13 our right to win in new attractive spaces, like data centers, internet of things, grid monitoring, connectivity and electric vehicle charging. While our previous strategy was based on inorganic growth through mergers and acquisitions, this strategy is centered on organic growth, but it relies heavily on the strengths built through past M&As, so the two strategies, albeit different, are very much linked. Of course, we will not be ruling out possible bolt-on M&As and expanding our geographical reach and market share. But these are not included in the five-year plan since they are not entirely in our control. As you launch this new strategy, what are you going to bring to the table as the new CEO? I will guarantee continuity with the past through our usual managerial discipline and strong stand for our culture. But I will also bring a new focus, to guide the group through a new pathway of growth. It is an exciting time for this company. Over the last 30 years we have never seen such a strong interest in our industry. It is clear that the world is on a one-way trajectory. Decarbonization and the resulting structural market trends are driving this change. What are the main drivers of the cable market at the moment? We recognize four new drivers in this market, which represent a unique opportunity for us because they fully overlap with our portfolio, our geographical distribution and our customer base. Firstly, there is Renewable Energy Generation. Today, fossil fuels account for 70% of electricity generation, while renewable sources only contribute 30%. By 2050 that is going to flip (30% fossil fuels, 70% renewables). This will lead to a four-fold increase in renewable power capacity by 2030, driving significant investments in transmission capacity, including long and powerful cable lines. On the back of this increase in renewable energy generation, the high voltage submarine and interconnector market is exploding. Prysmian has an important role to play here. Not only can we enable the transmission of renewable energy, but we can also enhance the cost-effectiveness and sustainability with new cabling solutions like 525kV P-Laser, which is fully recyclable. The second trend relates to Electrical Applications Growth. Electricity demand is surging, as fossil fuel-based applications are shifting to electricity. The shift in buildings is pretty evident, as heat pumps and induction hobs drive the complete elimination of natural gas from new buildings. Data centers and 5G are other relevant examples of the expansion of electricity demand. All these changes are prompting demand for a wider spectrum of cables and more specialized cabling solutions. The third driver is Power Grid Enhancement. We need something to connect generation to applications, and this is the crucial role of the power grid. Grids will now also have to deal with the intermittent electricity typical of renewables. The massive expansion of the grid in the next years will require safe and resilient cables that are also low carbon, to reduce emissions linked to the network. INSIGHT | Focus On CONNECT, TO LEAD. 30% / 70% Fossil fuels BY 2050 Renewables "We want to lead the market while we connect the world, enabling the Energy Transition and the Digital Transformation." #1 #2 #3
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