PROVIDENCE – National Grid PLC has entered into an agreement to sell its Rhode Island power business, known as Narragansett Electric Co., to the Pennsylvania-based PPL Corp. for $3.8 billion, the companies announced Thursday morning.
The proposed deal, which is subject to regulatory approval, is part of an agreement between National Grid and PPL that includes the sale of PPL’s Western Power Distribution business, the United Kingdom’s largest electricity distribution business, to National Grid for net proceeds of roughly $10.2 billion.
The Rhode Island power operation is valued at $5.3 billion including $1.5 billion in debt.
The regulatory process for the sale of National Grid’s Rhode Island operations is expected to take nine to 12 months. PPL expects to use a portion of the proceeds from its sale of its U.K. operation to finance the Rhode Island acquisition.
Narragansett Electric serves approximately 780,000 customers. National Grid noted that Narragansett Electric’s employees will remain with Narragansett Electric as the company transfers ownership to PPL, including all the members of UWUA Local 310, UWUA Local 310B and USW Local 12431.
“We expect to leverage our proven track record of operational excellence, award-winning customer service, strong reliability and cost efficiency to continue to improve service and deliver energy safely, reliably and affordably to Rhode Island families and businesses,” said Vincent Sorgi, PPL president and CEO of PPL.
Sorgi also said the company was committed to advancing the state’s decarbonization goals, as well.
“We believe our experience in automating electricity networks can help the state achieve its target of 100% renewable energy by 2030. And we look forward to being a strong community partner in Rhode Island, something that has been a hallmark of PPL for more than a century,” said Sorgi.
If the acquisition is approved, PPL will serve roughly 3.5 million electricity and gas customers in the United States.
“Narragansett Electric has always had a reputation for high performance, and PPL is gaining a world-class operation,” said John Pettigrew, CEO of National Grid. “Western Power Distribution presented a unique opportunity for National Grid to achieve scale in U.K. electricity distribution, a key component of our strategy to be at the heart of a clean, fair, and affordable energy future. Similarly, Narragansett Electric was a coveted business by PPL. We are pleased that this announcement is enabling two highly motivated operators to connect with two high-quality businesses in furtherance of our respective visions.”
Chris Bergenheim is the PBN web editor. You may reach him at Bergenheim@PBN.com.
