Slide 1: Energy infrastructure for a sustainable future
Energy infrastructure for a sustainable future May 2024
Slide 2: Snam, a leading pan European gas infrastructure operator
Snam, a leading pan European gas infrastructure operator energy to inspire the world Italian and International assets (pro-quota) Key figures € 23.8 ~ € 15.6 € 2.41 € 1.17 ~37,400 ~20 bcm ~20 bcm/y bn km1 capacity2 capacity3 bn bn bn Tariff RAB Market EBITDA Net Income Transport Storage Regasificati
Slide 3: Opening remarks
Opening remarks energy to inspire the world Snam’s Board od Directors, guided by its robust governance, oversees its long-term strategy while fostering an engaged and accountable culture. We have always been comprehensive in our approach to sustainability and remain committed to the Paris Agreement.
Slide 4: Our Ambition: Energy infrastructure for a sustainable future
Our Ambition: Energy infrastructure for a sustainable future With two businesses that are synergistic and progressively interconnected, Snam’s aim is to become a modular, flexible, and repurposeable infrastructure to secure energy supply across Italy and Europe. To achieve this, Snam will leverage t
Slide 5: 2023-2027 Strategic Plan: key figures
2023-2027 Strategic Plan: key figures energy to inspire the world Capex Old plan New plan EBITDA adj. Net income adj. +15% € 10 bn € 11.5 bn1 2022-2026 2023-2027 Cagr Cagr >7% ~4% € bn € bn Tariff RAB Net Debt Cagr € bn € bn ~2.4 ~3.2 ~1.14 ~1.33 >6% ~ 28.6 bn ~ 22.4 bn 2023 2027E 2023 2027E ~15.5 ~
Slide 6: Snam's Sustainability journey: what we achieved
Snam’s Sustainability journey: what we achieved energy to inspire the world Governance: Sustainable value creation introduced in Methane emissions : -57% vs 2015 and 3 years gold 1 4 the By-laws, including energy transition businesses and standard by UNEP on methane emissions BoD gender balance Empl
Slide 7: All-round Sustainable Strategy: a pillars framework
All-round Sustainable Strategy: a 7 pillars framework energy to inspire the world sformative innovatio Decarbonize the core business in line with Tran n our path to Net Zero, while partnering with Develop an energy transition platform to reach system's Carb suppliers to promote the sustainability of
Slide 8: Full scorecard aligned with the pillars framework
Full scorecard aligned with the 7 pillars framework energy to inspire the world 2023 2024 2027 2023 2024 2027 KPIs Actual Target Target KPIs Actual Target Target • Avoided CO2 emissions (ktCO2e)1 102.9 105 500 • Employees engagement index (%) 84 >80 >80 Green transition • H2 readiness length of netw
Slide 9: Agenda
Agenda Governance Road to Carbon Neutrality Biodiversity & Regeneration Snam People Engagement & Local Communities Key Data
Slide 10: Robust Governance
Robust Governance energy to inspire the world Appointed on April 27, 2022 Board of Directors Monica de Virgiliis Stefano Venier Massimo Bergami Laura Cavatorta Augusta Iannini Piero Manzoni Rita Rolli Qinjing Shen Alessandro Tonetti 67% Chair CEO Non-Executive Non-Executive Non-Executive Non-Executi
Slide 11: 2023 Board Evaluation
Board evaluation energy to inspire the world An evaluation of the organization and functioning of the Board and its Committees is conducted every year, coordinated by the Chairperson and supported by the ESG & Energy Transition Scenarios Committee. In 2022, the Board chose to perform its evaluation
Slide 12: Zoom on Climate Change BoD's oversight
Zoom on Climate Change BoD’s oversight energy to inspire the world Board of Directors ESG and Energy Transition Scenarios Nomination and Remuneration Audit, Risk And Related Parties Committee Committee Transactions • Examine and make recommendation regarding CC strategy and commitments • Make recomm
Slide 13: Pay Aligned with Strategy
Pay Aligned with Strategy energy to inspire the world Remuneration Policy aims at ensuring alignment with the Company's strategic objectives considering the characteristics of the business and the industry while ensuring that the variable component represents a significant portion of total remunerat
Slide 14: Remuneration KPIs
Remuneration KPIs energy to inspire the world New KPIs approved at the 2023 AGM Long-Term Variable Share-Based Incentive Plan Annual Monetary Incentive – 2023 KPIs1 (2023-2025 LTIP)1 KPI Description Weight KPI Description Weight Adjusted EBITDA 30% Adjusted net profit 40% Investments gas infrastruct
Slide 15: Remuneration: what is new
Remuneration: what is new energy to inspire the world 3 CLUSTER Updated peer group INDUSTRIAL UTILITIES/ENERGY REGULATED/INFRA • In January 2024, the Nomination and Remuneration Committee conducted a process to update the panel of companies to be used for compensation benchmarking • For the compensa
Slide 16: Enterprise Risk Management (ERM) approach
Enterprise Risk Management (ERM) approach energy to inspire the world Objectives Outcomes • Adoption of the Group Risk Appetite • Higher risk-informed contribution to both Framework decision-making and strategic processes in • Introduction of a distinction between With the aim of continuously enhanc
Slide 17: Climate Change Risk Management Framework
Climate Change Risk Management Framework energy to inspire the world Identification, measurement, and management of risks and opportunities associated with climate change that may impact industrial, economic, and sustainability objectives (transition risks) as well as the integrity of tangible (phys
Slide 18: Cybersecurity risk management
Cybersecurity risk management energy to inspire the world Cybersecurity plays a crucial role in preventing or addressing diverse events, ranging from compromising individual workstations to the degradation of entire business processes Security incident response team, Cyber Security by design & Secur
Slide 19: Policies
Policies energy to inspire the world SNAM POLICIES OVERVIEW 2023 NEW POLICIES AND UPDATES E S • Policy Diversity & Inclusion Climate Policy Committment: Gender Social Transition Policy: • Gender Equality Policy Enhancing transparency by disclosing It guides transgender individuals in climate-related
Slide 20: Tax Transparency Report
Tax Transparency Report energy to inspire the world The document, drafted on voluntary basis and published for the first time in 2023 (fiscal year 2022) to: • Promote a transparent and collaborative relationship with all stakeholders • Represent tax governance and how the tax strategy and tax risk m
Slide 21: Agenda
Agenda Corporate governance Road to Carbon Neutrality Biodiversity & Regeneration Snam People Engagement & Local Communities Key Data
Slide 22: Historical Scope 1&2 emissions evolution
Historical Scope 1&2 emissions evolution energy to inspire the world 76,37 74,48 Gas demand 72,66 71,30 (bcm) 68,69 61,85 Regulated perimeter 1,578 1,422 1,341 1,459 1,451 1,333 (ktons of CO2e) 1.600 1.200 800 400 0 2018 2019 2020 2021 2022 2023 Scope 1 - Natural gas emissions Scope 1 - Emissions fr
Slide 23: Scope 1+2 reduction targets and key levers
Scope 1+2 reduction targets and key levers energy to inspire the world SCOPE 1&2 TARGETS (ktons of CO2e) In line with 1.5° KEY LEVERS • ISO 50001 - Energy Management System to 1,451 improve energy performance -8% • Replacement of the gas-fueled compressor Scope 2 stations with electric units -25% •
Slide 24: Scope 3 reduction targets and key levers
Scope 3 reduction targets and key levers energy to inspire the world SCOPE 3 EMISSIONS TARGET1 KEY LEVERS (ktons of CO2e) Supply chain emissions 1.5° / well below 2° • Inclusion of ESG criteria in tenders • Most significant suppliers (in terms of emissions) involved in the CDP Supply Chain questionn
Slide 25: Avoided emissions
Avoided emissions energy to inspire the world Activities related to the energy transition businesses (energy efficiency and biomethane) contribute to avoiding emissions that would otherwise be generated by other actors in the system SNAM ENERGY TRANSITION BUSINESSES TOTAL AVOIDED EMISSIONS THANKS SC
Slide 26: Moody's Net Zero Assessment
Moody’s Net Zero Assessment energy to inspire the world ASSESSMENT Moody’s assigned a NZ-3 Net Zero Assessment score (Significant) to Snam’s carbon transition plan. The Group's ambition score is Well-below 2°C under Moody’s scoring scale, in line with the Paris Agreement goals IMPLEMENTATION The imp
Slide 27: Agenda
Agenda Corporate governance Road to Carbon Neutrality Biodiversity & Regeneration Snam People Engagement & Local Communities Key Data
Slide 28: Biodiversity at Snam today
Biodiversity at Snam today energy to inspire the world Biodiversity and Nature cover environmental topics beyond GHG emissions, such as land & sea use change and freshwater consumption, whose integrity is rapidly declining due to human-related activities that cause loss of biodiversity Environmental
Slide 29: Nature footprint analysis
Nature footprint analysis energy to inspire the world Infrastructure Transport & Off-shore On-shore Pressure Biomes Storage construction Dispatching regas. (FSRU) regassification Land and sea-use 1 No impact change Land (Km2) Based on most recent SBTN (Kg guidance (to be confirmed in Air Particulate
Slide 30: Biodiversity risk estimate
Biodiversity risk estimate energy to inspire the world Footprint Ecosystems Assessment Biodiversity risk land use change x = Baselining of projects impact Assessment of terrestrial Identification of hotspots with by Km2 of area occupied ecosystems integrity within the significant impact within high
Slide 31: Commitments & key actions
Commitments & key actions energy to inspire the world SBTN aligned SBTN aligned Scope Target formulation Key actions target actions as for SBTN Avoid • Zero Net Conversion already embedded in our operating model • Zero Net Conversion of natural with multiple initiatives in place ecosystem on all inf
Slide 32: Working towards a positive impact on Nature
Working towards a positive impact on Nature All-round Sustainability Nature and biodiversity commitment: from Zero Net Conversion to Net Positive Ambition First pure infrastructure player globally Net Positive impact to join SBTN Corporate Engagement by 2027 Program With focus on high biodiversity r
Slide 33: Agenda
Agenda Corporate governance Road to Carbon Neutrality Biodiversity & Regeneration Snam People Engagement & Local Communities Key Data
Slide 34: Health & Safety
Health & Safety energy to inspire the world Frequency Index1 Severity Index1 IpFG2 0.58 0.58 0.67 0.65 0.48 0.60 1.06 0.49 0.94 0.47 0.86 0.32 0.30 0.59 0.38 0.05 0.05 2019 2020 2021 2022 2023 2019 2020 2021 2022 2023 2017 2018 2019 2020 2021 2022 2023 • Snam4safety project launched in 2018 to stren
Slide 35: Welfare initiatives & Employees well-being
Welfare initiatives & Employees well-being energy to inspire the world Welfare initiatives 2023 Survey & main themes 30 welfare services organised into 5 main areas of intervention: 1. Sustainable Engagement • Family and Education 2. Well-being • Health and Care 3. Job satisfaction • Well-being and
Slide 36: Training
Training energy to inspire the world Initiatives to develop skills aligned with a constantly evolving work environment, such as the use of advanced technologies and innovative work procedures. Beyond the traditional role of skill dissemination, training aims to create awareness and empower employees
Slide 37: Diversity & Inclusion
energy Diversity & Inclusion to inspire the world 2020 • Policy Framework: spread the culture of diversity and equal opportunities, apply specific HR policies and metrics Achievement of UNI 125: to ensure fairness at all stages of the employment relationship (specific policies on diversity & inclusi
Slide 38: Agenda
Agenda Corporate governance Road to Carbon Neutrality Biodiversity & Regeneration Snam People Engagement & Local Communities Key Data
Slide 39: Engaged and Accountable
Engaged and Accountable energy to inspire the world Engagement Outcomes >150 NEW Climate Lobbying Committment: Enhancing transparency 336 Meetings with National Institutions… by disclosing climate-related lobbying activities and assessing their alignment with the objectives of the Paris Agreement. i
Slide 40: Local Communities
Local Communities energy to inspire the world Benefits for Local Communities (as 5 • Direct Liberalities, sponsorships and €3m % of regulated revenues) Value Released at Local Communities (€M) 4 compensations1 1 € 2.4 m • Contributions to Arbolia and Foundation 3 • Contributions to Italian start-ups
Slide 41: Suppliers
Suppliers energy to inspire the world Involving Suppliers in the decarbonization journey, raising awareness about climate change, and supporting digital innovation contribute to promoting a shared model of sustainable development Suppliers Engagement ESG Criteria & Supplier’s Sustainable Target Scop
Slide 42: Snam Foundation
Snam Foundation energy to inspire the world “3P approach… Key 2023 indicators Energy Poverty A “3P” approach to fostering a Education Poverty ~ € 1.45 M Projects expenses & costs Just Transition Food Poverty 35,414 Beneficiaries …implemented through 3 levers” 93 Volunteering: donation of ~4,200 hour
Slide 43: Arbolia – A benefit company to develop new green areas in Italy
Arbolia – A benefit company to develop new green areas in Italy energy to inspire the world Benefit company established in 2020 by Snam and the Cassa Depositi e Prestiti Foundation, creates new green areas in Italy, contributing to the fight against climate change, improving air quality, enhancing l
Slide 44: Agenda
Agenda Corporate governance Road to Carbon Neutrality Biodiversity & Regeneration Snam People Engagement & Local Communities Key Data
Slide 45: Snam's Shareholders
Snam’s Shareholders energy to inspire the world Shareholders structure (%) Shareholders geographical break down (%) 0.2 4 0.2 8.7 7.5 17.8 32.8 50.8 13.1 31.4 12 16.8 1.4 3.3 Institutional Investors Bank of Italy Italy - Strategic Holders 1 Italy - Retails2 Italy - Institutional Continental Europe C
Slide 46: Sound absolute and relative position in ESG Rating
Sound absolute and relative position in ESG Rating energy to inspire the world DJSI CDP FTSE4GOOD Sustainalytics MSCI ISS ESG Moody’s Vigeo 100 A 5 NEGLIGIBLE RISK AAA A+ ADVANCED AA B 82 LOW 3.7 BBB B- 2.7 C ROBUST 33 HIGH 0 D 0 SEVERE RISK CCC D- WEAK Snam Sector average 46
Slide 47: EU Taxonomy
EU Taxonomy energy to inspire the world Eligibility Alignment • Transport of CH4 : pro-quota of yearly demand • Storage of CH4: excluded • Transport of CH4: revenues aligned pro-quota of green 21% gases on yearly demand 20% • LNG: excluded Revenues • Biomethane: 100% eligible 81% • Biomethane: 100%
Slide 48: 2023-27 Capex alignment
2023-27 Capex alignment energy to inspire the world OVERALL CAPEX MIX AND CAPEX ALIGNMENT TAXONOMY ALIGNMENT TO SDGS 18% 19% 42% 10% €11.5 bn 46% €11.5 bn 17% 9% 6% 17% 10% 1% 3% 2% H2 Ready Energy transition SDG 7 - Affordable and clean energy SDG 11 – Sustainable cities and (including FSRUs) commu
Slide 49: Sustainable Finance
Sustainable Finance energy to inspire the world RECA O C R ESG Finance over total funding D S available: 85% in 2027 Sustainable finance doubled in 4 Y, Extensive toolbox of instruments available new target in 2027 Short-term ESG funding via ESG Recently updated commercial papers rated EE+ programme
Slide 50: Sustainable Finance Framework
Sustainable Finance Framework energy to inspire the world Eligible activities included: Full EU Taxonomy New o Green Infrastructure – • Green Gases – assessment on all project Updated Network for Renewables Hydrogen, Biomethane categories, including Do No Use of Proceeds and Low Carbon Gases, New o
Slide 51: Sustainability-Linked Features: KPI and SPTs (1)
Sustainable Finance Framework Sustainability-Linked Features: KPI and SPTs (1) REDUCTION IN METHANE EMISSIONS KEY CONSIDERATIONS KPI 1 – CH4 Emissions Targets1 (Mm3 of CH4) • The reduction of methane emissions, due to its high global warming potential, along the oil and gas value chain has always 49
Slide 52: Sustainability-Linked Features: KPI and SPTs (2)
Sustainable Finance Framework Sustainability-Linked Features: KPI and SPTs (2) REDUCTION IN SCOPE 1 AND 2 EMISSIONS KEY CONSIDERATIONS • This KPI and the SPTs are part of Snam’s longer-term target of being KPI 2 – Scope 1&2 targets 1 (ktons of CO2e) Carbon Neutral in its operational activities (Scop
Slide 53: Sustainability-Linked Features: KPI and SPTs (3)
Sustainable Finance Framework Sustainability-Linked Features: KPI and SPTs (3) REDUCTION IN SCOPE 3 EMISSIONS KEY CONSIDERATIONS KPI 3 – Scope 3 emissions targets 1 • On Scope 3, stated in absolute terms, Snam has a goal to reduce (ktons of CO2e) emissions of 30% and 35% respectively by 2030 and 203
Slide 54: Sustainability-Linked Features: KPI and SPTs (4)
Sustainable Finance Framework Sustainability-Linked Features: KPI and SPTs (4) INCREASE IN THE SHARE OF WOMEN IN MANAGEMENT POSITIONS KEY CONSIDERATIONS KPI 4 – Share of women in Management1 • Gender diversity has always been a focal point of Snam’s People (%) strategy, focusing on pragmatic actions
Slide 55: Sustainable Finance Framework: Use of Proceeds
Sustainable Finance Framework Use of Proceeds GREEN PROJECT CATEGORIES KEY NEW PROJECTS Extended Green Project categories to incorporate every aspect • Construction and operation of new transmission pipelines of updated Capex Plan dedicated to the transport of renewable and low-carbon gases (biometh
Slide 56: Disclaimer
Disclaimer energy to inspire the world Luca Oglialoro, in his position as manager responsible for the preparation of financial reports, certifies pursuant to paragraph 2, article 154-bis of the Legislative Decree n. 58/1998, that data and accounting information disclosures herewith set forth corresp
Slide 57: Thank you
energy to inspire the world T H A N K Y O U