National Grid sells off another 20% of gas network to Australia’s Macquarie
The deal means that the Macquarie-run consortium will own 80% of National Gas.
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Your support makes all the difference.National Grid has sold off another big chunk of Britain’s gas infrastructure network as Australian investor Macquarie plans to buy another 20% of National Gas.
The deal means the Macquarie-run consortium will own 80% of National Gas, which owns thousands of miles of pipes that bring supplies into homes across the country.
It follows a deal in February last year which saw Macquarie and British Columbia Investment buy a controlling 60% stake in the gas infrastructure business for £4.2 billion.
At the time the buyers revealed they had the option to take more shares in National Gas.
On Wednesday Macquarie announced it aims to buy an additional 20%, in a deal which would give National Grid proceeds of around £700 million.
The deal is still waiting for a thumbs up from the regulator but is expected to close in the second half of this year if all goes to plan.
Macquarie also has the potential to buy the last 20% of the company, putting all of National Gas into the hands of the world’s largest infrastructure investor.
It raises questions over the plan Macquarie has for the gas transmission grid. As the UK tries to decarbonise, a major element will have to be abandoning gas for cooking and heating homes.
Many say that heat pumps, which heat homes electrically, are the best solution, but others, including those who own gas networks, instead want to upgrade the gas pipes so they can pump hydrogen into British homes.
Critics say this could lock in the use of natural gas for much longer, that hydrogen will be needed elsewhere – such as in heavy industry – and that making green hydrogen, which uses renewable electricity to create hydrogen from water molecules, is much more expensive than using the same electricity to heat homes directly.
Macquarie recently hit headlines as Thames Water, which it owned for years, came close to falling into administration because of its debt pile.
A lot of the debt was built up during Macquarie’s ownership.