- Company name
- National Grid
- Sector
- Electric & gas networks (UK and US)
- About
- National Grid owns and runs regulated electricity and gas networks in the United Kingdom and the northeastern United States. In the UK, it owns the high voltage electricity transmission network in England and Wales and the electricity distribution networks of the Midlands, the South West and South Wales. In the US, it delivers electricity and gas in New York and Massachusetts. Regulators set the revenue it can earn on its regulated assets: Ofgem in the UK and state commissions and the Federal Energy Regulatory Commission (FERC) in the US. National Grid Ventures owns interconnectors to other countries and other non-regulated businesses. In 2025/26, it sold National Grid Renewables and Grain LNG. Its financial year ends on March 31, and its American Depositary Shares trade in New York.
- Thesis
- The market prices National Grid for the cost of its very large investment plan and for the risk of regulation. The company plans to invest at least £70 billion in the five years to March 2031, and net debt rose to £48.6 billion at September 30, 2026, from £44.2 billion at March 31, 2026. It funds part of the plan with new shares, through a scrip dividend and a larger share count, which reduces EPS growth per share. In the US, a FERC order in March 2026 lowered the allowed returns on New England transmission. Investors also see UK and US regulators as under pressure to keep customer bills low. For the gap to close, three things must be true. National Grid must deliver underlying EPS growth of 15% to 16% in 2026/27, as now guided, and then 8% to 10% a year to 2030/31. Its regulators must keep allowing returns near the levels of the RIIO-T3 price control and the recent New York and Massachusetts decisions. It must keep its credit ratings while gearing rises toward the high 60% range by 2030/31. At the half-year results on November 5, 2026, underlying EPS rose 22%, and the company raised its 2026/27 guidance. The full-year results, planned for May 13, 2027, show the first year of the new plan. If these checks pass, the gap can close over the next three to five quarters. The main reason it may not close is higher interest rates, which raise the cost of the debt that funds the plan.
- Risks
- Regulators set the returns on most of National Grid's assets. A FERC order in March 2026 lowered returns in New England. Lower allowed returns or disallowed costs in future rate cases reduce earnings growth.
The plan needs at least £70 billion of investment to March 2031, funded with new debt, hybrid debt and new shares. Higher interest rates increase funding costs, and more shares reduce growth in EPS per share.
Large projects can cost more or take longer than planned because of supply chains, permits and workforce limits. National Grid says that it has secured supply chains for about three-quarters of the plan.
A large part of profit comes from the US and is reported in pounds, so a weaker dollar reduces reported results. Storms in the US also add costs.
- Balance sheet
- National Grid funds its networks with bonds, hybrid debt and bank loans at the holding company and at its regulated companies. Net debt was £48.6 billion at September 30, 2026, up £4.4 billion from £44.2 billion at March 31, 2026, because capital investment and the Joulent investment were higher than the £4.1 billion of operating cash inflows. Borrowings were £51.2 billion, of which £5.5 billion was due within one year, and cash, current financial investments and financing derivatives offset £2.6 billion. From April 1 to September 30, 2026, the company raised about £5.6 billion of new long-term senior debt and about £3.2 billion of new committed loan facilities. It had £10.9 billion of undrawn committed facilities at September 30, 2026. Underlying net finance costs were £722 million in the half year, up 6%. The company expects net debt to rise by about £4 billion more by March 31, 2027, with regulatory gearing of about 65%, and it expects gearing in the high 60% range by 2030/31. It aims to keep credit metrics above the thresholds for its current group ratings, and Fitch raised its ratings by one notch in June 2026.
As of Sep 30, 2026.
- Checkpoints
- Nov 5, 2026: Half-year 2026/27 results: EPS growth and net debt. Passed. Watch: Results that support underlying EPS growth at or above 13% to 15% for 2026/27 and net debt in line with guidance pass; lower guidance or higher net debt fails. Outcome: Underlying EPS rose 22% in the half year, the company raised its 2026/27 guidance to growth of 15% to 16%, and net debt of £48.6 billion was in line with its plan for about £4 billion more growth by March 2027.
May 13, 2027 (estimate): Full-year 2026/27 results: first year of the new plan. Pending. Watch: Underlying EPS growth of 15% or more and capital investment of about £13.5 billion, on track for at least £70 billion over five years, pass; lower EPS growth or a cut to the plan fails.
- Recent events
- Nov 5, 2026: National Grid reported half-year 2026/27 results. Capital investment rose 33% to a record £6.7 billion. Underlying operating profit rose to about £2.6 billion, and underlying EPS rose 22% to 36.5p, helped by the first year of RIIO-T3, US rate base growth and one-off fair value gains in NG Partners. Statutory EPS was 26.9p. Net debt rose £4.4 billion to £48.6 billion. The interim dividend is 16.97p, up 4%. National Grid raised its 2026/27 guidance to underlying EPS growth of 15% to 16%, with about £13.5 billion of capital investment, and kept its five-year plan.
Oct 5, 2026: National Grid said in a pre-close update that it now expects 2026/27 underlying EPS growth slightly above its guidance of 13% to 15%. National Grid Ventures & Other expects about £130 million of extra first-half profit from fair value gains in its NG Partners portfolio and stronger interconnector results. Half-year results are due on November 5, 2026.
Aug 3, 2026: National Grid announced a simpler operating model. From September 1, 2026, the Group Executive Committee falls from 13 to 8 members, with single Presidents for the UK and the US, a global capital delivery team and a global technology team.
Jul 1, 2026: National Grid Ventures agreed to invest $1.75 billion for a 35% interest in Joulent, a platform that develops contracted power generation and high voltage infrastructure for large US power users.
May 14, 2026: National Grid reported 2025/26 results. Underlying EPS rose 8% at constant currency to 78.0p, and statutory EPS rose 9% to 65.5p. Capital investment was a record £11.6 billion. The total dividend rose 3.8% to 48.49p. It extended its five-year plan to 2030/31, with at least £70 billion of investment, asset growth of about 10% a year and underlying EPS growth of 8% to 10% a year.
Mar 2, 2026: National Grid accepted Ofgem's RIIO-T3 price control for UK Electricity Transmission, which runs to March 2031, and upgraded its five-year financial framework.