National Grid Sees Upside to Rocky Energy Markets in U.S., Europe

Researched by Industrial Info Resources (Sugar Land, Texas)--Power infrastructure company National Grid plc (NYSE:NGG) (London, England) is optimistic about its future, despite numerous global headwinds. Earlier this week, the company said it expects Great Britain will have enough natural gas supply to meet demand through September while exporting to Europe. The company's U.S.-based business also appears to be in line with expectations, with significant progress expected on several key renewable projects. Industrial Info is tracking more than $11.4 billion worth of active global projects from National Grid, more than 75% of which is attributed to projects in the U.S.

Click on the image at right for a graph detailing National Grid's active projects in the U.S. and the U.K., by industry sector.

Nearly 90% of the investment value for U.S.-based National Grid projects is attributed to renewable-energy projects, according to Industrial Info's Global Market Intelligence (GMI) Power Project Database. Some of the heaviest investments are in Ohio, where National Grid's subsidiaries are seeking permits for the 120-megawatt (MW) Ross County Solar Plant in Buckskin Township, the 117-MW Dodson Creek Solar Farm in Hillsboro and the 47.5-MW Fayette Solar Plant in Jeffersonville. The company already is at work on the 274-MW Yellowbud Solar Project in Chillicothe, which it expects to complete toward the end of the year.

Ohio has seen a recent uptick in interest for solar projects. The Ohio Siting Board, the state agency that oversees new sources of power generation, approved proposals for 18 solar farms last year, including several from National Grid. Subscribers to Industrial Info's GMI Project Database can read detailed reports on the Ross County, Dodson Creek, Fayette and Yellowbud projects.

Last year, National Grid acquired PPL Corporation's (NYSE:PPL) (Allentown, Pennsylvania) U.K.-based utility Western Power Distribution (WPD), while PPL purchased National Grid's The Narragansett Electric Company, which services Rhode Island. National Grid said the sale of its Rhode Island business "continues to make progress" and expects to complete it in its fiscal first quarter, which ends in June. For more information, see September 27, 2021, article - PPL Buys Some of National Grid's U.S.-Based Assets, Bolsters Renewable Role, and November 19, 2021, article - National Grid Scales Up Investments in U.S. Renewables, New York Transmission.

National Grid's projects in the area include a $100 million liquefaction unit at its Fields Point Satellite LNG Storage Plant in Providence, Rhode Island, accompanied by a pretreatment unit. The units will process 20 million standard cubic feet per day of gas and produce 100,000 gallons per day of liquefied natural gas (LNG). According to a filing with the Rhode Island Public Utilities Commission, these numbers are not likely to change when PPL takes over. For more information, see Industrial Info's project reports on the liquefaction unit and pretreatment unit.

Much of National Grid's improved outlook comes from stronger-than-expected conditions in its home country. The company expects underlying operating profits in its U.K. Electricity Transmission and Distribution business to come in above guidance, which it credits partly to inflation. Britain is offering to export natural gas to various European Union (EU) member states, where gas storage levels are low as these countries cut back on Russian imports in protest of Russia's actions in Ukraine.

While Great Britain sourced only 3% of its natural gas from Russia prior to the conflict in Ukraine, the EU sourced about 40% of its needs with Russian imports. Last month, Russia said foreign buyers would have to pay for gas shipments in rubles instead of euros starting April 1, which most European buyers refused to do, prompting further concerns about supply. To date, only Lithuania has eliminated its imports completely.

National Grid is preparing to begin construction later this year on the overhaul and refurbishment of a natural gas compressor station in Lancaster, England, and expects to finish construction on a one-kilometer connection between an existing pipeline and a power station in Keadby, England. The Keadby station, which is owned by SSE plc (Perth, Scotland), is building an 882-MW gas-fired unit that is expected to wrap up this spring. Subscribers can read detailed project reports on the compressor station overhaul, pipeline connection and gas-fired unit.

Industrial Info Resources (IIR) is the world's leading provider of market intelligence across the upstream, midstream and downstream energy markets and all other major industrial markets. IIR's Global Market Intelligence Platform (GMI) supports our end-users across their core businesses, and helps them connect trends across multiple markets with access to real, qualified and validated project opportunities. Follow IIR on: LinkedIn.