National Grid's first 1.44GW at Teesside is contracted to a rival's network, with no operator named
National Grid bought 73 acres at Teesside for Britain's biggest substation, but the 1.44GW first tranche is contracted to a rival's private network and the data-center operator is still unnamed. Shares have run ahead of Thursday's results; the second tranche and the regulator's price are still open.
Richard Tang · 3 min read
National Grid+0.56% — National Grid, up 0.56 percent as of its last quote has agreed to buy 73 acres of a former steelworks on Teesside to build Britain's biggest substation, and the first 1.44GW of its power is already contracted 1. But read who signed: not a data-center operator, but Steel River Power, the private electricity network across the Teesworks estate, part-owned by a rival utility group 12. The campus it would serve, spanning nearly 500,000 square metres, has no named tenant 3.
That gap, plus a regulator that sets what the build earns, is what the share price has to earn back: the stock has run from about 1,096p to about 1,252p ahead of Thursday's results 5.
A 1.44GW hub on reclaimed steelworks land
Teesside Node A, thought to be worth over £200 million and built by Balfour Beatty, sits on land National Grid bought from Teesworks, the public-private partnership that owns the former Redcar steelworks site 123. Teesworks spends the next six months remediating the land, and the first 1,440MVA is due online by the end of 2029, with expansion to 3.2GW described as possible 12.
Every megawatt of the first tranche is contracted, which is what Britain's data-center queue has been unable to get. Mayor Ben Houchen's point is that power, not planning, is the bottleneck that sent AI investment to Texas and Abu Dhabi 23.
Analysts see UK transmission as National Grid's largest revenue line
- Estimate
Data
| Value | |
|---|---|
| UK electricity transmission (estimate) | £1.2B |
| UK distribution (estimate) | £0.59B |
| US regulated (estimate) | £0.78B |
The buyer is a rival's network, not a hyperscaler
Steel River Power is a joint venture of Steel River Energy and North West Electricity Networks, part of the ScottishPower/Iberdrola group 12. So National Grid builds the asset, a competitor's private network buys the power, and the eventual operator of the campus has not signed its name to anything 3. Microsoft already walked from one UK AI campus because the power would not arrive until the 2030s (6); a contracted grid connection is the fix, but only once a paying operator exists at the end of it.
What Ofgem allows decides what the build earns
Cost recovery is the other open question. The same week, National Grid committed up to £400 million to keep the IFA interconnector, the subsea cable linking England and France, running to 2050 45. And our October 28 reporting found the builder quoting planners £1.1 billion for the Sea Link cable while asking Ofgem, Britain's electricity regulator, for £2.567 billion (7). The gap between what a build costs and what the regulator allows decides whether it is an asset or a stranded one.
My read is that the capability is real and the first tranche is contracted, but the last two hops are unbuilt: a named data-center operator, and an allowed revenue. Watch Ofgem's next determination and the day the campus operator is named; until then, buying the story into results means paying for capacity whose second half nobody has bought.
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