Approval of downstate New York rate settlement

RNS Number : 0644H

National Grid PLC

14 June 2013

 



14 June 2013

National Grid plc

Approval of Downstate New York rate settlement for KEDNY

At an open session meeting conducted on 13 June 2013, the New York Public Service Commission (the "Commission") approved a two year rate settlement for National Grid's KeySpan Energy Delivery New York ("KEDNY") gas utility business.     

The new rate plan ("plan"), as approved, reflects the Joint Proposal settlement filed with the Commission in February, which extends and modifies elements of the original KEDNY five year rate plan.  The plan would apply from the end of the previous five year rate plan on 31 December 2012.  The plan includes a 9.4% return on equity in each of the two years 2013 and 2014, with a 48% equity structure in the business, which is financially equivalent to the terms of the original five year rate plan (9.8% return on equity and 45% equity structure).  Under the plan, 80% of any earnings over 9.4% will be allocated to fund recovery of prior environmental deferrals with the remaining 20% being retained by KEDNY.  The plan also includes an increase in capital expenditure allowances to approximately $320 million in 2013 and $294 million in 2014 as compared to the original rate plan capital allowances of $155.4 million per year.  The plan also proposes updates to various customer service and other performance metrics.  Under the plan, there is no impact on the delivery rates for customers.

Ken Daly, National Grid President for New York, said:

"On behalf of our New York Gas customers, we are pleased that the new plan sets out a framework of increased investment, stable customer rates, and performance metrics to deliver high standards of customer service, safety and reliability. The plan also provides a sharing mechanism that should allow the business to continue to provide excellent service to New York customers, while delivering appropriate returns.

CONTACTS

Investors

John Dawson              [phone]                    [phone] (m)

George Laskaris           [phone]                     [phone] (m)

Andy Mead                   [phone]                    [phone] (m)

Tom Hull                      [phone]                    [phone] (m)

Caroline Dawson        [phone]                     [phone] (m)

Media

Chris Mostyn               [phone]                   [phone] (m)

Brunswick

Tom Burns                  [phone]                  

CAUTIONARY STATEMENT

 

This announcement contains certain statements that are neither reported financial results nor other historical information. These statements are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include information with respect to National Grid's financial condition, its results of operations and businesses, strategy, plans and objectives. Words such as 'anticipates', 'expects', 'should', 'intends', 'plans', 'believes', 'outlook', 'seeks', 'estimates', 'targets', 'may', 'will', 'continue', 'project' and similar expressions, as well as statements in the future tense, identify forward-looking statements. These forward-looking statements are not guarantees of National Grid's future performance and are subject to assumptions, risks and uncertainties that could cause actual future results to differ materially from those expressed in or implied by such forward-looking statements. Many of these assumptions, risks and uncertainties relate to factors that are beyond National Grid's ability to control or estimate precisely, such as changes in laws or regulations, announcements from and decisions by governmental bodies or regulators (including the new RIIO approach and electricity market reform in the UK); breaches of, or changes in, environmental, climate change and health and safety laws or regulations, including breaches arising from the potentially harmful nature of its activities; network failure or interruption, the inability to carry out critical non network operations and damage to infrastructure, due to adverse weather conditions, including the impact of 'Superstorm' Hurricane Sandy and other major storms as well as the results of climate change, or due to unauthorised access to or deliberate breaches of our IT systems or otherwise; performance against regulatory targets and standards and against National Grid's peers with the aim of delivering stakeholder expectations regarding costs and efficiency savings, including those related to investment programmes, restructuring and internal transformation projects; and customers and counterparties failing to perform their obligations to the Company. Other factors that could cause actual results to differ materially from those described in this announcement include fluctuations in exchange rates, interest rates and commodity price indices; restrictions in National Grid's borrowing and debt arrangements, funding costs and access to financing; regulatory requirements for the Company to maintain financial resources in certain parts of its business and restrictions on some subsidiaries' transactions, such as paying dividends, lending or levying charges; inflation; the delayed timing of recoveries and payments in our regulated businesses; the funding requirements of its pension schemes and other post-retirement benefit schemes; the loss of key personnel or the ability to attract, train or retain qualified personnel and any disputes arising with its employees or the breach of laws or regulations by its employees; and incorrect or unforeseen assumptions or conclusions (including financial and tax impacts and other unanticipated effects) relating to business development activity, including assumptions in connection with joint ventures. The effects of these factors are difficult to predict. For further details regarding these and other assumptions, risks and uncertainties please read the Business Review section including the 'Risk factors' on pages 41 to 43 of National Grid's latest Annual Report and Accounts. In addition new factors emerge from time to time and National Grid cannot assess the potential impact of any such factor on its activities or the extent to which any factor, or combination of factors, may cause actual future results to differ materially from those contained in any forward-looking statement. Except as may be required by law or regulation, National Grid undertakes no obligation to update any of its forward-looking statements, which speak only as of the date of this announcement. The content of any website references herein do not form part of this announcement.

 

END

 

 

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