Our CFO, Nadia Jakobi , and CEO, Leonhard Birnbaum, are here. As always, both of them will give you an overview of the past fiscal year in the next 30 minutes, and then you'll have the opportunity to ask questions. With this, I'd like to pass the floor to Leonhard Birnbaum. Go ahead.
Lars, ladies and gentlemen, good morning from me as well. I'd like to welcome you to our annual press conference for fiscal 2025. My text says 2025 was marked by economic and geopolitical uncertainty. That hasn't improved in 2026, we will have to live with that, most probably as in previous years. Unfortunately, this uncertainty has reached a new dimension, much of what it underpins international cooperation and creates stability is now being called into question. The confidence in reliability and predictability has been lost. These developments are beyond of what we can control at E.ON. Nevertheless, what we can do as a systematically relevant company is living up to our responsibility and help make Europe strong.
Therefore, I'm happy to be able to say that E.ON has concluded fiscal 2025 successfully. We are delivering financially on the promises of our growth strategy. With an Adjusted EBITDA of EUR 9.8 billion, and adjusted Group net income of EUR 3 billion, we have fully met our guidance. Natalie Jacobi will comment on the details in a minute. What is even more important to me is that we have not only delivered financially, but to be in the playmaker of energy transition in Europe, we delivered operationally as well. In particular, we continued to systematically implement our investment program. In 2025, we invested EUR 8.5 billion in our company's future viability and thus in Europe's energy transition, in products for our customers, in security of supply, and in the modernization of critical infrastructure.
This performance and this increase, EUR 8.5 billion, and EUR 1 billion more than last year, is not automatic. It's the result of clear priorities, a high level of operational discipline, and an organization that remains fully capable, even under pressure. It's, above all, the result of our employees' hard work and dedication. Day in, day out, they ensure we make energy work reliably, safely and affordably. For this, I'd like to express my sincere thanks to them. Today, ladies and gentlemen, when we talk about the energy transition, it's no longer about the vision of the future, it's about implementation. It's about networks, connections, digitization, resilience, and secure energy. It's about innovative products for our customers, so they can participate in the energy transition.
E.ON, we can definitely say that, is at the forefront when it comes to implementation. By the end of 2025, about 70% of onshore wind capacity and almost 50% of solar capacity were connected to E.ON's grids in Germany. This is despite the fact, when you look at the length, we only have about one third of the German network. We have connected more renewable to our grid than others. The energy transition is taking place in our distribution networks. Just recently, we integrated the 2 millionth renewable energy plant to our German grid, in January, February, I think it was.
The total connected capacity of all these assets in Germany, renewable assets that is, now stands at roughly 110 gigawatts, and it took at least 15 years to connect the 1st million, whereas the next million took us about 2.5 years, and we're now seeing the 3rd million in less than 2 years. This shows the extraordinary pace at which we are developing the system. It's a growth segment, everything is developing, and this dynamic growth can only be managed if networks are systematically planned in advance, digitalized, and industrialized. That's why we're investing massively to expand and modernize our network infrastructure. That is also why we are continued adapting our processes and supply chains to meet requirements.
As part of our supply chain initiative, last year, we signed long-term contracts with manufacturers of core components for network infrastructure. This is how today we are already securing our future ability to deliver. One thing is clear, as the system grows, so does its complexity. Decentralization and volatility, new loads are fundamentally altering the requirements for network control and stability. Despite this, it's no coincidence that Germany still has one of the world's most stable power networks, with an average outage of less than 12 minutes per year. E.ON, thanks to our systematic investments in digitalization, automation, system intelligence, is making a major contribution. The journalists who are here today, we will present some of these things to you later.
Those of you who are not here today, I'd like to motivate you to come to next year's annual press conference. We are making consistent investing in system intelligence. We are the leaders in the energy sector, and this is in exotic forms. For example, our rating in the Quantum Innovation Index. E.ON is propelling digitization. One example is a digital twin for our German grid, or the installation of smart substations, where we can measure the condition of an asset and control it at any time.
By the end of 2025, we have put a total of around 30,000 smart substations into operation in our German network area. This helps us to control networks in real time, manage load proactively, and balance out fluctuations before our customers even notice them. A key prerequisite for our digital infrastructure is the rollout of smart meters. For E.ON, it was never a question of whether we would achieve the mandatory quota of 20% by the end of the year, but rather how we will achieve it. You can see it on this chart here. We delivered, even under challenging conditions. All E.ON units in Germany surpassed the mandatory quota, in some cases, significantly. Our average rollout rate is 30%. This operating strength is also the foundation for new customer solutions.
We develop innovative products that enable our customers to actively benefit from the energy transition. These primarily include flexibility solutions, like Germany's first bi-directional charging tariff, which we developed in partnership with BMW or E.ON Home Comfort, a digital energy solution that automatically optimizes decentralized systems. Outside Germany, we did nice things. For example, in the United Kingdom, we forged a partnership with Usinso, a technology and service platform, to better support our customers in their decision regarding the installation of heat pumps end-to-end. Heat pumps, solar panels, charging solutions, and batteries can and now be used in their homes. Our integrated energy solutions also help industry, businesses, and municipalities to decarbonize.
A project like Windwärme Ludwigsfelde shows how wind energy can be used to supply heat to a large industrial park and city, so both directly and when there is no demand for heat, where they can feed into the network. You can see that on the right-hand side, the planned United Heat joint venture, where we are connecting German and Polish cities in the Görlitz area, to achieve a transnational decarbonized heating solution for both countries. In short, E.ON delivered, and we lived up to our responsibilities and whenever and wherever we were needed. E.ON is one of the largest investors in Europe's energy infrastructure these days, and if we are not even the largest one. The surge in our investments, particularly in our network business, clearly demonstrates this.
For the period 2022 to 2026, we plan to invest EUR 22 billion. This is when I started here, EUR 22 billion, and it was EUR 26 billion from 2023 to 2025, and EUR 35 billion up until 2028. We now plan to make group investments of EUR 48 billion for 2026 to 2030, of which EUR 40 billion will go toward our network business in Germany and abroad. These figures represent a clear commitment. We deliver, and we're prepared to continue making a significant contribution to the transformation of the energy system in future. At the same time, investments of this magnitude require the right regulatory framework, including for the upcoming regulatory period in Germany. Our investments must be profitable for them to be financeable.
We've made this assumption in our planning and therefore explicitly subject to our planning to this proviso. Sound regulation is a precondition for the necessary expansion of this infrastructure to continue at a sufficient pace in the years ahead. One central point is affordability determining the energy transition success. E.ON is actively committed to offering our customers solutions that meet their individual needs. I just gave you a few examples, but that alone isn't enough. Last year, Germany's Renewable Energy Sources Act had its 25th anniversary, and during these 25 years, we have seen a huge ramp up of renewables, and that's why we achieved 58% of the country's electricity last year from renewables. E.ON is proud that our grid infrastructure helped make this possible.
Nevertheless, we made it clear some time ago that the uncontrolled growing growth of renewable energy plants that need to be connected to the network, will further drive up system costs for our customers, and this will call into question the energy transition's public acceptance and long-term success. Therefore, I can only repeat what I said one year ago at the press conference. The first half of the energy transition is over, and now the second half has begun. In the second half, we must play a different game than in the first one. We now need to fully concentrate on continuing the development of the energy system and make it as affordable as possible. Affordability and reliability are on top of sustainability. That cannot be ignored.
E.ON cannot and will not implement the energy transition without considering the customer's interests, Germany should not advance the energy transition in the long term without considering its citizens' interests and its economy. That's why it's particularly welcome that the German government has recognized this necessity and is beginning to systematically address it. I just said it, we need to play the second half differently than we did in the first half. That means different rules here and there. What is need, the energy transition must now become system transition. A demand-oriented energy system, planning will be essential, according to our calculations, there is a savings potential of EUR 15 billion annually.
The new maxim must be only as many renewable facilities as Germany actually needs in the years ahead, in line with the development. These facilities must be integrated in the right places, so that they benefit our customers, this includes subsidy schemes that need to be systematically reviewed. Network connections are another area. E.ON has developed a wide range of solutions to make better use of grid capacity and connect system faster. Examples include, we have too many requests, which we cannot serve. We, as E.ON, are playing our part, as we already said, 20 gigawatts of renewables last year, 12 or 4 gigawatts for data centers, contracts for large batteries. The 70% gigawatts of renewable were. Did we had that last year as well, in 2024, 2025?
We are playing our part but cannot continue this way because we are coping with the biggest part. We have developed new concepts as well, feed-in sockets and flexible connections. The volume of requests is beyond what we can deliver. Federal Network Agency, in its scenario, is expecting an actual demand of 41 to 94 gigawatts of installed large battery storage capacity. Yet last year alone, E.ON was able to confirm grid connection request for new storage capacities, totaling more than 16 gigawatts. Even if not all of these systems are built, the ramp-up, the way it is now, doesn't offer an advantage for our customers. That means we need a new net connection regime, and for that, we need a reform in various places.
First of all, a new grid connection regime must be created that moves away from the first come, first served principle and focuses on clear criteria, smart priorities, and a legal certainty for grid operators, and so legal certainties for the operators as well. What drives me personally is that the first come, first served principle means that we cannot serve demand because we're fully utilizing the node with new renewable batteries, and then later, the investor who wants to electrify their site, we have to tell them: "Sorry, we don't have capacity until next year." That's not acceptable. We need to change the basic principle. We need a totally different logic. Secondly, significantly faster approval procedures are needed for grid expansion.
As part of the acceleration of the old traffic light coalition, we also requested that for the 110 kV, we get the acceleration, and we didn't get it, but we do need it. Otherwise, we can never reverse the bottleneck because building is happening faster. Thirdly, we need local signals, cost signals, that send a steering effect. The Ministry of Economic Affairs and Energy is considering reservation regarding financial compensation in the event of curtailment for renewable energy plants in grid congestion areas. That's understandable. Some sort of instrument is required, and we would then have to look at the details in the future. Without such an instrument, we cannot reverse the bottlenecks. We therefore welcome the fact that the German government is working on initial proposals for reforming the grid connection regime.
It's no coincidence that leading associations representing industry and the data center welcome that and see it the same way we do. There's another point. The importance of significant was shown in Berlin as well. Without electricity, people can end up in difficult or life-threatening situations. Allow me to take this opportunity to make 2 personal remarks. Firstly, attacks on infrastructure are brutal acts of terror. They endanger human lives. They're inexcusable. Second, if 5 days in Berlin kept us on edge as being very critical, which they were, then imagine, particularly today, I mean, yesterday, we had the anniversary of the Russian attack on Ukraine. We need to pause and think about the suffering endured by the Ukrainian people under Russia's terror attack, which is inexcusable.
Since they cannot win at the front, they resort to terror attacks. We must do everything we can to help Ukraine and its people in their fight for freedom. Back to Berlin. The right conclusions must now be drawn from the experiences. The Bundestag's decision on the crisis umbrella law is welcomed, at the same time, demands for a completely redundant network infrastructure are neither effective nor cost-efficient. The attack showed that the technical redundancy alone doesn't guarantee resilience. Resilience means designing systems and processes in such a way that they can cope with disruptions or attacks swiftly and recover quickly.
This is where the focus needs to be, because there can be no such thing as a complete protection, because if we rely on this kind of protection, then we have an issue when it fails, and it will fail. In addition, existing transparency must be reviewed and withdrawn where they could jeopardize the security of critical infrastructure. It's also conceivable to establish crisis hubs in the various network regions. In any case, we are glad that our E.ON units were able to restore electricity service in Berlin faster than anticipated. The solidarity within the industry was very remarkable, the cooperation showed how important trustful cooperation is for the benefit of our citizens. E.ON stands for reliability towards our customers, towards society, and toward shareholders.
We invest, we deliver operationally, and we live up to our responsibilities for an energy system, and we are prepared to do that for the future as well. I hand over to Nadia.
Well, thank you very much. I would like to also welcome you to our annual press conference. E.ON, in the past year, again demonstrated how robust our business model is in a volatile market environment. We further increased our operating effectiveness, continued to purposefully develop our business divisions, and systematically raised our investments to a new level. Adjusted Group EBITDA was at EUR 9.8 billion, and that was at the upper end of our guidance range, and 9% above the prior year. Adjusted Group net income rose to 6% to EUR 3 billion. Let us now take a look at our business division's earnings. The Energy Networks business division was again the main driver of E.ON's growth in fiscal year 2025. It achieved Adjusted EBITDA of EUR 7.7 billion, which was 12% above the prior year.
This increase was mainly due to the further growth of our regulated asset base as a result of our investments. Our network business in Germany, as well as in Southeastern Europe, also benefited from higher than anticipated distributed volume. Regulatory catch-up effects, particularly regarding network losses in Hungary, made a positive contribution to earnings as well. Our Energy Retail business division recorded Adjusted EBITDA of EUR 1.7 billion, which was at the midpoint of our guidance range. As already mentioned in previous quarters, Energy Retail's earnings performance was significantly influenced by portfolio effects in the United Kingdom, which resulted mainly from a higher proportion of customers with fixed-price contracts. Business in Germany improved moderately, although expenditures on digitalization and customer management dampened growth. Adjusted EBITDA at Energy Infrastructure Solutions was at EUR 590 million, and thus slightly higher than in the prior year.
The factors contributing to this growth included higher asset availability in the United Kingdom and Scandinavia, increased heating demand in Germany due to weather conditions, and further progress in our smart meter rollout in the U.K. The strong demand for our integrated decarbonization solutions, from district heating projects and industrial energy infrastructure to local storage solutions, was particularly gratifying. E.ON's investments reached a new benchmark in fiscal 2025. They amounted to EUR 8.5 billion, which was EUR 1 billion more than in 2024. EUR 7 billion of this went toward our network business alone, a year-over-year increase of around 20%. These investments reflect the need to further expand and modernize our network infrastructure and upgrade it to meet increasing demands. We're investing precisely where the energy transition is being decided, and that's in our distribution grids.
We also made targeted investments of EUR 480 million in Energy Retail and roughly EUR 900 million in Energy Infrastructure Solutions, both of which are future growth businesses. Investments in the Energy Retail business went particularly toward the Europe-wide expansion of charging infrastructure, new customer-oriented energy solutions, and digitalization. Our investments in Energy Infrastructure Solutions were aimed primarily at developing our decarbonization projects for municipalities and industrial customers. One message is clear: we prioritize investments that strengthen our operating performance and further consolidate our role as a reliable infrastructure partner. Our investment strategy is based on a solid balance sheet and disciplined financing policy. Despite high levels of investment, our year-end debt ratio was 4.4, well below our upper limit of 5. The financing of our growth remains long-term, stable, predictable, and, above all, sustainable.
Around 70% of our bond issues in fiscal year 2025 consisted of green bonds. This added value benefits our shareholders as well. It enables us to propose a dividend of EUR 0.57 per share for fiscal year 2025, an increase of 4% year-over-year. This means we are reliably keeping our promise of an annual increase of our dividend of up to 5%. I'll turn to our guidance for the current fiscal year. Starting in 2026, we are adjusting our adjusted Group EBITDA and adjusted Group net income to exclude temporary regulatory effects in the energy network business. On this basis, we expect stable earnings at the adjusted prior year level for fiscal year 2026.
We anticipate adjusted Group EBITDA in the range of EUR 9.4 billion-EUR 9.6 billion, and adjusted Group net income between EUR 2.7 billion and EUR 2.9 billion. This corresponds to adjusted earnings per share of EUR 1.03-EUR 1.11. I'll turn now to our medium-term plan. It demonstrates clearly that E.ON continues to invest and to systematically pursue its growth path. Today, we affirm our clear growth strategy. We plan to invest EUR 48 billion for the period from 2026 to 2030. Around EUR 40 billion thereof will be invested in Energy Networks, and about EUR 2.5 billion in Energy Retail, and around EUR 5 billion in Energy Infrastructure Solutions. This plan reflects the increasingly growing needs of Europe's energy system, from renewable energy generation, flexible consumers and data centers, to storage technologies and industrial transformation.
An important point that Leo Birnbaum already mentioned is also very close to my heart. Our business's ability to help implement the energy transition at the necessary pace depends largely on an appropriate regulation. We need a reliable regulatory framework. We need secure refinancing of our investments. Regulatory requirements must recognize additional demands on the resilience of critical infrastructure. Germany's network connection regime must set more priorities, so that resources can be allocated effectively. Our investment plans are therefore expressly subject to an economically adequate regulation. Only then can private capital be mobilized on a large scale. Based on our planned investments, we expect adjusted Group EBITDA to rise to around EUR 13 billion by 2030. Adjusted Group net income to around EUR 3.8 billion, and adjusted earnings per share to around EUR 1.45.
This growth is no coincidence, but is the result of the consistent execution of our investment program, and it is based on a clear and robust operational logic. All three of these business divisions will contribute to it, supported by their operating performance, efficiency, and systematic digitalization. Ladies and gentlemen, 2025 was a year of implementation and progress at E.ON. We delivered operationally, financially, and strategically. We further strengthened E.ON as the playmaker of the energy transition, as a reliable partner for customers and policymakers, and as a sustainable investment for our shareholders. I'd like to thank our teams in all markets. Their commitment and professionalism are the foundation of our success, and I now look forward to your questions. Thank you very much.
Thank you very much, Nadia and Leo, and with this, I would like to open the Q&A session.
As always, you can ask questions in the room. Please press the button on your mic, and I'll ask you to speak. The same applies to the virtual room. Please raise your hand, and we will then call you consecutively. The first question is from Antje Höning . As always, it's nice. From Rheinische Post, Antje Höning , please go ahead.
I have two questions concerning the Heating Act, which was adopted last night. How do you like it, and how do you like the green fuel add mixtures that may also affect you? How did this number of electricity customers develop in Germany, and do the consumers have to expect as far as prices are concerned?
The Building Modernization Act is what it's called now. That's true, it has been adopted.
It's a pretty big regulation. We haven't really looked at it yet. I don't want to give a quick assessment because it's the details are important. You really have to understand if a quota is to be applied. I currently do not feel myself able to make an assessment and to be able to tell our customers what impact it may have on them and on us as E.ON. That was really too much at short notice. With as far as the customer figures are concerned or the price adjustments, our German retail business reduced electricity prices on the 1st of January and gas prices on the 1st of January, and electricity prices on the 1st of February. Customers will be benefiting from this. Customers are at about 14 million customer contracts currently in Germany.
How do you see the future with regard to prices?
Well, as far as prices are concerned, we are known for offering opportunities or the price development from, of the wholesale markets are passed on to customers at short notice. Price adjustments have just been made, and we are not giving any outlook on future price developments because they depend on the wholesale markets.
We also have some other questions in the room. The next speaker will be Ms. Kapp from Handelsblatt, and then Nathan Witko from Montel, Ewa Krukowska from Bloomberg. Kapp from Handelsblatt, please go ahead.
Hello, yes, I'd like to hear about your take on the network package. You also mentioned a few points, Mr. Birnbaum. The way it looks at the moment, this first draft, if it is passed that way, would you then be entirely happy with it, or would you like to see further adjustments?
Well, first of all, it very much depends on the details we need, I have to say, because the same headline can, depending on the details, have a very different effect. I cannot give you a blanket answer. What I can say, though, and I tried to say that in my speech earlier, what I do like is that the underlying thought has changed. We had first come, first served, which led to, you know, people of throwing out their towel, to reserve a place, whether or not the place was actually needed or not.
Now we are saying we want to introduce a different principle and really give the grid to those who, one, really want it and not speculate, and second, then actually go ahead and do it, and not just hope to sell on the connection. That's a good approach. The principle is to be welcome. Second, there, it contains a lot of creative and innovative approaches, so instruments we should use, for example, technically, the sockets and so on. I do welcome all of that as well. Regulation needs to be changed for that to happen, and once this is done, it will provide or make more grid available for less money. Thirdly, we need the localization elements in there.
I mean, the redispatch reservation that's in there needs to be shaped in one way or another at the end of the day. At the moment, for it's designed for the new plants that come in congestion areas. There will be no compensation. Which is understandable, what is temporary, what does no compensation actually mean? It depends on the detail. What we need, regardless of how we do it at the end of day, and therefore it is dependent on the detail, we need some decision that actually puts flesh on the bones of this signal. If it doesn't have an impact, then, well, it will not change anything. Principally, it's a good starting point, it's a good package, and it's great to have this debate now. It's very much overdue.
Whether it turns out to be a nice package or not, we'll have to see.
Yeah. Thank you.
Thank you, Ms. Kapp . Then Mr. Witko from Montel, please. Good morning, Mr. Birnbaum. I was going to ask about redispatch as well. You just said it was understandable, this change. Can you perhaps expand on that? Some energy utilities have called it absurd. You're saying, for example, that it will lead to a reduction of investment in renewables and a factual split of the uniform German prices zone, and all of that without any incentive for the construction of grids to reduce the burden on the infrastructure. How would you respond to these kind of statements?
Well, I think that this warrants two answers.
One, the reproach to me, we could have done more there, and the second is the content side of the discussion. When the voice is loud enough, then a critical point has been found. If nobody says anything, then you need to think. A controversial discussion is good. What's the topic here? We have areas in the grid today, objectively, where we know that when we connect there, nothing is going to happen that will benefit the customer. The only thing that we will do is spend more money on redispatch. Now, you all know the 3% for redispatch, so there's a congestion area and the 3%. Let's leave it at the 3%. What does it mean?
If you build in that area, the likelihood that the additional capacity will, the output of that will not be limited by 3%, but by 30%. The grid's already full. If capacity is added, the output will not be just limited by a little, it's wasted. The additional construction needs to happen where it creates benefit for the customers. That's important, from my perspective, it's necessary for us to have this debate. The second question is, all of that wouldn't have been necessary had you built enough infrastructure. I fully reject this. Accusation. I've got proof with me, if you like. Back in 2020, we did analysis as to what we need in terms of grids.
I can give you a copy of this study later. We did this with the French economics, the University of Aachen. We made assumptions about the renewables, PV, et cetera. All of these assumptions were much lower than what we have today, so we were totally wrong with our assumptions, were well too low. That's statement number one. Statement number two is, we didn't see any data centers, we didn't see any batteries, and trucks, we believe, would run on hydrogen. Now, all of this is on top now, within 5 years. At the time, we said, the too little investment need to be avoided from an overall macroeconomic perspective. At the time, we were accused of just wanting to build networks to increase costs for customers.
The same people are saying now, "You should have built a new, more networks." Even though permitting takes 8 years for 110 kV networks, it's not possible. If it takes 8 years to get a permit, we cannot fundamentally change anything within 5 years. Again, the forecasts were much lower, still we were said it's not possible. I fully refute and reject this accusation. We cannot compensate a build-out that is fully uncontrolled in the market, those who are shouting most are the ones that profited most in the past. That's always how it is. Does that answer your second question as well? You asked 2 questions.
Okay. If I can ask another question, this is a different topic now.
The data centers, or is artificial intelligence a blessing or a curse or a threat for the energy transition?
I think artificial intelligence is going to play a role everywhere. To say we can decide whether or not to do it or not would be a mistake. For the German economy, it's absolutely vital to proactively do something about AI, also for the benefit of our benefits of this country, our customers. We need to use artificial intelligence and not see it as a threat and manage it as a threat. That's my statement. For customers, a data center means a reduced network tariffs because the data centers increase demand.
They pay the network tariffs. The network tariffs paid by the data centers don't have to be paid by the customers. That's good. If the data centers build their own generation capacity, which they sometimes do, from an energy perspectives, they are advantageous, from the customer's perspective, they're advantageous, and also for society and our economic development. Mr. Wildberger is now saying we need to build data centers in Germany, we need to provide the right framework for that. I was shocked, therefore, that in Groß Gievitz, it was decided not to do so. We have to do it. Without data centers, Germany will turn poor. Without AI, there will not be a good Germany going forward. If Brendel, I need a little help, because I have been seeing Mr.
Steitz from Reuters. He's not on my list. Can you please check what the sequence is? I've seen you, Mr. Steitz, and also Mr. Schulte, I've seen you as well. Ms. Brendel first, please.
My question is...
My question is that you said that you want to invest EUR 5-10 million billion more. When exactly will you decide whether or not you will invest this EUR 5-10 billion? Will this happen as soon as the Federal Network Agency has provided more clarity on the return on your equity? Once this been decided, would it be invested in the current period up until 2030, or could it be possible that you invest this after 2030?
First of all, you're right. We have a leeway of EUR 5-10 billion compared to the minimum rating target, which we set for ourselves.
This allows us to invest more, but it also provides a certain risk buffer because we will not invest down to our minimum rating. We now have a very attractive new investment program and decided very consciously, even though, as Leo has said, we could invest, we've decided not to do so for the time being, because we, the parameters defined by the Federal Network Agency are not right in terms of the return situation, and you mentioned it. Once we have more clarity on that, then we will be able, with our operational performance, to raise these investments, and we'll be able to do that from 2029 onwards, when the new regulatory period starts.
The earlier we have clarity, the earlier we can, for example, from 2027 or 2028 onwards.
...if there is an attractive regulatory regime, we could start investing in 2029. For that, we need early signals, early clarity, and with what's been published so far, we haven't had that clarity. Thank you very much. Now I can see the right order. Christoph Steitz , who has joined us online, is next, followed by Mr. Batke, Mr. Schulte, and Ms. Becker. Mr. Scheitz? Good morning from Frankfurt. Good morning from Frankfurt. I have three questions. The first question is, Mr. Birnbaum, you referred to grid resilience, and you also said that transparency measures would have to be eliminated in order to safeguard or achieve more protection, and I know this is a very important topic for Germany as well. Could you elaborate on that?
Your investment program is accompanied by a disposal program of about EUR 2 billion, which you weren't that clear when you talked about that. It is oriented towards strategic incentives. Could you please give us more details? Romania, apparently, is not that. You want to develop that further, what does E.ON want to dispose of in the medium term? Question number 3: How do you see the Turkish market? Is it still part of E.ON's core business? What's your current opinion on Turkey and your business there? Resilience. Briefly. As a critical energy infrastructure operator, we were asked to make our grids transparent and to make them geo-localizable so that every new investor would be able to look where they could connect themselves to the grid. As representatives of the industry, we criticized that.
We said that this might not be such a good idea, but now it's too late. The entire German critical infrastructure is available on the Internet and with geological data. We can't change this anymore, but anything that we're going to build in the future should not be visible. As far as critical infrastructure is concerned, transparency may be interested or important, but I do believe there are many, many other interests that are more important. The legislation has to be changed, I think this will be done in the future. Now, with regard to the Turkish market, these are at equity participations. In some cases, we own them together with a joint venture partner. We have one company is also listed at the Turkish Stock Exchange.
It's not a core business. These are operating units that are developing very well. We would, well, enjoy them even more if this country didn't face such a high inflation rate. Disposal program. We are pursuing our portfolio optimization program. We are continuously reviewing our portfolio. We are planning to achieve EUR 2 billion in total. Of that, about EUR 1 billion have been implemented. You asked about some examples for disposals. Well, at the beginning of January, we sold our Czech gas distribution grid. We're also looking at smaller divestitures, which in areas where we may not be the best owners and in cases where our disposal would create value for shareholders and would give us money to grow in other areas in which we would like to invest. We're not under pressure.
We're moving ahead opportunistically, and from a perspective of portfolio hygiene, we just ask, have to ask ourselves whether the individual assets help us create value or whether others might be better owners than we are.
Mr. Batke from Energate.
Thank you very much. I hope you can hear me. I can't hear myself. Perfect. I have two questions. The first one is, goes to you, Ms. Jacoby. You criticized the economically viable regulation. If you look at the regulatory framework, a lot is being changed. What were you referring to? What is an economically viable regulatory framework? What are central aspects of such a framework? Second question, Mr. Birnbaum, the network package. There is mention of individual grid connection processes. You mentioned the first come, first served principle.
That still applies, the regulations on the individual grid connection processes at distribution system level as it is now, can you work with that? Do you have any ideas? The Transmission System Operators have the maturity level procedure. Is that something that you could also apply at the distribution system level?
Well, we are steering our investment program from 43 up to EUR 48 million. Our economic net debt also rose further. We would like to attract more private capital, for that, we need an attractive regulatory regime. It's not just one single component of the regulatory regime.
It always depends on the overall package. If I would have to pick one aspect, then I would like to mention that we have existing assets that have to be refinanced. The current proposal that is being discussed will not enable us to refinance our investments at market conditions. That's something, for instance, that should be ensured in a good regulatory framework. I would also like to pick up your question and use it as an occasion to summarize what I tried to say in my speech. We only will have one-third of the network if you look at the kilometers, but we have connected disproportionately high amounts, 50% of the PV system, 60% of the strategies, 70% of onshore wind. The redispatch topic is not an E.ON topic, but a transmission system operator.
8, 80, 78%, with regard to the distribution system, it's has a disproportionately high amount at E.ON or E.ON because we have the distribution system. With regard to power connected, we are in a very good position to know what customers need. You talked about the maturity degree system for the TSOs. We believe that new criteria for connections are necessary. Maturity degree procedure of the TSOs would be a starting point, but for the 110 kV level, we would like to also take the requirements of final consumers into account, and we should not simply apply the regulations of the TSOs to the DSOs. Thank you very much.
Mr. Schulte from WAZ Newspaper, please.
Good morning. Hello to everyone. All the good questions were already asked, so I have another question. Mr. Birnbaum, how do you like what the German government are planning as far as the Building Energy Act is concerned? You are indirectly affected, and you've been saying for a year, "We can do the transition, no problem. We will do it one way or another." The heat transition is the bigger challenge. So will that now decelerate the heat transition? Is it good that the level of 55% of renewables has been eliminated? So what do you think of the plan to bring in more bio quotas for gas and oil? That's where you come in. You, as a gas supplier, would need to ensure that the gas contains more biogas.
Is that realistic? What do you think about all of this?
I think I said this in reply to Ms. Söhning's questions. It's more than the Building Modernization Act, as it's called out. There were statements on district heat in there, on the supply and the funding instruments that are available, also the quota staircase and the bio percentages. A big package. As I said, to be honest, today, I cannot answer your question because it very much depends on the details at the end of the day, how positive or negative this will be for customers. A quota can be too high or too low. It can be too bad for liquidity in the market. It can come too early or too late.
Today, I cannot give you an assessment. Let me put it differently. It's great that we now have something on the table. Now we can discuss it rather than speculate. We can talk about how to do what's on the table and develop it in such a way that it works for climate protection and also for affordability. I am positive and grateful that we now have something on the table we can work with. Whether it's positive, at the end of the day, we'll need to see.
Okay. I think I was out of my room here when Ms. Söhning asked the question, so apologies for that. Well, with this topic, it does do no harm if this question comes up twice. I added a few things now the second time around.
One other question: Do you like the basic idea that the responsibility is shifted away from the consumers towards you? Again, as a supplier, what does this shift of responsibility, what does it mean? What will the details look like? Well, I'll be facing that responsibility in two ways. I'm a gas supplier and I'm gas network operator. What does it mean for gas grids?
We had the discussion that we should switch off the gas infrastructure, I cannot say off the cuff now what my take is on that. We need to look at in detail or also ask what else do we need to understand for us to be able to give you a take.
Annette Becker from Börsen-Zeitung, please.
Can you hear me?
Yeah, yeah.
Okay. Yes, I have a series of questions as well. I would, first of all, talk about data centers and demand planning. Mr. Birnbaum, you just said that you did a study or had a study made 5 years ago that expected a totally different demand or build-out. Now, data centers has only really come up in the last 1 or 2 years, and it has increased electricity consumption as well. How big is the risk that you are now wrong again with your plans? Back in March or in summer last year, you already voiced this threat that you would not continue to invest if the framework conditions aren't right.
You said at the time that the rolling plans would be put on hold, today you're saying, "Okay, we will spend EUR 5 billion up until 2030 after all." To what extent is the threat an empty threat? I do not fully understand that. Then at a totally different topic, the lawsuit, OLG Schleswig-Holstein Brokdorf, can you explain what that is about? Then a technical question: you are adjusting your calculations of Adjusted EBITDA and the group numbers. Could you explain, or at least say, how the numbers for 2025 would be had you applied this approach already for 2025?
Okay, fireworks of question. Well, first, how good are forecasts?
I've always said all forecasts are wrong, and whenever we have looked 10 years into the future, and I can go 50 years back, we were totally wrong, all of us, always. That's why I do not believe in long-term plans. I do not believe in 5-year plans. They've never worked, ever, anywhere, and I don't believe in 10 or 15 or 20 year plans. I do believe in planning over and over again in a rolling way to take another look at reality and adjust plans. You cannot define a target picture which you want to achieve, and then you don't look again in that 10-year period.
That's why I welcomed the monitoring when it came up, because I said it's good to look at reality and to check what are we really observing, regardless of what we would have wished X number of years ago when we did the plan. I said, we should do this monitoring every 2 years. We should check again after 2 years. The second topic is, we didn't have wrong assumptions. Our assumptions were too low. All of our assumptions were too low for PV, for wind, for heat pumps, for electric vehicles, and they were too low prior to Russia's attack on Ukraine, prior to the Easter package, before the trucks, before the batteries. Even though we weren't wrong, we were too low in all of these segments.
Nevertheless, we were told we need more networks or we were criticized for demanding more networks. If we were to say now, 5 years later, with a permitting period of 8 years, you should have built more, it's nonsense. We should have looked again and again what the reality is. Of course, the permitting procedures need to be accelerated if we need to deal with this discrepancy I mentioned. This demand has been made over and over again, and I said so in my speech as well. At the end of the day, I can say from E.ON perspective, distribution networks, particularly E.ON's distribution grids, are a growth segment. We'll need more of that, and that's why we are investing so much. Now, we come to the wrap-up, and Ms. Jacobi, please.
You're right, Ms.
Becker, you described it correctly. We have now allocated EUR 5 billion more for the 5-year plan. If you break it down to the individual years, then from 2024-2028, we had a significant ramp-up. What we do with our new investment program is that we use the old plans and the numbers we had already defined for 2027 and 2028, EUR 10 billion. Now we are continuing that at the same level for 2029 and 2030. Our operating point was already directed at EUR 10 billion CapEx overall, and now we have indications suggesting that we increase that. We don't have clarity yet, full clarity, but we also know, as Leo said, that we need these investments. They are politically desired.
They make very much sense from a macroeconomic point of view. To say now that we should reduce our network investments would be totally the wrong decision to take. We have explained this in our annual report as well. The neutral effects that are due to the regulatory account will be cleared. Adjusted for these effect for 2025, we would have an EBITDA of EUR 9.4 billion. That would be the reference figure. The last question was about Brokdorf, Leo?
Yes, sorry. The lawsuit there. I think the lawsuit was filed for the German government, or the local government not being active. I think Schleswig-Holstein is where everything is more expensive and takes longer.
Decommissioning will not work the way it's panning out now, therefore, we have taken action accusing the authorities of not taking action. It cannot be that we wait for the simplest things for years at the same time, being expected to motivate the people and stay there at the site without being bored. It was urgently necessary to take this action for failure to act. In Grohnde, there's a almost the similar of the same design in Lower Saxony, or what we did at Isar, what we dismantled there, and in Brokdorf, we just filled out forms and elsewhere, during the same period, we dismantled thousands of tons of plant. Schleswig-Holstein did very good things. Mr.
Goldschmidt, the environment minister, did a lot of good things in terms of network connection regime. It contains a lot of good things, but it's a very good document. I would subscribe to that, but in that area, his ministry is simply not delivering.
Okay. We can discuss this bilaterally later on. We have further questions. Looking at the clock, I suggest we won't forget that question, I promise you, but let me go through the list here. Ms. Weikert is next, and then Mr. Käckenhoff from Reuters, and then Mr. Rasch from NZZ. Ms. Weikert first, please.
Yes, thank you. I would like to know what progress is being made in your talks with the regulators. Are you confident that more investment will be possible going forward? Maybe you can report on that.
The EUR 5 billion-EUR 10 billion headroom, Mr. Corbey, what will you do if the prerequisites are not right or are not the way you would wish them to be? What will happen with the money then? There are two other areas you could invest in. Would the money be invested there then instead, or what will you do with that EUR 5 billion-EUR 10 billion?
Well, we're basically optimistic that when something is really needed, that the right rules will be put in place for them to, for all of this to be implemented. We are not willing to disclose anything on the bilateral talks we've had. We are having constructive discussions in the relevant communication channels. That's all I can say.
I'd simply like to add to that, we have a very high demand and, we already said at last press conference is that the network plan would justify much more investment, or we could connect a lot more than we are connecting at the moment. We have waiting times for customers that don't have preferred access, so we could connect a lot more. Our main focus would be on the organic increase of network investments. Since we are confident that we will have positive regulation at some point in time, that's our plan A.
Okay. Thank you.
Tom Käckenhoff from Reuters. Good morning. Could you please elaborate on the outlook concerning the figures that have been adjusted? In the text, you say that you are expecting stable earnings, the figures that you were stating are below the figures of the previous year. Well, that's what we just mentioned in the context of the last question. Our earnings have been adjusted for the neutral effects of 2025. They've been adjusted for them, they've been corrected, and as a result of that, we are going to achieve EUR 9.4 billion, and based on that, we are expecting a stable result. What are the figures of the previous year?
Well, that is the figure. This year, we are at EUR 9.8 in terms of EBITDA, that already included...
At the beginning of the year, we said that neutral regulatory account effects of EUR 200 million are included. They were even higher by the end of the year because of higher amounts distributed in Eastern Europe or grid loss recoveries from the previous years. These factors, well, in the past, we always talked about regulatory account effects. These will be adjusted for in the future, for this pro forma figure, for the sake of the comparison, we have adjusted them. The unadjusted figure is the EUR 9.8 billion. The adjusted figure, adjusted for the neutral net effects for 2025 is EUR 9.4 billion.
Let me add, the investors asked us to do so. We always...
Well, we used to say, "Well, it was better than previously assumed," because we had fewer losses in Eastern Europe, grid losses. The next year, well, we had to say that it was slightly worse because what we had achieved in the past or received in the past was not available now. We always had to explain why the earnings figure went up or down. Well, when we exclude this regulatory aspect, that was only really a time matter, what is the actual curve? Now we have one year in which we used both tracks both ways, but next year we will only have one E.ON figure without any adjustments. I would like to apologize for the fact that we created this confusion this year, because this year was the year in which we changed the approach.
That was a request that we received from the market, and it's also in line with what our main competitors do, such as National Grid.
Mr. Rasch from Neue Zürcher Zeitung, please. Good morning to you.
Good morning from Hamburg. I'm from the digital financial magazine Der Markt. We're a magazine for investors, and that's why I would like to ask the following question: If I look at the free cash flow as analysts report free cash flow, you have a negative free cash flow for 2025 of more than EUR 1 billion. 2026, this figure will even be negative EUR 2 billion, and that's how it's going to continue.
You described your investment program, which is very extensive, and you have a good return on this investment program, but until 2030, if I look at the plan, do you expect that the free cash flow is going to be positive at some stage? What are your prospects in this regard?
Well, we explained that we are a growth business, and if you want to grow, well, we are growing, but although we are free cash flow negative, we are achieving our KPIs. Now, considering the earnings increase, are we also going to manage to finance our increasing debt? You're right, we are a growth business, and we will still be free cash flow negative. Because we are planning to increase earnings substantially, we are still going to be able to meet the rating figures despite the negative cash flow.
Is there any horizon, any time frame? Do you know when you're going to be free cash flow positive?
Well, we have a good portfolio of businesses. We have an Energy Retail business that generates a very good cash flow, and on the other hand, we have strongly growing businesses in the area of Energy Networks and Energy Infrastructure Solutions, which will be financed by the high cash flow from the Energy Retail business. Based on our current plans, we do not expect that we're going to be free cash flow positive. If growth would not be that fast in the future, we may have that situation in the thirties. Currently, we rather see this as a positive quality. It's good for us to have the opportunity to invest in the growth businesses. This brings me back to regulation.
The additional investments need to generate earnings. We can't increase debt with a negative cash flow without generating good earnings. You have a good point, but it's one of our KPIs and one of the KPIs used for steering. We are steering the cash conversion rate, and we also communicated target figures to the capital market. That's the operational performance of our business. Operating cash flow is to be 100%, so the EBITDA that we are guiding is fully cash effective. That's really all I can say about this.
Thank you to Hamburg. We still have one last question in the virtual room from Mr. Haas, from Westdeutscher Rundfunk.
Good morning. I have two questions, Mr. Birnbaum. Last year, we talked a lot about smart meters, and I would like to ask you how you see the current developments.
Secondly, we also talked about Brokdorf and Grohnde nuclear power plants, in many countries, nuclear power is facing a renaissance, not really in Germany. Do you see any investments there if this industry becomes more important? Would you think that at some stage we'll have two or three nuclear power plants in Germany?
I'll ask about the second question, because I can answer it more quickly. The answer is a lot is happening, nothing in Germany. I am very sure that there will not be any private investor who's going to build nuclear installations in Germany. You can discuss this at length, private investors need 40 years of reliability, we don't have that's why nobody's going to invest in Germany. I forgot the first question. The first question related to smart meters.
Oh, yes, I'm sorry. I apologize. The second one, I lost track. The smart meter rollout, and I already mentioned that the smart meter rollout continued as planned. The rollout rate of 20% was exceeded in all areas. We built a half a million additional smart meters in Germany. We're going to achieve 1 million in Germany now. I don't know whether the entire industry achieved that, but I would like to say that for a country that is as large as Germany, 1 million is very sad. 1 million were built in Warsaw in 2 years. 1 million can be built in Sweden in 1 year or 2 years at the latest.
I always criticized that in Germany, we chose the most complicated and slowest smart meter rollout, driven by the most expensive and most complicated regulation worldwide. There's no other regulation that's more complex than the one in Germany worldwide. We made a lot of suggestions. None of them were implemented. Now we are where we are. We're doing this rollout, but it's not fun.
Thank you very much, Haas. That's the last question on my monitor. With this, I would like to close the balance sheet press conference for this year. Thank you very much for joining us. I would like to say goodbye to our colleagues in the virtual room. Do hope that some of the colleagues here are in the room will stay with us and look at the exhibition mentioned by Birnbaum.
We also have some snacks for you, and you'll have the opportunity to exchange and discuss. If you have any questions throughout the day, my team and I will be available anytime. Thank you very much for coming and many greetings to the virtual room. Thank you very much.