National Grid PLC (LSE:NG.) expects to earn £70 million more than expected from its Electricity System Operator (ESO) mechanism in the first half of its financial year ending on November 7.
In a quick trading update, National Grid said this is due to “ownership and held-for-sale accounting treatment”.
The ESO is the mechanism that is responsible for managing and balancing the electricity system in Great Britain.
It operates within a highly regulated revenue framework set out by energy regulator Ofgem, which limits what the ESO can charge generators, suppliers and consumers for these balancing services.
National Grid recently sold the ESO to the UK government for £630 million, putting it back into public hands for the first time since the 1990s.
The sale is seen as rational given the level of risk associated with operating the ESO came with only marginal profitability.
Elsewhere in the trading update, National Grid said: “We anticipate operating profit to be broadly evenly split across the year.”
Its US business is expected to be weighted to the second half.