National Grid (LSE:NG.) has become one of the most-watched FTSE 100 Utility stocks of the decade. With a record £11.6 billion of Capital-Investment/">Capital Investment in the year to March 2026, a fresh £70 billion five-year plan and a regulatory framework that runs to March 2031, the group is at the centre of the UK and US Northeast energy transition.

The May 2026 full-year results highlighted a step-change in scale: underlying EPS up 8% to 78.0p, Dividend-per-share/">Dividend per share at 48.49p in line with UK CPIH, and EPS growth guided in a range of 13-15% for 2026/27. For UK investors used to thinking of National Grid as a slow-and-steady income share, the new growth-and-investment profile is a meaningful shift.

Key takeaways

  • National Grid invested a record £11.6 billion of capex in the year to March 2026, with 85% classified as Green capex under EU taxonomy principles.
  • The group has committed at least £70 billion of cumulative capex over the next five years.
  • Underlying EPS reached 78.0p in 2025/26, up 8% at constant currency.
  • The 2025/26 dividend per share was 48.49p, up 3.8% in line with UK CPIH; the same CPIH-linked formula applies to 2026/27.
  • Net Debt rose 7% to £44.2 billion, with regulatory gearing held at 61%.
  • Underlying EPS is guided to grow 13-15% in 2026/27, with an 8-10% CAGR through to 2030/31.

Why investors are watching this FTSE 100 stock

For UK investors, National Grid offers a relatively unusual combination among FTSE 100 utilities: a long-duration regulated asset base, growing exposure to electricity transmission and a clear capital plan tied to the energy transition. The direct answer to "why now?" is that the group has just locked in regulatory frameworks on both sides of the Atlantic and is preparing to deploy more capital than ever before.

According to company updates, the RIIO-T3 price control runs until March 2031 and gives National Grid clarity on how to invest at scale in the UK electricity transmission network. The US Northeast businesses are also benefiting from significant rate base growth, supported by state-level energy policies.

Recent share price performance

National Grid shares have been volatile by utility standards over the past two years. A 2024 rights issue to fund the larger investment programme weighed on the stock initially, but improving execution, clearer regulatory visibility and rising EPS expectations have helped the share price recover.

Where the NG. share price stood in May 2026

According to publicly available market data, National Grid was trading around 1,290.50p on 14 May 2026, with a previous close of 1,276.00p. One source quoted a Market Capitalisation of about £65.1 billion at a recent share price of 1,309.00p, although figures vary depending on the timing of the snapshot.

Drivers behind the move

The recent move reflects investor digestion of the FY2026 results published on 14 May 2026 and the extension of the financial framework to 2030/31. The combination of higher EPS guidance, a CPIH-linked dividend formula and improving capital execution has supported sentiment.

How NG. sits against UK utility peers

National Grid sits among the largest UK-listed utility stocks alongside groups such as SSE and Severn Trent. Compared with pure-play renewable developers, NG. offers more regulated visibility and less direct exposure to power prices. That regulated profile is part of its appeal to income-focused investors.

Business performance and Earnings

The 2025/26 results demonstrated the scale of the transition under way. According to the company, record capex of £11.6 billion drove asset growth of 10.9%. Underlying EPS reached 78.0p, up 8% at constant currency, while the regulated asset base continues to expand on both sides of the Atlantic.

Net debt rose 7% to £44.2 billion as spending outpaced Operating Cash Flow, but regulatory gearing held at around 61%. The group has financed its growth through a combination of debt issuance and an earlier Equity raise, and Credit metrics have remained within the parameters set by ratings agencies. The fact that gearing remained stable despite the step-up in investment is a notable feature of the FY2026 results and reflects the regulatory framework’s recognition of higher allowed equity.

A significant share of the investment is being directed towards the UK electricity transmission network, which is at the heart of plans to connect new renewable generation, support electrification of heating and transport, and reinforce capacity for the long term. The company has signalled plans to nearly double the amount of power that can flow across the country under the RIIO-T3 framework. In the US, the New York and Massachusetts businesses are also benefiting from significant rate base growth, supported by state-level energy policies.

Looking ahead, National Grid has extended its financial framework to 2030/31. Capital investment is expected to rise to nearly £13 billion in 2026/27, with cumulative capex over five years totalling at least £70 billion. Underlying EPS CAGR of 8-10% from the 78.0p baseline is targeted, with 13-15% growth specifically guided for 2026/27. 85% of the £11.6 billion capital investment in 2025/26 was classified as Green capex under the principles of the EU taxonomy, underlining how closely tied National Grid’s growth story is to the energy transition.

Dividends and Shareholder returns

National Grid has long been viewed as a core UK income stock, although the rights issue and the larger investment plan changed the dividend trajectory. For 2025/26 the dividend per share is 48.49p, up 3.8% in line with UK CPIH. The board has signalled that the same UK CPIH-linked formula will apply to the 2026/27 dividend, implying a roughly similar percentage increase.

The CPIH-linked policy is designed to provide UK investors with a real-terms income, while leaving sufficient cash flow to fund the £70 billion capital plan. Yield figures can vary widely across providers and depend on the share price used; investors are watching whether dividend growth keeps pace with Inflation as the investment cycle accelerates. At the share price of around 1,290p quoted in mid-May 2026, the trailing yield implied by the 48.49p dividend sits in the mid-3% range, although different reference points can produce different figures.

In contrast to the previous policy of higher headline dividend growth, the current CPIH-linked approach reflects management’s judgment that more capital should be retained to fund regulated investment. According to the company’s communications around the rights issue and subsequent updates, the rebased dividend is designed to be sustainable through the entire 2025-2030/31 investment cycle, with scope for growth in real terms. Income-focused UK investors are watching how that policy is applied through periods of changing inflation, and whether the regulated business can deliver the cash flows needed to support continued real growth.

Outlook for 2026 and beyond

The May 2026 results announcement extended National Grid’s financial framework to 2030/31. According to the company, this framework targets compound annual growth rates of around 10% in asset growth and 8-10% in underlying EPS from the 78.0p baseline. For 2026/27 specifically, management has guided to underlying EPS growth of 13-15%, supported by capex of nearly £13 billion.

The underlying drivers are clear. The RIIO-T3 price control runs to March 2031 and sets out the framework for UK electricity transmission investment. The US Northeast businesses are progressing through their own multi-year rate cases. As long as regulatory outcomes remain supportive, asset growth and the regulated returns it produces should translate into higher reported earnings over time.

Risks to the outlook include slower-than-expected planning approvals, Supply chain capacity constraints in transmission equipment, and the cost of financing. If interest rates remain higher for longer, the cost of debt to support the £70 billion plan could rise, although much of the existing debt is at long maturities. UK investors are watching how National Grid balances growth, gearing and dividends as it executes one of the largest infrastructure investment programmes in its history.

Valuation and market position

National Grid trades as a regulated infrastructure business rather than a high-growth technology stock. Valuation is therefore driven by long-term cash flow expectations, the regulated asset base trajectory, the cost of debt and the regulatory framework. The new £70 billion plan effectively front-loads investment, supporting future regulated returns.

According to the May 2026 results announcement and analyst commentary, the implied compound annual growth rate of around 10% in asset growth and 8-10% in underlying EPS represents a meaningful uplift versus earlier expectations. Whether the stock continues to rerate depends on confidence in execution, the trajectory of UK and US interest rates and the willingness of investors to pay for a longer-dated growth profile.

Sector trends shaping National Grid

Multiple structural trends are pushing more spending into electricity transmission and distribution:

  • Electrification: rising electricity Demand from electric vehicles, heat pumps and industrial decarbonisation.
  • Renewables connections: large-scale wind and solar projects require new transmission lines.
  • Grid resilience: extreme weather and decarbonisation push higher spending on reinforcement.
  • Digital and smart grids: increased deployment of sensors, software and storage on the network.
  • Regulatory frameworks: RIIO-T3 in the UK and US state-level rate cases shape allowed returns.

Risks to watch

Despite the visibility offered by regulated Assets, National Grid is not without risk. The company is highly capital-intensive, and rising interest rates could increase financing costs even if much of the debt is structured at long maturities. Regulatory decisions in the UK and the US Northeast can change allowed returns and the pace at which investment is recovered through customer bills.

Execution risk on the £70 billion plan is significant: delivering major transmission projects on time and on budget requires supply chain capacity, planning approvals and skilled labour. Political and consumer pressure on energy bills can also affect regulatory decisions. Currency risk is relevant given the size of the US business when reported in sterling.

Another risk category is the changing shape of the energy system itself. As decarbonisation accelerates, the role of gas networks may evolve, with implications for asset values and Depreciation. Decisions about hydrogen, heat pumps and electrification of heating will shape long-term demand patterns. National Grid has been investing in pipeline replacement, safety and resilience programmes in the gas business, but the longer-term trajectory of UK gas demand remains an area of debate. Equally, on the electricity side, the pace at which renewable generation is built and connected will affect both transmission investment requirements and customer bills.