Finance to support the energy transition: a success story

Graduating and being able to find a job right away in a large company that helps you grow and grows with you. One that allows you to acquire the skills to be able to climb, day by day, all the steps to the top, rewarding merit and professionalism. In Italy, these stories sound like Aesop's fables, so rare as to appear almost utopian. Yet they exist. And hearing them (or, in this case, reading them) instils hope in a labour market that often stifles dreams and ambitions. The journey made by Riccardo Miconi, who since October has held the position of Head of Finance at Terna, the national electricity grid operator, is an example of this.

He graduated in 2007 with a degree in Management Engineering from the University of Rome Tor Vergata, after a brief period in a consulting company and a Master's in Business Administration from Luiss, Riccardo Miconi joined Terna for a project work. What was supposed to be a project work at the end of the Master’s course became the start of his career which, almost 15 years later, has seen him rise to a crucial role for the national electricity grid operator.

From a project contract to a permanent one: Riccardo Miconi started from the bottom step and hasn’t stopped climbing since. In the early years he was involved in Finance and Business Development, collaborating on the financial modelling and sale of a project concerning a series of photovoltaic initiatives to a private equity fund. He then moved to Finance, where he worked in Financial Planning and Project Finance, and subsequently as head of Corporate Finance office. In between, he worked as assistant to Terna’s CFO with a focus on financial analysis.

«At the beginning of October 2023, I was appointed Head of Finance», explains Miconi, «and that means being in charge of Terna’s financial aspects: debt, treasury, derivatives, insurance, extraordinary finance, project finance and quantitative risks». But there is one aspect of his career, important yet hardly obvious, that Riccardo Miconi tends to emphasise: «I can say that Terna and I have grown together and my journey makes for a good story for two reasons: it confirms that meritocracy is a sound company value and it shows how my own growth is linked to the growth of the entire team. I have spent 95 per cent of my career at Terna, learning a great deal of what I do from colleagues and people who were here before me and who, in many cases, still are today. Mine is therefore a personal journey shared with others. And this also creates a strong sense of belonging, as if we were a family». In other words, the team acted as a trainer for his professionalism.

Since he joined Terna in 2009, the company’s finances have more than doubled: today it is one of Italy’s leading companies in terms of market cap, volumes managed, resources employed and complexity, bringing new challenges and responsibilities. «Between the end of 2022 and the beginning of 2023 we signed the financing agreements with the European Investment Bank for a very important project for our country, one of strategic importance for decarbonisation and energy transition, the Tyrrhenian Link, the submarine electrical connection uniting the Italian peninsula to Sicily and Sicily to Sardinia. This operation allowed us to obtain total financing of around €1.9 billion against an investment of approximately €3.7 billion for the entire project».

Another key initiative took place in February 2022 with the first hybrid emission worth €1 billion. An achievement that was looked on favourably by the market, with a maximum demand of over €4 billion, more than 4 times the offer: this is a bond issue with the characteristic of being subordinate to other debts, therefore contributing to supporting the company’s financial solidity. «This was a first for the company, as a bond like this had never been issued before. This issue certainly represented a step change in Terna’s finance, a company that is becoming ever larger and more central to our country’s energy transition process», highlights Miconi.

Larger but also more diversified and more sustainable in terms of the instruments used. «The focus on financial sustainability is unavoidable for Terna, and ESG (environmental, social and governance, ndr) aspects have now become more fundamental than ever. As early as 2018, Terna began issuing to green bonds, making extensive use of this type of instrument dedicated to green investments. Terna has taken on the role of director and enabler of the energy transition and, consequently, our investments are considered sustainable by definition. The use of green finance works in tandem with this strategy: there is optimal alignment between industry and finance».

Speaking of strategy, the objectives of Terna's Business Plan are increasingly ambitious, resulting in the role of finance becoming more central. «Finance has a support function for business. The company has to finance increasingly significant investments for the development of the electricity grid in favour of the integration of renewable sources, and we must always be ready to pick out the right tools to find the economic resources, negotiating financing on favourable terms and trying to cement the company’s financial solidity. That’s why our commitment must be rock solid».