To determine the optimal extent to which TenneT's capital structure should rely on hybrid bonds, we must evaluate its financial profile, industry characteristics, and the specific role hybrid capital plays for the entity.

1. **Industry Profile and Credit Quality**: TenneT is a regulated transmission system operator (TSO) with monopolistic characteristics, owned by the Dutch State. Its revenue is primarily driven by regulated energy transmission charges (€7.517 billion out of €8.299 billion total revenue). This provides highly stable, predictable cash flows, which is ideal for carrying substantial debt and hybrid capital without jeopardizing financial stability. 

2. **Capital-Intensive Nature and CapEx Needs**: The company is extremely capital-intensive, with Property, Plant, and Equipment totaling €26.823 billion. Investing activities consumed €4.345 billion in cash outflows during 2022, reflecting massive infrastructure investments (e.g., grid expansion for renewable energy). To fund this while maintaining investment-grade metrics, TSOs widely employ hybrid capital because credit rating agencies (like S&P and Fitch) classify certain hybrid bonds as 50% equity, allowing the company to leverage its balance sheet without diluting state ownership or deteriorating debt-to-equity ratios.

3. **Current Capital Structure and Agency Frameworks**: As of the end of 2022, TenneT's total equity stood at €7.713 billion, of which €2.125 billion was explicitly identified as Hybrid Capital. This means hybrid bonds already constitute approximately 27.5% of the firm's total equity. The company actively utilizes hybrid bonds to fund operations, as seen in the consistent €57 million distributions to hybrid capital owners. However, hybrid capital is subordinate to senior debt and carries higher refinancing risks and costs. Thus, while essential for the "equity credit" needed by rating agencies, it structurally cannot replace more than half of the core equity base without negatively impacting the overall cost of capital and violating the "limited" equity credit thresholds (usually capped at a maximum depending on the rating agency methodology, often allowing hybrids to count up to 25% or at most 50% of the adjusted equity for rating purposes).

4. **Market Data & Financing Context**: The rising interest rate environment in 2022 (5Y swap moving from -0.264% to 1.726%, and corporate bond yields increasing) emphasizes the necessity of optimizing the capital structure. Relying on 75% or 100% hybrid capital would be cost-prohibitive and excessively risky. Relying on 0% would force the company to either rely heavily on pure debt (straining leverage covenants) or seek equity contributions from the state, which was only €1.23 billion in 2022 compared to €2.125 billion in hybrid capital. 

Given that hybrids already naturally fill the ~25% tier of their equity stack, optimizing the structure to purposefully target a 25% reliance on hybrid bonds perfectly balances the need for equity treatment by rating agencies and the preservation of state ownership, while keeping financing costs and subordination risks within prudent limits.

<answer>25%</answer>