National Grid plc is one of the world's largest investor-owned energy infrastructure companies, operating electricity transmission and distribution networks in the United Kingdom and regulated electric and gas utilities across New York and Massachusetts. The company is listed on the London Stock Exchange (NG.) and has American Depositary Receipts trading on the New York Stock Exchange (NGG). It was formed in 1990 as part of the privatization of the UK electricity industry and has since expanded through a series of acquisitions into what is now a predominantly electricity-focused business spanning two countries.
Zoë Yujnovich became Chief Executive in November 2025, succeeding John Pettigrew, who had led the company for approximately a decade. Pettigrew oversaw a dramatic reshaping of National Grid's portfolio: the £7.8 billion acquisition of Western Power Distribution (the UK's largest electricity distribution company), the divestiture of the UK gas transmission business, the transfer of the electricity system operator function to government ownership, and a £7 billion rights issue to fund the company's expanded capital program. Yujnovich, previously an Integrated Gas and Upstream director at Shell, takes over with the capital program well underway.
The company's four primary business segments are UK Electricity Transmission, UK Electricity Distribution (operating as Western Power Distribution), US Regulated operations in New York and New England, and National Grid Ventures, which owns a portfolio of electricity interconnectors linking the UK to continental Europe. The connecting thread across all segments is regulated or contracted wires infrastructure — National Grid is not a power generator and does not take commodity price exposure in its core operations.
National Grid owns and operates England and Wales's high-voltage transmission network — approximately 7,200 kilometers of overhead lines and underground cables, and around 340 substations — carrying electricity from power stations and offshore wind farms to regional distribution networks. The business is regulated by Ofgem under the RIIO (Revenue = Incentives + Innovation + Outputs) framework, with each multi-year price control setting the allowed revenue, capital expenditure, and return on equity. The most recent determination, RIIO-T3 covering 2026 through 2031, set a real allowed cost of equity of 6.12% at 60% regulatory gearing and a baseline capital expenditure allowance of £4.9 billion for National Grid's transmission entity alone. The company has described the allowed return as lower than expected. UK electricity transmission is the business National Grid was originally built around and remains the segment with the deepest regulatory history.
Western Power Distribution, acquired by National Grid in 2021 for £7.8 billion, is England's largest electricity distribution network, serving mid-Wales, south-west England, and the West Midlands. Distribution networks operate at lower voltages than transmission, delivering electricity from the transmission grid to homes, businesses, and industrial sites via a dense network of local substations and cables. WPD operates under Ofgem's RIIO-ED2 price control (2023 through 2028), which sets allowed revenues and defines output targets across reliability, customer service, and low-carbon network hosting. The acquisition of WPD doubled National Grid's UK electricity asset base and was financed in part by the concurrent sale of Rhode Island electric utility Narragansett Electric to PPL for approximately $3.8 billion, plus proceeds from the subsequent gas transmission divestiture.
National Grid's US business operates regulated electric and gas distribution utilities across New York and Massachusetts. In New York, the primary operating entity for upstate electric and gas service is Niagara Mohawk Power Corporation, acquired in 2002. Downstate New York gas service is provided through Brooklyn Union Gas and KeySpan Gas East Corporation, brands inherited from the £8 billion KeySpan acquisition completed in 2007. In Massachusetts, National Grid distributes electricity through Massachusetts Electric Company and gas through Boston Gas Company and Colonial Gas Company, serving roughly 1.4 million electric customers and a significant gas customer base. Together, the US segment serves approximately 3.4 million customers. The New York Public Service Commission approved a three-year rate plan in August 2025 providing average residential increases of approximately 15% for electric and 20% for gas service. Massachusetts approved a five-year Electric Sector Modernization Plan in August 2024 with up to $2 billion in distribution investment.
National Grid has spent the past five years deliberately reorienting its portfolio away from gas and toward electricity. The logic is straightforward: net-zero energy transitions run through electricity networks, not gas pipelines, and the investment requirements to accommodate renewable generation, electric vehicles, and heat pump adoption are concentrated on the wires side of the business. The portfolio transformation has involved four major moves.
First, the March 2021 acquisition of Western Power Distribution for £7.8 billion gave National Grid the UK's largest electricity distribution business, adding mid-Wales, south-west England, and the West Midlands to its portfolio. The deal was the largest electricity distribution transaction in UK history. To partially fund it and satisfy regulators, National Grid simultaneously agreed to sell Narragansett Electric Company in Rhode Island to PPL Corporation for approximately $3.8 billion, which closed in May 2022.
Second, National Grid divested the majority of its UK gas transmission and metering business to a consortium led by Macquarie Asset Management in January 2023, with a further 20% stake sold in July 2023 for £681 million. The divested business now operates as National Gas plc, an independently managed company. National Grid retains no operational role in UK gas transmission.
Third, in October 2024, National Grid transferred its Electricity System Operator function to government ownership, receiving £630 million. The entity, now called the National Energy System Operator (NESO), is responsible for real-time balancing of the GB electricity system and long-term energy planning. The transfer removes an operationally distinct and politically sensitive function from National Grid's perimeter and leaves the company as a pure networks owner and operator.
Fourth, in June 2024, National Grid completed a £7 billion rights issue, one of the largest in UK corporate history, offering 7 new shares for every 24 held at a 34.7% discount to the ex-rights price. The rights issue was necessary to strengthen the balance sheet and provide equity funding for the company's expanded £70 billion five-year capital plan. The combination of these four moves has left National Grid as a significantly larger, electricity-concentrated business with a heavier capital program and a substantially larger debt load than it carried five years ago.
National Grid reported FY2025 revenue of £18.4 billion from continuing operations, split approximately £6.7 billion from UK operations and £11.7 billion from US operations (the higher US figure reflects revenue recognition conventions for regulated utilities rather than profitability weighting). Underlying operating profit was £5.4 billion, up 12% at constant currency versus FY2024's £4.8 billion. Underlying net income was £3.5 billion, up 20% from £2.9 billion in FY2024. Underlying earnings per share was 73.3p, up 1.2p year on year, with the modest per-share growth relative to the strong earnings growth reflecting the dilution from the June 2024 rights issue.
The company reports both statutory (GAAP equivalent) and underlying/adjusted figures. Statutory profit after tax was £2.8 billion in FY2025, lower than underlying due to exceptional items, remeasurements, and financing charges. National Grid's underlying figures exclude these items to present a cleaner view of regulated operating performance, and underlying EPS is the basis for dividend setting and investor guidance.
Net debt at March 31, 2025 was £41.4 billion, with regulatory gearing of 61%, in line with the company's target range and consistent with Ofgem's regulatory assumptions for the UK businesses. The company is rated investment grade. Capital expenditure in FY2025 exceeded £11 billion, a record for the company. National Grid delivered a dividend yield of approximately 5.6% as of late 2024, funded through a combination of operating cash flows and debt, as the magnitude of the capital program means free cash flow after investment is limited.
National Grid's £70 billion capital plan covering 2026 through 2031, increased from an original £60 billion commitment in 2024, is the defining strategic commitment of this period. The plan is allocated roughly £31 billion to UK electricity transmission, £9 billion to UK electricity distribution, £17 billion to New York regulated operations, and £12 billion to New England, with £1 billion for National Grid Ventures. The company targets 10% compound annual growth in its regulated asset base and 8–10% annual underlying EPS growth through 2031, using FY2026 as the baseline year. As of the updated plan announcement, approximately 75% of the supply chain and delivery mechanisms to execute the plan were secured, and approximately 67% of the required investment was covered by existing regulatory agreements.
The investment case rests on two structural tailwinds: the UK's legally binding net-zero targets require large-scale electricity network expansion to accommodate offshore wind, interconnection, and demand electrification; and the US Northeast faces grid investment requirements driven by aging infrastructure, clean energy mandates, and rising demand from data centers and EV adoption. National Grid Ventures' interconnector portfolio, which currently links the UK to France, Belgium, and the Netherlands, and has additional interconnectors under construction to Norway and other European markets, provides a smaller but high-return complement to the regulated core. Whether the company can execute £70 billion of capital investment in five years while maintaining credit quality and dividend payments is the central question investors face.
Ofgem's RIIO regulatory framework is the primary determinant of UK earnings, and the allowed returns set by each price control directly constrain what National Grid can earn on its UK assets. The RIIO-T3 determination for 2026–2031 set a cost of equity of 6.12% at 60% regulatory gearing, which the company described as lower than expected. If future Ofgem determinations — including the upcoming RIIO-ED3 reset for distribution — continue to set returns below the company's cost of capital, it becomes difficult to justify investing at the pace the plan requires. UK political and regulatory pressure on energy bills creates a persistent headwind against allowing higher network returns even as investment requirements grow.
The financing challenge is significant. Net debt of £41.4 billion is already large, and funding £70 billion in capital investment over five years with 61% regulatory gearing implies continued heavy debt issuance. The June 2024 rights issue raised £7 billion but the capital plan has since been increased by another £10 billion. If equity markets weaken or credit conditions tighten, the company's ability to fund the plan at acceptable cost is constrained. The dividend, yielding around 5–6%, is not covered by free cash flow after capital investment at current levels, meaning it is partially funded by debt and relies on regulatory returns eventually translating into cash. A dividend cut — the option of last resort for UK utilities — would be a material event for a shareholder base that holds the stock primarily for income.
This profile was compiled from publicly available information including:
National Grid Investor Relations — Annual reports, results presentations, SEC Form 20-F filings, and regulatory disclosures.
National Grid corporate website — Business overview, capital plan documentation, and regulatory submissions.
FY2025 Full Year Results (May 2025), Annual Report and Accounts 2024/25, SEC Form 20-F (FY2025), Ofgem RIIO-T3 Final Determination (July 2024).
This profile is for informational purposes only and does not constitute investment advice, a recommendation, or a solicitation to buy or sell any security.