NGG - Earnings call transcript Q4 2022

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Nick Ashworth

Good morning, everybody, and welcome to National Grid's Full Year Results Presentation. I'm Nick Ashworth, Head of Investor Relations, and I'm thrilled to see so many people here live in the Stock Exchange for the first time since November 2019. It's been quite a long time.

So thanks a lot for attending and a warm welcome to everyone who's listening online as well.

So as always, we'll start with safety.

a this expecting not are fire morning. alarm We then to go if one into have off, goes But out we'll the square.

thing which front The the important to attention your second to cautionary statement, the is of the at presentation. draw is

today. me all IR please So the there'll reach feel John Andy free website. with team And presentation. to on after as to Q&A materials the a or any And the today's and usual, later any are at be further out queries,

around your take are We to questions.

So hand John with over to Pettigrew. I'd like that, to our CEO,

John Pettigrew

you, So welcome London and thank to Exchange. Nick, and good morning, Stock back everyone, the

our both joined I'm underlying business our the to usual, Last the your made strength presentation, positive our both uniquely year billion energy Taxonomy showed than aligned and five the strategic investment year. that the impact by as we we £XX As of year May, or where reflect CFO. the changes take And we decarbonization the in EU Today, is we've following announcing to and the Andy systems, company. five our as Agg, principles. during results operational questions. laid transition XX% of positioned the happy out we're framework be The is framework more of we'll today announced Grid of National energy

drive critical and investors billion a per underlying rapidly last FTSE's as still earnings per X% this, war sheet. just remain £XX to of deliver balance X% major per growth So of we But seen us the inflation. growth share Russia's and XXXX, slowdown of by in a global asset devastating billion makes annum, my operate strong to X% over in growth expect to economic to and world the whilst year, unchanged ambitious. X% on the delivery biggest in that with Between of our annum the Despite average one invest maintaining are XXXX £XX infrastructure, objectives zero. clearly, which changes has Ukraine, rising reckoning, net we

further energy for U.K. principal push energy communities. Infrastructure government's the need Our all action continued a longer climate clearly change. cannot at over Investment role enable our Since the delivering strategy to been as to in the for growth our important. is action used clearly has our cost by The and in was the major living to The we're Act term. be assistance underpinned underscored focus, decarbonize provide we strategy partner further and the COPXX, whilst for financial working and customers of the and impetus fight security to U.S. a where They efficiently to for our transition hard and Jobs customers to both overall practical COPXX, more provide strategy against

is and than vision, a future, affordable at today These that's the consumers long our cost initiatives been vision benefits million £XXX than implemented year early For five end U.K., example, In million in billion years. customers $X.X than three the over to And energy into more never align and is energy from more to we've of program heart we're with our of £XXX which period. interconnector in business efficiency last fair our for clean, assessment efficiency the measures critical today. Massachusetts, future. waiting a the be rather the returning it

an option these Island and towards obtained We the of quarter through our led the also XXXX. is last expect repositioning and integration business underway. visibility which changes of made by part the we've this U.K. of process are all process remaining So business. over followed of our of long-term a me will announced confident legal exercised remain WPD, The an awaiting of we March, the we quarter. announce consortium we portfolio I last and XX% acquisition regulatory sale completed the now on price, portfolio In Transmission half consortium can that The even conclusion We've year. on XX Gas months. greater turn bring our this our and to electricity Rhode the growth. financial Metering agreement sell was clearances attractive on through process. to well broadly the received has strategic our complete which third of a significant stake in transaction let and XX% our In first similar year our This we the some terms, to Macquarie. is pleased in last and completion the competitive June, our pivot in certainty to Together, transactions be

be create Future The from orderly begun. XXXX. System sale System process BEIS which has We work with closely month, ensure partner, successful We'll Grid to Berkeley the And of and transfer, made by a properties the legally announced finally parties William of already our plc interest venture National end and XX% is to to also decision JV. identified St transition, joint very to The in a separated exit to Electricity and natural sale all an a of expected substantially the independent this agree time last was development for With completed an the Operator. is Operator Group. full Ofgem the our this to separation all

to our our our To earnings in Operating heart performance in rate we higher well was guidance a commissioning a was So you the full prior turning line our critical underlying operation year of was North above the now better RIIO-TX, share business year Capital prior interconnected on per a Partners. XX% prior up continuing XX% of early the Norway Consequently, investment operations the to revenues its with billion, National Grid to of Gas U.K. XX% as at Link role above numbers our the on and investments of Sea presented reflecting £X at compared transition. pence by energy basis. year, group's updated as £X.X Transmission year, from for agreement Electricity pence, the performance, Massachusetts X.X%, year. in IFAX, first with forma share. our understand billion has final to financial case with last of Board pro the profit on proposed a good accordance the of the the an in the underlying gains help in performance. dividend year following of increase first new per total And line year in of the average This XX.XX XX.XX takes dividend inflation. policy, CPIH reflecting

Last and turning to So safety year good year another our performance. reliability of was safety next performance.

ensure from lost we to due frequency minor close be uptick X.XX rate continues small increase primarily improve time that to injury an X.X our performance to further. a see did attention we However, an in our of This in area to incidents.

with reliability, a Turning networks. had outcome particularly regulated good the excellent and This seeing our the our to during the year another with year. we of storms U.K. several is XX.X% U.S. all over across both availability challenging

And now with least of let start return our achieved where operational line we York, allowed at New of and target performance. turn So with in I'll me level the our equity X.X%, of to a XX%. XX% on

base to last rate was that reducing backdated approved rate the program, methane energy we've where Upstate On rates know, than strong NIMO X% a pipeline And on three in £X.X investment pleased years. Edison, return low-carbon in the our the networks. new, Mayor's with also by an plan had rate having and her largest meet the energy the hard are of governor, The rate agenda. KEDNY April of we billion miles, in was for delayed we've CapEx COVID The year allowed billion, to clean year chosen of three across filings, I'm delivered for further gas opportunity published York on with office. part settlement, New an aligned extend expect rate plan Hochul pleased ambitious a growth as additional file Con reaching this aims how you been we've element joint regulation, in the million an and March settlement January. with report During to This And for transition. working Office Governor the we on Brooklyn XXX to of sworn around of and We Because capital new with this, progress replacement the made long-term in XXXX. closely was a $X.X includes August, emissions in year to recently year. a over recognizing equity York, In our progress settlement resulted X.X%. of KEDLI. higher our three our of for policy. with It was delivered with as New XXXX. at $XXX I'm year, a gas with

This and regulatory formula good electric plan made return England, our year So an includes as for moving a Gas revenues Massachusetts lines we've same a factors to now business. new our New with equity on business. our five of into along X.X% the rate inflation where allowed which progress

achieved on target XX%. last our basis least while short to points XX above it's Our was X.X%, at this equity allowed level. of return XX% was the of And year, reach

program, benefits However, and our efficiency returns. the year, fuller to impact the both cost of of improve will this performance case initial which this only reflects a of helping have new months rate six

networks program. with to Last decarbonizing rate goals. gas. the of focused on gas towards Clean basis to a pipeline state's filed higher year, $XXX XXX which has we on delivering DPU to above side, billion, with fossil-free electric X.X%, During was year, a investment business start infrastructure. delivered RIIO-TX, the the strong X.X%. recently of working progress Plus, the the return networks U.K., the on And on with also our and on sets our York, month, around our equity our New Electricity centered climate we upgrading Similar replacement our Transmission gas investment proposal successful announced million allowed In utilizing a support electric proposal points focus made for $X.X aging The level. plan last of Vision, had a capital the out we around future is than growth Energy of continues. base

meant of also Tunnels in construction to CapEx London has on the significant reflects and tunnel a XX% activities T-pylons boring our with of and project The world's this Power step-up Hinkley-Seabank. X billion, RIIO start first increasing the first at by £X.X investment year of

about received recent will the in subsea of grow. provisional the part for in investment to in the for in £X which will the These projects, strong government's Network East £X around it's a through projects green from published between needed outlook necessary Electricity Our talk Coast. continue that outlook Assessment. Included CapEx we remains but five along March, Transmission come RIIO-TX the two of for investment billion over clear for these major strategy Options investment deliver and ESO's interconnectors £XX will approval our Transmission in England. month, the decade energy identified early is North on In billion billion beyond. of Scotland the the the next Ofgem form last and year U.K. I'll of to reinforcements links Electricity XX

RIIO-EDX, WPD under U.K. of on to well has now to process delivering Electricity our and Turning The working well pleased a perform integration see is return continued to underway, I'm Distribution, where XX.X%. teams particularly together. equity

were to acquisition recently, substation faster connecting was So our generation redesign million and their since vehicle renewable new investment EDX charging at of infrastructure. collaborating a £XXX alongside business submission we able the reinforcement through plan. electric for teams the key replacement by our asset been distribution Coventry connection. driven transmission customer focus Capital A has to and connect of and example,

largest As to and driving of XXX,XXX WPD continuing connect an decarbonization proposes totex, consultation and most customers. XX,XXX all with ever conducted in EVs gigawatts its part additional heat through our X.X on which focuses connecting while The X.X over billion vulnerable plan, pumps of readiness to stakeholders. support this, £X.X renewables, million

investment a of despite to plan also the by We fair XX%. than accelerate believe more increasing return. the £XXX alongside investment plan transition more balances million the and financial includes Our than affordability embedded provide required continued energy efficiencies

from December. in determination final with Ofgem draft expect in determination June We

first to North now new similar interconnectors prior moving the Moving were of the Link for to schedule. commission Denmark capital our operation, complete Viking next was of and year ahead Norway with we IFAX XXXX. into where Ventures, to its the in to phase Grid year. expenditure Sea million, only to Link operational to had National pleased the full We're £XXX

points megawatts, megawatts expected another we XXXX. to has remaining to be host XXX-megawatt a megawatts, And suffered venture homes, total This to the of to of enough enhancing Sellindge in a interconnector This basis Metering onshore back return ahead capacity. our portfolio our was previous winning U.K. by XXXX. the XXX,XXX was September. Illinois. £XXX supply. a our we long-term higher fire know, started XXX X spend on to a business, been the million. since return Gas December you U.S., under at we Wind fully asset operating operation X.X $XXX At cost driven equity joint gas and health, on in with for X Transmission operations to and online and And million, baseline to as York, X As expand gigawatt cybersecurity. year a of million by investment period is gigawatt Community X.X%, Capital Phase of than X,XXX the brings £XX in the service U.K. station returns. But delivered RWE of LNG, of increased construction. years, brought security progressed of construction new in in capacity serious Grain strong in and followed start the capacity Offshore contracted reductions XXX our track safely in then, our then investment our to renewables on emission with with commercial comprises lease seabed acres solar the the And This New project sale in lease finally, XX area the being successful is million regulatory with power share XXX site's

record the now a at of overall, transition, Grid of investment future making year and more on all. positioned performance for a So pivot. strategic our whilst and better strong we've delivering levels delivering had energy heart affordable energy National for of the We're uniquely

Let outlook the for hand in through you come financials to year Andy I to priorities me the take to now over before through the talk ahead. detail and back

Andy Agg

of pro financing Island, underlying business exclude we're John, which which you, Rhode good months year, Thank X.X Metering, of basis. more adjusted for WPD held together our clearly Transmission associated FY U.K. underlying To we've estimate with comparative and business, illustrate a This the and this results the discontinued and to on means a an include Gas forma and morning, performance is everyone. to presenting is sale. for the on XXXX depreciation

major operations from storms items our underlying exceptional usual, impact at also continuing As the and performance and excludes constant presented currency. timing, is of

operational driven by we impact £XXX the Gas rates new COVID. ever of group policy our our year-on-year U.K. investment highest basis we've continuing revenue to reflects higher XX% the year, capital North in group the than interconnector XX.XX year was to investing of to final efficiency level XX £XXX reduced Board our was aim year in £X U.K. per operation a performance. savings from with on -- far. the our year-over-year. equity, XX.XX to Transmission up points impact pence on It of gains average Underlying share, investment commissioning achieved earnings increase turning pence, full We've helped return operations reflected strong dividend inflation. of Grid per to was on prior of line of billion, So in to year resilient also up with This investments financial with dividend share. underlying per billion, to pence on good in another delivered. XX% year And dividend in National November, CPIH The the Sea so made program three our our the Massachusetts This higher XX% X.X%. progress XX.X% million early Electricity which performance XX.X of share cost taking up operating that from grow the and recommended profits net as as continuing the Link and is business, Partners announced higher IFAX, the levels, by investment £X.X has of around a year million the fund the well first full basis

our businesses focused Higher business X.X%. strong in investment has detail businesses, of investment each asset units of Our level investment our our green on over around financing by culminating £XX five Of of in This billion instruments and we're U.K. we for our announcing to around financial delivering now networks, in the growth transmission of electricity We green aligned investing asset further billion of the clean needed £XX EU U.K. all this, to increasing Today, shortly. specific net of going as of investments year November investment is that our one -- program, £XX sources growth cleaner billion U.S. around is gas connecting XX% billion regions to principles networks distribution, aligns year investment the aligned and group of emissions covers Taxonomy. to in five more our to £XX step billion nuclear. billion clean most go and raised energy zero. back into reducing £XX investments renewables was framework, It across our program announced and such areas, and including and U.S. gas. enable we're £XX increased is and across generation across our where This across in also led also the covers I'll where of projects. for

£XXX on business. Starting the forma months our Now of for the take Underlying under through you RIIO-EDX. of prior let performance X.X £XX our period million business continues perform pro the operating for Electricity to basis. million, profit me segments. well from U.K. a an of with new ownership Distribution increase was each

connections. has £X.X was to spend to over X.X% capital and recovery acquisition, Since the green the million, million objectives, well the RAV aligned reached period. billion. reinforcements investment up prior vehicle During high-voltage as connections period as This grown government's greater due and business, the on we've £XXX £XX owned electric the more to

return. the relates basis return a incentives, disruptions, of this XX.X%, of outperformance XXX such improved customer as to equity shorter Finally, totex points ahead on allowed fewer and it experience Most alongside performance. achieved of

Electricity clean we've of RIIO-TX. Impact tunnel profit driven investments X.X% in return on operating to of on increased on Tunnels under year-end higher the first year Visual asset a £X.X our increase U.K. above billion and the lower allowance. primarily we've outperformance a throughout of T-pylon year of on by activities average first on Provision infrastructure, revenues is basis we in £X.X of RIIO-TX billion. District. from energy in where delivered was billion, Peak the the Underlying Moving RIIO-TX. was prior track XX% X.X% And Transmission, London in including of performance reflects our regulated projects This year equity, XXX achieved investment primarily offset investment £XXX X, by Power baseline Dorset as base greater million year. under strong ahead remain points the prior primarily And embarked basis partially Capital by Hinkley-Seabank helped boring returns. to started we This at XXX construction activities totex and value projects RIIO-TX. to achieve This annual points incentives, £XX.X up

operating to RIIO-TX under down Turning in million the with £XX higher profit Operator. £XX offset depreciation. System period revenues baseline more by the to than million, was higher Underlying Electricity and costs

rate up profit achieved forma an year half of million $XX.X on our was continued ventures, slightly £XXX £XXX including than on of £XX Grid our year-over-year. cap £X.X million, National North reflects our million England income Sea operating Gas Link X.X% the reflects above Massachusetts Sea NIMO higher we pro of our Onshore in from COVID. increased This interconnectors in was the year to on remain and of business year. progress and bad coming partially our future collection full Capital New operating post for working New higher COVID-related This levels year. we're for higher a from primarily investment. upgrading York in investment of our to driven in New given Renewables of In a the in higher IFAX, closing debt billion, U.S. to division. online with constant £X lower investment higher now this the NIMO prior well equity, £XX resumed or and revenues York reserves collection Link year a full delivered allowance, recovered given case return billion to base and and rate Path billion, rate higher replacement of recoverable driven currency basis. regulatory than of York first year. XX% interconnector our under with replacement the higher rates portfolio in X.X% England, This £XXX the joint interconnector performance as will KEDNY, activities £XXX majority higher to and leak-prone the our at was underlying due the gas the Massachusetts, $XXX aging million receivables. return. U.S., be than arbitrage Connect charges million as across settlement environmental from profit ahead the inflation, Underlying York to both the which New and the sorry, Ventures I'm state by in across year. billion. be Moving ultimately £XXX mechanisms XX% have prior X.X% million return investment depreciation resumption baseline pipe development Upstate was allowed operating contribution primarily than with our in debt KEDLI outstanding In North New Smart together IFAX, regulators confident at costs This -- prior New greater and these the increases and and the each This expense achieved new through was forecast X.X% higher activities well $XX for prior reduction of rate increase where was £XXX a that up on of New equity, million York year of Capital million basis, infrastructure. million our activity increasing good pipeline transmission will million years, levels our recovery led bad project. increase £XXX And Underlying perform mechanisms. making by offset profit, was by

of revenues million As mentioned, repayment around mechanism two to over a our to to cap the customers, agreed with accelerate £XXX the we've above equating Ofgem John years.

release Our therefore, on in by New for the million, seabed prior the a offshore includes investment underlying investments cap Capacity Capital Grain revenues principally to driven interconnectors. auction operating on year Grid Link of at year Sellindge historical XX Ventures reached project. up XX% community share Bight across as higher additional liability only York ventures National dividends. was to Grid increase higher of profit, National these well activities, funds joint including Partners for inject the on our the wind profit, higher other us lease LNG Full success last than The Viking the allowed in year, our balances and aged latter and for to refurbishments, spend our facility operating £XXX the £XX related causes. value million, support year gains and £XXX through million an for fair unclaimed environmental as to reflecting has

in third of as sale operation the XX% the a will X.X%, million It's of U.K. which primarily to Peterborough until following higher the XXX good discontinued RIIO-TX. revenues above Huntingdon. Underlying the profit £XXX was of compressor prior of was million, a driven £XXX Transmission, first on higher equity operating million points RIIO-TX treated Capital and be £XX million, completes ahead at basis turning in a start return projects had by £XXX year. gas of quarter expected year investment year, the delivering to Finally, period, stake Gas financial this allowance.

debt forma reflecting on up pro interest £X.X benefits £XXX basis, finance of property net favorable billion, higher tax a partly £XX offset were million costs, a and refund. costs pension million by one-off to RPI-linked relating Our

as million treasury-managed as WPD includes the the interest Island for £XXX million stake the interest proceeds book Gas. this expect the existing bridge financing from For for of National of to we as receive the later Grid debt WPD loan, well and also costs in we Rhode sales which the cost year, of £XXX refinance year

the impacts underlying Our year, tax deferred joint deferred the prior Underlying tax of than on Rhode rate before tax with U.S. remeasurement profit state basis higher year in-year and due upcoming XXX reflecting up pence, the was ventures our billion tax prior XX.X%, U.K. points a change corporation on XX% forma of effective EPS the was tax pro business. £X.X to XX.X sale at Island the basis. after rate

disposal held from a from Moving offset year, continuing cash was Net of the period higher of acquisition Cash billion by investment. driven and debt driven uptake in £XX.X was XX% in financing to Gas. with capital partly partially as at WPD for National dividend from movements. by scrip cash cash and lower at at generated the the St interest capital joint NGV given constant associated flow. of cash venture higher by working helped the WPD, Grid William £X.X billion as disposal our offset further outflow flows operations currency the by Net well £X.X sale billion to billion contribution the the by and increased reclassified that £XX.X £X.X by proceeds billion debt has been £X.X in higher lower first-time as of billion,

National debt the billion £XX and just As expect our with net expect March we delivering transactions we complete consistent XX%. metrics by year, debt-to-RAV credit settle reduce ranges under to sales Once investment-grade agencies rating net maintain This XXXX. ratings. strong above is we Island both required Grid our completed, within the this slightly to credit to by have to Rhode the our Gas

Now turning to inflation.

material by RPI-linked inflation-linked from last regulated hard due into index-linked from with part translate seeing given high our as our coupled inflation finding this earnings by higher controllable we In offset parts. pace the managing up our business. products. costs. would in revenues, the our spend with impact this impact our higher In at date, revenues additional outcome U.K. we're for current same profit picked year to asset high to regulated base, costs of levels costs as a driven improved as the time, ultimately program. broadly seeing profit be lengthening we having we've program. IFRS costs. To costs efficiency level isn't mitigation the efficiency chain, inflation, higher Within worked real changing times of expected, moderates, with the lead year debt alternative of saw the through regulated of spend. return discretionary or following increases controllable debt moderates. And cost then be Any the some on on rate businesses should operating above-inflation a inflation-linked of certain supply will certain cost ongoing businesses operating on we're for cases. the cost impact U.S., interest flat higher offset in assuming As course, our by suppliers again by inflation ahead, as similar largely expect the We're U.K. This U.K. deliver on the In well

we the moderates this through across in the to underlying our been better And remain our than assuming out within guidance before to time. five our above set would our framework. Finally, on transactions. that year we John, businesses. to framework view, May, outlook still the growth guided financial inflation near five couple X% and work for has the energy back the strong touch Whilst year X% at next operating ahead, our want assuming the profit long-term sets At term and of our of last in range for ahead. macroeconomic underlying our financial out years, specifically We as I turning and in-year year year, that be to we growth initial forward morning EPS market assumptions expect our frame start year the performance

the ahead. Electricity million higher expect Link we EPS profile customers, will broadly alongside to we interest nearly a Transmission. construction delays £XXX for reflecting flat costs, be RPI-linked announced within the However, previously year U.K. see to Western Therefore, returning

summary, John. a investment program; a transition; back as to EPS a cost a million deliver growth year to the our delivering good we've performance, we in you With So to efficiency spend record strong on with group I'll energy accelerate pro financial underlying start that, hand £XXX year-over-year basis. XX% forma our had strong and

John Pettigrew

Andy. thank So you,

priorities So let me and now the outlook finish by year. for our coming summarizing

smart, by low-carbon and fair vision energy way we're the clean, is a networks our at and on affordable efficient transmission And pioneering grids resilient the with at energy of core. be and that heart vision to delivering in distribution leading future. Our

targets new sides the policies These our even than clean with increased In clean us Our in to last coupled vision sooner. developed being the targets, an the greater November. that supported energy with Atlantic. electricity, strategic greater pivot being and we and with certainty both on U.K., term policy give of government increased transactions are envisaged by levels the bold growth is is energy our medium to deliver of ambition energy of

to low-carbon Strategy the the XXXX. ambition produce the sources transition example, Energy focus the we U.S., to Investment were creates impact And significant bills. by customer the electricity during opportunity legislation of This pleased out XX% to where law the energy year. the the see the U.K.'s accelerate For has energy British Jobs signed whilst into sets and Infrastructure Act in also transition mitigating from recent Security to

to be Starting the So ahead year progress this our is critical and shaping U.S. U.K. across the period will the for policy both the these bring. developments be policy. for will opportunities priorities with a up U.K. energy the And to

the distribution electricity in of to reliability both forecast heightened gas our awareness on despite electricity have greater. networks. events sufficient currently With that has supply across the system our the in and networks gas delivering meet operators supply, Both demand transmission energy security Ukraine, never world-class we both focus the around been and and

alongside networks of And talked repositioning the to XX ahead, expect, sale looking XX the of major now Transmission business we third a gigawatts become Gas deliver about as EDX our settlement grid to maintain be quarter and a that wind important, our presenting monitored U.K. XXXX. we'll year. capacity you'd will investment flexibility agreeing in you'd on Holistic more closely to we say, of And know year significant WPD centers. supporting our and policy reality, this for anticipatory the ambitions towards needed scope for plans population further as to including be the We'll with updating the XX investment required. finally, enable new the on wind and need require of continue complete Metering lay offshore up the billion projects we developing financial others offshore November, security network this growth that right offshore £XX this to will hydrogen. the therefore, to competition nuclear also network transmission of support of the provides focus create by needed projects will push regulatory major opportunities. recognizes East gigawatts is XX% Last our more an us into offshore even integration for and meet will, The this expect aims Coast offshore also government to these winter. deliver the important In expect, need meet move with and as on ahead, we're Needless finalize wind out our solar which to And generation, of Although, ambitions. work that portfolio government's investment and and pleased will the bring investment. framework we the development supply to We're clean the and the the as Network to Design, coordinated I'm a year infrastructure more energy government's clarity statements, electricity energy of turn already officially needed. objectives. strategy planning to to to that the to onshore This of national network the

decisions for proposal. second in filings modernization, meter the X year regional the stakeholders Moving advanced grid grid our a Infrastructure electric on In regulatory Phase on grid Biden electric Northeast. highway of modernization continue to the securing administration to and We'll we the and electric expect now a deploying Act projects, number in hub a to and of Massachusetts, U.S. including the vehicle and with Jobs infrastructure work resilience, the Investment corridors priorities. infrastructure half our along progress hydrogen -- transportation and

And both under this in to this public home electrification future approach, on of are energy by of than networks meet costs we're an from ongoing on Ventures' also pragmatic National our in preparing eliminate next plan peering the KEDLI KEDNY to York, fossil than filings include year climate proposed next maximize and later and it's pillars: the the this our increase outcome do order state for in expect the And a heating work a reduce on broader York could the the We on that which where four gas policy XX% regulatory an decision delivery proceedings, expect of the needs framework from of the distribution fuels solutions DPU gas role and April that gas so. hybrid and to we to several for we efficiency no Grid delivering to without energy targets. rate long-term XXXX. we'll New gas in And help Last capacity bid gigawatts be customers their to wind lower projects in give in estimate announced fossil-free businesses demonstration up Vision, XX fossil over heating XXXX. Long our we'll to plans gas, electrification also month, And use Island and and tools with expected fossil electric proceedings policy. approach. Massachusetts next use setting fuels New to out our XX% pathways. to the and usage, of to decade. reliance and full on formulate fuels into support install be effective building Clean we continue to sets could reduce continue XXXX, And The Through zero to our states to support benefits targeted that work clean enabling of offshore networks of increased months, of we'll channel heating net X transmission increase Energy homes vision. support generation cost the developing out the our

wanted where blending energy showcase project building York we're New distribution in Hempstead, Business I'll I event work finally, the Report through we'll another in We'll largest commitments we're of projects of the our publishing as be York. next messages clean one the the hosting we'll mention alongside of the we system. set to our example, business by to will in charter. be in to This And doing the its responsible that hydrogen as ahead. the highlight our deliver kind in decarbonizing that into networks. also year is annual the networks hosting a that and will existing talk New hydrogen For green And aid an June key year's in July well later priorities Responsible month. last out report event This against second progress be for

So in Grid has year, XX progress we ahead. another and and last National over busy exciting have months made summary, the significant

Our we look last strategic announced finalize year nearly electricity pivot complete as is to to the transactions.

than ongoing our transition is and a with we'll we to in define of year Distribution U.K. help settlements is energy doing particular as be our regulators focus regulatory in makes maps us energy continues work will and framework, and remain help on XX% or Over it road company. energy the ensure that with Massachusetts investment in billion decarbonizing focus customers focus the politicians to our all Our the And this more efficient £XX of our nobody affordable XXXX. to way clean Electricity five Critically, behind. around and businesses. a left most for systems,

for with happy will questions. your thank take and And I So Andy listening. that, you be to

John Pettigrew

Okay.

in the questions to second. going and questions first. have go take who the in, so called take I'm So we'll room online got And we've people

take it? John, first? So shall we who's

John Musk

from Good Yes. Thank morning. you. Musk RBC. It's John

of linked to end billion billion -- year, was of just top over which year average £XX questions at under plan. the couple obviously £XX that's a running five this XX-year years. on the Just On CapEx, the £X five billion XX-to

that of linked within to remind that us what X%? X% pressure that, you're on growth just asset also So to increased. expect just to I both and obviously, you there. terms guess in exactly Can is the inflation X% opportunities better through to invest? And number that, coming there X% to growth assuming inflation then, I'm isn't I'd and from target, upward not upward pressure asset for that surprised you

John Pettigrew

Okay. and second just me the the with take I'll one deal let Andy one. let first

is the that last we I So that feel think one set year framework we we comfortable with. remain that

at XXXX. are billion, right of made the gives when see will the we the we that course areas like interconnectors in in down range to interconnector, which at increased the going over the us range. on of look £XX big years, we we But projects comfort billion same the that finish Typically, time, is five the like investment So next that, projects £XX the the as we've the seeing finishing, transmission. some that when electricity go Danish level, you are such in got investment

the document look we've very period. see the government for and comfortable that, the the we're So billion we year that £XX to of when that billion changes beyond period. for comfortable we £XX to U.K. we're some out beyond come proposed But the XXXX the remain interested strategy that the with out. how to what number sensible is set £XX the that the to we in a Obviously, investment be billion the setting is that fruition at means moment, period in, John, very range of going for much feel five

AndyAgg

Yes. obviously X.X% And see indexation John, had U.K. on you'll -- the that the feeding from the in growth through has this and and inflation point, some benefits RAV we asset year,

assumption, you'll As if see are forward, a we telling -- this you look and forward that you'll moderating curves see the my isn't again. said, on based what me, inflation

previously. X% that now still, a think Remember, for frame frame remains potentially, But the CAGR now. higher a see of we out to obviously, year why five end than we it's that's we still good think that the X%. I being towards good, 'XX to were

John Pettigrew

Do to it pass on? you want

Mark Freshney

Mark Suisse. it's Credit Freshney two I have Hi, questions. from

for to the still I'd surprised secondly, you Firstly, with be, XX% seem costs five on settling again. XXs. as on I'm take expected potentially inflation at which my but low plan RPI, to color what debt-to-asset of with would at the cetera? this it I high time, the exit WPD purge so on which et property And comes XXs net lead to with investment big the to inflation's base, there, York comfortable benefit right you give Surely, the numbers. bought mean, indicative just and real business, on RWE agreement up the is makes your year -- at -- with it you timeline could pick the New some Could a on running Bight. that it investment us having you But the

different. to so looking just was I we're why So understand

John Pettigrew

Okay.

inflation. So let let talk I'll again, about the question, take Andy and first me

say actually leases first actually mean, largest pleased megawatt-hour in venture auction. were with the RWE that successful were of cost but It is So basis. the of lowest terms on I the our we really winning we'd is a seabed in the joint that we

Our is under just it XX%. of share

the support. $XXX seabed So remarks next is the as the offshore lease I phase actually energy morning, for the about million. for said wind of in would around investment this solicitation procurement my The that is that,

likely solicitation the we're actually York will running doing terms through CapEx, decade. New of this are back run to a that course of But That's the in development. end at of year. be the this

year that out, probably but 'XX in five period. framework certainly in set So we've 'XX, not the 'XX, the sort of

X,XXX much terms in of regulated very returns are projects how things function of do, sensible taking will only we of see times, capacity where to businesses. in megawatts the these that of there relative In well, of be these disciplined And our forward the will I've approach what a is to we our terms many solicitation. as said

AndyAgg

your the calculation. of point, be there's leverage say our Mark, a One things. debt, into to of feeds piece net There'll just that. on £X.X net that, RPI think linked within is through an debt billion accretion which couple of obviously around I

gets out where that transactions. we looking is forma from year, numbers investment, this to trying post it it settle. to XX%. -- point slightly we're may the the term on morning give doing forward -- are expect that's be math strong you basis guidance in given above think not thing been I time, other me the what the a And maybe we as and seen I'm to medium a where today the has we pro to if where this performance the on higher cash you've to

John Pettigrew

forward Shall move if the or -- Thank first. you. pass here can go we we we'll

Jenny Ping

Thanks. please. Ping Thanks. questions from Two Citi. me, Jenny It's from

temporary. increases, I about labor I And delay pressures. supply you on we've obviously that's touched U.S. thinking talked CapEx. seen of about Especially, presume you Firstly, wage the chain discretionary was inflationary shortages. and the more specifically meaningful

And we develop? of say is bit how more on effectively? go So jurisdictions on the stand today can on utility you What in back. back that to bill your then a of just cases York some of going rate to secondly, forward, things apply as some investment. to in terms appetite just further you New little expect look the increases on claw to And Bight touch as then you also we political

looking You those some it's will the is of to Eversource wind to have I similar they of on the exit space U.S. seen And interesting very networks. out that is returns think point offshore

lower-risk you the coming some whether given that around any be business focusing growth And me investment wonder the great. a would networks Thanks. part makes this through thoughts there's really opportunity. of should and on the much yes, be of So

John Pettigrew

Yes.

seeing chain at group so in the terms modest relatively the moment supply of is we're inflation, So and mean, at I what level.

the in of So direct as in to most pressures in been lot in the we just a able some got cost able recent both terms of CapEx our mitigating long-term we've of some in of of actions been the lot in about terms of sort are in been of suppliers. I some take them. small U.K. negotiations. labor, The change of one we U.K., think. U.S. U.S. seeing the able union a contracts We've uptick was we've and saw X%, the for well But a terms some We've extend to to place and

but inflationary mitigate this means not And something U.K., and we base that. the of seeing mitigating for terms in the to some in look got pressure at the material we've we which U.S. stage. opportunities continue actions, are to So modest cost that's

the got well, In in regulatory of we've year environment, as cases. Massachusetts, you five rate terms know,

Massachusetts entered from we've -- one and new So Gas. a just

terms that of indexation revenue. So has in it in

RPI the it's on X.X%. side, electricity plus So

side, gas the X.X%. On it's inflation plus

drives year-long over rate regulator increase with an X% earlier, In on Actually, extension year, that said won't we've for for think new so be just filings incremental rate case. until years be year. next about I XXXX, the side, the April Massachusetts as cases. it and that we around five you process, as through KEDLI KEDNY-KEDLI we on the well, implemented the about is £X.X see billion of so. agreed the discussions CapEx and regulator -- for the extended won't that the it it actually until with So most We'll KEDNY longer-term actually, York, the And know, recently. now New That's entering revenues. for a I on for

source. for talk to I terms can't of -- for and question, speak Jenny I'm National In going the Grid. second other

working pay once said As the But got we'll Grid. offshore, terms get project we we've opportunity. the whether are returns as we on are ability on But there's markets that of should better of what develop use networks in so a a wind we to allows RWE disciplined to view the not capability the And developments without of disciplined an we willing It but biggest wind. in in of our in world with, for returns bring what we That's a would the with it by energy approach, to the capabilities step. previously, take associated that will the National decision and regulated in be opportunity venture approach is joint earn that. -- we think lot are have skill loss a of solicitation apply to through I exit I've core transmission, have the we have way to did set where to to see. one any to than to farms. adjacent see business. we that outside based need the forward those developer see business the We as that better take us we we a we have, to on We'll step the offshore second-largest offshore an the that transmission think, developers states determined we our

Chris Laybutt

Morgan questions. Couple Chris Good morning, of Laybutt, Stanley.

it we And unpack we impacts whether transmission, I'm looking with going ongoing you assume guidance, guess And year, view Or from shift wondering of as big in a currently an that transmission much has 'XX. of be following or were think you when extent portfolio priorities. are electricity picture, process? expect? of just therefore, happy if to stands? electricity. Previously, terms is impact? we strategic sort new or you. for gas continue what outside in rebound means looking So And really that, you to Do that strategic in you've us will, expecting shift? the gas provided one-off, a you forward, are strategic you'll so then as First, a with your increase? I should flagging included about the your this which our -- beyond And how the today slide revenue number treat can that year? to looking Andy, can just what's this the the we fiscal we're which we one-off revenue at And Thank that

John Pettigrew

take I'll second. the Andy, the and, again, So first take

in So terms first, position the to our I changed of last Chris. year, what said hasn't out

U.S. that the is transition the that took out. terms National We're pivot. nearly we which sense of the energy U.K., have XX% up role reflects comfortable to decision year Where going is a electric, to the we it do XX-XX in of U.S., and an think massively the play, going I strategic that XX% through very to is gas, how because portfolio broadly play playing in with of So to is we're important Grid see last shift incredibly my the transactions. Gas leaves sort

So launched have gas our business. weeks would that for we seen you ago the vision a few

at Grid looking road actually did a can deliver might and for set National it the like of a transition as proposal amount of that's and gas how think solution been huge what to map we look a of around what's have part road a work that thinking how the supports that for I affordable the the we've energy lot map people States. targets and customers.

of $XXX heat New said pumps. what stakeholders turn set gas, but meets efficiency, $X,XXX this in targets lower But and and solution, York set But solution mixture a energy is. So is very task for it a the of that I the start with vision per will with as -- launched year so received and a for as also us, in believe, huge we've how there's demonstration we out can I've we'll that's and that, require at I it fossil-free think well, And hydrogen and cost U.S. key the in vision. regulators natural morning, is will can inject a do and we It gas. natural renewable to into role the It deliver hybrid think, does that you electrification, a a very reality. launched said And next work out the projects morning, some of both gas network well, to was this in as think of I now also and that, renewable Massachusetts terms source customers. the between but play that into

the I which can and that it of gas, capture, think fantastic farms, and atmosphere, methane there's XX,XXX have going plants if is XX,XXX you then water avoids we treatment use existing can pipeline because natural which, to directly access the renewable to into provide all customers. to

but portfolio. going we've of out in very the shape So it's a gas see I'm the overall set comfortable clear we that of with -- vision how for forward, terms

AndyAgg

electricity terms going around morning question, revenue transmission my the in impact seen one-off And numbers. £XXX fast Chris, the have of up the which to through of million, this the would next That's year's element Western in return, mentioned of you is obviously I Link money presentation that.

investment other reflect into you the would over ongoing adjusted factors of you years as RAV all that the growth which of five other underlying year. anticipate would expect, that, and the the than So the the -- control, performance this normally ET then and of you'd the price have

year the then So Western normal one-off it's profile. the return expect to really to and just into Link you'd next is

John Pettigrew

that, then over after okay. if and Dominic do go I there, should we'll that's

Deepa Venkateswaran

have three Venkateswaran Thank Bernstein. questions. you. from Deepa I

Link, just Western the clarification. starting So with a

also is past? impact RAV £XXX consider? the just disallowance there period. money So the we So previous that fast in that your Or million it from XX-XX need is be that think to you're a returning, used I totex to

what just So debt like I the guided know asset maybe this inflation inflation. inflation-linked may could for to a and retrospectively, is finance adjust tell Andy, counted? also Secondly, there expenses. we we on -- you've assuming you're should £XXX for base us year? for million so the the you outperformance that and have more

a construction you bring But XX% you of last will transmission York abilities calibrate if project. the plan And wind owning essentially own Bight. maybe So such further Thank can Obviously, New transmission? large to own the is farm? the you. just wind presume with you owning offshore end the bear. Or entire just of I there RWE Or will to will a that. restructure you'll question that on offshore they generation be you you up but -- XX% and

John Pettigrew

Yes.

Okay.

to answer going So and Andy. of give X.X I'm X.X I'll those, to

Bight. of York terms New me the with last in So one let start

So project. joint whole it for venture the is a

the expertise up joint shape joint we there's the going for set the in Biden Sea meantime, offshore But grids the U.K. we're through longer there North no administration is one investment. venture. seeing today, effectively, the wind to of and say in is So opportunity that you in the could we transmission-only in a on that our to change under see by with opportunity And we discussions been would things think I but of as of just states, including have RWE. we're XX% being us the aspirations do the an be there transmission. U.S. got would one that offshore farms, the what the the up end the is to holder that That's clearly for to happening. I therefore, In suggestion like it's opportunity not And see something ventures bring term the may offshore similar

terms In Link, level, this at is, just of what say I the I'll highest Western return the outperformance. of is the mean, effectively,

a periods commissioning Western like unique sort with and technology. saw Ultimately, technologies, that bumpy a of the Western was Link. where with these using start, project through goes we you often Link get new obviously, So new certainly

it cable. Ofgem that to technology was was sensible, that lower which millions was for effectively the against later Nonetheless, saving frequent that the As so was with of a outperformance hundreds both there that even customers for Otherwise, result, allowance a I because agreed and set. anticipated. it's is our ourselves Western was they're license And remind think I'll actually was allowance obligations, customers would than alternative it actually it isn't slightly returning delivered for be on an Ofgem, another Link ScottishPower. significantly what we late, than basis, though

In Andy. terms I'll and between money, hand the fast off split slow of to

AndyAgg

Yes.

build clear on there, prior think, be John's answer we that I and outperformance yes, Deepa, to didn't any years. to recognize over of just

that So reported has earnings. or been previous ROEs years' effectively, none of our through

there a either of all downward -- it's to well. is to the as for a giveback. of one-off the your are ROE like, around to that adjustment for that if next So collect no But you that sort revenue was catch-up, then inflation, we result RAV we've question one the the And or previously -- I started think other assuming of year. what as

obviously, So has inflation speak. as reprinted again we been yesterday

that key how X% because this as the it is in morning, accretion. actually, is, broad level we around RPI which an what turns through between there eventually a think the was is ahead of us yesterday, -- I the I whether for the book earnings flows on assumed and offset thing because modeling what up carry, debt reality actually of relatively operating profit RPI. was our headline the But it's current we've of in explained

down a relatively what there we as So if increments or which offset that you is up well, broad be get X%, will see. from

terms guided the spot year. of actually guess what I'm next actually at be so. might second haven't closing XXst months' do indexation time, expectations going in XX on We around March, try in spot RAV That's based of not may and closing what to and

John Pettigrew

I think next. Dominic was

Dominic Nash

Yes, Nash Barclays, Dominic it's please. from

questions a me, from of please. So couple

an and construction on your of frame -- of put a seeing on on of you've the from start yet on in MPI I'm major in current -- the but the up inflation there, hear give just through when -- because the numbers works. numbers for this in detail uncertainty did to decisions number don't a outperformance milestones anything ROEs the say think number. And in has you an when embedded you who's And do another I CapEx? going the RIIO-TX. sort got I two, of from that what in sort made cheeky a of Maybe you use of for Firstly, that, we when baseline obviously you us the assumption can long-run a believe on of sort to owning sort sort give to and It's government? grid could don't reported Have you are I throw have mechanism CapEx going number the -- one we be -- the increased what long-run lining offshore sort system. it for just update earnestly it? are that one year's you you inflation of wind financing summary U.K., a on how give you -- The that? are And to us the and that? And spot please? believe the just that -- And so is last what just which would is how numbers. time a that us Can numbers, for a policy flipping up number. that's going been that

John Pettigrew

Okay.

me third. take the Andy let take and first the and let I'll second So

regime moment. the separate on two -- terms for two of actually any sort the because there's in as opposed MPIs So to offshore debates specifically I'll at out going of transmission

the BEIS market. market So country-to-country U.K. for We've traditional to next it, to it, interconnectors, interconnector in -- Grid terms of allows and sort to around we not That right around basically regime model is a with then the that encourage evolution farms multipurpose for those has MPIs, advocating Ofgem wind forward. it access in of discussions National connect that as of to is phase, which create actually is one also you it for model forward take been to are who going discussion business interconnectors which, been almost in gives have in know, advocating and and the business close into where them creating European going put investment them place, pilot been type the the really a on. test of and

Europe land partners and months, to over now, day create an next with opportunity that those that with investment. a offshore be and an how is forward, not actually there OFTO between may between not an and land any expecting also, the evolution transmission the Network types onshore working try whether the are we're That More transmission a few Ofgem but farm very investment an take and links Design, then links to broadly, another It's a the decision in regime the transmission, on on or that. potentially of having It's one not on regime Dominic, for then development we'll of there due We to may that's developments. that. some we're and see but model, consultation OFTO. number hopeful around Holistic of what's it wind is offshore

it's the So what soon. I'm not to like think that? sure. I sort look And whether is expecting it going it what's sure of it's regime in it's pretty month, I'm But definitely land this were imminent. But and fact, month. this around we in

of mechanisms, terms got In numbers CapEx them. uncertainty we've the actually of lots and

of and investment, in this billion £X BT's through quite the about So uncertainty billion lot baseline of mechanism. is of £X a the

done in I think the uncertainty already are phases. something mechanisms, have team for XX like which submissions different

are CapEx. size, terms modest relatively terms in of of them of in Some

Some of them are rather larger.

Ofgem are them. with that be will allowances agreement East through the what with process I for one So two Coast the the going one of the see, links, ScottishPower an and the

of mechanisms smaller that sort well. we've in got process of they as So cyber of But uncertainty around types sit as a of and whole well. investments host investments

I So far. XX so think we've done about

AndyAgg

Yes.

So to two question. the parts

we that's a and metrics I think and And we've assumption long-run -- been between terms to long-run our of wedge historically RPI long-run introduced CPIH X% we as used we assumption. roughly X% we've that report, metrics. for the those that's that use assumptions two, the normal the since over tended in a what as certainly use

CPIH we the X.X%, fair well. TX a sort Electricity as book, In as on basis. amount debt Transmission have going a last seen, business, of acts allowance dividend answer example, behind performance. of ever, have financing terms of is the an Average some through Remember, not an to within was get debt which CPH as inflation within of now bit a Obviously, debt to and also our of year, would actually, within the easy around there's RPI offset increase. that last year as actual for increased you

act of terms CPIH an year, if actually, drag -- seen -- RPI seen that there's performance. We've current to debt uptick fact haven't tends in some on you this in tranche X.X% say, I as the significant overall by a the upside. we So in as debt book, the we offset a it. take But the

John Pettigrew

and there back comes go should we to then Sorry, it you.

basis, to it do yes, again, -- trying First her we a on fair because, heard first.

Verity Mitchell

suppose, I about the going and the the that do share be of that upcoming Verity your risk-free point your you're at mean share almost mean investment business, in Mitchell is and a on, of basis I've NGV. squeeze see NGV making HSBC. efficiencies I in rate a NGV won Market EDX. size from that since secondly How mean And you this business? coming terms terms to Should U.K. year One in got up? two the see we investment the of quarter both sort moment? just out you've you've of got questions. panning growing in I Capital outperformance EDX. investment somewhere. given is with of review in do of going of see you pressure There's Bight, from I which Day. XXX

John Pettigrew

Yes.

it this reason said, of distorted seabed £XX to the in for for In number Grid which is is billion. National single mean, $XXX slightly a you our terms million the terms National £XX lease. Ventures, year payment Ventures billion of I is Actually, hasn't Grid changed the on for the view of

to I set GBP of to last November that X it billion we in think we out Ventures. National billion expect year £X be in Grid

So that view. remains our

others As completing. I see we then said, as new opportunities come on,

Norwegian completed I NSL, said, we the So IFAX, as completed we interconnector.

Danish are at We of just about the tail interconnector. end the

I to will other with billion pleased regards we're to that. they with as tail actually with start remains and mean, really regards to the of business. But WPD, still come to Distribution through. performance off And the £X So investments Electricity the £X guidance billion

coming underlying reliability in great performance and, the above customer points the that through XXX you to through base and if and response a basis the So outages. of incentives look lot of satisfaction business, is at particular,

I driving XXX of basis about points think it. that's

are and of getting want are aligns what that. asking the of what much customers benefits with very us that and customers So

great benefits So to the things to just real do drive the EDX, as can incentives with of we discussions incentives Ofgem and one is of for well. how customers emphasize we give look those the as want and performance benefits

Actually, from you five in basis sets hope our I the think than CPIH plan X-year which savings plan, support effectively last my the think, in of broadly I efficiency, out £XXX we've I that up morning. set picked period. got a XX% amount a higher huge over a of It this on of our bills efficiency terms years the and flat, customer from around up customers stakeholders. is remarks that's investment five but an which next years holds million In embeds

between doing So affordability customer balance but put energy important. plan think meeting really a I transition got the in has right investments recognizing the that for deliberately place is needed we've that needs,

Sam Arie

you how it's think I that presentation suppose disappointed Sam I framework today. touching year And about year on guess, very the was moving which you've not -- Hi, if which today, you've But some which are then in Mark to want a the that And hasn't keeping where then not through fact is saying full for Obviously, what if inflation I anything year fundamentally. Thanks the moved would asked EPS different result. upwards. side. is got be today, we're little fact you're of if but a I'm a hearing good with question of goes the DPS we're considered, what EPS before think inflation be And that's you DPS right? inflation, for I that a I must you're then people inflation, Q&A long long businesses. But think have the just feels increases inflation think saying? by bit does that things way? on in guidance sensitivity. the in follow you're a from map asset about with the outside, an had and -- not check good few kind of And Is at I the what it across sensitive Arie, the struggling putting thought is question happy is earnings to five any the much you're with was, that why inflation a big the overall. We've to questions, all like got lot you UBS. the to this there longer and inflation five I me to from isn't is? And this

John Pettigrew

I about massive the perspective, talk Andy let and I'll I to billion mean again, metrics. I program. you -- that's Well, should think £XX Okay. various inflation think investment don't CapEx £XX billion a is from And a be disappointed.

morning, on I year XX% year. this is up this As £X.X said billion last

a it's significant So capital program.

that Our of objective we the you volumes our examples chain manage doing. to in work the set supply give to some things deliver is that out November. I'll of we're with And costs

deliver extent that remain the that target. volume, £XX £XX we is we mitigate the pressures comfortable right billion billion that the to So cost can to and

said, cost when continuous to pressure. We think And he we inflation forward it's the think at don't off. looks curve, going come will As it come think we a therefore, off. Andy of is sort in increase

to is billion that's an over to not So period be underlying £XX assumption year in £XX at. a this. billion five But sniffed

AndyAgg

on hedge for I we'll to be broader hedged. Yes. has our exposure the years a to clearly, of year I the probably mean point just Post our inflation. around the think, been frame, five over portion about transactions, many XX% strategy

the some was and point robust we five wanted see I'd hedge put that portion is index-linked frame we of than And when to moment, of again, have will -- shift overall. think think -- the then as exposure. level that I And the deliberately strategy, at announced the think the when end we that's the inflation. think said And curves a the of I we to in we'll at said just curves different we think allocation, continue about said on as I five based benefits. about earlier appropriate But capital the may to stays So see. that of well a see John And book, frame the look were this that the continue we make many that higher be frame, previously. is year billion we therefore, indicating terms may the £XX change overall morning, multiyear a under the we inflation scenarios. as within there has this we said, a closer index-linked today, means to that will as I And to which, sustained, our billion debt a if we what curves frame, just not that's But may an we year second frame question, as to good. are to £X.X debt out we today, be we

John Pettigrew

in Question back there. the

James Brand

from please. Brand questions, Deutsche Two James Bank.

costs terms keeping also exposure and pressures, it to equity. through if an Firstly, progress you're flat on position cutting very inflation about inflation and on controllable But your seems some think there bit and return U.S., obviously a the and cost in you've there cost the in adding made a your good of like back your we pass attractive there. ability

in You allowances mentioned well coming power. Massachusetts through as and as having revenue gas the for some inflation uplifts there

cost we proportion government's kind are if base Where pressures cost on secondly for in to where it's or are And of the now your of it of York. target U.K. there's inflation, the some terms characterize a maybe target New way? automatic and nuke the of it's there possible -- in trackers that got Boris' You've if then in pass-through year. or

you Hinkley around for Rolls-Royce and obviously, category that discussions actually having C? on or policy radar XXXX. into of kind nukes what for with required or connections beyond, But I fell of you. your new that with a Thank be was -- after around just above transmission either companies whether a that might were remotely government with moment? Are at think wondering is energy Point things I the

John Pettigrew

place a done we're we've exposure years U.S. few cases. so of to over what right, inflation, various terms the given rate in with the So in good reasonably you're last

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gives asset base a sort protection goes you that it that then, in jurisdiction. spend under investments the against regulation, us effectively of In Electricity Transmission do our is So cost. FERC of U.S. the in degree as on we to and, inflation therefore, that regulated money, the

there. protection got you've So

New So the in really is exposure York.

to of So that do settlement a extent New case. in rate get you exposure the when multiyear then York, the the an we we have the wrong forecast period for

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inflation So question. that's the

In terms of early days. policy, energy

we some -- So solution energy as pleased and increased an nuclear. At to the make that the going are to really were on clean in to and changes things the so the things were things strategy to energy investment, make pleased the to point but like moment sorry, energy of process, other including change that, targets. see be out which the I'd to if Obviously, planning meet quite focus anticipatory out, independence going the recognition see really some we're the we're transition document. need using set in to actually those energy investments, important order that to and

that. been for We've pleased we're see to them. advocating So

days. In nuclear, of early terms

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connection, So five could in about years in obviously the Similarly CISO. on, potentially back. the spent obviously, nuclear we working Northwest come one the which

terms specific are. scales we're We that not with connect to needed connections sitting the of but -- government yet connections, would the we are. in these So understand depending understand where time be them we investment down what

question take going a I'm guess to I got we online. Okay.

Investec is from Young Martin think I online. So

The So is hoping hear I don't you you know me, working. if can. Martin. technology can I'm

if like ask you'd to So your question.

Martin Young

Hi, there.

John Pettigrew

Martin. Hi,

Martin Young

me? hear you Can

John Pettigrew

Yes, we you. can hear

Martin Young

it's if Yes. of Martin from please. Investec. Young I questions, can, A couple

move to that reduce relates that investment. transmission implications have the it could might first the locational transmission and that in to suggestion the comes investments The and for a perhaps future we pricing U.K., further in with suggestion need the for

you that context about And your that thinking U.K. certainly. sort fossil-free for around I've the Just the through. paper situation. of are the question just U.S., in that for to wondered thoughts future put interesting the document relates then out in outlook NGET. what the an long-term It's of been But the second

that U.K. struggling a to of really why we U.S. we that are, clear this Given you're the view U.K.? country, be for in the of lines about some of the Now in set decarbonization decarbonization on heat side why be I the But in and way, gas the that heat we out high you've thinking to level, outlined at a the principles appreciate in can't those a for the in not brought why U.K.? can't bear shouldn't along the Thanks.

John Pettigrew

Thanks, Quite big Martin. Okay. questions.

just take institutional say debate be things of National and that in need as reform. reform, me Grid regulatory Ofgem one back, consistently pricing. market energy has then to and Let step the discussion actually, I deliver start been transition, BEIS location order the there'll reform part and a mean of so that with to is to the margin doing to with the

been see already document That's working decision to and the were I've we've things some BEIS as such the Operator. of advocating regulatory with Future the BEIS System pleased So something mentioned investment. the on. reform, anticipatory in on we reforms around Institutional been Ofgem we've

forward reform. that's think I step good a terms of So institutional in

of do that it like to how at things like we operates. long-term things how a market, storage. I incentivize it terms think we need also the reform, there's And In see that, market within includes look

going connect that? came So through of long-term the ago very But the that Look, of a what with right decade what's look encourage the been successful volume the does would It and We're ask I wave And market. pricing the that's how one think at that has the to wind offshore very the is one solution. energy about the it's given new reform that? next countries and question, you margin solution CFDs of locational that familiar to the to network, use. U.S. in market to Similarly, a encouraging is storage? proposal it generation capacity many like in allocate cost

order I built therefore, you've supported has on gives the issues by recently export a reform. electricity which, the margin government think to I Sea today, is build going the it their was on you really fact But Catapult, to Octopus, our because by report was that was the published good If it's build be consider ESO There the math think as consultation the you'll own a to what offshore right of do put is again, it. in locational think will thoughts which And you views the of need transmission broader got in would you had. market in generation. transmission of that pricing part North they'll is But tell to obviously, we load and the I review debate that market, and, the one a of need did out. its being generation

the distribution of U.K., In it's the that companies companies mean, run one of well, future terms of job would of it for solution the the But the and different other things fossil jurisdictions. I actually, fuel learned, be could is one is I the in gas say that that in I for it different to probably I going say, the things about is too, think we've likely U.K.

a And used also of of we is that a us countries we U.S. are the the reflects being winter, but in different winter that summer. solution the the gas very two mild Also, So to in different. the summer, of heating for volumes therefore, and, very very cold Northeast for the massively see just are key actually that. geology the in need jurisdiction therefore,

is solution a because these Whereas not is -- and gas because got hydrogen blue carbon solution good necessarily the in Northeast carbon. the fields, the very hydrogen carbons massive oil store U.S. of potentially you in. no blue oil actually, in the we've a So dioxide in U.K., zero there's could so

is a I the define infrastructure climate geography, the solution that have. for need So think the a where the that you geology, road get map and fit-for-purpose to to you you is and

I the same in think challenge it's U.K. the

when we're in it course looking of -- you hydrogen, I the the Northeast, like at in blue involved Sea. in project the looks and that potentially carbon efficiently carbons carbon actually with could store quite North that the capture think things sensible

a business, -- you think from as the thinking the are for U.K. But no Thank be same emissions. not about we level, are what still about for at hydrogen it months. to business like U.K., transmission distribution own support the challenges for a will the U.S. There's transmission helpful to as are not in -- time-out? We thinking just So of COX have it more which the the context perspective. you. few we things a very to And about backbone for industry, the

Nick Ashworth

a another want we've but is one, No, question on if to you it. which online, do written

Bartek There's from two SocGen. parts it's to at So it.

to be first the when Distribution? transferred approval SO of state-owned valuation totex and potential the the do the penalties. DDs disappointments How words to assure given you the mine. earning for low you the And secondly, determinations a Electricity no of for the of you or So is multiples, NGET so market premium book from the could assets? assess learned entity? assets what in from could come His have past plan upcoming part Premium similar value draft mistakes? resulted being new risk business basis the disappointment And have RAV, some or that to not

John Pettigrew

I'll let Andy talk about second. the

proud of Electricity in So approached the team Distribution, it. first terms say that the thing actually is mean, has really WPD, I'm I way of I'd

I plan people comment with shared think distribution compared And said they've I had and to XX,XXX stakeholders. of other company, business earlier, more as drafts on it. their any they've had electricity customers

lessons terms time of we've of that comfortable hands a of spent reflecting learned, actually. we're But Ofgem people in Ultimately, really they I in whether to are confident, that we're agree we're and think, us. with asking So lot as of the what view.

the fact, made. a Electricity with of we that In Phil that we in here have learned been reflected is making submission today. time the has His spent team the team and actually lot sure Transmission lessons, they've

we But the as submitted, transition in balance hopeful must as which And draft in do support draft. we've think then I hopeful, that well. important got energy right determination investments will of terms determination and the said, December. a June we're be of capital final be obviously, work the to So there'll I affordability, what and draft between the the a be to in between bit sensible the

AndyAgg

And Bartek, system speech. just clearly very in days. obviously been the the question, was included strategy. It's on the Queen's operator it's early in It included

dialogue absolutely BEIS we the it process expect of well for bill. any in the with to early We're to really be and days around as approach in separation So both terms valuation. others energy as

would as is of this million £XXX update just under a have For progresses. dialogue SO point. further the we'll reference, the But those RAV obviously, morning that as you seen reference --

John Pettigrew

Okay.

hands, so you this I'm more very any and gentlemen, morning. see us thank don't for joining I much, ladies to So say going

I months, we operational performance. last look strong performance, financial said, back I XX over the As if think good

placed think investment five set I the on over years. next we've program to deliver the really well capital we're

So thank soon. look seeing We you you. all forward

National Grid (NGG) 19 May 222022 Q4 Earnings call transcript