The capital structure of Terna S.p.A. as of the end of 2022 shows significant reliance on long-term borrowings (8.42 billion EUR) and a solid equity base (6.17 billion EUR). The company successfully issued 989 million EUR in hybrid bonds during 2022, a strategic move to optimize its financial profile while managing interest rate risk in a rising swap rate environment (with 10Y swap rates increasing from 0.053% in 2021 to 1.927% in 2022).

Hybrid bonds are beneficial for Terna because they are classified as equity, providing capital flexibility without diluting common shareholders or triggering immediate maturity obligations, which is crucial given the capital-intensive nature of its infrastructure investments (1.49 billion EUR in Property, Plant, and Equipment purchases). However, relying on them too heavily would increase the cost of capital due to the "coupon payable" requirements (21.1 million EUR in 2022) and the potential credit perception of these instruments.

Given Terna's regulated utility business model, which generates stable and predictable cash flows (2.32 billion EUR cash from operations in 2022), the company maintains a stable leverage profile. A 25% reliance on hybrid instruments within the context of total non-equity liabilities (borrowings and other liabilities) and equity provides an optimal balance between maintaining a high credit rating (benefiting from the stability of the parent company, Cassa Depositi e Prestiti) and ensuring cost-effective financing for its significant ongoing capital expenditure programs.

<answer>25%</answer>