The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Globe Investor

News Sources

Take control of your investments with the latest investing news and analysis

Press release from PR Newswire

PPL's United Kingdom Subsidiaries Accept Ofgem's Cost of Equity Decision

Monday, February 17, 2014

PPL's United Kingdom Subsidiaries Accept Ofgem's Cost of Equity Decision

15:18 EST Monday, February 17, 2014

ALLENTOWN, Pa., Feb. 17, 2014 /PRNewswire/ -- PPL Corporation (NYSE: PPL) said Monday (2/17) that its Western Power Distribution subsidiaries in the United Kingdom have accepted a decision by the Office of Electricity and Gas Markets (Ofgem) to set the real cost of equity at 6.4 percent as part of its ongoing price control review process.

Western Power Distribution's four subsidiaries own and operate electricity distribution networks that serve 7.8 million customers in central and southwest England and south Wales.

Ofgem's decision results in a slightly lower cost of equity than the 6.7 percent proposed in the business plans submitted by the WPD subsidiaries in July 2013, but by accepting the change they remain in Ofgem's "fast tracking" process.

Plans submitted by the WPD subsidiaries were the only ones Ofgem determined to be suitable for accelerated consideration in the price control review process for electricity distribution networks, called RIIO-ED1, which will set base revenue requirements for an 8-year period beginning April 1, 2015.

The final fast tracking decision is expected Feb. 28.

Fast tracking affords several benefits to the WPD subsidiaries, including the ability to collect additional revenue equivalent to 2.5 percent of total annual expenditures, or approximately $35 million annually, greater revenue certainty and a higher level of cost savings retention.

The cost of equity change does not affect the projected earnings ranges for the U.K. Regulated business segment that PPL Corporation announced when the RIIO-ED1 business plans were filed in July 2013.

The business plans submitted by WPD subsidiaries, and key milestones in the RIIO-ED1 process, are posted on PPL's website.

PPL Corporation, with 2013 revenues of $12 billion, is one of the largest companies in the U.S. utility sector. The PPL family of companies delivers electricity and natural gas to about 10 million customers in the United States and the United Kingdom, owns more than 18,000 megawatts of generating capacity in the United States and sells energy in key U.S. markets. More information is available at www.pplweb.com.

SOURCE PPL Corporation

For further information: For news media: George C. Lewis, 610-774-5997, For financial analysts: Joseph P. Bergstein, 610-774-5609, PPL Corporation

Products
  • Globe Unlimited

    Digital all access pass across devices. subscribe

  • The Globe and Mail Newspaper

    Newspaper delivered to your doorstep. subscribe

  • Globe2Go

    The digital replica of our newspaper. subscribe

  • Globe eBooks

    A collection of articles by the Globe. subscribe

See all Globe Products

Advertise with us

GlobeLink.ca

Your number one partner for reaching Canada's Influential Achievers. learn more

The Globe at your Workplace
Our Company
Customer Service
Globe Recognition
Mobile Apps
NEWS APP
INVESTING APP
Other Sections