Manage

RIEL continued to work closely with investment managers on ESG issues in directly held real assets and in making investments and divestments in line with the ROP. This close collaboration ensures maximum impact for the Trustee. The Trustee has a significant portfolio of real assets. Some of these assets are wholly owned and some are owned as a joint venture or minority interest. Through RIEL and its investment managers, the Trustee can take more direct action to address ESG issues and apply its ROP. Highlights of activity in the reporting period are as follows:

• Real estate

  The joint venture with Legal & General to develop retirement villages through Inspired Villages continues to provide opportunities for the Trustee to use sustainable technologies in its real estate with ground source heat pumps and solar power key features of these developments. Greater use of renewable energy will help residents manage their cost of living better and reduce reliance on fossil fuels with associated price volatility. As more villages are developed, the Inspired Villages team will look to optimise building design and energy usage.

  RIEL has worked with asset managers in the past to ensure real estate assets have reported to GRESB and have worked to improve their GRESB scores over time. The Fund’s directly held real estate portfolio has reduced materially and work to manage the remaining assets will preclude the relevant investment managers from participating in GRESB going forwards. Inspired Villages are working to implement GRESB reporting for the Fund’s retirement villages.

  

• Renewable energy

  The Fund continues to produce renewable energy from onshore UK windfarms managed by Vantage and Schroders Greencoat. The Vantage assets generated 219 gigawatts per hour of clean energy in 2022 (201 gigawatts per hour in 2021), equivalent to the annual energy needs of 81,000 households (69,000+ in 2021). The same assets contributed to 198 ktonnes of CO₂ abatement annually plus 359 ktonnes avoided by customers switched from heating oil to gas.

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  Shipping

  The Trustee has sold the majority of its ships. Generally, in each sale, the Trustee found that previous capital expenditure on energy saving devices increased the marketability of its vessels and these decisions made during the Trustee’s period of ownership mean that subsequent owners will benefit from greater fuel efficiency and lower emissions. The Fund’s carbon emissions will reduce as a result of the Fund owning fewer vessels (all other things being equal). The most significant energy saving project was a rotor sail retrofit on TR Lady which was completed on 24 June 2023. The vessel subsequently commenced a 10-12 month charter with favourable terms linked to the fuel saving produced by the rotor sails which is expected to result in a reduction in emissions of up to 10%.