Ascopiave

Ascopiave Group initiatives aim to combine sustainability and industrial growth, focusing on the optimisation of ESG objectives with a view to creating value for all stakeholders

Environmental

The Ascopiave Group's commitment to fighting climate change is translated into concrete actions aimed at reducing CO² emissions, producing clean energy and saving energy. Further attention is paid to initiatives to reduce the consumption of plastics at company sites.

Social

Ascopiave supports the improvement of social quality standards through initiatives and policies that promote social values in compliance with the principles of non-discrimination and equal opportunities within its organisation and in favour of local communities, for example through training and inclusion programmes aimed at employees.

Governance

Ascopiave, as a listed company, is aligned with industry best practices in the composition of its Board of Directors and Board of Statutory Auditors, complying, for example, with regulations on gender equality. Documents such as the Articles of Association, Code of Ethics, Remuneration Policy, and Management and Coordination Guidelines provide for sustainable success as a key principle.

Sustainable Finance

ESG linked loan: credit lines with a rate linked to the achievement of specific targets of some ESG indicators.

2020: First ESG linked loan with Intesa Sanpaolo S.p.A. for a total amount of € 50 million and a duration of 3 years

2021: Green loan with Mediobanca S.p.A. for an amount of € 20 million and a duration of 5 years, aimed at covering investments in renewable energy.

Sustainability Comittee

Established in November 2021 by Ascopiave's Board of Directors, the Sustainability Committee has investigative, propositional and advisory functions in evaluations and decisions concerning environmental, social and economic sustainability and energy transition.

^vnE

^{ri o mn}

cial - Governance

ental – S

o

Environmental sustainability

Ascopiave Group has always placed great emphasis and commitment on environmental issues, with the aim of minimizing the impact of its activities

Energy from renewable sources: Ascopiave has entered the renewable generation business, investing in hydroelectric (27 plants for an installed capacity of 48.5 MW) and wind power (2 plants for an installed capacity of 35.6 MW). At the company headquarters there is a 380 kW photovoltaic plant and a geothermal plant that guarantee a significant reduction in pollution and consumption.

CO² emission reduction: we have long been implementing the best technologies for constant consumption monitoring and implementing sustainable behaviors.

TEE management: through its subsidiary Asco Renewables (ESCo certified), Ascopiave manages the procurement of the Group's energy efficiency certificates in the most effective way.

Canteen Service: canteen service availability with focus on providing sustainable menus with the goal of reducing water use related to food production and consumption and CO² emissions. Ascopiave contributes to reducing food waste and spreading the culture of food value, proper nutrition, favoring supply chains with low environmental impact, supporting health and environment.

Extent of corporate green space: the main office has multiple green spaces totaling about 28,000 square meters equipped with an intelligent irrigation system that is not fed by the water service network. The green space/employee ratio is 150 sq. m.

Economic and social sustainability

Ascopiave Group promotes the involvement of its stakeholders in a context of mutual trust and collaboration to achieve its economic and social sustainability objectives

Supply chain: the Group gives preference to suppliers who hold certifications in environmental, quality and health & safety areas, and who operate in line with the Group's sustainability choices. The prevailing presence of local suppliers contributes to maintaining the level of employment in the territory.

Sustainability Report: during 2023, the Company continued the approach of communicating its social and environmental performance through the Non-Financial Statement, in addition to the Sustainability Report responding to the strategic goal of developing and nurturing relationships with the Stakeholder community over time.

Training: the Group promotes the professional growth of its employees. In order to increase employees' skills, continuous training and development activities are carried out. In 2023, the average training hours per employee amounted to 28.7.

Inclusiveness: the Group promotes the principles of inclusion, non-discrimination and equal opportunities, both in personnel selection and career development, as set out in the Code of Ethics and the personnel selection policy.

Work/life balance: the Group pays particular attention to the work/life balance of its workers: in particular, through a 2 nd level contractual agreement, the company provides for flexibility when entering and leaving the working day.

Parenthood: for workers, the Group allows them to obtain part time and/or a more conciliatory work schedule until their child reaches the age of 14.

3. Context and market trends

The Macroeconomic Context

There is a deceleration in GDP growth in 2023, which is adjusted downwards to 0.8% from the 1.0% reported in the Economic and Financial Document ('DEF').

GDP deceleration causes are the
erosion of household purchasing power
due to high inflation, the uncertainty
caused by the war in Ukraine, the
stagnation of the European economy
and the contraction of world trade.

Current situation in Italy	Market outlook
Inflation, after peaking in August 2023, is	Short-term interest rates are expected to rise in
✓	✓
expected to settle at 2.5% during 2024 and return	2023-2024, as a consequence of the ECB's
to the 2.0% level between 2025 and 2026.	monetary policy decisions, while there are no
✓	significant changes in long-term yields.
This reduction is thought to be related in	✓
particular to the evolution of energy commodity	The unemployment rate is expected to
prices	continue falling, from 7.6% in 2023 to 7.2% in
(down from the previous year), and the	2026, albeit with a slowdown in employment,
easing of volatility levels in energy goods.	affected by the broader GDP slowdown.

Outlook on investment and credit

• ✓ Investment expenditure in 2023 is lower than in the period 2021-2022, mainly due to tighter financing conditions and higher interest rates. These phenomena result from repeated interest rate increases by the ECB. The trend scenario sees investment expenditure increasing by 2.8% in 2024, with a lower growth trend in 2025 and 2026 (2.3% and 1.9% respectively).
• ✓ The trend in public investment is affected by the grants and loans of the National Recovery and Resilience Plan, as well as the reclassification of tax credits related to the superbonus. The result is a ratio of government gross fixed capital formation to GDP of 2.9% in 2023, 3.2% in 2024, 3.4% in 2025, and 3.2% in 2026.

The European and Italian decarbonisation goals

Both the European Union and Italy have based their growth targets for the next decade on the transition to a sustainable economy model

Ascopiave Group – Strategic Plan 2024-2027 23 Note: ¹Compared to 1990 levels; ²Compared to projected energy consumption in 2030 (based on 2020 reference scenario); ³Compared with data from Fit for 55.

Role of the gas sector in the energy transition

In the energy transition pathway, gas represents a key source that will have to ensure the transition from a fossil fuel-based energy model to one with low emissions

Expected gas consumption in Italy¹

Ascopiave Group – Strategic Plan 2024-2027 24 Source : ¹Snam document "Reference Scenarios for Gas Transmission Network Development Plans 2023-2032 and 2024-2033";²Biomethane and hydrogen.

The new infrastructure grid – Green gases

Significant growth in demand for green gas is expected in the coming years in order to accelerate decarbonization, increase energy independence, and foster integration with the electricity grid

Biomethane

• ✓ Renewable source (produced from biomass of agricultural origin) that already in the medium term can provide a sustainable alternative to natural gas
• ✓ Sustainable: carbon neutral source that can also significantly reduce emissions from the agricultural sector by promoting waste reuse and circular economy

Hydrogen

• ✓ Carrier that can be produced emissionfree from RES by electrolysis
• ✓ Viable alternative to natural gas in the long term, especially for decarbonization
• ✓ Promotes integration between electricity and gas sectors

Potential benefits of green gases

Programmable electricity generation

Possibility of storage and transport with existing gas networks

Multiple end uses (e.g. transport, industrial uses, electricity generation)

Application in light of the integration with the electricity network (e.g. power-to-gas-to-power)

Significant contribution to the reduction of emissions

New demand scenarios for 2040

To achieve decarbonization levels by 2040, greater reliance on carbon capture and storage (CCS) is necessary.

				Gas demand in Italy	in 20401
	Gas demand in 2040 is projected to be 61.0 billion cubic meters, representing a 34% reduction compared to the PNIEC	Gm3	61.0			62.9
GA-IT+	REFERENCE inertial scenario			54.6	52.3	4.5
			12	7.3	5.8
	Gas demand in 2040 is projected to be 54.6 billion cubic meters, representing a 37% reduction compared to the PNIEC		10.3	10.3
DE-IT+	REFERENCE inertial scenario					58.4
	MASE scenario with the implementation of new measures to support		38.7	37	46.5
PNIEC POLICY	the energy transition aimed at achieving national medium and long term decarbonization goals consistent with those envisaged at the EU level.
			2040 GA-IT+	2040 DE-IT+	2040 POLICY	2040 REFERENCE
PNIEC REFERENCE	MASE scenario that takes into account the evolution of the national energy system with current policies			Gas Naturale Natural gas	Biometano Biomethane	Idrogeno Hydrogen

Different scenarios

The Italian Long-Term Strategy on Greenhouse Gas Emission Reductions foresees a contribution from CCS of 40 Mt/year

Focus: hydrogen incentives

PNRR makes approximately €3.65 billion available for projects suitable for hydrogen development

The new infrastructure grid

The gas network will require technological and infrastructural adjustments to facilitate the introduction and transport of "green" gases in order to decarbonise the system

Dynamics of the gas distribution sector in Italy

Gas distribution in Italy is now a mature and consolidated sector, with the need to renew itself to meet the challenges arising from the evolution of the energy system

The gas distribution sector recorded a gradual consolidation, favored by:

• ✓ Rules for awarding concessions for ATEM¹
• ✓ Economies of scale deriving from centralised management

No. of gas distribution operators in Italy²

The energy system transformation scenario will require a renewal of the sector, in terms of:

• ✓ Technological and industrial renewal
• ✓ Rethinking of the business management methods

Examples of necessary renovations

Upgrade of distribution networks

✓ To safely allow the distribution of gas with increasing percentages of hydrogen

Reduction of CO² and CH4 emissions

✓ Through operational efficiency measures aimed at greater sustainability of the activities

Regulation of the gas distribution industry

Current sector regulation ensures stability and risk containment while the regulatory evolutions expected by ARERA are geared toward total cost efficiency and encouraging innovation and solutions aimed at decarbonization

Current	Regulatory	Regulatory
regulation	evolution	innovation
The current legislative and regulatory framework is ➢ characterised by stability and transparency and guarantees: ✓ Stability of economic results and cash flows ✓ Recovery of the value of the investments made at the end of the concession Recognition of operating costs based on ✓ predefined productivity recovery rates ✓ Rate of return on capital updated periodically on the basis of market parameter evolution The current regulation therefore ensures a limited ➢ operational risk for gas distribution activities	ARERA proposes a gradual introduction of a tariff ➢ regulation for Expense and Service Objectives (ROSS), oriented to the total efficiency of the service (from 2026): ✓ Integrated recognition of operational costs and efficient capital costs ✓ Standard capitalization coefficients ✓ Revision of the incentive mechanism ✓ Selectivity of recognizable investments, to be justified with cost-benefit analyses ➢ The paradigm shift will support the rationalisation of the sector: ✓ Opportunity for efficient companies to improve their profitability ✓ Risk of under-remuneration of capital for inefficient companies ✓ Alignment of tariff regulations for infrastructure services	DCO 250/2021/R/gas – Pilot projects of innovative solutions ➢ Optimized network management ✓ Bi-directionality, accumulation, loss reduction ▪ Innovative uses of networks ✓ Biomethane, hydrogen, "green" gas injection ▪ ▪ Renewable gases in industrial processes ▪ Electrolysers and methanation ▪ Power to gas, power to hydrogen, CO2 capture ✓ Technological / management innovation ▪ Network digitization Energy recovery in decompression and re compression ▪ ▪ Energy efficiency in preheating ✓ Convergence between the gas and electricity sectors ✓ Reduction of methane emissions into the atmosphere ➢ Resolution 404/2022/R/gas - Regulations for the application of the premium tariff mechanism to support the innovation of infrastructure in the natural gas sector in the areas of intervention identified by DCO 250/2021/R/gas mentioned above

➢ Resolution 590/2023//gas - Incentives disbursed to support the 21 projects admitted to incentivization: 30.8 m€

The regulation of ATEM tenders (1/2)

Tenders for the allocation of gas distribution services for ATEM are regulated by national-level legislation and regulation, subject to subsequent refinements. The market opening process is characterized by significant delays.

Genesis of the legislation Over the past twenty years, the natural gas sector has undergone profound changes, which have also affected the methodologies and objectives of tariff regulation, as well as the methods for identifying the operators of natural gas distribution facilities. ➢ Legislative Decree 164/2000 (known as the "Decreto Letta") established the principle that the service must be entrusted through a public tender (competition for the market). ➢ A series of subsequent interventions have further defined the liberalization process: ✓ Identification of 177 ATEM (later reduced to 171) for the allocation of concessions¹ ; ✓ Definition of criteria for evaluating bids (Ministerial Decree 226/2011 and subsequent amendments): economic offer, investment plan, safety standards, and service quality. Current status In the aftermath of the issuance of ministerial decrees, the organization of tenders encountered numerous implementation obstacles, which delayed the start of the tenders. ➢ By the end of 2023, the tender procedures for 8 areas had concluded (Milano 1, Torino 1, Torino 2, Belluno, Valle d'Aosta, Udine 2, Napoli 1, La Spezia). However, only 4 concessions had actually been initiated (Torino 2, Milano 1, Napoli 1, Valle d'Aosta). ➢ Tenders in progress: 7 ➢ Tenders suspended or cancelled: 24 ➢ Calls sent to ARERA: 12 (4 of which are awaiting publication)

Ascopiave Group – Strategic Plan 2024-2027 31 Notes: ¹Each ATEM is subject to a single tender, and within each area, the networks are managed by a single operator who will be transferred ownership of the facilities upon payment to the outgoing operators of their reimbursement value.

The regulation of ATEM tenders (2/2)

Recently, some significant measures have been adopted (or are currently being adopted) to simplify and expedite the process of publishing tender notices and to update the criteria for evaluating bids.

Disposal of networks owned by local authorities

➢ The Law of August 5, 2022, No. 118 (Article 6, paragraph 1, letter b) provides that if a local authority or a network asset company, during the tendering process for the natural gas distribution service, intends to sell its ownership of the networks and distribution and metering facilities, said networks and facilities shall be evaluated according to the residual industrial value calculated based on the "Guidelines on criteria and methods for assessing the reimbursement value of natural gas distribution facilities" of April 7, 2014, approved by the Minister of Economic Development on May 22, 2014.

Updating Ministerial Decree 226/2011 (tender criteria)

• ➢ The MASE¹ , in implementing Law No. 118/2022, aims to update Ministerial Decree No. 226 of November 12, 2011, "Regulation for the tender criteria and evaluation of bids for the allocation of the natural gas distribution service" and subsequent amendments. To this end, it has initiated a consultation with ARERA, AGCM, and sector trade associations (the so-called "Cabina di regia").
• ➢ The future decree aims to:
• ✓ Mitigate significant issues related to the existence of informational asymmetries in the trilateral relationship between outgoing operators, local authorities, and incoming operators;
• ✓ Introduce important coordination elements between the criteria for valuing interventions and the objectives of optimizing and rationalizing the use of energy resources;
• ✓ Introduce a significant update of the criteria for technological innovation, aiming to strike the right balance between the need to implement a forwardlooking vision and the necessity to remain anchored to parameters of immediate feasibility as well as economic and financial sustainability..

Simplification of ARERA verifications

• ➢ ARERA intends to consolidate into a single procedure the two separate procedures currently provided for its two competencies regarding gas tenders, namely those related to observations on reimbursement values and those related to observations on tender documents prepared by contracting authorities. Additionally, ARERA aims to introduce provisions aimed at accelerating and streamlining procedures for verifying discrepancies between VIR (values of reimbursement) and RAB (regulated asset base) even for ongoing procedures.
• ➢ Relevant measures published by ARERA:
• ✓ Resolution 35/2024/R/gas
• ✓ DCO 36/2024/R/gas

Dynamics of gas and energy prices

Pandemic and geo-political crises have accelerated the path of energy transition while introducing a gradient of uncertainty.

Russian gas supply replacement, progressive technology substitution for electric generation and electrification of consumption are the main substantive elements underlying an energy price outlook characterized by significant levels of volatility along the transition path. The last period has witnessed a substantial decrease in prices related to the completion of storage, the availability of LNG to compensate for the decrease in flows and concomitant low demand levels related to decreased industrial production and off-normal temperatures.

Dynamics of the renewable energy sector in Italy (1/4)

European energy policies have introduced increasingly challenging decarbonization targets, and national energy policies have followed the impetus from EU initiatives.

The Plan for Ecological Transition (PTE) has among its goals to 2050

• ✓ Setting greenhouse gas emissions to zero
• ✓ Revolutionize mobility to its full sustainability
• ✓ Minimize pollution and contamination of air, water and soil
• ✓ Setting the path toward a zero-waste circular economy and healthy, sustainable agriculture

The main goal of the RePower EU Plan is to reduce European countries' dependence on Russian fossil fuels by leveraging: diversification of energy sources, acceleration of energy transition, and stringent energysaving targets

Ascopiave Group – Strategic Plan 2024-2027 34 Source: Zero Carbon Policy Agenda Report 2022 (Energy & Strategy Group, Polimi); C.E. "Realizing the European Green Deal"; M.A.S.E. "Plan for Ecological Transition»

Dynamics of the renewable energy sector in Italy (2/4)

Renewables in Italy show a trend of substantial growth over the past 10 years with a total installed capacity of ~70 GW.

However, to achieve national decarbonization targets to 2030 will require at least 60-65 GW of new RES capacity to be installed in Italy establishing sound market conditions, investing in essential infrastructure and implementing effective regulatory and policy frameworks.

Dynamics of the renewable energy sector in Italy (3/4)

In 2022, renewable energy sources recorded a production of approximately 100 TWh (down by approximately 14% compared to 2021)

Therefore, there has been a significant change in electricity production³ : traditional thermal sources have decreased from 84% share in 2005 to 64% in 2022, while renewable energy sources have increased from approximately 16% to 36% over the same period.

Ascopiave Group – Strategic Plan 2024-2027 36 Note: ¹Elaboration of latest available TERNA data. ²Considering exclusively production from natural sources (excluding pumped storage); ³Gross production.

Dynamics of the renewable energy sector in Italy (4/4)

Italy's renewable mix is characterized by a general growth trend, emphasized by measures implemented at the EU level to address the Russian-Ukrainian crisis. By 2040, 65% of the projected installed renewable capacity will consist of photovoltaic

Ascopiave Group – Strategic Plan 2024-2027 37 Source: ¹Forecast data 2030-2040 Terna Scenarios 2022; ²Hypothesis scenario FF-55: 55% emission reduction through electrification and substantial RES increase; ³Hp: Distributed Energy scenario Italy: electrification push, greater RES needs, electric storage, electrolysers and CCS

4. Strategic plan 2024-2027

Strategic pillars Plan projections

Shareholder remuneration

3. Size of concession basins (ATEM)

1. Awarding of a significant number of tenders of minimum territorial scope (ATEM) 2. M&A of small to medium-sized companies operating in the gas distribution sector organisational innovation 4. Financial capacity

3. Establishment of partnerships aimed at joint participation in tenders

processes

The Group has identified some tenders of interest, defining the different levels of priority with the aim of establishing a portfolio of territorially contiguous concessions

Selection criteria for ATEM of interest

• Valorisation of economies of scale and synergies
• Competitive advantages over potential competitors
• Fair risk/return balance

The definition and implementation of the strategy depends on the timing of publication of the tender notices and any delays in the deadlines. This implies the need to establish an order of strategic priority and a continuous updating of decisions regarding participation in future tenders

1. Priority to development in the North-East region, consolidating the current leadership position

tenders in currently managed ATEM and in other contestable ATEM

Thanks to its characteristics and track record, Ascopiave is a credible counterpart in possible acquisitions and/or partnerships in the gas distribution sector

Ascopiave Group – Strategic Plan 2024-2027 45 Notes: ¹Operation expected to commence after the planning horizon; ²Operation expected to begin partly in 2025 and partly in 2026; 3 Includes the Calabrian wind farm (21.6 MW) which commenced production in January 2024; ⁴Excludes the contribution of the new wind farm, which is expected to commence production after 2027 (Expected EBITDA in 2028 is 6.7 m€).

Ascopiave Group – Strategic Plan 2024-2027 46 Notes:¹EBITDA of investment in green hydrogen not reflected, as it is developed outside the plan horizon (estimated approx. 1.6-1.8m€ EBITDA from hydrogen investments when fully operational).

The diversification strategy undertaken by Ascopiave plans to invest around €48m by 2027 to support projects related to green gases, energy efficiency and water service services

Assume an important role in the energy transition of the target territories based on green gas deployment

abt. 17 m€ Investments¹

abt. 1.6-1.8 m€ EBITDA at steady state

Ascopiave Group – Strategic Plan 2024-2027 49 Notes: ¹Figure gross of any government grants

abt.1.2 m€ EBITDA@ 2027

Realize synergies by enhancing the expertise gained in the core business of gas distribution

EBITDA@ 2027

Contribute to the path of consumption rationalization by obtaining incentives (TEEs) useful to mitigate the effects of these obligations in the core business of gas distribution

Ascopiave has achieved appreciable results on the management efficiency front, implementing organizational and technological solutions that are functional for the purpose

Reorganization of activities

Beginning in 2016, an extensive reorganization process of distribution activities was initiated, affecting all Group companies:

• Renewal and reengineering of systems and procedures;
• Rationalization of operational and logistical locations across the territory;
• Centralized and integrated management of all major processes;
• Adoption of new state-of-the-art information systems for workforce management and distribution business services.

This has enabled optimization in the use of resources, allowing many activities contracted to third parties to be internalized in order to reduce operating costs and increase the possibility of making investments

Post-acquisition integrations

• Ascopiave has solid experience in integrating companies post-acquisition, with achievement of management improvements with cost reduction and increased service quality
• During 2023, the integration of the assets acquired by A2A in the Group's various distribution companies was completed.
• A study was launched to rationalise the number of distribution companies with the aim of further streamlining processes and the possibility of synergies in the management of the territory

Improving operational and economic efficiency is at the heart of Ascopiave's management policies, which aims to follow up on the excellent results achieved over the past few years

Business policies and practices to support efficiency

• ➢ Continuous monitoring of process efficiency through dedicated operational systems and organizational resources
• ➢ Incentive remuneration of staff, based on indicators of economic-management efficiency

Interventions on areas and tools targeted for potential improvement

• ➢ Innovative technological solutions/digitization
• ➢ Efficient internal organizational processes
• ➢ Optimized management of existing relationships with external suppliers

Plan

• ✓ Reducing the incidence of overhead and industrial costs
• ✓ Maintaining a lean and flexible cost structure objectives

Short term goals

Interventions with immediate positive effects on income:

• ✓ Operating costs optimization
• ✓ Interventions encouraged by current regulations

Medium term goals

• Strategic investments:
• ✓ Competitive potential improvement in ATEM competitions
• ✓ Offer improvement in innovation

Long term goals

Strategic investments :

• ✓ Technological adaptation of networks and infrastructures as a contribution to the competitiveness of the "gas system" vs. alternative energy carriers:
• 1. Cost competitiveness
• 1. Convergence with environmental objectives

In the coming years, Ascopiave will execute an organic program of innovative interventions aimed at evolving the infrastructure and improving its safety and functional efficiency

Sustainability Commitments

Staff training: target of 29 hours/year of training per employee through enrichment of e-learning training offerings available to Group employees, and through further implementation of a dedicated training platform.

Average age: the Group intends to maintain the current average age of about 48 years, ensuring uniformity in the distribution of the different age groups of employees.

Gender Equality Certification: activities aimed at obtaining gender equality certification are ongoing.

Welfare: further expansion of the services available on the platform, ranging from education and instruction, social security and health benefits, to the purchase of other goods, while maintaining the current scope of involvement at 100% of employees.

Worker safety: the Group considers the protection of workers to be of primary importance, setting itself the goal of maintaining high levels of safety, promoting the integration of safety in all company activities and focusing on continuous staff training. Therefore, by 2025, the Group is committed to certifying all companies with operating personnel to the Occupational Health and Safety Management System (ISO 45001) (by the end of 2023, 96% of Group personnel will already be certified).

Sustainable vehicles: corporate fleet renewal according to the highest industry standards. By 2027, the electric/hybrid car fleet target is 23.5% (9.5% at 2023).

Waste: the Group is committed to maintaining the standards already achieved of sending more than 99% of special waste for recovery.

Renewable power: photovoltaic power installed at the company's headquarters that will save, in terms of tons of CO² avoided from 2023 to 2027, more than 1.3 ktons.

Gas distribution asset renewal: replacement of ageing networks to reduce fugitive emissions of natural gas. Digitisation and renovation of the network to facilitate the introduction of renewable gases (biomethane, hydrogen-methane blending, etc.).

Renewal of domestic meter fleet: selection of meters capable of receiving the new gas mixtures and made of recyclable material. Gradual replacement of meters with GPRS communication technology in favor of NB-IOT will allow reduction in quantity of spent batteries for disposal.

Reduction of CO² and CH⁴ emissions: through the implementation of energy efficiency measures for the pre-heating cycle in REMI substations and the adoption of innovative methods to search for CH⁴ leakage in networks.

4. Strategic plan 2024-2027

Strategic pillars Plan projections

Shareholder remuneration

The plan projections have been elaborated and defined taking into consideration both the main risk elements typical of the reference sectors, and the characteristics of Ascopiave

Main rationals

Uncertainty about the start of ATEM tenders

• The uncertainty about the timing of tenders and subsequent award of concessions suggested the development of a scenario analysis based on various hypotheses¹ :
• o Scenario A: increase in the perimeter of activities managed in gas distribution sector only through M&A and organic growth as by the end of the plan period no ATEM tender is able to complete its award process;
• o Scenario B: in addition to the growth expected in Scenario A, 4 ATEM tenders are assumed to be initiated and awarded in 2027 and, as a result, a significant increase in networks and users managed.

Pursuit of rational goals in terms of efficiency and investments

• The projections reflect the goals reasonably achievable by the Group
• Operating and investment costs incorporate:
• o Inflation dynamics (+)
• o Economic-management efficiency targets (-)

Implementation of M&A initiatives and diversification into other activities

▪ Achieving reasonable growth targets through M&A and investment initiatives in the renewable energy sector and diversified businesses

The plan requires the undertaking of a significant amount of investment, directed both at the maintenance and development of the existing network and the expansion of activities on new synergistic businesses

Ascopiave Group – Strategic Plan 2024-2027 60 Note: ¹Net of any disinvestments.

Investments in gas distribution

Most of the planned investments are in gas distribution, with significant interventions on current perimeter and possible additional gains in case of ATEM tender award

Investments in renewable energy

The Group aims to expand the portfolio of RES generation power plants both through M&A transactions and the development of new greenfield plants

Net cumulative greenfield investments Net investment ¹ @ 2027 ¹ cumulated @ 2027

m€ 99 122 221 122m€ in M&A investments in renewable energies for the acquisition of wind (35 MW) and photovoltaic (40 MW) plants with a remaining useful life of 25 years, and an expected annual output of 119 GWh when fully operational

Investimenti greenfield M&A Greenfield investments

Development of greenfield photovoltaic plants: plants already authorised or at an advanced authorisation stage with a nominal capacity of 37.9 MW and annual production when fully operational of 46 GWh. Planned commissioning in 2025 and 2026.

Development of greenfield wind farms: plants with a nominal capacity of 36 MW for which the authorisation process is expected to start in 2024. Given the length of the authorisation procedures, a start of production is assumed after the plan horizon.

Key prospective data - Gas distribution

Growth prospects, both by internal and external lines, will result in further consolidation of the Group in the gas distribution sector

in case of ATEM tender award (Scenario B)

Key prospective data - Renewable energy

The growth strategy will also enable the Ascopiave Group to significantly increase its share in the renewable energy sector

Ascopiave Group – Strategic Plan 2024-2027 65 Note: ¹The amount 387 GWh as of 2027 does not include the estimated expected output of 65 GWh from a 36 MW wind power plant built by 2027 and that will enter in production in 2028.

Key prospective data - Environmental sustainability

Through a strategy of energy efficiency and integration of renewable energy sources, the Ascopiave Group will be able to generate a positive climate impact by reducing CO² emissions

-1.7 kton CO²

-136 kton CO² p.a.

Through continuous efficiency gains in its consumption (-2% p.a.), Ascopiave Group will be able to save approx. 1.7 kton CO² emissions over the strategic plan period (scope 1 and 2)

Ascopiave Group's consolidation in the sector of green energy generation will contribute to an average annual emission reduction of about 136 kton of CO² . A further contribution in terms of CO² savings is expected from initiatives related to Green Hydrogen and Biomethane.

Energy recovery from the decompression of network gas, using an innovative cogeneration turboexpansion process, shows that the amount of CO² emitted into the atmosphere will be reduced by approx. 533 tons compared to conventional decompression systems.

Ascopiave Group – Strategic Plan 2024-2027 66 Note: ¹Estimate of emissions in 2027 does not consider the impacts of increased gas consumption resulting from the construction of cogeneration turbo-expansion plants.

In both the scenarios examined, the economic results to 2027 are expected to show a growing trend

m€	2023	2027 Scenario A	CAGR 2027 Scenario B CAGR		Δ 2027 Scenario B vs A
Revenues	181	260	10%	282	12%	22	8%
EBITDA	95	139	10%	160	14%	21	15%
EBIT	46	69	11%	79	14%	10	14%
Net financial income1	-4	-9	21%	-15	35%	-5	55%
Net income	37	42	3%	45	5%	3	7%

2023 results include the capital gain realised on the partial exercise of the put on the stake held in EstEnergy for 13.6 m€

Invested capital and financial debt

Over the plan period, there is growth in net invested capital and optimization of the mix of financing sources

Ascopiave Group – Strategic Plan 2024-2027 68 Note: ¹Debt-to-equity ratio; ²Net financial position.

Distribution of economic value generated

Ascopiave's strategy aims to create value for its stakeholders, distributing the value generated to contribute to the economic and social growth of the context in which the Group operates

^{176 149} 104 147 ^{56 52} 508 Retained value added Distributed value added Employees Local communities Shareholders Public Administration Financiers 684 m€ 508 m€

Value added¹ generated by Ascopiave's activities in plan arc 2024-2027 (Scenario A)

Ascopiave Group – Strategic Plan 2024-2027 69 Note: ¹Value added is determined by the value generated during the reporting period and partly redistributed in various forms to the Group's stakeholders.

4. Strategic plan 2024-2027

Strategic pillars Plan projections Shareholder

remuneration

Financial management goals

Ascopiave focuses on cost of capital efficiency and financial flexibility in order to create longterm shareholder value

Use of financial leverage to cover the needs of planned investments

Value creation for shareholders

Shareholder remuneration

The Group has been regularly creating value for its shareholders, highlighted by a stable distribution of dividends. An attractive and sustainable dividend distribution is expected for the period 2023-2027

In the 2017-2022 period, Ascopiave distributed total ordinary dividends of approx. 214 m€ (annual average: 16 c€/share¹ ), thanks to:

• Stable cash flow
• Stable business profitability
• Balanced financial structure

Ascopiave plans to distribute a rising dividend from 14.0 c€/share to 2023 to 18.0 c€/share to 2027 (+29%)

Dividend distributed by Ascopiave and historical dividend yield 2017-22 and prospective dividend yield 2023-27

Ascopiave Group – Strategic Plan 2024-2027 72 Notes: ¹Historic average dividend and dividend yield calculated by considering only the ordinary dividend; ²Dividend approved and distributed during 2028 with reference to fiscal year 2027; ³Dividend yield calculated as the ratio between distributed dividend and the share price at the end of the year

Ascopiave Group is a well-established entity with a balanced portfolio of assets, characterized by a low risk profile, and a track record of growth

The strategy that will guide Group's actions in the coming years is based on the growth of core businesses, diversification into new synergistic activities, economic efficiency and innovation

The investment plan, of approximately 620 mln€ under the more conservative scenario, is equally allocated to the current perimeter and the expansion of the company's activities. Around 290 mln€ of the plan will be financed through resources from the exercise of put options in EstEnergy and HeraComm stakes

Expected results foreshadow sustainable growth that will create value for shareholders and stakeholders

The plan provides for the distribution of a remunerative dividend during the period to benefit the Group's shareholders

Parameter	Hypothesis
Inflation	2.36% - average annual inflation over the entire plan horizon (2024: 3.00% / 2025-2027: 2.15%)
Real pre-tax WACC (RAB distribution)	6.5% - in 2024-2027 (5.6% rate acknowledged in 2023)
Tariff operating costs	X-Factor currently provided by the regulation
Tariff capital costs	Continuity of cost recognition methodology (actual costs in distribution, maintenance of depreciation rates, etc.)
Electricity prices	Energy transfer prices in line with medium-term expectations (i.e. 116 €/MWh at 2027)
EstEnergy result	In line with the forecast of the Company's plan
Dividends other investments	Equal to dividends paid in 2023
Income taxes	IRES tax rate of 24% and IRAP abt. 5% assumed constant over the entire plan horizon
Cost of debt	3.25% approx.- Average annual passive rate over the entire plan horizon
Dividends	14.0 c€ in 2023 increasing by 1 c€/per year in subsequent years

• This presentation has been prepared by Ascopiave S.p.A. for information purposes only and for use in presentations of the Group's results and strategies.
• The reader should, however, consult any further disclosures Ascopiave may make in documents it files with the Italian Companies and Stock Exchange Commission and with the Italian Stock Exchange.
• Statements contained in this presentation, particularly the ones regarding any Ascopiave Group possible or assumed future performance, are or may be forward-looking statements and in this respect they involve some risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward looking statement. Such factors include, but are not limited to: changes in global economic business, changes in the price of certain commodities including electricity and gas, the competitive market and regulatory factors. Moreover, forward looking statements are currently only at the date they are made. The Ascopiave Group undertakes no obligation to update forwardlooking statements to reflect any changes in the Group's expectations or in the events, conditions or circumstances on which such statements are based. However, Ascopiave will inform the market of any change that may occur in the Ascopiave Group's expectations of future results and relevant assumptions to the extent such change qualifies as "price sensitive information" according to applicable law.
• The manager responsible for the preparation of financial reports, certifies pursuant to paragraph 2, article 154-bis of the Legislative Decree n. 58/1998, that historical data and accounting information disclosures herewith set forth correspond to the company's evidence and accounting books and entries.
• Any reference to past performance of the Ascopiave Group shall not be taken as an indication of the future performance.
• This document does not constitute an offer or invitation to purchase or subscribe for any shares and no part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.
• By attending the presentation you agree to be bound by the foregoing terms.