Financial strategy

Investment highlights

EnBW is the only German utility active in the entire energy value chain
EnBW is driving the energy transition in its entirety
Highly robust business model based on balanced portfolio

Integrated utility driving forward energy transition

Low-risk business profile from regulated grids and renewable energies
Stable cash flows
Attractive risk-return profile

Robust diversified portfolio with high share of low-risk business

Natural hedge between EnBW’s competitive business areas sales and generation
Supply contracts closed on a back-to-back basis
Generation margins locked in for up to 3 years in advance for cash flow predictability
Long-term PPAs for high cash flow visibility

Hedging of earnings from marketed electricity generation

SBTi approved EnBW’s CO₂ reduction targets
Coal exit brought forward to 2028
Climate neutrality in 2035 by offsetting the remaining residual emissions

Ambitious climate action targets

Financial policy geared towards credit investors' needs and protecting solid credit ratings
Dedicated asset liability management for long-term provisions
Diversified funding and prudent liquidity management using state-of-the-art systems and tools

Prudent financial policy

State of Baden-Württemberg and OEW (an association of counties) holding more than 93% of share capital
Most of the remaining shares are held by other municipal shareholders’ associations in Baden-Wuerttemberg
Shareholder structure reflects EnBW’s roots in Baden-Wuerttemberg, one of the economically strongest regions in Europe

Stable government-related shareholder structure

Financial management

Foundations

Management of financial transactions within the Group finance department in order to minimise risk, optimise costs and increase transparency
Deployment of derivates in the operating business generally for hedging purposes only: for example, for forward contracts for electricity and primary energy source trading
Interest rate risk management for managing and monitoring interest-sensitive assets and liabilities / Interest rate risk strategy to limit the risk of interest rate changes for the Group
Currency management system to monitor foreign exchange risks

Objectives

Payment obligations can be fulfilled without restriction
Balanced financing structure
Solid balance sheet ratios
Solid investment grade ratings

Key performance indicator for creditworthiness management

The key performance indicator debt repayment potential describes the retained cash flow in relation to net debt. The debt repayment potential measures the ability of EnBW to repay its debts from its current earnings potential.

Debt repayment potential¹

≥0%

Controlled revenue growth accompanied by solid investment grade ratings

Retained cash flow / net debt

¹ We regularly check whether our target value for the debt repayment potential complies with the current requirements of Moody’s and S&P.

Positive creditworthiness of high importance

To maintain the future viability of the company, EnBW aims to hold solid investment grade ratings, in order to

ensure unrestricted access to capital markets
offer reliable opportunities for financing partners
be regarded as a dependable business partner in our trading activities
achieve the lowest possible capital costs
implement an appropriate number of investment projects

Further information

Financing strategy

Management of financing needs of operating activities separately from the Group’s pension and nuclear obligations

Managing financing needs of operating activities
- Constant assessment of capital market trends with regard to
  - current interest rate environment
  - any potentially favourable refinancing costs
Coverage of pension and nuclear obligations using asset liability management model

Alongside the internal financing capability, we have various financing instruments at our disposal:

Financing instruments as of 31 March 2025

Programme	Value⁰Rounded figures
Programme Debt issuance programme (DIP) EMTN (Euro Medium Term Notes) AMTN (Australian Medium Term Notes)	Value⁰Rounded figures €12.7 bn utilized €15 bn, thereof €12.1 bn utilized AU $1.0 bn (Equivalent value of ~€0.6 bn Conversion at the pricing date)
Programme US private placement	Value⁰Rounded figures US $0.9 bn (Conversion on the pricing date)
Programme Hybrid bonds	Value⁰Rounded figures €2.5 bn
Programme Commercial paper programme	Value⁰Rounded figures €2.0 bn, undrawn
Programme Promissory notes	Value⁰Rounded figures €0.6 bn
Programme Sustainable syndicated credit line⁰The credit line was renewed on July 5, 2024 in the amount of € 2.0 billion with a term until July 2029 and replaces the previous credit line of € 1.5 billion. After the first or second year, the line can be extended by one year until July 2031 at the latest with the approval of the banks. The financing costs of the syndicated credit line are once again linked to selected ESG criteria: the reduction of CO₂ emissions in Scope 1 and 2 and, for the first time, a reduction path for CO₂ emissions in Scope 3. The proportion of EU taxonomy-compliant investments has also been newly included.	Value⁰Rounded figures €2.0 bn, undrawn
Programme Commited bilateral credit lines	Value⁰Rounded figures €4.2 bn, thereof €0.1 bn utilized
Programme Uncommited bilateral credit lines	Value⁰Rounded figures €1.0 bn, thereof €0.2 bn utilized

Other financing sources

Bank loans and promissory notes of subsidiaries

EnBW benefits from strong access to bank funding as additional liquidity source

Maturities of EnBW’s bonds

Overview of EnBW’s bonds

Asset liability management model

Management of financing needs for pension and nuclear obligations
as of 31 December 20234

Objectives

Ensuring timely coverage of the pension and nuclear obligations
Coverage of long-term provisions by corresponding financial assets within an economically reasonable period

Core concept of the model

Cash flow based model
Determining the effects on the cash flow statement and balance sheet over the next 30 years taking into account
- Anticipated return on financial assets
- Sector-specific appraisals by external experts on costs for nuclear decommissioning and disposal
- Actuarial reports on pension provisions
Limiting the impact of payments for the pension and nuclear obligations on the operating business to €382 million a year (will be infated annually) by taking funds from the financial assets
After full coverage of the considered provisions by the financial assets, no further funds will be taken from the cash flow from operating activities

Investment targets

Portfolio strategy considers planned withdrawal of funds from the financial assets
Broad diversification of the asset classes
Risk-optimised performance in line with market trends
Reduction of costs and simplification of administrative processes

EnBW’s cash flow-based model

in € m

Green transformation of our integrated portfolio

Sustainable Generation Infrastructure

Wind
Solar
Hydropower
Thermal (gas, coal)
District heating
Biogas
Hydrogen
Pump and battery storage
Trading

System Critical Infrastructure

Transmission grids electricity/gas
Distribution grids electricity/gas
Water supply

Smart Infrastructure for Customers

B2C/B2B sales electricity/gas
E-Mobility
Home battery systems
Broadband

By 2030

we want to expand the generation capacity of our renewable energy plants to between 10 GW and 11.5 GW
(2024: ~ 6.6 GW)
the CO₂ intensity is to be reduced to between 90 and 110 g/kWh.
(2024: 272 g/kWh)

To successfully drive forward the green transformation of our entire portfolio, we have planned total gross investments of at least €40 billion for the period from 2024 to 2030. Taking into account relevant partnerships, we expect net investments of around €22 billion by 2030. Additional investment opportunities of €10 billion may arise for a sustainable energy infrastructure and to ensure security of supply. The taxonomy-compliant expanded capex is expected to be more than 85%.

In 2030, we expect adjusted EBITDA at Group level to be between €5.5 billion and €6.3 billion. The share of low-risk adjusted EBITDA from networks and renewables is expected to be at least 70%, as in the previous years.