LONDON, June 24, 2026, 13:07 BST
National Grid shares ticked up Wednesday after New York announced the 100-mile Smart Path Connect upgrade was done. The $438 million a year in consumer benefits the state projected doesn’t go to National Grid. The company gets paid via regulated returns from its part of the project.
The stock traded 0.12% higher at 1,227p as of 1302 BST. It moved between 1,216.5p and 1,228.5p during the session, and had a market cap near £61.1 billion. Shares sat about 14% under their 52-week high. The FTSE 100 didn’t move much.
The new line brings 1 gigawatt of renewable power and relieves congestion that blocks low-cost electricity from reaching where it’s needed. National Grid handled the 55-mile southern leg and put in a new substation, while New York Power Authority built the other 45 miles plus three substations. “As demand for energy grows, this project delivers renewable power directly to the businesses and communities that need it most,” said Sally Librera, president of National Grid New York. Governor Kathy Hochul
National Grid’s projected capital share landed at $535 million. The Federal Energy Regulatory Commission gave the project a 10.3% return on equity, based on a 50:50 debt-equity split. The full rate base — the pool of assets on which a return is allowed — would provide about $27.6 million a year in equity return. This isn’t company guidance. FERC also approved including all prudently incurred construction work in progress in the rate base from April 2023, so the project could start earning a return before it’s finished.
National Grid last month said Smart Path Connect was finished on time and within budget. Using the group’s fiscal 2026 average exchange rate, the $27.6 million return works out to about £20.5 million, around 0.5% of National Grid’s £3.86 billion in underlying earnings. The project is more about showing National Grid can execute on its £70 billion five-year plan than delivering immediate earnings. National Grid spent £11.6 billion in fiscal 2026 and is planning for nearly £13 billion in spending this year. “National Grid is embarking on the largest investment programme in our history,” CEO Zoë Yujnovich said. National Grid
National Grid’s investment is “ramping up as expected” and should back growth, Hargreaves Lansdown equity analyst Aarin Chiekrie said after the company’s results. The company is aiming for annual underlying EPS growth between 8% and 10% through March 2031. Shares barely moved on Wednesday, so there’s pressure for projects to come online smoothly without major cost overruns. HL
RWE (GER:RWE) is moving into grid ownership. The German utility said this week it will buy a 55% stake in transmission company Amprion for €3.6 billion and bring in around €4 billion via new shares. That puts regulated income into its mix. But raising fresh equity highlights grid companies’ tough funding needs.
Downside risk is tied to funding and how fast National Grid can recover costs from regulators. The company sees net debt rising more than £6 billion from the £44.2 billion it projects for fiscal 2027. If the Smart Path rate base lands under $535 million or cost recovery slows, the basic $27.6 million outlook drops. In May, profit missed market hopes after U.S. storm repair costs hit results.
