The UK’s National Grid, a leading enterprise in the energy transmission and distribution sector, plans to strategically invest a staggering £66 billion in its electricity network over the next five years. This initiative aims to stimulate economic growth while advancing the digitalization and decarbonization of the power system. In its recent annual performance report ending March 31, 2024, National Grid explicitly states that half of this investment will be dedicated to enhancing and optimizing its grid operations in the UK.

Furthermore, to ensure the smooth implementation of the investment plan, the company concurrently announced a fully underwritten equity raise plan of £7 billion. This plan will effectively raise the necessary funds through the issuance of shares to existing shareholders. National Grid emphasizes in its official press release that these actions align with its strategic plan to build “a world-class, pure-play electricity networks business.” Specifically, the company will allocate up to 80% of capital investments to support the robust development of its electricity networks business.

John Pettigrew, CEO of National Grid, commented: “Today, we announce this significant investment plan, marking a solid step forward in advancing energy transition across both sides of the Atlantic. As governments and regulatory bodies increasingly prioritize achieving net-zero emissions targets, our confidence and understanding of the mid-term investment plan continue to strengthen. For this reason, we have developed a new five-year financial framework, with investment levels expected to nearly double that of the past five years.”

In the UK, National Grid will invest £23 billion in transmission network construction to ensure the healthy operation of grid assets and meet the increasing demands of connecting offshore and onshore generation. Additionally, the company will increase funding for 17 Accelerated Strategic Transmission Investments (ASTI) projects.

In the distribution sector, the company plans to invest approximately £8 billion over the next five years, primarily for asset replacement, system reinforcement, and new connection construction. This will facilitate the development of new energy facilities such as electric vehicles and heat pumps, and promote the widespread adoption of direct connection generation methods.

Moreover, in the US market, the company plans to invest £17 billion in the New York and New England regions respectively, with 60% of the investment focused on the electricity networks sector. This effort aims to enhance renewable energy connections, upgrade transmission networks, and improve digital capabilities, thereby advancing energy transition.

Pettigrew further noted: “Supported by a comprehensive financing plan including a £7 billion equity raise, we expect this capital investment to achieve an asset growth rate of approximately 10% annually for the group. We anticipate significant growth in underlying earnings per share compound annual growth rate from the baseline of 2024/25 to 6-8%.”