Octopus Renewables Infrastructure Trust (LSE:ORIT) — AGM

0:00 Good morning, and welcome to the OCTOPUS Renewables Infrastructure Trust PLC AGM proceedings. Conference recorded meeting attendees are being in listen only mode. A question could be submitted anytime by the q and a tab situated in the right hand corner of your screen. Simply type in your question and press send. Company may not be in a position to answer every question received during the meeting itself. However, the company can review your questions submitted today and publish responses where appropriate to do so. I'd now like to hand you over to Chair Phil Austin, Chair of the Board.

0:25 Good morning, ladies and gentlemen, and welcome to the twenty twenty five Annual General Meeting. My name is Philip Austin. I'm chair of the board of directors, and also present are my fellow directors, Audrey McNair, James Cameron, Sally Duckworth, Elena Elsinger, and Sarim Sheikh. All the directors are standing either for election or reelection today, with the exception of Audrey, who is retiring from the board.

1:19 The board is very grateful to Audrey for all her contributions to the company over the past five years, and in particular, for her able chairmanship of the audit and risk committee and her contribution in her role as senior independent director. She's been fantastic support to me as chair. We all wish her very well for the future. We're also joined by David Bird and Chris Gaydon and Charlotte Edgar, representing our Investment Manager, OCTOPUS RENEWABLES. We also have Nicola Board, Hannah Shaw and Jeremy Jones representing our company secretary and administrator, Apex listed company services UK Limited, as well as Carol Fong and Andy Gray representing our registrars at Computershare.

2:08 So in accordance as chair of the meeting and represent the proxy votes that have been submitted in advance, and I can confirm that a quorum is present, and so I declare the meeting open. The format for the proceedings today is that we will start with the formal business of the meeting. And once the AGM, the formal AGM, is finished, we'll then proceed to a presentation from our investment managers, David and Chris. This presentation will be filmed and made available on the company after the meeting. And attendees will have the opportunity to ask questions of David and Chris after the presentation. Questions can also be submitted via Investor Meet company platform during the meeting itself. So let me now turn to the formal business of this meeting.

2:55 I propose that the notice of the meeting is taken as read. With your permission, ladies and gentlemen, I'd like to proceed by dealing with any questions from shareholders on any matters relevant to this meeting to the AGM. Let's deal with them at the outset before we move on to voting on the resolutions themselves. This is because we have a number of resolutions, and in my view, we'll be able to deal with the voting more expeditiously in this manner while still giving shareholders time to ask all the questions that they may wish to ask. So are there any questions from the floor, please, from shareholders? No? Okay. Thank you.

3:39 To reflect the views of shareholders of the company more accurately, voting today will be done by way of a poll on each of the resolutions. And this is seen as in the best interest of the company and shareholders as it gives all shareholders the opportunity to participate in the decision making of the company and have their votes recorded in proportion to the number of shares that they hold. The poll will be administered by our registrar's Computershare. Poll voting cards were distributed when you registered this morning. If you are entitled to vote and do not have a poll card, please raise your hand now.

4:20 If you already have a proxy form appoint... If if you have already lodged a proxy form appointing me or one of my fellow directors as your proxy and you do not wish to change your votes, there's no need to complete your poll card. However, if you wish to change any of your votes, you should complete your poll card for every resolution.

4:40 Moving on to the resolutions. I propose that the resolution set out as in the note... Set out in the notice of the meeting be put to the meeting. We've taken the contents of the notice as read, and unless otherwise requested, I do not therefore propose to read the text of the resolutions in full, and so we can proceed directly formalities. Please, would you now complete your poll card by marking how you wish to vote on each resolution and sign your poll card. You can vote in favor of a resolution, against a resolution, or you may withhold your vote. Should you require any assistance, please raise your hand. Poll cards should be handed to the registrar on leaving the AGM.

5:28 The final results of voting on each of the resolutions will be announced on the London Stock Exchange and via the company's website as soon as practical following the meeting. And voting will close ten minutes at the end of the meeting. That concludes the formal business of the Annual General Meeting. I thank you all for your attendance and declare the meeting closed. I will now invite David and Chris to provide an update on our investment management activities. David, Chris? Thank you, Phil. And I'd also like to extend our thanks to everyone joining us today, both online and in the room for this Investment Manager update for OCTOPUS RENEWABLES INFRASTRUCTURE TRUST. My name is Chris Godin, I'm joined by David Bird, and we manage ORIT alongside our team on a day

6:25 So, we thought we'd start by reminding you of the key features of ORIT that makes us a highly differentiated proposition in the investment trust space. So, first of all, we are a diversified renewables investment trust. We think diversification is incredibly important because it reduces concentration of risks in the portfolio. And I'll come on to some of those in a moment. ORIT is also managed by our expert team, both those dedicated to ORIT and also from the wider OCTOPUS Energy Fund Management business, of which we have over 150 individuals who are specialists in investing into renewable energy projects. We also seek to add value

7:12 through our mandates allocations towards both construction and development. That value is added by de risking projects as we bring them through the development phase, through the construction phase, and it also seeks to leverage the skills and resources that we have within the wider fund management business. While we're targeting additional capital returns from those investments, we're also looking to unlock optionality. And by that, I mean those projects and pipelines that are being developed by our developers, we're able to access those and invest into them when they come to fruition. Finally, here is sustainable investing. We are an SFDR Article nine product, and our approach to sustainable investing winds its way through all of the things that we do, our investment committee processes and the projects that we choose to invest into.

8:09 So, I mentioned diversification. And ORIT, we believe, is the only genuinely diversified investment trust of meaningful scale in the renewable energy transition space. And that's because we're diversified across both geographies and technologies. The map on the right shows you the extent of that diversification. And, as I said, we wanted to put diversification into the mandate. It's been there from the start to reduce concentrations of risks. And those risks could be things like weather patterns, exposure to particular grid networks, and also exposure to various regulatory regimes. At the moment, our portfolio currently has 41 assets, which total eight zero three megawatts of generating capacity across five different technologies and five different countries.

9:05 And to put that diversification into numbers, you can see how our country exposure is split in the pie chart on the left or doughnut chart. On technology, we are roughly fiftyfifty split between wind and solar. We have very small exposure to batteries and also to our development investments. And in terms of the asset phase, now that almost all of the construction that we've been undertaking over the past five years, The portfolio is broadly in the fully operational phase. In terms of gross asset value, our latest announced figure is approximately £1,000,000,000 just touching then on investing for impact, as I say, we're an SFDR Article nine product.

10:03 We employ sustainable and responsible investment processes through everything we do.

10:12 Also work with our local communities and we think working with them improves the long term value of our projects, being a good corporate citizen. We do things like promoting a just transition through retraining programs. We install pocket forests in urban areas that don't have much greenery. We work with mental health charities. And we have a number of rewilding programs as well. It's an incredibly important part of what we do and something that we all as a team believe in entirely. Now, at the end of December twenty twenty four, that marked the fifth anniversary of ORIT since IPO.

11:00 And over that period of time, I think we're comfortable in saying that we have delivered on what we said we would deliver when we IPO ed. Over that period of time, we've invested into 45 different assets across eight countries and five technologies. We've delivered a 31.9% total generated NAV return and we've returned £128,000,000 to shareholders. We've also produced over four terawatt hours of clean electricity. We have avoided a million tons of carbon and that's equivalent to over half a million cars being taken off the roads. And a brief look at our track record over that period of time. Although we have a progressive dividend policy, we have been able to maintain increases in line with inflation over the past four years and our current guidance has us doing that again

12:03 delivered dividend cover of 1.24 times. And if we were to calculate the same number before debt principal repayments, it would be closer to 1.85.

12:19 In terms of the portfolio itself, you can see how the capacity of the portfolio has grown over that period of we've been acquiring and constructing assets. In 2024, we delivered 1.24 gigawatt hours of generation, produced £131,700,000 and EBITDA of 85,500,000 And that's despite us having recycled and sold some of our assets during the course of the last fifteen to eighteen months or so.

12:58 I'll hand over to David. Thanks, Chris, and good morning, everybody. I'm going to spend a bit of time now just taking you through some of the examples of the activities we've been concentrating on over the last year or so that really go to support the mandate and how we set ourselves apart and add value, and then touch on the priorities that we've set out for the near future. So first of all, I want to talk about the sale of the Lumbyom wind farm in Sweden, which completed in the second half of twenty twenty four and really encapsulates a lot of what we do within the active management of the portfolio. It was the first investment that we made back in March 2020, and we invested in that asset before construction had started.

13:47 Successfully took it all the way through construction into operations in around the middle of twenty twenty one.

13:54 We then ran it very successfully for around three years before before selling, as I said, in the second half of twenty twenty four. And during that period, we delivered an 11.3% return on that investment, and the sales proceeds that we realized were roughly €1,700,000 above our holding value. So it shows that the extra value we can deliver through managing construction successfully and then selling at a good price can deliver enhanced returns to shareholders. And it's just one example of where we've done that over the last couple of years. We've delivered in total £161,000,000 worth of sales proceeds, and that has realized over a 3p per share uplift in the net asset value of the company.

14:45 And we're committed to do more of the same. So we've got £80,000,000 worth of asset sales that we've committed to deliver during the rest of 2025. Another area where we're very hands on in looking after the portfolio of assets that we invest into is in the way we look after the revenues coming from those assets, and in particular, putting in place new contracts to ensure that we have a high level of certainty on the price that those assets are going to receive for their electricity generation. So we have a very high degree of fixed revenues already.

15:20 At the moment, around 84% of our forecast revenue is a fixed price in nature over the next two years. And over the next ten years, we also benefit from over 70% of revenues being fixed, half of those with explicit contractual inflation linkage, which helps support the growth in the dividend and our ability to keep doing that.

15:41 One specific example of where we've done something along these lines in the last year or so is a new contract that we put in place on our Scottish wind farm called Cross Dykes, And that was a new 10 contract with the Sky Media Group for just under 70% of the generation that that wind farm produces. And that gives us benefit not just of fixed pricing over the next ten years, but also inflation protection because the price will increase in line with CPI year on year. And when we put that contract in place, again, it was NAV positive for shareholders, delivered

16:18 roughly a 1p increase in the value of each share. Here, I'm going to talk a little bit about another area where we think we can deliver enhanced returns to investors compared with a company purely investing into operational assets, and that's through investing in what we call development, which in the renewable sector means assets that are not yet ready to start construction. So working to get permits, get land rights, get a grid connection for assets so that then they're ready to start building. We have a number of different development platforms that we've funded. And one of the real advantages that comes with that activity is not only that we can get higher returns, but it gives us optionality on whether or not we want to then take those assets forward and build them ourselves, or whether we want to sell them onto the market.

17:11 And two investments here I wanted to highlight where we've made follow on investments in the first half of twenty twenty five are in the middle Nordic generation, which is looking to bring the next wave of wind and indeed solar projects that are going to be ready to build in Finland. And they are having some good success with getting projects permitting,

17:33 particularly some solar projects which could be ready to build sometime during the course of next year. And we've also put extra funding into BLC Energy, which is focused on developing solar and battery storage in The UK. And they've recently submitted several 100 megawatts of planning applications with more to come during the rest of the year. So hopefully, we should see some interesting progress on those development pipelines over the next year or two.

18:05 This slide sets out where we've invested capital over the last year or so. So I've mentioned on the right hand side those recent investments into Nordic generation and BLC. Going back into the second half of twenty twenty four, we did also

18:24 put more money into our Irish solar complex. The vast majority of that was made at the beginning of twenty twenty four and was a commitment that dated back a couple of years. But we did also put a small amount of additional capital into another developer, the Simply Blue Group, in order to provide them funding as they seek a long term strategic funding partner to take their projects through to the next level. Another area where we've been very active over the last year or so is looking at the overall balance sheet position of the company and its underlying investments. You can see if you look at the two columns that we have moved a lot of what was relatively expensive short term debt in our revolving credit facility into a new £100,000,000 five year facility held in one of the holding companies lower down in the structure.

19:18 And that has enabled us to materially reduce our borrowing costs, which have gone from around 4% on average at year end to 3.6% as at the end of March. And we're continuing to be very active in managing the gearing position and have committed to bring overall gearing below 40% during the course of 2025.

19:44 So that brings me on to that sort of forward looking picture and and where our focus is at the moment. And earlier this year, we announced three core priorities for for capital allocation. The first of which was around the cash that we returned to shareholders. So a buyback program of £10,000,000 was launched in around June of last year. We increased that by £20,000,000 or rather the board did to £30,000,000 earlier this year, and we're roughly halfway through that total £30,000,000 program at the moment. And buying back shares whilst those shares are trading at a discount to the net asset value provides net asset value per share accretion to remaining shareholders.

20:31 Alongside that, the Board earlier in the year announced an increase in the dividend target for FY 2025 to 6.17p per share. Again, another increase in the amount of cash being returned to shareholders through the dividend and in line with inflation once again. Second key capital allocation priority is to bring leverage down below 40%, as I mentioned earlier, and to keep bringing the borrowing cost of the company down, which we've already achieved some success with, with the financing that completed earlier this year.

21:05 And finally, to deliver on those previous two priorities, we have committed to keep on with our capital recycling program and to realize at least £80,000,000 from selling existing assets, which are likely to be predominantly operational assets, and to be very selective in the new investments that we do make during FY 2025.

21:30 So finally, before we go to questions, to remind everyone why we think the investment case for ORIT remains as strong as it has ever been. We think that the opportunity in investing in renewables and the energy transition remains enormous. There are huge tailwinds behind investing in renewables, particularly because renewable energy generation is the answer not just to decarbonizing our economy, but also to increasing energy security and to reducing end bills for consumers because wind and solar are the cheapest forms of new generation.

22:09 As Chris mentioned earlier, we've demonstrated a track record now of growing the income coming from our portfolio of assets and translating that into increasing levels of income and being returned to shareholders. I've talked about the developer investments that we have, which we think are very well positioned for growth and bring opportunities for capital growth in the shares in the future. And looking at where the shares have been traded, we continue to be very confident that our net asset values are set fairly and that the share price does not reflect the fair value of those assets. So we see there being an opportunity there for investors to put money into an attractive portfolio of assets at an attractive price. And we've proven those valuations through being able to consistently sell assets at or above our holding value.

23:00 So with that, I think we're ready for questions. Thanks. Charlotte, any questions coming through? Thanks, Chair. We've got two questions. The first is: Did the recent events relating to the Spanish grid impact your view of solar in Spain or other countries? Chris, do you want to take that? You're Yep. Very familiar with Spain. I I'm not sure that it had an impact on or changed our views, let's say. I think the Red Electrica is still working out what happened in in that blackout that they had on the Iberian Peninsula. It looks to be that it wasn't directly due to solar's fault, but the massive solar and the massive wind that's on the Spanish grid had led to a lack of inertia and lack of resilience, I suppose, for the grid to be able to withstand outages and other disturbances.

24:00 Now, we've recently exited our Spanish investments and that was in part due to our nervousness around long term power prices in Spain. And I think that decision has been very much justified. We've seen power prices be extremely low in that market. And I think we mentioned to exit, but that was all well before the blackout that occurred. Thanks, Chris. We've got one further question currently. I can understand the fixed prices of the agreements with Sky or others. Are there performance aspects to these contracts? Like, how much electricity needs to be produced and when?

24:46 Or when they may decide not to take power that is generated if they don't need to... If they don't need it at that time? Should I take that one? So there are performance related aspects, but not of the sort of nature that maybe you're alluded to in the second part of that question. So when we're selling our electricity, there are a number of different structures we can use. One is that we can sell what we would call a baseload contract. So we're selling a fixed amount of power in every single period for a fixed price. Clearly, we're using wind and solar assets, they don't have that flat generation profile. So that creates a mismatch which would create risk for us and for our investments. So we very rarely even consider those sorts of base side contracts.

25:37 If you look at what we've done with Sky and other contracting in our portfolio is that the other end of the spectrum is what we call payers produced. So whenever our wind farm is generating, Sky are buying just under 70% of the power from that wind farm in that period, even if it's more than their power demand is in that period.

26:03 So effectively, risk of is there more or less wind than sky need in a particular period sits with them and not with us, and that is true of all of the contracts we have in our portfolio. So the only sort of performance aspects that are in those contracts are sort of a minimum level of availability, which is typically set far, far lower than both what we would expect and where we also have contractual protections from our external operations contractors so that we are protected if something really unexpected happens and we don't meet those levels in the contracts. So hopefully that covers that question. Thanks, David. A couple more questions have come in now. There's currently a net discount of share price net asset value of around 26%, leaving my investment sitting at a loss. I originally invested at IPO.

26:55 Do you have a hurdle rate of 26% for making new investments since you can currently effectively buy assets at a 26% discount by buying back shares from the market? I'll take that one as well. Yeah. So so we absolutely do have a hurdle rate on new investments that takes into account the share price discount to NAV. The sort of the numbers aren't quite in line with what was set out in that question. There's a few different ways of thinking about it. One is that if you look at our existing portfolio of assets, we expect that to deliver returns roughly 8%, maybe slightly higher than that over the long term if we were buying those assets at their net asset value. So because we can effectively invest in those assets through buying back shares at a 25% plus discount, we can turn that eight something return into low double digits, 10% to 11% return.

27:49 So that's really something that we have to be able to prove that we can do better than if we're going to justify new investments. And it's reflected in the new investments that we have made in recent times. So we haven't done any new operational investments

28:07 because it's relatively challenging to find operational assets that will return 11% or more. But we have done new investments into developers where we would expect to earn returns comfortably over 11%. And we might also see construction opportunities that start to meet that sort of return hurdle as well. But clearly, that's a little more difficult than it is to find those development stage opportunities. So yes, there is that sort of hurdle rate consideration. We also look at the different levels of NAV per share accretion that might be available through a buyback compared with successfully delivering investments with potential for growth like development and construction and what NAV per share accretion they might deliver. And we also look at the different risks associated with those investments. Investing in our existing known highly operational portfolio is less risky than investing in a new developer asset.

29:01 So we have to not just beat the hurdle, but beat the hurdle on a risk adjusted basis as well. Thank you. Staying on the same theme, might be one for the Board, what are your views on the effectiveness of the share buyback program so far? David, do you want to cover it off?

29:18 Then I'll come in, yes. So I think the share buybacks so far have done what we expected them to do, which is deliver NAV per share accretion and to demonstrate discipline on capital allocation. I think if you look at what's happened with the discount that we... I didn't expect share buybacks to make the discount to now disappear and see them as a a sound capital allocation tool that we have in the current share price environment. Yeah. I would just add that, you know, the buyback program is part of the capital allocation package, really, that David was talking about before. And as David said, we didn't expect it to move the dial significantly on the share price. I think it's helped.

30:05 And I've spoken to quite a number of our shareholders over the last month or so. And I would say on balance, most of them welcome the buyback program. So it is something we thought an awful lot about, and we continue to monitor. As David said earlier, we have a GBP 30,000,000 pot, if you like, and we're about halfway through that. So we'll continue to monitor it and continue to monitor the benefits for it. Great. Thank you. And moving a bit to the portfolio, are there any plans to increase battery storage volumes within The UK or Europe? Yes, I can take that. Well, all subject to capital allocation, of course. And we have had a... Over the past five years, quite a conservative approach to batteries, partly stemming from the amount of capacity that potentially could come online over the various markets where we operate.

31:04 Having said that, and going back to the Spanish example, the need for flexibility in those sort of grid forming technologies is high and will increase across all the markets where we operate. And there is a role for batteries. We our approach to batteries will be quite targeted, let's say. We understand the economics of batteries and we think that on a standalone basis, returns are probably a little bit on the low side versus what we might want to underwrite those sorts of transactions. But we also think that batteries can have natural hedge with some of the generating portfolio that we have. And where we think we can access that synergy, that's where we'll be focusing our efforts.

31:57 Great. Thank you, Chris. Would you outline the increase in capacity that the developer assets described will bring to ORIT?

32:08 Should I start off there? So I think it's important to note that we don't expect or intend to take all of the assets that come out of our developers through into actually building them ourselves because that would require many, many hundreds of millions of capital that we certainly don't have right now. There's, as I mentioned, several 100 megawatts in The UK through PLC, several 100 more in The UK with WIN2 that could come through. And to do all of that would put us very overweight UK even if we had all the cash. Similarly, we're not going to build hundreds and hundreds of megawatts in Finland because that would skew our exposure to that market. So I think how much of that development pipeline comes through into our portfolio depends partly on the share price environment and therefore how much capital we can allocate partly on

32:59 sort of wider activity. Maybe we get back to raising money in some period in the future and that can allow us to grow more. I think the potential we see for the portfolio is that it can grow by many, many hundreds of megawatts. So the constraint really is around the availability of capital and the ability to grow rather than how much is coming through those developers. There's more than enough coming through those developers to satisfy what we might want to be able to spend. But that doesn't mean we won't go and

33:31 buy other assets as well because we're also looking to make sure we keep the diversification. So we might want to buy more assets in France or Italy or Germany where we don't currently have development pipeline coming through. Great. Thank you. Are there any plans to capitalize on the P415 agreement within The UK and invest in any energy aggregators as this is such an early and underserved part of the renewables market? Okay. That's quite a technical one. I think stepping back now, looking at how the energy system is evolving and where we might want to invest in parts of that value chain which are not the core of the energy generation from wind and solar is something that we're always looking at and looking at, whether being closer to the end consumer or closer to even to the supply chain of the assets is something that can add value to the company.

34:31 So that sort of specific example there of aggregators is not one that we have any sort of near term plans on. And that core of having at least 80% of the portfolio in wind and solar generation remains the focus. But we do have that sort of other technology allocation that allows us to make investments in things if we think that they're synergistic with a wider portfolio or provide diversification or other sorts of complementary features. Thanks, David. Please, can you discuss the impact potential for RENEWABLES INFRASTRUCTURE PLC assets? So I think so for those who aren't aware of what RENEWABLES is, this is a process that's going on in The UK at the moment looking at a wide range of different things actually around how our electricity markets run and also how new generation capacity is incentivized through things like contracts for difference.

35:28 And the most high profile element of RENEWABLES is a review of whether we should, as we do now, have a single national price for the electricity that's sold in the market or whether we should split Great Britain, in particular, into a number of different zones that reflect the actual physical constraints on the electricity network. And what that might mean if it came in, which remains uncertain, is that the average price of electricity in the South where there's lots of people and lots of electricity demand might be higher, and the average price of electricity, say, in Northern Scotland where there's lots of wind generation and not so many people might be lower. If you look at ORIT, this is exactly one of the reasons why we think diversification is so important.

36:17 So we don't have all of our assets in The UK, so changes to the regulatory and policy regime in The UK don't affect us as much as a vehicle that's only looking at UK assets. Then if you look at what we're investing in within The UK, again, we have diversification. So we have a significant volume of solar generation assets mostly in the South. We have an offshore wind asset that connects in near the sort of the East Wash through King's Lynn. And we have, yes, some wind farms in Scotland. But those two wind farms are only about 11% or 12% of ORIT's portfolio in total. They also currently pay quite significant locational network charges, which if locational electricity pricing came in, those charges would also go away.

37:10 And the government has said that if they do introduce something like a zonal pricing setup, that they would expect there to be grandfathering protection for existing assets. So overall, the combination of diversification, grandfathering and just where our assets are means that while we can't put a specific number on it, we don't envisage any changes through if they do occur, as having any kind of material effect on ORIT. Thank you. Back on to battery storage, and I think we've covered most of it. But if you've got anything else to add, do you see potential for more battery storage to improve the production potential of existing assets? Would it enhance returns? And I think, Chris, you covered that on returns, but perhaps if there's anything else to add. Yes.

37:57 So potentially, there's some benefits through co locating batteries with existing renewable energy plant. Ultimately, those batteries can piggyback off the grid connection or export connection that's already in place, which up which means you can get those batteries connected to the grid cheaper. We have an ongoing program of reviewing our portfolio to see where there's opportunities for adding batteries. Some of the Scottish wind farms, for example, might make sense depending on regulatory change ends up. And we will continue to monitor that as time goes on. Thank you. Are you looking at other technologies beyond the five that ORIT is currently invested in?

38:48 No. Okay. A bit more of a corporate question here. Are you open to mergers as being bigger may attract more investors? Yeah. I'm happy to take that. Yes. We are. I think we all agree that the sector, the renewable sector needs some consolidation. We have been active eighteen months, two years ago when we looked at a possibility that didn't materialize. And we're very aware of the need for consolidation in the sector, and it's something the Board is focused on. Thank you. Turning to the dividend. Can the dividend continue to grow over the next three to five years in line with inflation?

39:38 David?

39:39 So I think when answering this question, it's important to remember that the company's dividend policy is pay a progressive dividend. And whilst we have a strong track record of having increased it in line with inflation, there isn't a sort of standing commitment to do so. One of the things which has enabled us to increase in line with inflation over the last three or four years is that we have a lot of inflation linked revenues in the portfolio. That still remains the case.

40:06 But when we're looking at increasing the dividend cover and providing projections to the board in order to ultimately make that decision as to whether inflation linked increases the right amount or whether it should be more or less. There's a lot of different things that are feeding into that, including the trajectory of electricity prices, the cost of servicing debt, how much we're managing the portfolio between operational assets and those that support being able to pay that dividend in a way that's covered by operational cash flows, and on the other hand, assets that offer opportunities for greater capital growth. So what we are confident in is that we can manage the portfolio in a way that allows us to keep growing the dividend and to pay a dividend that is fully covered by the cash flows that are being generated from the portfolio.

40:57 Ultimately, whether an inflation increase is the right thing to do or or some other number is something, again, that we we work very closely with the board every year, but it's ultimately a decision for for them. Thanks. Can you talk about the forecast for electricity prices over the next five years? I could. Yeah. We could be here all week. So again, because we're invested in a range of different countries, the answer is not the same in every single country. Generally, we're in a period where prices over the last couple of years have been trending downwards because they got to being very, very high indeed in 2022 following Russia's invasion of Ukraine.

41:44 And so generally speaking, that that downward trend is forecast to continue for a little bit longer, but then prices are stabilizing in the next couple of years. And then it becomes very market dependent and technology dependent. So we had the question earlier on solar in Spain. There, the price that solar receives is expected to go down over time as more and more solar gets built. In other markets, for example, in Finland where we have wind assets, the price forecast trends up because the pace at which new sources of demand like big data centers are expected to come into the market sort of outweighs the pace at which new wind and solar generation comes onto the grid. But ultimately, what happens in reality is heavily driven by that tension between how much new demand, whether that's heat pumps, electric vehicles, data centers, how much of that comes on versus how much new generation capacity comes on.

42:44 And the price is still heavily influenced by global commodities. So a lot of times, particularly in The UK, the price is ending up being set by the global price of gas. We've seen a little bit of upward movement even in the last day or so following what's been going on between Israel and Iran. So there's all sorts of different factors that can that move prices over the next five years. It's something that we're looking at constantly. The overall picture actually on average over the next five years is for a relatively stable power price profile. Thank you. Final question online. Will The UK market eventually become saturated as companies are building on mass?

43:29 So I touched on that a little bit actually in the last answer around that, that sort of tension between, yes, there's new wind and solar coming onto the system, but there's also expectation that there's a lot more electricity demand because more and more of us are to drive electric vehicles, use electric heat pumps in our houses and potentially a very significant increased component from new data centers. The other really important thing to note is all of the valuations that we do have these very long term projections and assume that

44:00 billions and billions of new money is invested into new wind farms coming on. So we're already assuming that we build loads more wind and solar that we already have when we're projecting the power prices that the assets that we currently have will receive. Great. One question has come in. I recently came across this curious phrase, wind theft. Does it affect the ORIT portfolio much if indeed we know what wind theft is referring to? I suspect that refers to weight losses from wind farms for which are built perhaps downwind of... Sorry, upwind of an existing wind farm. So it it is it is a thing. Quite often when you develop projects, you will put in place wind protection zones so that the landowners are unable to develop projects in certain areas around your wind farm.

44:58 But, yeah, as there are certain areas in Scotland, etcetera, where wind farm... There's a lot of wind development and it is starting to impact different projects. We haven't seen any big impacts on our portfolio from that specific issue. There are couple of projects built around our Cumberhead wind farm, but we anticipated that when we made the investment and modeled that now in our forecast. And I think where people have probably heard that phrase most is because a lot of the big developers of offshore wind have been in a bit of a public PR exercise trying to protect their existing assets because there is a lot of development going on offshore and big companies that are operating in that space are worried. Again, you look at ORITS portfolio, we have an offshore wind asset in the form of the Lynx offshore wind farm.

45:48 That asset is in the North Sea, very near to the coast compared with where new assets are being built. And if you look at the prevailing wind direction, it tends to be from the broadly from the West Southwest, and there's really no space to put a new offshore wind farm between the coast and where Lynx is. So the people who are worried about this and making a lot of noise are either those who are much further offshore or those in the Irish Sea where the ones close to the shore have lots of space to the west that could be filled with other wind farms. Okay. Thank you. That completes all the questions online. Are there any further questions from the floor? Councillors and gentlemen just joined us. Hello?

46:35 That's okay. Do you have any questions of the Board? No? Okay. Thank you. Okay. Well, thank you to David and Chris for that presentation, Charlotte for facilitating that. And thank you to those of you who've attended in person. And also to all we can now formally close the meeting. Thank you. Thank you for updating investors today on behalf of the Board of OCTOPUS Renewables INFRASTRUCTURE TRUST PLC. We'd like to thank you for attending today's general meeting. That concludes today's session, and good morning to you.