National Grid Earnings Surge 19% Thanks To Imports From France

National Grid Earnings Surge 19% Thanks To Imports From France
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National Grid said annual profits have been boosted as Britain imported cheaper energy from France.

The UK's power network operator hailed a "strong performance" from its French interconnector cable as full-year earnings surged 19% to £123 million.

Overall group underlying pre-tax profits rose 9% to £3.1 billion for the year to the end of March.

On a bottom line basis, profits rose 15% to £3 billion.

New chief executive John Pettigrew, who took the post at the end of March, said the group delivered a "strong performance" in the year and paid tribute to predecessor Steve Holliday's "focus and commitment".

The group said its 2GW French interconnector cable benefited from the "high power price differential between France and the UK in the first half of the year".

It added that plans to offload a majority stake in its £10 billion UK gas networks business were "on track".

The group, which announced the plans last November, hopes to start a formal sale process next month or early July and complete the sale in early 2017.

National Grid said it had begun the process of separating its domestic gas distribution business ready for stake sale - a move to rebalance its portfolio and create extra value for shareholders.

It has 82,000 miles of pipeline, which delivers gas to around 11 million customers.

Analysts have valued the business at around £10 billion, or even as high as £11 billion.

Annual figures showed operating profits from the UK electricity transmission business fell by 5%, but gas transmission and distribution earnings were up by 11% and 6% respectively.

National Grid recently agreed to pay £3 million to fuel poverty charity National Energy Action (NEA) after failing to meet gas network repair targets.

Regulator Ofgem also cut the amount of revenue National Grid can earn from its gas distribution networks by £2 million after the company failed to meet targets on customer satisfaction.

Reports have also suggested that National Grid could be stripped of its role managing the UK's electricity supply under Government plans being considered to hand Ofgem sweeping new powers.

Whitehall is said to be looking at setting up a not-for-profit company, to be overseen by Ofgem, that would manage Britain's electricity system and have the ability to switch off factories and request emergency back-up generation.