National Grid PLC (LSE:NG.) has proposed a higher return on equity to reflect increased capital investment for its Upstate New York electric and natural gas distribution business, Niagara Mohawk Power Corporation (NIMO).
On Monday, the FTSE 100-listed group said it has filed a joint proposal for a three-year rate plan from May 2025 to March 2028 with the New York Public Service Commission, for which a final decision is expected in the next few months.
The plan includes a return on equity of 9.5% and funding for capital investment of $1.43 billion in electricity and $351 million in gas in the first rate year.
This compares to a ROE of 9.0% – with earnings shared above a 9.5% threshold, according to the nationalgridus.com website, and a capital investment in rate year one of US$743.8 million for electricity (and common programmes) and $200.6 million for gas.
"The proposed settlement will fund programmes necessary to maintain and improve reliability, integrate renewables and replace gas pipelines, promoting economic growth and advancing New York's renewable energy and emissions reduction goals," National Grid says.