Over $76 billion set aside for energy projects across the Atlantic over next five years

National Grid, an energy transmission and distribution company, has unveiled its investment plan for the 2024-29 period, earmarking £60 billion (close to $76.5 billion) for energy projects that will step up its decarbonization game and propel the energy transition momentum forward on both sides of the Atlantic Ocean, encompassing the United States (U.S.) and Western Europe. The biggest slice of this multibillion-dollar investment pie is expected to be spent in the U.S. and the UK.

While disclosing its refreshed strategy to be a pre-eminent pureplay networks business, National Grid outlined an almost twofold rise in investment compared to the previous five years, with around £60 billion designated to be spent over the coming five years to March 2029. The increase in investment is anticipated to drive 10% asset growth CAGR, with group assets heading towards £100 billion (more than $127.4 billion) by 2029.

Furthermore, around £51 billion (about $64.99 billion) of the £60 billion capital investment covering the period up to March 2029 is said to be aligned with the EU Taxonomy to decarbonize energy networks. The multinational electricity and gas utility player underlines that nearly 80% of capital investment will go into its electricity networks, with the mix moving towards 80/20% electricity/gas by 2029.

John Pettigrew, National Grid’s Chief Executive, commented: “Today is a defining moment for National Grid as we announce a significant increase in investment that cements our position as a leader in the energy transition on both sides of the Atlantic. Governments and regulators are moving with increased urgency to attract the levels of investment required to meet their net zero ambitions, giving us improved visibility and confidence over our medium term investment plan.

“That is why we’re announcing today a new five-year financial framework. We will be investing £60 billion in the five years to the end of March 2029 – that’s nearly double the level of investment of the past five years. We expect this significant step-up in capital investment will deliver annual group asset growth of around 10%, and 6–8% underlying EPS CAGR from a 2024/25 baseline, supported by a comprehensive financing plan that includes a £7 billion equity raise.”

According to National Grid, this investment program is backed by “a balanced, comprehensive financing plan,” including a £7 billion (close to $8.92 billion) fully underwritten rights issue. The electricity and gas transmission and distribution-focused firm also announced its intention to sell Grain LNG, its UK LNG business, and National Grid Renewables, its U.S. onshore renewables business.

Only months before this, Venture Global LNG and UK National Grid Grain LNG inked a binding long-term terminal use agreement (TUA) in a bid to allow the regasification and sale of LNG from all of Venture Global’s terminals in Louisiana, including CP2 LNG, subject to obtaining necessary federal permits.

“This is an unprecedented time for our industry that is creating significant opportunities for National Grid today, over the next five years and for decades to come. Our new five-year investment plan will deliver long-term value and returns for our shareholders, support over 60,000 more jobs, and accelerate the decarbonisation of the energy system for the digital, electrified economies of the future,” added Pettigrew.

National Grid has launched its high-voltage direct current (HVDC) supply chain framework which, together with SSEN Transmission and ScottishPower Energy Networks, plans to secure the supply chain required for offshore cabling requirements across UK networks beyond 2030. Recently, the company commissioned its sixth interconnector, the 1,400 MW Viking Link to Denmark, said to be the world’s longest subsea interconnector.

Pettigrew highlighted: “In the UK, our 17 major onshore and offshore transmission projects are moving ahead at pace, and in the US our $4 billion ‘Upstate Upgrade’ is underway representing the largest investment in New York’s electricity transmission network for over a century.

“Our sixth interconnector, the Viking Link to Denmark, came online in December and is the world’s longest onshore and subsea HVDC cable, demonstrating the world-class capabilities within National Grid. Alongside our new five-year financial framework, we are also today further evolving our strategy to focus on networks and will therefore be streamlining our business.”

National Grid’s $4 billion ‘Upstate Upgrade’ is perceived to be a collection of more than 70 transmission enhancement projects through 2030 to deliver a modernized, stronger, and cleaner energy network in Upstate New York. A set of contracts have been executed to secure the supply chain for the project, including circuit breakers and power transformers.

In addition, a seal of approval has been obtained for the Propel NY Energy transmission project on Long Island, a partnership between New York Transco and the New York Power Authority, which will bring offshore wind into the state.

Moreover, National Grid underlines that it has achieved a 5.9% reduction in its Scope 1 and 2 emissions versus 2022/23, an 11.8% reduction against the 2018/19 baseline, while total Scope 3 greenhouse gas (GHG) emissions have been reduced by 1.7% year-on-year. However, Scope 3 GHG emissions rose by 0.8% against the company’s SBTi-approved target, which excludes sold electricity.

Associated emissions linked to increased procurement spend for new energy infrastructure are said to be behind the increase. National Grid also connected 3,030 MW of renewable energy across its UK and U.S. transmission and distribution networks, a hike of 2,344 MW compared to the prior year.

Currently, National Grid is involved in two multibillion-dollar HVDC cable connections in the UK, known as the Eastern Green Link 1 (EGL1) and Eastern Green Link 2 (EGL2) projects.

These electricity superhighways are expected to enable Britain to bolster the security of energy supplies while also contributing to the country’s net zero targets, supporting the UK’s 50 GW offshore wind power by 2030 goal.