As Leo already said, we are facing a unique investment opportunity. The lion’s share of our CapEx upgrade will be invested in our Energy Networks business. 90% of this is RAB effective. We target to increase our annual CapEx run rate by a further 20% each year until 2025. This will translate into a sustainable CAGR of our power regulated asset base of 10% annually. Our networks investments have a clear regional focus and follow largely the same underlying trends across markets. As a significant part of our investments are directed at German regulated networks, I would like to zoom in for a brief moment on the value creation in Germany. In the German regulatory system, we create value through allowed capital returns on our investments and through becoming more efficient relative to our benchmark cost base.
Our ambition is clear. We want to achieve 150 to 200 basis points value spread on our total cost of capital across our entire networks business. In our German business, by far, the largest market will live up to this as well. This has made very transparent for you if you look at the composition of our EBITDA. Our step-up in investment volume presented today is well tailored to the total effective returns that we can and will earn. For an even further step up of our investments, we would need to see additional improvements in the regulatory environment. In this context, we highly appreciate that the German regulator has started an open and transparent consultation process on how to make the German regulatory regime fit for what is and will be needed in the future.
In parallel, we continue to take legal actions where regulatory parameters are not in sync with market standards. This continues to be the case for the market risk premium for the current regulatory period. If this was to improve to international market standards, it could justify further investments beyond our currently communicated envelope. Next to Energy Networks, we continue to gradually increase our investments in the Energy Infrastructure Solutions business. We see growing demand from our industrial and commercial customers for decarbonized energy and heating solutions. We have not yet factored in the significant potential from the municipal heating transition, which is gaining more and more momentum across Europe. And in Energy Retail, we continue to focus our investment activities on strengthening our digital sales and service platforms against the digitization strategy that Leo laid out.
All our investments are required to meet strict internal hurdle rates, buildup of project in country-specific WACCs plus risk-adjusted spread ambitions. Turning to our 2028 outlook, as we roll forward our 5-year guidance horizon. Our operational achievements in 2023 and our transparent value creation set the starting point for a unique green growth story. Of course, we need to discount for the significant positive nonrecurring effects that we saw in 2023. Doing this, we will increase our underlying earnings by 6% per year or in absolute terms, EBITDA will grow on an underlying basis by more than €3 billion to more than €11 billion in 2028. In the same period, adjusted net income will grow by €0.9 billion on an underlying basis to €3.3 billion.
And this should provide for you a feel for the underlying robustness and strength of our earnings trajectory also well beyond 2028. As a reminder, our net income line is now protected against any further change in interest rates due to the remuneration scheme for new investments in German Energy Networks. Finally, we focus on value creation and increase our ROCE guidance by 100 basis points to a range of 8% to 9% on average for the coming years. Our green growth story is supported by all 3 business segments. Close to 90% of the EBITDA growth can be attributed to our 2 infrastructure business segments. Growth in Energy Networks is driven by our growing investments. Our power RAB CAGR of 10% translates into an underlying EBITDA CAGR for energy networks of 7%.
Energy Infrastructure Solutions is expected to grow at a CAGR of 13% until 2028. This is supported by a total investment plan of €5 billion. Be reminded, the segment will be a stand-alone segment from Q1 2024 onwards. We will then share with you additional details on the business. Finishing with our Energy Retail business. Based on the strong recurring earnings growth in 2023, we envisage our Energy Retail business grow gradually by another €0.3 billion to around €2 billion by 2028. Growth will be driven by an increased focus on high-quality customers, excellence in operations and an increasing share from our decarbonization products and services. On to our balance sheet and capital structure commitments. We have a strong financial position with ample headroom to further accelerate the clean energy transition going forward.
We remain fully committed to our strong BBB/Baa rating commitment. With our accelerated green growth plan, we will remain comfortably below our up to 5x debt factor commitment. In terms of rating relevant ratios like FFO to net debt, we look at an additional balance sheet capacity of €5 billion to €10 billion by 2028 on top of our current €42 billion CapEx envelope. We explicitly reserve the option to carry out additional opportunistic portfolio measures over the course of the next 5 years. This would provide for even more balance sheet headroom. Importantly, for you, executing upon such disposals should still leave us in line with our EBITDA and adjusted net income guidance for 2028. All this sends a clear and simple signal to you, there is room for much more.
Let me conclude on what all this means for our shareholders. We are fully confirming our long-term dividend growth commitment with annual increases in our dividend per share of up to 5%. This commitment is backed by a strongly growing earnings per share of 6% on average across the next 5 years. We will propose to payout €0.53 per share for 2023. And based on yesterday’s closing price, our financial commitment to you translates into a total annual shareholder return of significantly more than 10% for the next 5 years. And if there is one thing that you can continue to rely upon, and with that, I’m getting back to my first message, we will deliver what we promise, and we always strive for more. And with that, back to Iris.
A – Iris Eveleigh: Thank you very much, Marc and Leo. And with that, I’ll open our Q&A session and we start with Harry from Exane.
