More than £460m in dividends has been paid to US shareholders of power supply company Northern Powergrid on the back of rising revenue and profits.
New accounts for the North East operation of the network operator – which is responsible for the distribution of electricity to about 1.6m people in the region – show that a total of £460m was paid to shareholders over the past year and a half. It comes as the owner of 42,000 kilometres of overhead and underground cables and more than 28,000 substations booked revenue of more than £536m in 2024, up from more than £435m the year before, thanks to higher tariffs charged of electricity suppliers using its network.
Operating profits at Northern Powergrid (Northeast) plc also grew, from a restated £166m up to more than £264m. Pre-tax profits increased from £145.6m to £235.8m.
The Ofgem-regulated business, which is owned by US conglomerate Berkshire Hathaway, also invested more than £231.9m in its network that extends from North Northumberland, south to York and west to the Pennines. That was about 20% more than spending the year before in a move designed to improve network performance and increase resilience.
Major works included the refurbishment of transformers, replacement of oil-filled cables, rebuilding of overhead lines, replacement of switchgear, changing of deteriorated poles and the commissioning of new remote-control points. £900,000 was also invested in research and development activity.
The spending put the company 9% ahead of the prior regulatory year but 20% down on phased total expenditure allowances over the price control period between April 1 2023, and March 31, 2028. Bosses said a number of work programmes were re-phased with the goal to achieve 11% efficiency savings.
Within the accounts, directors pointed to a performance against a number of strategic aims, including rises in measures of customer satisfaction – both overall and more specifically on dealing with power cuts. They also pointed to efforts to support vulnerable households and growth in energy advice services to support 20,000 customers in fuel poverty and a further 5,000 with support to increase the energy efficiency of their homes.
Like other distribution network operators (DNOs), Northern Powergrid is measured by Ofgem on two key performance indicators which show the quality of supply: customer minutes lost (CML) and customer interruptions (CI). Performance on both was said to be below targets due to bad weather, with the duration of the duration of the company’s power cuts – together with sister firm Northern Powergrid (Yorkshire) plc – increased by 6.4%.
On the restoration of high voltage connections, the company averaged 60.2 minutes, down from 62.1 minutes after allowing for severe weather incidents and other exemptions.
DNOs like Northern Powergrid have to operate within a price control regulatory framework set by Ofgem, which is intended to protect the interests of end users. The firm’s revenue is derived from electricity suppliers via charges which account for about 8% of the end users’ overall electricity bill.