Greencoat Renewables PLC (GRP) Earnings Call Transcript

Good morning all, and welcome to our H1 2026 semiannual results. I'm here with Paul, so Bertrand Gautier speaking. Let's turn to Slide 3. And before getting to the detailed agenda of the day, let me start with a reminder of who we are. Greencoat Renewables is a pan-European renewable platform with a gross asset value of EUR 2.3 billion and operating 1.4 gigawatt capacity-wise. Since our IPO in 2017, we are generating close to EUR 1 billion of cash and paid a cumulative dividend of EUR 0.55 per share. In H1, the business continues to perform strongly with net cash generation of EUR 60 million, underpinning a 1.6x net dividend cover on track to deliver 1.5x dividend cover for the full year, well exceeding the 1.2x that we indicated in December 2025. Moving on to next slide. In March, we set out a 6-pillar capital allocation framework, and I want to anchor this presentation on it because it is the lens through which we run the business. The first 3 pillars are about enhanced capital allocation, prioritizing the return of capital to shareholders in the short to medium term. Those are buybacks, deleveraging and dividend. The next 3 are about value-accretive growth, positioning the company for higher return opportunities. 6 months on, the headlines are there. The initial EUR 25 million buyback is complete. A second EUR 25 million tranche has been announced as in progress. The portfolio review is now complete and formal disposal processes are underway to deliver 45% gearing level by year-end -- sorry, by end of 2027 and unlock the residual EUR 50 million of buybacks to get us to EUR 100 million as we indicated. In parallel, we have established our green digital infrastructure platform and on hybridization, site screening now is complete with land and preplanning work ongoing. We will work -- we go into this -- each of this in more detail. In terms of agenda, Slide 5 and running order, I will cover financial performance first, then Paul will give you some perspective on favorable market developments that GRP can capitalize on, and we will detail our progress in respect of our capital allocation with Paul focusing on our value-accretive growth initiatives. On Slide 7, focusing on financial performance from a cash P&L perspective, we see that net cash generation for the half year was EUR 60 million compared with EUR 65 million in the first half of '25. That equates to net dividend cover, as I said, of 1.6x against 1.7x last year. We would expect full dividend cover to well exceed the 1.2x we projected at the beginning of the year and to be around 1.5x, benefited from favorable power price upside. Revenue was EUR 157 million for the period, down 2% on a reported basis versus last year. And I need to stress that on a like-for-like basis, revenue actually increased by 4% and production by 6%. This is when we adjust for the disposal of the EUR 156 million Irish portfolio in early 2025. As we flagged in the -- at the Q1 update, wind resource was weaker in the first quarter, standing at minus 10%. However, the second quarter was on budget and the net result is that production was 6% below budget for the first half. Operating expenses were well under control at EUR 67 million, down for EUR 70 million which meant that EBITDA was flat at EUR 90 million. Turning to the balance sheet on Slide 8. The fair value of investment was EUR 2.1 billion, giving a gross asset value of EUR 2.3 billion, down 2% from year-end. Borrowing were broadly unchanged at EUR 1.2 billion. with net asset value at EUR 1.1 billion, a reduction of 4%. As a result, gearing stood at 53%. I will walk through the drivers of that in the NAV bridge shortly. On the next slide, Slide 9 breaks down production and revenue by market. Ireland remains our largest contributor, generating 47% of production but 55% of revenue at an average of just over EUR 100 per megawatt. Irish revenue structure remains highly appealing as revenues are 100% contracted and a portion of those circa 45%, benefits from elevated merchant price when exceeding the REFIT pricing level, which stands around EUR 95 megawatts. Together, the 3 markets, which are Ireland, Germany and France are mostly contracted, generated 91% of our revenue at an average price of more than EUR 95 per megawatt. Sweden and Spain are lower priced, more merchant fully merchant exposed market. Production there was affected by weaker wind in the first quarter and in Germany, we also had temporary operation constraints on the offshore assets, which has now been resolved. Importantly, merchant power price remained materially above budget, which offset the weaker production in both of those countries. So the picture is 1 of revenue resilience the higher price contracted markets and the port exposure to merchant prices mitigated the impact of lower production on the first half. Moving to Slide 10. No update. I mean, material since this was published in early August. NAV in H1 at June of this year was down EUR 0.018 versus December to EUR 0.972 operating performance, as you can see on the graph, contributed EUR 0.057 of net cash generation against EUR 0.034 of dividend and depreciation of EUR 0.032. The major headwind came from longer -- lower, longer-term power price in Germany, driven by an aggressive expected buildup of renewable capacity as enhanced by the government and suffering from an expected slowdown of electricity demand from industrial needs. As a result, our German curve has been reduced by close to 10%. However, as you will see later, we are taking steps to contract German power pricing, which will also offer upside certainly in the short term. Slide 11 talks about the debt structure of the business, which underpin what I would qualify as solid. Sorry, we're a bit confused on the slide numbers, so we don't want to lose you. So on Slide 11, we talk about the debt structure of the business, which underpin what I would qualify as solid. Our financing is cost effective with a weighted average cost of 3.5%. The aggregate debt of EUR 1.2 billion is 89% fixed rate. So we have limited exposure to interest rate movements, and it's secured throughout 2030 with a stage and well distributed maturity profile, as you can see on the graph. The first maturity is coming due in March 2027. We've already begun proactive discussions with lenders, and I would characterize those lender engagement as strong. Liquidity is strong with EUR 139 million of cash on balance sheet and an RCF undrawn capacity of EUR 240 million. Disposal program. We'll talk about it in more detail, but this will add further in excess of EUR 250 million of liquidity, which we are planning to allocate to deleveraging. This, combined with organic excess cash flow is paving the way for gearing to reduce from current 53% to mid-40s by the end of 2027. On Slide 12, this table sets out illustrative dividend covered through to 2030 of the existing portfolio. On current assumptions, you can see that the net dividend cover would average 1.7x over the period, ranging from 1.5 to 1.9x in the later years. Contracted cash flow represents 73%, now 75% when you factor the recent Borkum PPA that we have signed past period. And of the total that was [ 5-year ] that we are showing here and it's well on target. Key is that this underpins a potential for EUR 600 million for cash generation which offer great flexibility in terms of strategic allocation and support the capital framework that we put forward. The sensitivity at the bottom of the table, apply different capture merchant price merchant volume [indiscernible]. And this illustrates that even in extremely low power price environment, the ability of the portfolio to support the dividend of the business. On Slide 13, we are showing you a short-term power price affected by the Middle East crisis as 1 would expect. You can see that around 25% of our 2026 volume is merchant and therefore, directly exposed to power price movement. And this figure of 73% increased to 78% when factors Borkum PPA that we signed, as we say during the summer. What I think it's interesting that you can see is that the forward price, which is also a small curve in H2 sits significantly above what was our Q2 NAV assumption in most markets. Without surprise, gas prices have continued to strengthen. This is a period end, which supports the outlook that we currently are expecting for dividend cover of 1.5x for the year. And in Ireland only second half [indiscernible] of 42% above the level assumed in our Q2 NAV. However, I would caveat as always that forward curves are not forecast, but as you can see, the trend is quite positive for the business. Moving on to the next slide. So in this I would say, positive environment. We wanted to recap our strategy to maintain contracted revenue in excess of 70% on a rolling 5-year basis. So this is something that we have been continuously focused on. And as you -- as we just talked about, we are well on target with 75% already of those revenue to be contracted in 2030. So this is a dynamic strategy. The way we've done it has been to lock in PPAs when pricing support boost NAV and cash flow visibility. This is now a proven capability. We started this in 2022. You can see on the left-hand side that we signed 8 PPAs. This has covered roughly 870GWh of annual generation. Now to put things into perspective. This will represent 20% of our annual generation with an average tenure of 7 years. What is interesting is that the counterparties range for big tech to utilities and multi-Nationals. The most present example is a Borkum offshore asset in Germany. As you might recall, our first other offshore asset in Germany, Butendiek, we contracted for a period of 6.5 years. In this instance, vis-a-vis Borkum, we signed a short-term 15-month PPA for 450 gigawatt with a utility company, and the PPA is sitting at EUR 96 per megawatt, which compared well to our H1 price of EUR 90. So a premium of EUR 6 per megawatt and more importantly, it's securing the cash flow in the period where that can go down, can go down. So looking ahead, our value-accretive growth strategy will further enhance our potential to lock in those premium corporate PPA capitalizing on our unique position in Ireland, market dynamics. We just talked about it, certainly on a short-term basis and our data center platform. So it's on this basis, I will pass it on to Paul to go in more detail on markets.

Thank you, Bertrand. What I'd like to do over the next 3 slides in '16, '17 and '18, is just to actually reset the scene in terms of how we see the market outlook today, because I think the market outlook has really turned very favorable across the broader renewable and energy outlook in Europe. So when you look on Slide 16, we've been taking advantage and playing into the trends around decarbonization, the need for increased renewable electricity and the policy framework in Europe has really led that opportunity over the last number of years. But really, over the last 6 to 12 months, as we've seen the demand for AI power emerge into Europe, and as we've also seen the need for increased energy security at a country-by-country level, that policy is essentially creating significant near-term opportunities for platforms like Greencoat Renewables to provide a solution. When you look back on the policy changes over the last 6 months in March, we saw the EU clean energy investment strategy. In April, we saw accelerating EU. In June, we saw the EU digitalization and AI energy road map. And then finally, in July, we've seen the EU electrification action plan. All of these are designed to increase the capital deployment to the energy and digital sector. And we estimate today that there'll be over EUR 660 billion of capital needed between now and 2030. Much of this will go into supporting grids and allowing the grids to take onboard more flexible power and increased amounts of renewable electricity but we see below the line, the 28 gigawatts of new data center capacity being increased from 13 gigs today. And in addition to that, the increased renewables overall. This means that we expect to see Europe continue to fill up the strategy of using renewable electricity to solve and to be the way to decarbonize Europe's power. But there will be increased focus on flexibility and being able to use the grid connections to unlock increased amounts of power onto the grid today. When you turn to Slide 17, we've set out for our -- for businesses like Greencoat Renewables, what the opportunity sets are and how we can take advantage of that in the short term and the medium term. Today, there are a range of ways that we are playing into this new market dynamic, including taking advantage of the power price volatility that we see by having the capability to lock in PPAs when we need to do that playing to the increased green PPA demand, and that's something that we'll touch upon a bit later in our data center platform as we see the increased opportunity to link being able to provide a whole solution to tech companies and being able to sell green power directly to them. We see the increased value in our portfolio having grid connection scarcity and the firm access premium that our portfolio has being able to do more with our existing grid over the long term. And in addition, co-location hybridization has now become core strategy opportunities where today, the opportunity to use the grid and add storage to add solar and use the grid in a more continued basis, provides both a near-term opportunity and taking advantage of the long-term embedded strategic value that we have. Nowhere more particularly, is that clear that in Ireland, and you can see on Slide 18 today, that the Irish market is 1 of the first markets to link through policy and growth opportunities. When you look across the Irish market today, you see a continued opportunity for growth into clean electrification and Ireland has set the 80% renewable target for 2030. In addition to that, given Ireland's significant exposure to data centers already and the fact that data centers are expected to consume 30% of electricity. This is creating the near-term need for significant investment into generation storage and grid reinforcement. All of this is underpinned by the fact Ireland has a very clear policy and infrastructure approach. And there is clarity as to how Ireland intends to allow large energy users, i.e., mostly data centers to intersect with the grid with a clear message that it will be driven by renewable generation, increased storage investment and continued using of the network. What this results in is a scarcity value with the grid access being the key constraint for large energy users and the demand for renewable electricity now increase -- supply now increasing. With a key message that Ireland is now a leading clean energy investment market, which sits at the intersection of real generation, good expansion and digital infrastructure growth. When we overlay that to our business, we see a market that will require up to EUR 40 billion of investment into renewable generation. And given Greencoat Renewables position, where we produce over 4% of our renewable electricity. We have an operating portfolio of 680 megawatts and with deep relationships across the utilities, the developers and the offtakers. This is positioning us to consider increased growth opportunities as the opportunity for growth emerges in the future. So with that, I'll hand back to Bertrand, who will give you an update on our capital allocation progress to date.

Thanks, Paul. So moving on to Slide 20. You might be familiar with this chart. Our capital deployment plans have not changed since the full year results. This is a self-funded plan and it doesn't rely on raising new equity, as we talked about. On the right side, you see the 5-year sources are nearly stable. And on the left side, you see how we are planning to allocate capital to each of the 6 pillars, broken down on an annual basis to 2030. As we said in the past, we are focusing the next 2 years on returning capital to shareholders, which is what the enhanced capital allocation dark blue segment covers. However, in parallel, but with a moderate level of investment, we are gearing up our value-accretive initiatives where capital recycling and allocation will ramp up as of 2028. On the next 2 slides, starting with '21. I would like to detail the milestone we have delivered for each of those pillars since March. So starting with short-term plan buybacks. We announced a EUR 100 million program, of which EUR 50 million has been formally kicked off. EUR 25 million of those EUR 50 million is now complete, has been completed over the summer, and we are now on the second tranche of EUR 25 million, which is in progress. This has been funded and is funded from existing cash and has been NAV accretive continuing shareholders with an average discount of 23%. In respect of deleveraging, we are accelerating with gearing expecting to reduce to 45% by the end of 2027 and to be mostly funded by our disposal program proceeds. For more and lately, a key focus for the business is around disposal processes, which are underway with refinancing discussion, having comments underpinning by showing a strong interest from our lenders. On Slide 22, those are the 3 value accretive initiatives that we're pursuing hybridisation, we have an attractive set of projects, and we have prequalified [indiscernible] with a combined potential capital deployment of EUR 100 million plus of which 3 are moving to the next phase in the next 6 months. Second, the green-green -- green digital infrastructure platform has been established, operational. First asset is progressing well. and areas we are targeting cash-on-cash return of more than 3x. We are seeing strong customer and partner engagement by this, I mean big tech company in Ireland, with an attractive growth pipeline emerging and light lately in respect of PPA, this remains a medium-term objective, and we build up on our ability to unlock premium price PPA and invest into earlier-stage contracted asset in the later phase of our capital allocation strategy. Next slide, portfolio disposal. So in this stream is probably the top priority that we have for the business. The portfolio review against a number of criteria you can show here have been completed. We have kicked off those processes. We have good response from the market, and we expect that more than EUR 300 million of assets will crystallize by and be complete by mid to end of next year. I'm going to hand it over to Paul, which will going to go in more detail in each of those initiatives.

Thank you, Bertrand. So maybe just turning to Slide 25. Hybridization, I guess, is becoming 1 of our key focuses when we think about unlocking the embedded value that sits in our portfolio and using our existing assets potential to create this incremental value creation. To remind our investors, we've been actively doing this since 2022, and we're looking back on the progress in that type of -- in that business model with now 5 years of run rate revenue. And you can see that over that period, the cash yield has averaged about 15% and the unlevered IRR that we can see in these projects, I guess, has been around the 10% level. So when we think about unlocking value in our portfolio today, it's based off the existing experience that we have and the capability that we have in the platform, not just to unlock those sites and to get the projects developed on a fast track basis. We're very pleased in terms of the opportunity in Ireland today. We see the policy continues to be supportive of co-location. We see the ability to use storage to provide additional services to the network and capture ancillary revenues increasing, and we're now able to benefit from access to the wholesale market. And so what that will mean for our business, as Bertrand touched upon, we have a range of projects today that we're moving towards preplanning phase. And we would, therefore, expect through the next 12 months to bring those projects through the next phase of development. and allowed the business to become ready for FID type investment. Turning then to Slide 26. We wanted to give a more detailed update on where we stand with our data center platform. and in particular, where we sat with the first project, which is the Drogheda Energy Park. Again, to remind investors, we made -- we closed this investment in February 2026 and over the last 6 months, we have been focused around securing planning, enabling the grid works to be finalized with the grid operator, taking control of the site and making sure the site was getting -- would be ready to move at a fast track pace and aligning the regulatory steps that are required in Ireland in terms of the large energy user action plan. Over the next 6 months, we expect planning permission to be -- to get to a more finalized position. We are awaiting a final decision from the commission plan [indiscernible], which is the planning appeal board to tide down the renewables that we would want to use in that project and to secure access to those to start to commence site preparation to allow the project to move towards a construction phase and then, in particular, working with the customers who we expect to be some of the larger hyperscalers to align their interest in the site with our development phase. In addition to that, we've put in place a fully operational management team to run the platform. And that team is focused day-to-day on managing the Drogheda site as well as focusing on some of the earlier opportunity sets, the emerging opportunity sets that we can see in emerging now outside Drogheda. On Slide 27, we wanted to clarify to investors how we see value being created. And Bertrand touched upon the 3x cash-on-cash return that we expect will deliver for sites that we then take through development. Our business model today is around unlocking new sites managing the development of those sites and then securing the customer and the clean energy that are required to allow the project to move into its construction phase. Today, we are in that second phase. So we're kind of moving from site secured land control and having local planning secured. And therefore, we're moving through second phase at the moment. with the view that we would hit a power land phase on that project on a fast track basis. Our intention is to take the sites further in terms of then tying down the customer and essentially securing the renewables that are required in Ireland to allow the project to move to a construction phase where we then have the ability to sell the project through to the type of long-term capital or hyperscaler that are more typical owners of long-term data centers. The valuations that we can see today in Ireland are attractive. For powered land, we see sort of 1.5 million to 2 million-megawatt opportunity. And then if you can take the project all the way through to ready-to-build phase that valuation range increases further from 2 million to 4 million a megawatt. Today's project in Drogheda sits at an initial 32 megawatts with the capacity to scale further to multiple phases. So this opportunity creates a chance for Greencoat to demonstrate not just the upside that we can capture from this development. But in addition to that, to allow us to provide renewable electricity to these projects and as Bertrand -- which is a key part of our value accretion opportunities in the long term. Turning to Slide 28. We've seen over the last 6 months, the opportunity in the data center market become much clearer with utilities with hyperscalers and with site owners now very engaged in terms of how we fast track access to new sites. Our evidence has been that hyperscalers are very focused on getting access to power and that is a key criteria when it comes to site selection. In addition to that, having access to grid remains a critical constraints with most hyperscalers focused on the short-term access they can get to power. And in addition to that, we see that access to flexible generation storage will become increasingly important due to policy. A second set of partners that we have worked with on a long-term basis are utilities and we're taking a number of inbound interest from utilities who are looking to partner, who can see opportunities to be much more collaborative in delivery models and have the ability to provide a range of services alongside our development platform ultimately to fast track the access to new sites. And then site owners more generally. There's a recognition today that having the capability and credibility to secure power is as important as having access to the land and therefore, site owners have a clear preference today to have access to credible delivery partners, which is what the Greencoat Renewables platform is able to do. When you bring that back together, and I think we've seen this over the last weeks, as we've seen some of the big tech companies move into other European markets. What we see is any solution is going to require a power first solution. It's going to require a capability to manage the grid and capability to add flexibility and is going to require access to significant amounts of renewable electricity. And we think that opportunity set over the medium term is 1 that's a very attractive 1 for the Greencoat renewables team. So therefore, maybe in conclusion, I'll bring it back to what Bertrand touched upon in terms of where the business sits today. And for us, the focus over the next 12 months read your amount is focused around our enhanced capital allocation. I won't repeat the feedback Bertrand gave, but for us, delivering the buybacks -- sorry, delivering the sell-down of assets, delivering the increased buybacks and the focus on the deleveraging is really critical over the next period of time. which then gives the flexibility to the business to unlock the value accretive opportunities that we can see over the long term. So with that, I'll hand back and hand over to questions. Thank you very much.

[Operator Instructions] Our first question is from Alex Wheeler from RBC.

Two for me, please. Just firstly, on policy momentum, you clearly highlight good policy momentum at the EU level. I was just interested to understand whether there was anything else within the geographies you're operating in that you're looking for in terms of policy that could be helpful in the future? Or do you now see that most of the investment targets and necessary policies are in place for you to deliver that would be question one? And then my second question here was just, Paul, just on your point around partnering with utilities and potentially the services that can offer there. Can you just elaborate slightly on how that may look in the future, if that was an avenue that you ultimately decided to go on.

Yes, I can take that. I guess, firstly, on policy, no, I think we feel pretty comfortable now we have a strong policy and what has really needed, I think, is the opportunity to invest at the right types of return. So we see the European market being 1 where it's a very good long-term market to invest into. And for us, the criteria to do so has really been able to deliver the attractive returns to investors and being able to invest at the right cost of capital. And I think we can see that opportunity set emerging as we touched upon across the value-accretive opportunities. But we look at policy today being stable. We look at the countries where we're investing as being stable and having a growth outlook -- and therefore, the criteria that we would approach in terms of increased investment into the future is 1 that will be led by the returns that we can secure on those incremental investments, which we think are -- the backdrop to that looks really interesting. And just to touch upon the utilities. I think it's a really interesting point. When you look at what large energy parks are going to require into the future they're going to require in terms of from an energy perspective, they're going to require increased investment into renewables. They're going to require increased investment into backup flexibility and storage and they're likely going to require investment also into some thermal generation to provide the stability on a long-term basis. And really, that's -- many of those areas play to the strengths of what traditional utilities are wanting to invest into. So the Greencoat Renewables capability is more led towards renewables. It's more led towards energy storage such as batteries, et cetera, whereas I suspect utilities are more focused today on a mix of that, but also capacity to build power plants and be able to build out the backup gas that might be required. And so that type of investment need lends itself very well to partnerships. In addition to that, the fact that we have our own platform that can fast track development that has experience of working alongside utilities for the last 10 years in our case, at least, means that sort of opportunity to find new sites and to unlock new sites and a partnership model works very well with utilities.

Our next question is from Kate Nurse from Davy.

Hi guys, good morning. Hopefully, you can hear me okay. Just 2 questions. Firstly, just on the Drogheda Energy Park and the new platform there. Are there thinking change on the opportunity there since it was first announced? And then I guess beyond that pilot project, is there additional sites you could acquire? And when would that take place? And then just looking at Slide 27 and the valuation framework there, about EUR 2 million to EUR 4 million range FID. Can you just talk about the evidence kind of underpinning these ranges, like in particular, is there a transaction benchmarks or discussions that support them.

Thanks, Kate. Yes, look, I'll take some of those and Bernard might come in if he wants to add to that. I think -- the first thing is, no, our view of what the platform -- the development platform we've created hasn't changed. We are best positioned to develop these sites to unlock the kind of milestones that we touched upon in terms of planning in terms of grid and in terms of customer engagement and prepare these sites to be able to be built -- moved into a more long-term finance strategy. So our view is the capital that we're investing into this platform is development capital designed to create the value uplift associated with de-risking these projects. And there's a very active access to longer-term capital that then can step in and become the construction and operating partner for these assets. These assets tend to be well project -- well asset financed and project financed under secured terms. And there's access to capital that is more akin to the data center sector that invests on a long-term basis into that space. And so we see a natural evolution or transfer, I guess, at that point of FID, where other more traditional digital investment can come in and own these assets on a long-term basis. I think to evidence that, yes, look, the benchmarks are pretty clear in terms of that transfer of value. And we've done a lot of work understanding the long-term finance that will step in to own these assets and the types of returns that long-term digital investors are seeking for these assets essentially allows the capturing of that sort of EUR 1.5 million to EUR 4 million per megawatt valuation. So what's important from our perspective is that we secure planning that we secure grid and that we're able to then provide the assets -- or the other aspects critical for the hyperscalers, which is really the renewable energy that they will require to allow them to then step in and become the tenant or the owner of that site. And then with that, I think given, in particular, the competitiveness of Ireland where each of the larger hyperscalers have their European headquarters as well as there being an increasing number of players looking to get access to that market. the competitive dynamics are favorable towards the sale of these assets at FID.

If I may add, I mean, 2 things, 2 observations. One, since we have announced strategy in Ireland. Since we have a real site on the go, it did trigger and credentialize quite seriously, the combination of green energy that we could offer to a site. So it really -- and we are the only 1 doing this into the Irish market, which is the best market you want to be in from a data center perspective. And as you know, we have been active to strike and enter long-term PPA with a range of corporate. I mean, tech company in Ireland 15 years. So this is quite -- it's interesting to see how the phone in Ireland has been ranging from those guys, and it has completely transformed our level of engagement with those people. So when I was referring to our capability to seek PPA. It's not only PPA, but more importantly is to extract premium value for the green electrons that are asset able to deliver. And this is really the strategic angle to all of this beyond making investment and good cash and cash returns. The second piece is when you look at the value creation, there's 2 metrics you should think of. One is a value per megawatt you are able to extract from the market it like a real estate, you have land and you have a planning and you have secured tenant. So those kinds of value creation, which convert into those euro per megawatt pricing. And it's also, to me, it's quite interesting, your ability to scale up your campus. So you may find that the per site with Drogheda, we indicated 32-megawatt but there is a capacity on the site itself to ramp up to 100 megawatts, and you have a neighboring country, I mean, in land, which could make you run up to a much larger scale, which is exactly the strategy. So the value creation of those is number of megawatts multiplied by the value you can extract at which point in time in your strategy, you decide to monetize those -- is that so much -- is that so much difference between powerline and FID in terms of risk you are taking. It's more the time it will take for you to secure the different component to get the project to this level of maturity.

[Operator Instructions] We'll now take our next question from Conor Finn from Barclays.

Just 1 for me on the Drogheda Energy Park. So if you soon say final planning secured later this year. What sort of time line then do you expect from [ farm ] grid connection offer?

Yes, look, I think -- so there are 2 milestones that we need to go through to be -- 3 milestones we need to go through to allow this project to move into its construction phase. The first is a final planning decision, we would hope to receive that in H2 of this year. The second is a grid offer, I think, which will follow that planning decision, but we would expect that to be months, not years, given we have an existing grid connection on the 38 kV line that will take a significant amount of Phase I power. So we have the capacity on site to get access to that. And then thirdly, under the new large energy user action plan, you are also required to have access to backup capacity plant. So that may mean that we put in for planning just to allow the building of that backup capacity plant on site. And I think if you put all of those together, it means we will probably be going through final development phases in 2027 to allow us to move towards into that sort of more FID/construction phase in 2028.