Electricity Distribution in the UK - Market Research Report (2014-2029)
London, United Kingdom
Last Updated: July 2024
SIC D35.130Revenue
£8.9bn
Past 5-Year Growth
Profit
£X.Xbn
Employees
26,055
Businesses
26
Wages
£X.Xbn
Electricity Distribution in the UK industry analysis
Electricity distribution network operators (DNOs) operate regional monopolies, so pricing in the industry is heavily regulated by Ofgem in Great Britain and the Northern Ireland Authority for Utility Regulation (NIAUR) in Northern Ireland. In the United Kingdom, there are currently 15 different DNOs managed by seven operators and 19 independent distribution network operators (IDNOs) working primarily to connect new housing, commercial and industrial premises to existing networks.
Trends and Insights
- Regulation hamstrings the Electricity Distribution industry's earnings. Ofgem's new price controls and restrictions have curtailed industry profitability; stricter standards along with reduced returns on equity under RIIO-ED2 put downward pressure on revenue, regardless of initial revenue increases.
- Gas continues to reign in UK's electricity production. Despite rising wholesale prices, and geopolitical tensions sparking a move to reduce dependence, gas-fired power remains the primary source for the country's electricity supply due to its cleaner emission rating.
- London and the South East are key for electrical distribution businesses. With their heavy electricity consumption due to high population density and commercial activity, these regions offer significant opportunities for distribution network operators.
- A competitive atmosphere sharpens the Electricity Distribution industry. IDNOs, despite high barriers, introduce key competition, seeking new connections to boost their own smaller networks.
Industry Overview
Market size and recent performance (2014-2029)
Industry revenue has grown at a CAGR of 1.3 % over the past five years, to reach an estimated £8.9bn in 2024.
Trends and Insights
Revenue has tracked in line with price controls
- Since distribution network operators (DNOs) operate a natural monopoly, revenue is dictated by price controls set by the energy regulator, with profitability maintained at an artificially high level to ensure sufficient funds to re-invest in the network while providing sufficient returns to attract equity investment.
- Additional trends and insights available with purchase
Source: IBISWorld
Industry outlook (2024-2029)
Market size is projected to grow over the next five years.
Trends and Insights
Technology advances are spurring change in what is expected from distribution networks
- The transition of operators from distribution network operators (DNOs) to distribution system operators (DSOs) is key to achieving decarbonisation outcomes set out in the RIIO-ED2 price control.
Biggest companies in the Electricity Distribution in the UK
| Company | Market Share (%)
2025 | Revenue (£m)
2025 |
|---|---|---|
National Grid Electricity Distribution plc | 2,079.0 | |
UK Power Networks Holdings Ltd | 2,047.8 | |
Northern Powergrid Holdings Company | 1,231.0 |
To view the market share and analysis for all 7 top companies in this industry, view purchase options.
Products & Services Segmentation
Source: IBISWorld
Industry revenue is measured across several distinct product and services lines, including Gas-fired electricity, Offshore wind power and Onshore wind power. Gas-fired electricity is the largest segment of the Electricity Distribution in the UK.
Trends and Insights
Gas generation is sloping downwards but remains the dominant source UK electricity production
- Gas-fired electricity is generated in thermal power stations.
- More insights available in the full report
Widen you competitive advantage with related industries
Competitors
- There are no industries to display.
Complementors
- Electricity Production in the UK
- Electricity Transmission in the UK
- Electricity Supply in the UK
- Renewable Electricity Generation in the UK
International industries
- Electric Power Transmission in the US
- Electric Power Transmission in Canada
- Electricity Distribution in Australia
- Electricity Transmission and Distribution in New Zealand
- Electricity Transmission and Distribution in China
Table of Contents
About this industry
Industry definition
Firms in this industry operate the low-voltage electricity distribution networks that carry power from high-voltage transmission lines to end users.
What's included in this industry?
Gas-fired electricityOffshore wind powerNuclear powerOnshore wind powerBiomassOil and otherSolarCoal-fired electricityCompanies
National Grid Electricity Distribution plcUK Power Networks Holdings LtdNorthern Powergrid Holdings CompanyPurchase this report to view all 7 major companies in this industry.
Related Terms
RIIO-ED1SMART METERDISTRIBUTED GENERATIONIndustry Code
SIC 35.13 - Electricity Distribution in the UK
Performance
Get an indication of the industry's health through historical, current and forward-looking trends in the performance indicators that make or break businesses.
Analyst insights
Regulation hamstrings the Electricity Distribution industry's earnings. Ofgem's new price controls and restrictions have curtailed industry profitability; stricter standards ...
In this chapter (4)
- Current Performance
- Outlook
- Volatility
- Life Cycle
Key metrics
- Annual Revenue, Recent Growth, Forecast, Revenue Volatility
- Number of Employees, Recent Growth, Forecast, Employees per Business, Revenue per Employee
- Number of Businesses, Recent Growth, Forecast, Employees per Business, Revenue per Business
- Total Profit, Profit Margin, Profit per Business
Charts
- Revenue, including historical (2014-2023) and forecast (2024-2029)
- Employees, including historical (2014-2023) and forecast (2024-2029)
- Businesses, including historical (2014-2023) and forecast (2024-2029)
- Profit, including historical (2014-2024)
- Industry Volatility vs. Revenue Growth
- Industry Life Cycle
Detailed analysis
- Trends in supply, demand and current events that are driving current industry performance
- Expected trends, economic factors and ongoing events that drive the industry's outlook
- Key success factors for businesses to overcome volatility
- How contribution to GDP, industry saturation, innovation, consolidation, and technology and systems influence the industry's life cycle phase.
Products and Markets
Learn about an industry's products and services, markets and trends in international trade.
Analyst insight
Gas continues to reign in UK's electricity production. Despite rising wholesale prices, and geopolitical tensions sparking a move to reduce dependence, gas-fired power remain...
In this chapter
- Products & Services
- Major Markets
Key metrics
- Largest market segment and value in 2024
- Product innovation level
Charts
- Products & services segmentation in 2024
- Major market segmentation in 2024
Detailed analysis
- Trends impacting the recent performance of the industry's various segments
- Innovations in the industry's product or service offering, specialization or delivery method
- Key factors that successful businesses consider in their offerings
- Buying segments and key trends influencing demand for industry products and services
Geographic Breakdown
Discover where business activity is most concentrated in an industry and the factors driving these trends to find opportunities and conduct regional benchmarking.
Analyst insights
London and the South East are key for electrical distribution businesses. With their heavy electricity consumption due to high population density and commercial activity, the...
In this chapter (1)
- Business Locations
Charts
- Share of revenue, establishment, wages and employment in each region
- Share of population compared to establishments in each region in 2024
Tables
- Number and share of establishments in each region in 2024
- Number and share of revenue each region accounts for in 2024
- Number and share of wages each region accounts for in 2024
- Number and share of employees in each region in 2024
Detailed analysis
- Geographic spread of the industry across Europe, and trends associated with changes in the business landscape
- Key success factors for businesses to use location to their advantage
Competitive Forces
Get data and insights on what's driving competition in an industry and the challenges industry operators and new entrants may face, with analysis built around Porter's Five Forces framework.
Analyst insights
A competitive atmosphere sharpens the Electricity Distribution industry. IDNOs, despite high barriers, introduce key competition, seeking new connections to boost their own s...
In this chapter (4)
- Concentration
- Barriers to Entry
- Substitutes
- Buyer & Supplier Analysis
Key metrics
- Industry concentration level
- Industry competition level and trend
- Barriers to entry level and trend
- Substitutes level and trend
- Buyer power level and trend
- Supplier power level and trend
Charts
- Market share concentration among the top 4 suppliers from 2019-2024
- Supply chain including upstream supplying industries and downstream buying industries, flow chart
Detailed analysis
- Factors impacting the industry’s level of concentration, such as business distribution, new entrants, or merger and acquisition activity.
- Key success factors for businesses to manage the competitive environment of the industry.
- Challenges that potential industry entrants face such as legal, start-up costs, differentiation, labor/capital intensity and capital expenses.
- Key success factors for potential entrants to overcome barriers to entry.
- Competitive threats from potential substitutes for the industry’s own products and services.
- Key success factors for how successful businesses can compete with substitutes.
- Advantages that buyers have to keep favorable purchasing conditions.
- Advantages that suppliers have to maintain favorable selling conditions.
- Key success factors for how businesses can navigate buyer and supplier power.
Companies
Learn about the performance of the top companies in the industry.
Analyst insights
UK Power Networks leads the UK's Electricity Distribution industry. Serving over 8.5 million homes and businesses through more than 190,000km of cables, their extensive netwo...
In this chapter
- Market Share Concentration
- Companies
- Company Spotlights
Charts
- Industry market share by company in 2020 through 2024
- Major companies in the industry, including market share, revenue, profit and profit margin in 2024
- Overview of National Grid Electricity Distribution plc's performance by revenue, market share and profit margin from 2018 through 2024
- Overview of UK Power Networks Holdings Ltd's performance by revenue, market share and profit margin from 2018 through 2024
- Overview of Northern Powergrid Holdings Company's performance by revenue, market share and profit margin from 2018 through 2024
- Overview of revenue, market share and profit margin trend for 4 additional companies
Detailed analysis
- Description and key data for National Grid Electricity Distribution plc, and factors influencing its performance in the industry
- Description and key data for UK Power Networks Holdings Ltd, and factors influencing its performance in the industry
- Description and key data for Northern Powergrid Holdings Company, and factors influencing its performance in the industry
- Description, key data and performance trends for 4 additional companies
External Environment
Understand the demographic, economic and regulatory factors that shape how businesses in an industry perform.
Analyst insights
Ofgem's RIIO price control shapes the electricity distribution industry. By incentivising investment in the network and promoting innovation, the output based price control d...
In this chapter
- External Drivers
- Regulation & Policy
- Assistance
Key metrics
- Regulation & policy level and trend
- Assistance level and trend
Charts
- Regulation & Policy historical data and forecast (2014-2029)
- Assistance historical data and forecast (2014-2029)
Detailed analysis
- Demographic and macroeconomic factors influencing the industry, including Regulation & Policy and Assistance
- Major types of regulations, regulatory bodies, industry standards or specific regulations impacting requirements for industry operators
- Key governmental and non-governmental groups or policies that may provide some relief for industry operators.
Financial Benchmarks
View average costs for industry operators and compare financial data against an industry's financial benchmarks over time.
Analyst insights
The price control mechanism boosts profitability. Ofgem's regulation ensures firms deliver while maintaining a high profit margin, enabling capital expenditure on network mai...
In this chapter
- Cost Structure
- Financial Ratios
- Key Ratios
Key metrics
- Profit margin, and how it compares to the sector-wide margin
- Average wages, and how it compares to the sector-wide average wage
- Largest cost component as a percentage of revenue
- Industry average ratios for days' receivables, industry coverage and debt-to-net-worth ratio
Charts
- Average industry operating costs as a share of revenue, including purchases, wages, depreciation, utilities, rent, other costs and profit in 2024
- Average sector operating costs as a share of revenue, including purchases, wages, depreciation, utilities, rent, other costs and profit in 2024
- Investment vs. share of economy
Data tables
- Liquidity Ratios (2018-2022)
- Coverage Ratios (2018-2022)
- Leverage Ratios (2018-2022)
- Operating Ratios (2018-2022)
- Assets (2018-2022)
- Liabilities (2018-2022)
- Cash Flow & Debt Service Ratios (2014-2029)
- Revenue per Employee (2014-2029)
- Revenue per Enterprise (2014-2029)
- Employees per Establishment (2014-2029)
- Employees per Enterprise (2014-2029)
- Average Wage (2014-2029)
- Wages/Revenue (2014-2029)
- Establishments per Enterprise (2014-2029)
- IVA/Revenue (2014-2029)
- Imports/Demand (2014-2029)
- Exports/Revenue (2014-2029)
Detailed analysis
- Trends in the cost component for industry operators and their impact on industry costs and profitability
Key Statistics
Industry Data
Data Tables
Including values and annual change:
- Revenue (2014-2029)
- IVA (2014-2029)
- Establishments (2014-2029)
- Enterprises (2014-2029)
- Employment (2014-2029)
- Exports (2014-2029)
- Imports (2014-2029)
- Wages (2014-2029)
Methodology
How are IBISWorld reports created?
IBISWorld has been a leading provider of trusted industry research for over 50 years to the most successful companies worldwide. With offices in Australia, the United States, the United Kingdom, Germany and China, we are proud to have local teams of analysts that conduct research, data analysis and forecasting to produce data-driven industry reports.
Our analysts start with official, verified and publicly available sources of data to build the most accurate picture of each industry. Analysts then leverage their expertise and knowledge of the local markets to synthesize trends into digestible content for IBISWorld readers. Finally, each report is reviewed by one of IBISWorld’s editors, who provide quality assurance to ensure accuracy and readability.
IBISWorld relies on human-verified data and human-written analysis to compile each standard industry report. We do not use generative AI tools to write insights, although members can choose to leverage AI-based tools within the platform to generate additional analysis formats.
What data sources do IBISWorld analysts use?
Each industry report incorporates data and research from government databases, industry-specific sources, industry contacts, and our own proprietary database of statistics and analysis to provide balanced, independent and accurate insights.
Key data sources in the UK include:
- Office for National Statistics
- Office for Budget Responsibility
- Bank of England
Analysts also use industry specific sources to complement catch-all sources, although their perspective may focus on a particular organization or representative body, rather than a clear overview of all industry operations. However, when balanced against other perspectives, industry-specific sources provide insights into industry trends.
These sources include:
- Industry and trade associations
- Industry federations or regulators
- Major industry players annual or quarterly filings
Finally, IBISWorld’s global data scientists maintain a proprietary database of macroeconomic and demand drivers, which our analysts use to help inform industry data and trends. They also maintain a database of statistics and analysis on thousands of industries, which has been built over our more than 50-year history and offers comprehensive insights into long-term trends.
How does IBISWorld forecast its data?
IBISWorld’s analysts and data scientists use the sources above to create forecasts for our proprietary datasets and industry statistics. Depending on the dataset, they may use regression analysis, multivariate analysis, time-series analysis or exponential smoothing techniques to project future data for the industry or driver. Additionally, analysts will leverage their local knowledge of industry operating and regulatory conditions to impart their best judgment on the forecast model.
IBISWorld prides itself on being a trusted, independent source of data, with over 50 years of experience building and maintaining rich datasets and forecasting tools. We are proud to be the keystone source of industry information for thousands of companies across the world.
Learn more about our methodology and data sourcing on the Help Center.
Frequently Asked Questions
Unlock comprehensive answers and precise data upon purchase. View purchase options.
What is the market size of the Electricity Distribution in the UK industry in United Kingdom in 2024?
The market size of the Electricity Distribution in the UK industry in United Kingdom is £8.9bn in 2024.
How many businesses are there in the Electricity Distribution in the UK industry in 2024?
There are 26 businesses in the Electricity Distribution in the UK industry in United Kingdom, which has grown at a CAGR of 4.4 % between 2019 and 2024.
Has the Electricity Distribution in the UK industry in United Kingdom grown or declined over the past 5 years?
The market size of the Electricity Distribution in the UK industry in United Kingdom has been growing at a CAGR of 1.3 % between 2019 and 2024.
What is the forecast growth of the Electricity Distribution in the UK industry in United Kingdom over the next 5 years?
Over the next five years, the Electricity Distribution in the UK industry in United Kingdom is expected to grow.
What are the biggest companies in the Electricity Distribution in the UK market in United Kingdom?
The biggest companies operating in the Electricity Distribution market in United Kingdom are National Grid Electricity Distribution plc, UK Power Networks Holdings Ltd and Northern Powergrid Holdings Company
What does the Electricity Distribution in the UK in United Kingdom include?
Gas-fired electricity and Offshore wind power are part of the Electricity Distribution in the UK industry.
Which companies have the highest market share in the Electricity Distribution in the UK in United Kingdom?
The company holding the most market share in United Kingdom is National Grid Electricity Distribution plc.
How competitive is the Electricity Distribution in the UK industry in United Kingdom?
The level of competition is low and steady in the Electricity Distribution in the UK industry in United Kingdom.
