INVESTMENT OUTLOOK FOR 2023 - 30 - These goals are driving investment decisions: Along with the large sums for phasing out conventional energy in the utilities sector, more renewable energy infrastructure will need to be built over the next few decades, for example, for electrified fleets and the greater use of (green) hydrogen. As for the role of digitalisation in decarbonisation, data analytics can help improve (energy) efficiency. In selecting investments, our proprietary ESG framework has been fully integrated in the investment process. It includes a comprehensive assessment by our Sustainability Centre, while an independent consultant assesses the impact of each investment based on induced and avoided emissions, the net environmental contribution and ‘temperature alignment’ with the Paris Accord. Junior infrastructure debt, which delivers higher, equity-like returns, could be an attractive option Junior debt to weather the storm Over the past 10 years, infrastructure debt has offered consistently higher yields than listed bonds, partly due to the additional return investors receive for forgoing the flexibility of publicly traded markets. While infrastructure debt returns have remained fairly consistent, central bank rate rises have boosted yields on government and corporate bonds, sapping the yield premium. For investors seeking a yield similar to equivalently rated corporate bonds, this has made the choice between these two asset classes less straightforward. However, we believe junior infrastructure debt, which delivers higher, equity-like returns while maintaining debt-like protections such as covenants, and contained risk, could be an attractive option. We see growing opportunities in the telecoms space: glass fibre networks are rolled out in Europe, datacentres and telecom towers are needed for the explosion of data usage and new 5G technology. Overall, we expect infrastructure debt as a segment to expand further, not least as the need for financing around the energy transition and decarbonisation continues to grow.