Managing a global portfolio: the challenges and opportunities

Over the coming decades, as the number of countries announcing pledges to achieve net zero emissions continues to grow, there are more opportunities for investors to benefit from the stable returns and long-term growth prospects investment in renewable energy infrastructure has to offer. Whilst there are numerous benefits of investing in renewables across borders, it doesn’t come without its challenges. In this blog, we spoke with Ian Hunter, Director of Operations Services at RES and Laura Hoddell, Senior Commercial Manager at TRIG, to discuss the opportunities and challenges of managing a global renewables portfolio.

TRIG owns a diversified portfolio of over 2.8GW¹ of renewable assets across the UK and Europe. A key element of TRIG’s strategy is to manage total portfolio risk by asset exposure across different power markets, regulatory frameworks, weather patterns and technology classes. Laura Hoddell, Senior Commercial Manager at TRIG said, “Year on year we are producing robust results, demonstrating the inherent quality of our portfolio and management, especially against a challenging macro-economic backdrop.” A well-diversified portfolio helps improve the resilience of TRIG’s ongoing financial performance and valuation, contributing to the sustainability of returns to shareholders. However, such a diverse portfolio requires an operations manager with the correct industry knowledge and experience.

RES, now the world’s largest independent renewable energy services provider, active in 24 countries across five continents, serves over 40GW of operational projects across operations and maintenance (O&M) and asset management. Managing a number of significant portfolios for customers across the globe, RES provides support across solar, wind, energy storage, biomass, hydro, and green hydrogen.  As Operations Manager for TRIG, it’s RES’ job to preserve and enhance the investment value of the assets whilst considering sustainability opportunities and risks.

The importance of ‘Glocal’

One of the more obvious challenges of managing a global portfolio is the differing policies and regulations across regions. Laura noted, “Each region has its nuances and there is no substitute for local market knowledge and experience.” Ian added, “Navigating these regulatory frameworks requires substantial knowledge and administrative efforts. In addition to understanding current policies, it’s equally important that we stay ahead of the curve, anticipating market changes to mitigate risk and ensure that our customers gain competitive advantage.” RES takes a proactive approach to getting ahead of the ever-changing policy landscape, participating in and chairing a number of industry trade association working groups, developing ongoing relationships with politicians and helping drive change through active government engagement and lobbying.  For instance, most recently in Australia, a number of RES’ team worked in collaboration with the Clean Energy Council to develop the country’s first ever comprehensive national guide on meaningful engagement, consent, participation and benefit-sharing with First Nations people on renewable energy projects.

Whilst local knowledge is crucial, there are also advantages to being global. Local understanding aligned to global experience is the route to maximise influence. The key technology supply chains – wind, solar, storage – operate globally and if you want to deliver the optimal projects, it is not simply a matter of buying the wind turbine. True success comes from a portfolio approach where you can explore innovations – commercial or technical with the associated investment of time and effort recognised by both parties as it is a strategic relationship and not a transactional relationship. RES has used these relationships with technology suppliers for instance, to deliver first-of-a-kind projects and mitigate capex and opex increases driven by global events that impact on project economics.  Transparency and focus on solutions require long standing relationships – on a local and global level and while not mutually exclusive the combination is the way to secure innovation.

Speaking the same language

As portfolios continue to expand, asset owners and managers are facing a growing influx of data from various sources. RES is continuing to invest in its innovative technology-enabled ecosystems, data, analytics, machine learning and AI to further improve both maintenance and asset efficiency for its customers. “The days of passively managing projects are gone,” says Ian.

Leveraging new innovations and tools can help asset managers and owners dig deeper into the vast amount of data gathered across large portfolios with different technologies, as well as standardise and automate data, giving a single agnostic view, helping to improve the performance of assets and create efficiencies and savings for owners.

A partnership approach benefits all parties. For instance, as RES continues on its digital journey, the team works alongside customers to develop new technological solutions which help increase energy yield.

From TRIG’s perspective, Laura notes, “Across our portfolio, we have projects at different stages, from new developments to those that are now over 20 years old. Therefore, coming up with new technological solutions is really important for us to maximise the performance of our assets and improve energy yield, while at the same time reducing the stresses on  components to preserve and extend their operational life.” Laura added, “We also need to ensure that we can deliver at scale, so we need a partner who has the technology and experience to be able to help us achieve that.”

A recent success story has been the development of AeroUp, a solution that uses the most innovative aerodynamic upgrades in the industry, helping increase the output and performance of existing wind turbines. The solution was first piloted on one of TRIG’s operational projects, resulting in a 5% uplift in energy yield. The solution is now being rolled out across other sites.

A global future

Another great example of partnership is being able to support customers entering new markets. Being active in 24 countries, across five continents has enabled RES to support customers investing in new territories, helping them to grow their portfolios.

Ian added, “We have also structured our team to ensure that there is an overarching portfolio view and collaboration across borders. We now have 4,500 people across 24 countries. This means that it’s easy to pool our good ideas and share best practice, applying any learnings globally where appropriate to benefit our customers.” This is particularly useful when keeping up to date with fast moving areas such as sustainability or health & safety regulation for instance.

As an example, with regards to ESG, frameworks and standards can be voluntary, but we are seeing increasing government requirements around mandatory disclosure. Reporting can cover a wide range of specific metrics, targets, and requirements to be met at an asset, portfolio or investor level.  Given that there is no one size fits all when it comes to reporting, RES has appointed dedicated resource to create efficiencies, streamline reporting, as well as manage ESG portfolio performance, helping its customers demonstrate market leading ESG performance at a project and portfolio level.

Looking ahead, there are real benefits to continuing to grow renewables portfolios globally.  The above only scratches the surface of considerations across borders. However, the overarching themes of building strong partnerships and leveraging technology are key to maximising operational efficiency, enhancing sustainability, and achieving long-term success.

1: TRIG portfolio size as at December 2023.