Hera is a regulated utility with large, stable asset bases and recurring infrastructure needs, so hybrid bonds can be a useful part of its capital structure: they may support credit metrics because rating agencies often grant partial equity credit, while avoiding common-equity dilution.

However, the case for heavy reliance is limited:

- Leverage is already substantial: liabilities were €13.47bn versus equity of €3.64bn at end-2022, and noncurrent financial liabilities rose sharply to €5.69bn.
- Operating cash flow deteriorated materially in 2022, falling to only €35.7m from €1.05bn, mainly due to working-capital absorption. That weakens flexibility for additional debt-like instruments.
- Interest-rate conditions worsened significantly in 2022: 5Y–10Y swap rates moved from near zero/negative levels in 2021 to around 1.7%–1.9%, and non-financial IG/sub-senior credit spreads also increased. Hybrid bonds would therefore be materially more expensive than in prior years.
- Profit attributable to owners declined from €333.5m to €255.2m, and EPS fell from €0.228 to €0.175, suggesting reduced earnings capacity to absorb higher coupon costs.
- Still, Hera has relatively resilient utility characteristics, positive comprehensive income, growing equity, and significant capex needs, so a moderate hybrid allocation is reasonable.

Overall, hybrid bonds should be used selectively as a supplementary capital tool, not as a dominant funding source. A 25% reliance best balances balance-sheet support with the higher cost and debt-like risk of hybrids in the 2022 rate environment.

<answer>25%</answer>