Renewables Infrastructure Group Limited GBP Red.Shs · LSE:TRIG
Renewables Infrastructure Group Limited GBP Red.Shs — The Renewables Infrastructure Group — Investor Presentation (November 2020)
36 slides from Renewables Infrastructure Group Limited GBP Red.Shs's investor presentation, November 2020
Slide 1: November 2020 Investor Update
The Renewables Infrastructure Group November 2020 Investor Update Generating Sustainable Value. East Anglia One, England trig-ltd.com
Slide 2: Important Information
Important Information This document has been issued by and is the sole responsibility of The Renewables Infrastructure Group Limited ("TRIG"). This document has not been approved by a person authorised under the Financial Services & Markets Act 2000 ("FSMA") for the purposes of section 21 of FSMA. T
Slide 3: Overview
Generating Sustainable Value. Overview Purpose: To generate sustainable returns from a diversified portfolio of renewables infrastructure that contribute towards a zero-carbon future ▲ Diverse independent Board Portfolio construction1 to ▲ Sets and monitors adherence to the enhance resilience & stra
Slide 4: Strong track record over seven years
Strong track record over seven years Sustainable dividend growth, continued financial outperformance, scaling portfolio Dividend increased by 13% over 7 years NAV per share increased by 15% over 7 years 2020 target1 reaffirmed 160p NAV total return since IPO 8%1 6.76p per share 140p 120p 100p 80p 60
Slide 5: Generating Sustainable Value
Generating Sustainable Value. ▲ InfraRed has achieved the top A+ rating from PRI Powering 1 million homes with clean energy1 for six consecutive years 1.1 million tonnes of CO2 avoided p.a.1 ▲ RES ensures ESG integration and implementation by asset managers 12 Operational and Active ▲ See slides 21
Slide 6: Contents
Contents Section Slide Introduction and Highlights 7 Portfolio & Market 10 Appendices 14 6 trig-ltd.com
Slide 7: Highlights since June 2020
Highlights since 30 June 2020 Overall performance remains strong Generation & Operations ▲ Production c3% above budget to the end of October - down since 30 June, largely due to a combination of below average weather resource in October and some localised grid constraints ▲ Operations broadly in lin
Slide 8: Share Placing
Share Placing Rationale and timetable Funding requirement Timetable ▲ Following completion of the investment in East Anglia Placing opens 23 November One and including near term commitments on other projects, the Company is expected to have a c£200m Circular published 24 November funding requirement
Slide 9: East Anglia One
East Anglia One Newly constructed UK offshore windfarm with CfD subsidy ▲ 14.3% indirect equity interest acquired in newly constructed East Anglia One offshore wind farm located 4.3km off the Suffolk Coast ▲ 15 year CfD subsidy fixing the power price with inflation indexation – reduces portfolio pow
Slide 10: Portfolio & market
Portfolio & market Roussas Claves, France trig-ltd.com
Slide 11: Diversified portfolio (incl. East Anglia One)
Diversified portfolio (incl. East Anglia One) 1.6GW net capacity / 75 projects By Jurisdiction / Power Market1,2 Ten largest assets1 Oct-20 32% 26% 3%3% 12% 9% 15% Jun-20 24% 28% 4% 4% 13% 10% 17% East Anglia One 11% Dec-19 24% 26% 4% 4% 11% 18% 15% Jadraas 9% England & Wales Scotland Northern Irela
Slide 12: Policy drivers remain strong
Policy drivers remain strong The Green recovery opportunity European Union – energy transition ▲ European Green Deal and Next Generation EU recovery fund contributing to the energy transition ▲ Range of energy transition funding including €25bn into renewables between 2021 and 2027 ▲ EU Hydrogen str
Slide 13: Forecast new capacity of 90GW by 2030
Forecast new capacity of 90GW by 2030 New capacity from a broad range of revenue and market types Revenue type Largely subsidised markets Largely unsubsisdised markets Key Offshore & technology Onshore Wind Offshore Wind Onshore Wind Solar focus Onshore Wind1 25 40 35 32 Estimated 18 30 26 28 capaci
Slide 14: Appendices
Appendices Inside the nacelle at Jadraas, Sweden trig-ltd.com
Slide 15: Summary June 2020 Financial Statements
Summary June 2020 Financial Statements Resilient Results - NAV per share down 2.0p driven by impact of Covid-19 Income Statement Balance Sheet Cash Flow Statement Six months to Six months to Six months to Six months to 30 June 2019 30 June 31 December 30 June 2019 30 June 2020 30 June 2020 2020 2019
Slide 16: Valuation I – H1 highlights: power prices
Valuation I – H1 highlights: power prices Valuation movement in the six months to 30 June 2020 Power prices (-£123.1m) TRIG blended power curve1 70 ▲ Power price forecasts down – most significantly in the 60 Real 2019 GBP/MWh near term, driven by Covid-19 impact on power 50 demand 40 ▲ Longer-term r
Slide 17: Valuation II – H1 highlights: other key items
Valuation II – H1 highlights: other key items Valuation movement in the six months to 30 June 2020 Valuation discount rates (+£29.2m) ▲ Reduced by 0.2% reflecting observations of movements in market discount rates Mainstreaming of the asset class ▲ Blended rate now 7.0% (31 Dec 2019 7.25%) 10% 9% 8%
Slide 18: Production in H1 2020
Production in H1 2020 Geographic diversification continues to benefit the portfolio 2020 Jan-Jun generation: 2,141GWh1 ▲ 50% increase over H1 2019 ▲ Total generation 9.3% above budget ▲ GB wind, Scandinavian wind and UK solar performing well above budget 2020 Jan-Jun generation by region Electricity
Slide 19: Weather in H1 2020
Weather in H1 2020 Geographic diversification continues to benefit Wind and solar variation to long-term average 80% 60% 40% 20% 0% Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 -20% -40% -60% -80% GB Wind Ireland Wind France Wind Scandinavia Offshore Solar & Storage Portfolio Total generation 9.3% abov
Slide 20: Value enhancements
Value enhancements Proactive management continues to preserve and enhance value Value preservation Condition monitoring to ensure timely maintenance. Proactive main component management key for maintaining availability during pandemic Commercial enhancements Early participation in National Grid’
Slide 21: Sustainability
Sustainability Continued progress towards TRIG’s Four Sustainability Goals To mitigate climate ▪ 640k tonnes of CO2 emissions avoided in change H1 2020 To positively impact the ▪ Additional Covid-19 recovery support communities we work in brings 2020 community support to £1.4m To preserve the natura
Slide 22: Stakeholder engagement: Blary Hill case study
Stakeholder engagement: Blary Hill case study Active engagement with local supply chain In the period and during lockdown, the Blary Hill project held its first virtual Meet-the-Buyer event Opportunity to connect with local businesses capable of working on the project Strong business interest
Slide 23: Risks relating to the outcome of UK negotiations with the EU
Risks relating to the outcome of UK negotiations with the EU Outcome of negotiations with EU on a trade deal expected to have low impact Key EU trade deal risks Key Mitigants • Managers well resourced Workforce skills shortage • Wide range of subcontractors in place mitigates individual asset risks
Slide 24: Valuation – Key assumptions
Valuation – Key assumptions Power price reductions partly offset by reduced discount rates As at 30 June 2020 As at 31 December 2019 Discount Rate Portfolio return 7.00% 7.25% Power Prices Weighted by market Based on third-party forecasts Based on third-party forecasts UK 2.75% 2.75% Long-term Infla
Slide 25: NAV sensitivities
NAV sensitivities Based on portfolio at 30 June 2020 -30000.0% -20000.0% -10000.0% 0.0% 10000.0% 20000.0% 30000.0% Discount rate +/- 0.5% -3.6% 3.9% Output P90 / P10 (10 year)* -11.4% 10.2% Power price -/+ 10% -6.6% 6.8% Inflation -/+ 0.5% -4.1% 4.4% Operating costs +/- 10% -4.6% 4.5% Exchange rate
Slide 26: Portfolio (1) – Constructing a balanced portfolio
Portfolio (1) – Constructing a balanced portfolio Understanding the range of revenue types available ▲ FiT & CFD contracts (France, Ireland, Germany and UK) typically have subsidy revenues of 15-20 years then market revenues for the balance of a project’s life o Least revenue risk (early on), scope
Slide 27: Portfolio (2) – Revenue profile
Portfolio (2) – Revenue profile Medium-term project-level revenues mainly fixed and indexed Project revenue by type PPA Market Revenue 15% Indexed Fixed PPAs & FiTs PPA Market Revenue 52% at Floor 5% ROC Recycle and Other 3% Next 12 Months1 Indexed ROC Buyout 25% 1. Project revenue expected for 12 m
Slide 28: Renewables deployment
Renewables deployment Renewables continuing to increase as a percentage of overall generation Forecast wind and solar generation proportion Forecast low-carbon generation proportion GB 27% 52% 54% GB 62% 75% 80% RoI & NI 35% 57% 68% RoI & NI 42% 65% 74% France* 10% 22% 39% France 91% 96% 96% Germany
Slide 29: The Team
The Team Experienced Management Independent Board Helen Mahy CBE (Chair) Investment Manager Operations Manager Key roles: Key roles: Shelagh Mason Overall responsibility for day-to-day Providing operational management (SID) management services for the portfolio Sourcing and approving new inves
Slide 30: InfraRed Capital Partners – Investment Manager
InfraRed Capital Partners – Investment Manager Over 25 years’ pedigree in infrastructure Key statistics across infrastructure and real estate London 25 year $12bn 17 (Infrastructure & track record equity funds Real Estate) Seoul managed raised New York (Investors) (Infrastructure) Hong Kong Mexico (
Slide 31: RES – Operations Manager
RES – Operations Manager 38+ years experience in renewables 38 years 270+ track record projects delivered worldwide 2500+ 18GW employees developed and/or constructed 6GW 300MW Operational assets energy storage projects supported World’s largest independent renewable energy company Operating acro
Slide 32: Approach to gearing
Approach to gearing Disciplined approach Term Project Debt Gearing1 TRIG’s portfolio at 30 June 2020 ▲ Limited to 50% of portfolio enterprise value Project Category typically (Younger = <10yrs) Average % of # of ▲ Fully amortising within the subsidy period available gearing1 portfolio projects2 ▲ Li
Slide 33: Portfolio construction: power price sensitivity maintained
Portfolio construction: power price sensitivity maintained Incorporating subsidy free projects without increasing portfolio sensitivity ▲ Projects comprise a range of Fit, CfD and unsubsidised projects, Impact on equity return of change in power price1 with different gearing levels, across the UK, S
Slide 34: Short-run marginal cost supply curve (merit order)
Short-run marginal cost supply curve (merit order) Key elements of the power price: natural gas and Gas-fired power tends to set the marginal price carbon prices £/MWh £/MWh Min. Average Max. 100 Demand Demand Demand 70 60 Peaking 80 plant 50 Power price 60 40 Gas Coal 30 40 Biomass & 20 Interconnec
Slide 35: Key facts
Key facts Fund Structure ▲ Guernsey-domiciled closed-end investment company Performance ▲ Dividends to date paid as targeted for each period ▲ NAV per share at 30 June 2020 of 113.0p Issue / Listing ▲ Premium listing of ordinary shares on the Main Market of ▲ Market Capitalisation c. £2.2bn at 30 Ju
Slide 36: Contacts
Contacts Investment Manager Other Advisers InfraRed Capital Partners Limited Administrator / Company Secretary Registrar Level 7, One Bartholomew Close, Barts Square, Aztec Financial Services (Guernsey) Ltd Link Asset Services (Guernsey) Ltd London, EC1A 7BL East Wing Mont Crevelt House Trafalgar Co
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