National Grid beats half year expectations amid New York dispute
UK energy supplier National Grid used its half year results to say that it is “confident” it would be able to address issues raised in a letter from New York governor Andrew Cuomo earlier this week.
The company is facing the risk of losing its license to operate its gas franchise in New York City and Long Island, with Cuomo having said this month that it had failed to provide “adequate and reliable service.”
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The figures
Underlying profit before tax for the year to date fell four per cent to £785m, from £816m in 2018, but was above the £748m that analysts had expected.
Earnings per share rose two per cent to 20p.
National Grid reported that capital investment had risen to £2.7bn, driven by an increase in US expenditure and the acquisition of Geronimo, a US clean energy provider.
The Warwick-headquartered firm also announced proceeds of nearly £2bn from the sale of its 39 per cent stake in the Cadent Gas Networks.
Why it’s interesting
The FTSE 100 company, which runs Britain’s energy systems, has had a tricky year, with problems in New York compounded by an investigation over widespread outages in the UK over the summer.
The blackout, which was caused by a lightning strike in August, left more than one million customers including homes, businesses, a hospital and Newcastle Airport without power.
The company said it would continue to work closely with Ofgem and Beis in their investigations, adding: “We do not underestimate the disruption and inconvenience this caused.”
National Grid also announced that it had set a new target of reaching net zero emissions by 2050, up from its current target of 80 per cent.
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National Grid said the objective will be supported by other work such as further energy efficiency programmes and renewable natural gas programmes.
What National Grid said
Chief executive John Pettigrew said: “In the first half of this year we have delivered solid financial performance and continued to deliver strong organic growth at the top end of the 5 to 7% range.
“We also made good progress on our strategic priorities, including agreeing a multi-year, forward rate case in Massachusetts Electric, submitting our draft business plans for RIIO-2 in the UK and completed our acquisition of Geronimo.
“In the second half, we are progressing our priorities across the Group including addressing the gas supply constraint in downstate New York.”
Main image credit: Getty