In developed markets, the grid equipment is currently 40 years old on average— older than it was ever designed to operate. Even without greater intermittency and distances, even without accelerating electricity demand, the world would need significant investment in upgrading the grid, and that would result in bigger budgets for cables, transformers, and switchgear.
With governments and companies likely to invest billions of dollars to clean up and modernise the world’ s energy system, the“ unsung heroes” behind the curtain are the companies likely to find their work more celebrated. And for us as bottom-up investors, that does not look to be reflected in their current share prices.
We can compare their valuations to those of a headliner, like Tesla, with its ambitions across electric vehicles, charging, batteries, and solar power. To join the show with Tesla, you’ ll need to pay up. However, the supporting cast and crew like Siemens Energy, Shell and Prysmian could cost you far less while still giving you access to the production.
While the spotlight almost always focuses on the acts taking centre stage, as the curtain rises it becomes clear that the cast and crew behind the scenes are just as, if not more important in determining the success of the overall show.
For more information about how we are investing around the critical energy infrastructure, watch our video: The unsung heroes of our energy system( www. orbis. com / uk / individual / insights / insights / theunsung-heroes-of-the-energy-system)
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