# National Grid sparking into action

By Aarin Chiekrie — 2026-05-14

Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said: “National Grid’s looking to plant itself at the heart of the electric revolution, with £11.6billion spent modernising and expanding its energy networks across the UK and Northeast US last year.

“This forms part of the group’s recently upgraded plans to invest at least £70billion over the five years to 2031, marking a huge step up on the prior five-year period.

“It comes as it looks to support the electrification of industrial demand, as well as growing demand from data centres amid the rise of AI.

“And with National Grid’s revenues linked to the value of its asset base, this step-up in investment helped fuel underlying operating profit growth of nine per cent to £5.7billion last year.

“Looking ahead, National Grid looks relatively immune to the knock-on effects of the Middle East conflict.

“It has limited exposure to wholesale energy prices and its revenues are positively linked to inflation, providing a natural hedge to these otherwise unhelpful dynamics.

“Higher interest rates shouldn’t be too much of an issue either, as around 80 per cent of the group’s debt pile is locked in at fixed rates.

“As a result of these defensive characteristics and the step-up in investment, National Grid expects to grow underlying earnings per share by between eight-to-10 per cent annually over the next five years.

“The current 3.9 per cent forward dividend yield looks well covered and is expected to continue growing in line with inflation.

“While the sheer scale of National Grid’s investment plans brings some execution risk, the group has made good progress in delivering them efficiently so far.”

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