National Grid Unveils £7 Billion Rights Issue to Finance Major Grid Upgrades

National Grid has launched a £7bn capital raise to fund an extensive programme of electricity network upgrades, preparing the grid for the accelerating rollout of renewables and clean technologies.

Announcing the plan yesterday, the company said the new funds would support a significant £60bn investment programme to upgrade and expand electricity networks over the next five years.

National Grid highlighted that 52 per cent of the investment would be allocated to the UK, with the remaining funds spent in the US, where it operates transmission facilities in New York, Massachusetts, New Hampshire, and Vermont.

The £60bn 'Grid for Growth' plan, covering the period between 2024 and 2029, marks a doubling of investment compared to the previous five-year period. National Grid described it as a "huge growth opportunity" that would bring "significant benefits for the whole country."

In a video shared on the group's website, CEO John Pettigrew called the £60bn investment plan "unprecedented in its scale and ambition."

"As economies become increasingly digital, electrified and decarbonised, the need for energy infrastructure has rarely been more pressing," he said. "Our investment will unlock significant economic growth and, by the end of the decade, National Grid is expected to support over 60,000 more jobs while also decarbonising our energy systems, bolstering security of supply, and reducing consumer bills in the long term."

National Grid has invited its existing shareholders to purchase new shares worth £6.8 billion, launching a fully underwritten rights issue on the London Stock Exchange.

According to National Grid, this transaction marks Europe's most extensive rights issue outside the banking sector in the last 15 years.

Of the total £60 billion investment planned between 2024 and 2029, £23 billion is earmarked for upgrading and expanding electricity transmission in the UK, facilitating the grid's capacity to accommodate more clean energy.

An additional £8 billion will be directed toward National Grid's distribution business. This investment will enhance infrastructure, accelerating the adoption of low-carbon domestic technologies such as heat pumps and electric vehicles.

As reported, the funds for this extensive investment programme will also be raised through borrowing and selling assets and parts of the business.

Grid infrastructure continues to be a significant constraint on the growth of renewables in the UK. Some project developers have reported waiting times for grid connections exceeding a decade.