12. Property, plant and equipment

Property, plant and equipment, which amounts to €15,478 million (€15,399 million at 31 December 2014) breaks down as follows:

Property, plant and equipment (€15,478 million, compared with €15,399 million at 31 December 2014) relates mainly to transportation (€12,442 million), storage (€2,713 million), distribution (€231 million) and regasification (€89 million) infrastructure.

Investments¹⁸ (€846 million) refer mainly to the transportation (€656 million), storage (€163 million) and distribution (€20 million) segments.

During the year, Snam capitalised €28 million of financial expenses (€36 million in 2014).

Depreciation (€545 million) refers to economic and technical depreciation determined on the basis of the useful life of the assets or their remaining possible use by the Company.

During the year, there were no changes in the estimated useful life of assets or in the depreciation rates applied and explained by category in Note 3 “Measurement criteria – Property, plant and equipment”.

Capital contributions from government authorities and other entities (€71 million and €298 million; €76 million and €282 million respectively at 31 December 2014) are recorded as a deduction in the net value of property, plant and equipment.

Divestments (€26 million, net of the related provisions for depreciation, amortisation and impairment losses) mainly relate to the transportation segment.

Impairment losses and reversals (€3 million) refer essentially to the impairment of auxiliary piping in the transportation segment.

The value of plant and equipment includes site dismantling and restoration costs (€182 million), relating mainly to natural gas storage (€110 million) and transportation (€71 million) sites.

Other changes (€193 million net of the related provisions for depreciation, amortisation and impairment losses) mainly relate to: (i) the revision of estimated (discounted) costs for site restoration and dismantling (-€116 million) in the natural gas storage and transportation segments, which are offset by the recognition of a specific provision¹⁹, mainly due to the change in expected discount rates; (ii) the change in stocks of pipes and related accessory materials used in the production of plants in the natural gas transportation segment (-€30 million); and (iii) grants for the period (-€23 million).

Contractual commitments to purchase property, plant and equipment, and to provide services related to the construction thereof, are reported in Note 24 “Guarantees, commitments and risks”.

Property, plant and equipment by business segment

Pursuant to the provisions of IFRS 8 – “Operating segments”, a breakdown of property, plant and equipment by business segment appears below: