ITALIAN SUSTAINABILITY DAY 2019

MILAN, 2 JULY 2019

DISCLAIMER

This document contains certain forward-looking information that is subject to a number of factors that may influence the accuracy of the statements and the projections upon which the statements are based.

There can be non assurance that the projections or forecasts will ultimately prove to be accurate; accordingly, the Company makes no representation or warranty as to the accuracy of such information or the likelihood that the Company will perform as projected.

AGENDA

A successful industrial transformation
2018-2022 Business Plan
A focus on Sustainability
ERG Green Bond
ERG in a nutshell at 31.12.2018
Appendix

A SUCCESSFUL INDUSTRIAL TRANSFORMATION

A LONG HISTORY…

installed wind capacity is

1,506MW.

ERG INDUSTRIAL TRANSFORMATION

Renewable diversification financed through oil-linked disposals and strong cash generation

(1) It refers to M&A and organic growth CAPEX

(3) 2018 includes TotalERG Disposal whose closing took place on January 10, 2018 with a partial cash-in of €85mn in 2017, and ForVEI acquisition (EV €345mn) whose closing took place on January 12, 2018 (4) 2019 includesAndromeda acquisition(€221mn, finalisedon February12, 2019) and the recentwind asset acquistionin France (€52mn), whoseclosing tookplace on May6, 2019

(2) Itincludesdividendspaidin May2019 (ca. €112mn with ordinaryDPS at€0.75/sh)

A RAPIDTRANSFORMATIONAND…

… A SUSTAINABLE EVOLUTION

Decarbonising ERG's electricity production

• ERG's business transformation: increasing production of electricity from renewable sources
• In this way, by the end of 2018 ERG had reduced the carbon intensity of its production by 90% since it entered the renewable energies sector and by 42% in the last 4 years

ERG's Sustainability numbers

2.5GW Installed capacity from renewable sources

100%

ISO 14001 and/or OHSAS 18001 certified Italian companies consistent with their activities

Source: non financial information statements

(1) The Carbon index drop in 2010 was due to the entrance into operation of the ERG Power plant which replaced the existing oil fed power plants.

(2) The Carbon index drop in 2014 was due to the sale of the ISAB Energy plant.

ERG SUSTAINABILITY KPI AS AT 31.12.2018

ESGACHIEVEMENTS AND RATINGS

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			fro ( ) ( l len ) A+ D- to t m p oo r ex ce
			fro ( ) ( lea de ) C C C La A A A to m g g ar r
		Av era ge for Pe r me r	fro ( ) ( de ) 0 1 0 0 La Le to m g g ar a r
		fo S G E Pe r rm an ce be ha t te t r n av er ag e

CDP AND STB – SCIENCE BASED TARGET

•April 2019: ERG signed the Committment Letter

•May 2019: ERG submitted its targets for validation:

reduction of Carbon Index from Group production: -14% at 2022
reduction of Scope 2 emissions generated from purchase of Electric Energy

(1) Science Based Target ( institution affiliated with CDP) aims to certify that the emissions targets identified by companies on a voluntary base are compliant with 2030 road map (maintenance of Global Warming below +2°C). 563 companies worldwide, 210 with targets approved.

EU LEADINGRENEWABLE IPP

(1) It includes Polaris acquisition of 52MW signed in March 2019, whose closing took place on May 6, 2019

(2) It includes Linda project entered into operation in June2019

(3) It includes Andromeda acquisition (51.4MW), whose closing took place on February 12, 2019

(4) It refers to Romania, Bulgaria and Poland

STEADY AND WELL BALANCEDPORTFOLIO

(2) Wind EBITDA with incentive, Hydro

EBITDA with incentive, 100% Solar EBITDA

Close to 70% of EBITDA from incentives

•

•EBITDA well balanced across different generation assets
•Geographical and seasonal diversification, allowing for complementarity of the different energy sources
•Earnings stability sustained by priority of dispachtment

BALANCED GROUP STRUCTURE SERVING INTERESTS OF ALL STAKEHOLDERS

Fully independent and experienced management team paired with a constructive involvement by majority shareholder

•San Quirico S.p.A. and Polcevera S.A. are controlled by ERG founding family

• The Garrone family holds key positions in ERG (Chairman and Executive Deputy Chairman) and defines ERG long-term strategy along with the Top Management through the Strategic Committee, whilst the Board of Directors is composed mainly (7 out of 12) of independent directors and it is fully committed to the interests of every stakeholder
•The top management operates within a strict financial discipline, while following a strong risk management policy

6.9%

2018-2022 BUSINESS PLAN

ERG 2018-2022 CAPACITY EVOLUTION STRONG EXECUTION IN 2018

(1) Closing took place on February 12, 2019

(2) Closing took place on May 6, 2019

GREENFIELDDEVELOPMENT WELL ON TRACK

(2) In exercise

REPOWERING& REBLADINGIN PROGRESS

Reblading MW for RBL in BP 2018-22 MW for RBL as of 07/03/2019 40 13 22 ≃10 ≃65 ≃75 Project substitution(1)

•184MW applied for authorization:

- 6 projects included in BP for 153MW
- Additional 3 projects for 31MW
•New capacity under reblading is 75MW
•13MW under construction and on stream in 2Q 2019
•Expected rise in production from 16% to 20%

DRIVINGINTO2023

P r o s	l f l l l f f l l h l b l l E i i i R i 5 0 0 M W i i i I t t t t t • p o n g p o e n a o e p o e r n g o c s o n a e e g e n a x u w : u y
	h b d l h f l d B i i 7 0 0 M W i i i F t t t • o o s n g g r o w a r o a e v e r a g n g o n m o r e a n o p p e n e n r a n c e a n f h d l d d i i i U K G t t t t t o e c o- e v e o p m e n a g r e e m e n s u n e r n e g o a o n n a n e r m a n y
	k f l b l f h f i i j C C G i i i i i W T t t t t t t • o r n p r o g r e s s o r a n e w c o g e n e r a o n p r o e c a e g e o r w e c e r c a e s
	d d d f d f l f h K i i i i i i i i i I G i i t t t t t • e e p n g a s o u n a n v e r s e n a n c a s r u c u r e a m n g o c o n r m r a n g n e l t o n g e r m
C o n s	h f l l l b d h ( ) i i i i i i 2 0 2 3 P B P t t t + • a s e o u o n c e n v e s w p r o g r e s s v e y c o n n u e e y o n o r z o n

Keep growing leveraging on assets rejuvenation, larger capacity abroad and high quality financial stucture

FINANCIALS – UPDATEDPROJECTIONS

Acceleration of targets in the first years of BP

A FOCUS ON SUSTAINABILITY

ERG SUSTAINABILITY GOVERNANCE MODEL

The CEO is responsible for CSR.

Our Principles:

- Code of Ethics
- Sustainability policy
- Human rights policy

Sustainability Committee(1)

•composed by:
- Chairman
- Executive Deputy Chairman
- CEO
Top management
•duties:
- defining the Group's sustainability guidelines
- approving and evaluating sustainability objectives
- approving the CSR initiatives and DNF contents

ERG 2018-2022 BUSINESS PLAN

The 2018–2022 Business Plan is focused on a continuous development of plants producing energy from renewable sources and sets targets on three main priority areas:

(1) Carbon index (gCO2/kWh) reveals the quantity of CO2

included in every kWh produced

ERG'S SUSTAINABILITY COMMITMENTS 2018-2022 (1/3)

In alignment with the 2018-2022 Business Plan and with the UN SDG's, ERG had set up ERG's Sustainability Commitments for the same period. Some of them are presented below:

UN SDGs		Areas of commitment - Period 2018-2022	Status as at 31/12/2018
5 millin	8 ECONOMIC GROWING	GOVERNANCE, ETHICS AND SUSTAINABILITY APPROACH
0 11	Pursue the internal and/or external dissemination of the Group's principles expressed in the Code of	Code of Ethics and Sustainability Policy updated. Human Rights Policy approved.
16 FEACE THERE THE 13 School	Ethics, in the Sustainability Policy and in the new Leadership Model.	Training on sustainability issues continued at schools in the areas where the Group operates.
		Update the Enterprise Risk Management (ERM) risk catalogue with the analysis referring to the	Group Risk Catalogue updated following risk assessment on 2018-2022 Business Plan.
		new 2018-2022 Business Plan.	ERM risk dashboard implemented to monitor any changes in the
	Implement an ERM risks and specific Key Risk Indicators (so-called KRIs) dashboard for their ongoing monitoring.	risk profiles set out in the Risk Catalogue.
	Keep the Models 231 of Italian companies updated.	Risk assessment on regulatory changes that occurred during
		Implement an Anti-corruption Policy within	the year.
		the Group, by making the control system fully operational and continuously monitoring and training employees.	The Model 231 was drawn up for solar technology companies.
			An "Integrated Anti-Corruption Model" was adopted for all Italian and foreign companies in line with best practices.
		Anti-corruption policy and "key third-party due diligence" procedure approved.
		Implement an Environment - Safety certification in all Italian and foreign operating companies, in line	Implementation of the project for integrating existing certifications in the Italian companies.
	with the One Company organisational structure.	Project for extending certifications to foreign companies was defined.

ERG'S SUSTAINABILITY COMMITMENTS 2018-2022 (2/3)

N SDGs	Areas of commitment - Period 2018-2022	Status as at 31/12/2018
8 ECONOMIC GROWIN CENTEREST	BUSINESS STRATEGY
0- 简	Consolidate the Group's business leadership in the production of electricity from renewable sources and increase the efficiency of all of its plants according to the development lines of the 2018- 2022 Business Plan.	The increase in installed power continues thanks to the start-up of new plants in France (55 MW) and the acquisition of 30 photovoltaic plants [89 MW]. An additional 51 MW of photovoltaic plants has been acquired in 2019.
	Support the Group's strategies through scouting activities by identifying and assessing innovative technologies, and developing partnerships with Universities and Research Institutes.	The second cycle of scouting activities was started in 2018 with ERG Regeneration Challenge.
FOR THE CONL	SUPPLIERS
	Consolidate a supplier qualification and assessment system, with particular attention to	Over 50% of new suppliers qualified according to HSE parameters.
	Health, Safety, Environment and Sustainability.	Project for the qualification of suppliers according to sustainability parameters started.
IN SDGs	Areas of commitment - Period 2018-2022	Status as at 31/12/2018
AND LANDRING AFFECTLANDAN	EMISSIONS AND WASTE
ಾರ್ � 15 Misso	Group decarbonisation: - avoid CO, emissions for 15 Mtons in the plan period; - reduce carbon index of electricity production by 14%; - cover energy requirements with energy produced from renewable sources.	During 2018 3,029 kt of emissions avoided. Continual reduction in the Group's energy production carbonisation factor: - 42% over the past four years. 86% of energy requirements covered with energy produced from renewable sources.
	Implement activities to protect biodiversity in the	Bird monitoring in our wind farms.
	areas where our plants are located.	Support to the activities performed at the Oasis of Alviano (WWF).
	Reduce the amount of waste produced by processes by maximising the percentage of waste sent to be recycled also through the use of materials and substances ensuring better environmental compatibility.	A recovery procedure for the waste produced by the grate cleaners and used as a resource for the timber from Lago di Corbara, was implemented in our hydroelectric plants.

ERG'S SUSTAINABILITY COMMITMENTS 2018-2022 (3/3)

UN SDGs	Areas of commitment - Period 2018-2022	Status as at 31/12/2018
8 FECHOMIC GROWTH	SAFETY
11	Consolidate the Safety culture inside and outside the company, pursuing the goal for absence of	Following the injuries in 2018, corrective actions were implemented to prevent the recurrence of similar events.
	accidents caused by safety shortfalls in the plants and in the offices.	A near-miss reporting system was promoted to increase prevention levels.
TORCATION 5 RATULY 0	PEOPLE
	Define and implement training and development plans to increase the value of Human Capital	In 2018, around 35 thousand hours of training provided at an average of approximately 6 days per employee.
	Coverage [+3% at the end of the plan period].	92% of company staff took part in training courses.
		Around 83% of training is on technical and managerial topics.
	Improve working environments and welfare	"ONE health" project.
	systems for employees.	Opening of a gym for Group employees.
PC ACC 3152	COMMUNICATION
	Make contact with and inform the Group's	ERG received B rating from CDP. ERG included in some sustainability indices. 400 position in the Potentialpark Italy ranking (online talent communication) and 200 position in Italy for the section "Careers". Sustainability Policy principles.
	stakeholders in a complete, transparent and timely manner.

CLEASE (SECREE) O ECONOMIC GROWITH 0 11	COMMUNITY
	Contribute to the development of local communities through training activities at	Activities were developed in local communities in keeping with
	schools and universities and through social responsibility initiatives at a local level.	"A tutta acqua!" and "Vai col vento!" were our leading projects for students living in the communities where our plants are located.

ERG STRICT CORPORATE GOVERNANCE MODEL

•A strict financial discipline on investments (organic and M&A) through:
- -Strategic Committee (EVP, VP, CEO, CFO, 2 Board Members(1) )
- -Investment Committee (CEO, CFO, Management Team)
•Strong risk management policy:
-Best practice risk policy to ensure the hedging policy of the generation portfolio
•Full Alignment of interests between Top Management and shareholders through:
- - Launch in 2018 of a 3 year LTI compensation scheme fully based on shares

(1) 1 non-executive and 1 independent referring to the Corporate Governance Code set out by the Italian Stock Exchange (2) Committee composed of 3 independent Board members

CORPORATE BODIES AND BOARD COMMITTEES(1) Shareholders' Meeting Board of Directors 12 Members, of which 7 independent(2) 12 Meetings 2H 45' Duration Board of Statutory Auditors 1 Chairman, 2 Standing Auditors and 3 Alternative Auditors 13 Meetings 3H Duration Control and Risk Committee 1 Chairman and 2 Members(3) 11 Meetings 2H 10' Duration Nominations and Remuneration Committee 1 Chairman and 2 Members(3) 6 Meetings1H 25' DurationStrategic Committee 1 Chairman and 5 Members 8 Meetings 4H DurationBoD by Gender BoSA by Gender Women Men

(1) Data as of December 31, 2018

(2) 5 Independent referring to the Corporate Governance Code set out by the Italian Stock Exchange, and 2 Independent referring only to the Consolidated Finance Act («T.U.F.»). (3) 2 Independent referringto the Corporate Governance Code set out by the ItalianStock Exchange, and 1 Independent referringonlyto the ConsolidatedFinance Act («T.U.F.»).

REMUNERATION POLICY

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M B O P t a r a m e e r s ( 1) Gr E B T ou p d du l b In iv i O j ive E B I T D A, N F P, O P E X, t tc a ec s e. g. e	h W i t e g 3 0 % % 7 0	L T I P t a r a m e e r s / la d ( f f la Cu E B I T D A 2 0 1 8- 2 0 On O C te m u us e	h i W t e g ) 1 0 0 %

LTI

(1) IAS pre-tax profit.

ENTERPRISE RISK MANAGEMENT

Enterprise Risk Management (ERM) is responsible for:

•identifying and assessing the Group's main risks and defining strategies to mitigate them
•providing management dynamic risk mapping evolution
•providing Management with key information to make risk-informed decisions
•spreading over risk-aware culture across the Organization

ESG risks

• Included in the ERM analysis with particular focus on Climate Change (availability of resources and black swan), health & safety, retention of employees and key figures.

REDUCTION OF ENVIRONMENTAL IMPACT OF OPERATIONS

Green Energy for our indirect Consumption(1)

•As of 2016, ERG is committed to supply its offices and plants with certified renewable energy

Wood in Corbara: from waste to resource

• Until 2018, the significant accumulation of virgin wood (about 2,500tonn/year) dragged by Tiber river into Lake Corbara was considered by law as waste.
• In 2019 ERG received the authorization by the Umbria Region to manage such woody biomass as reusable material for activities such as energy recovery, wood industry and production of soil improvers.

(1) Figures are not on a like-for-like basis: they include all plants in exercise at each year-end

SUSTAINABLE PROCUREMENT

•

In 2019 ERG launched a "sustainable procurement project" focused on the introduction of new pillars to qualify and monitor vendors on:
environmental performance
human rights of the supplier and of his supply chai n
field audit.
•The project will be implemented in 2020

NEW LEADERSHIP MODEL

The Business Plan shows the direction, Skills help people find the way and Values give us strength, unity and stability

A STRONG FOCUS ON HUMAN CAPITAL DEVELOPMENT

ERG PEOPLE & TRAINING

"We are not looking for Talented People but rather for the Talent hidden in each Person"

ERG Training in a nutshell

KPIs IN OUR TRAINING
	HOURS OF TRAINING PROVIDED	DAYS OF TRAINING PROVIDED PER PERSON	PEOPLE WHO PARTICIPATED IN THE TRAINING
2016	31,787	5.6	96%
2017	37,950	6.6	97%
2018	34,356	5.9	92%

Every year all of our people are invited to design their own training path. A managerial attitude is required from all the employees.

DATA BREAKDOWN ON PERSONNEL

A DIVERSIFIED GROUP WITH EQUAL OPPORTUNITIES

(1) Percentage ratio between the average fixed remuneration for women for each position they belong to and the average fixed remuneration for men for the same position

WELFARE PROJECTS FOR EMPLOYEES

•Medical check up for all the employees
•Specific checks for older employees
•Additional leaves for medical check-ups

• Gym at Genoa office open to all employees with trainer available on site
Running and cycling team and other sport activities
•Corporate volunteering
•Family Day

•

•Plant's open Day
•Summer camps for employee's children
•Cooperation with schools and universities

•

"Holiday donation"

SAFETY AND ENVIRONMENTAL CERTIFICATIONS

Source: ERG 2018 non-financial information reporting

OUR CSR ACTIVITIES

•Support to entrepreneurial initiatives

•Special focus on technological start-ups
• Embrace disruptive ideas for competitive advantage

• In 2017 more than 10,000 students got acquainted with our CSR activities
• Future generations training and education on environmental matters
• Special attention to younger people supporting sports values

CULTURE & KNOWLEDGE

• Promotion of important cultural events in the communities where we operate

INNOVATIONS AND START-UPS

ERG GREEN BOND

ERG GREEN BOND RATIONALE

• As a leading European producer of electricity from renewable energy sources, ERG believes that issuing Green Bonds is a key tool to support the achievement of its sustainable development targets and to contribute to address major climate changes challenges
• In line with ERG's 2018-2022 sustainability commitment of consolidating the Group's leadership in the production of electricity from renewable sources, ERG decided to set up this Green Bond Framework, under which ERG can issue Green Bonds to support renewable energy
Process for Project Evaluation and Selection Management of Proceeds

• ERG's Green Bond Framework is aligned with the Green Bond Principles in its 2018 edition, its four core components and its recommendation for External Review ERG diversified electricity portfolio from renewable sources

USE OF PROCEEDS

The net proceeds will be allocated to the financing and/or refinancing of Renewable power generation facilities that fall under the following eligibility criteria:

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100% of the plants are or will be constructed according to EU and national/local legislation that requires specificenvironmental and social impact assessment

(1) Already in operation, under construction or on the way to to receive final authorization, at the time of the issuance of a Green Bond

PROCESS OF EVALUATION AND SELECTION

ERG Sustainability Committeewill be in charge of monitoring the selection and allocation process of Eligible Green Projects

•

Committee responsibilities

•Reviews and validates the selection of Eligible Green Projects
•Monitors the Eligible Green Project portfolio

•

•Monitors any ESG controversy related to an Eligible Green Project
•Manages any future update of the Green Bond Framework

Replacement of Eligible Green Projects

•If an Eligible Green Project does no longer meet the eligibility criteria
•If an Eligible Green Project is subject to a major ESG controversy

Committee Composition

•Chairman of the Board
•Executive Deputy Chairman
•Chief Executive Officer
Members: Chief Financial Officer, Chief Human Capital & ICT Officer, Chief Operating Officer, Chief Business Development Officer, General Counsel, Chief Public Affairs & Communication Officer, Chief Engineering Development Officer, Head of Institutional Affairs

Management of Proceeds

Commitment to ensure traceability of the Green Bond proceeds

•In the case of refinancing, no separate management of proceeds is required, projects costs being fully allocated on settlement date
•Proceeds from the issuance are invested in cash or cash equivalents until full allocation to Eligible Green Projects
•Complete allocation of proceeds from each ERG Green Bond is expected within 24 months from its issuance date

ALLOCATION AND IMPACT REPORTING

ERG commits to publish annually an allocation report and an impact report until full allocation

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External Review

RATING AGENCY VIEW

Long-term Issuer Default Rating (IDR): BBB-

EMTN Programme Rating: BBB-

Senior unsecured Rating: BBB-

Outlook: Stable

•

Last update: 19 June 2019

Key Rating Drivers:

•Independent Renewable Player

Credible Business Plan

CCGT Plant Contribution to Decrease

•

•Predominantly incentivised production
•Positive Current Trading
Leverage Consistent with Rating•Solid liquidity

•Committment to corporate funding

KeyConsiderations:

• Fitch Ratings has affirmed Italian renewable generation company ERG S.p.A.'s Long-Term Issuer Default Rating (IDR) and senior unsecured rating at 'BBB-'. The Outlook on the IDR is Stable

Stable Market Environment

• The affirmation mainly reflects the company's continuing robust business profile, with quasi-regulated activities representing about 70% of consolidated EBITDA, predictable regulatory frameworks and a clean asset base (mostly onshore wind, hydro and solar). The ratings also take into account ERG's growth ambitions in the context of a clearly stated financial policy of up to 3.0x net debt/EBITDA.
• We expect that ERG's credit ratios will remain consistent with the ratings, even after including in our rating case additional external growth in 2021 and 2022 (EUR50 million and EUR150 million respectively) not considered in the company's business plan. Our forecasts lead to an average funds from operations (FFO) adjusted net leverage of 3.3x and FFO fixed charge coverage of 7.4x over 2019-2022, compared with negative guidelines of 3.5x and 4.0x, respectively. This is also in line with ERG's stated financial policy

GROUP DEBT STRUCTURE

•Debt structure mainly composed of medium term loans with 91% fixed rate portion

•ERG's operating assets grant a steady flow of cash upstream to ERG S.p.A.:

-Hydro assets fully unlevered without any external financing constraints
-Natural gas asset with low levered financing having EBITDA/PF loan lower than 1.0x
- Wind & Solar SPVs financed by long term loans with maturities consistent with incentive life and abl e to upstream a relevant amount of cash

Evolving new financial strategy: move from Project Financing fund raising to corporate/DCM Financing

(1) ERG S.p.A. owns all the operating assets through ERG Power Generation S.p.A., a 100% owned operating subsidiary, free of debt and in cash pooling with ERG S.p.A.

ERG IN A NUTSHELL AS AT 31.12.2018

FINANCIAL AND OPERATING PERFORMANCE AS AT 31.12.2018

ERG DISTRIBUTION OF ADDED VALUE AS AT 31.12.2018

Current amounts (EUR million)	2018	2017	2016
Production value	1,050	1,065	1,041

Economic value distributed	(795)	(746)	(748)
Production costs	(426)	(450)	(463)
Remuneration of personnel	(80)	[79]	(76)
Remuneration of public administration	(54)	[51]	(ਤਰੀ
Remuneration of debt capital (1)	(105)	(89)	(97)
Remuneration of risk capital (2)	(128)	(75)	(71)
Remuneration for the community	(2)	(2)	(1)

Economic value withheld by the Group	255	ਤੇ।ਰੋ	293
Amortisation and depreciation.	275	252	254
Remuneration of the company	(21)	67	ਤਰੀ