NationalGridToday

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One of the world’s largest public owned utilities focused ontransmission and distribution activities in electricity and gas inboth the United Kingdom and the United States

March 2014 regulated assets of around £36bn generating operatingprofit of £3.7bn with a strong dividend

Strong growth opportunities in well regulated utility markets,particularly in the UK

Dividend policy effective 1 April 2013 – aim is to grow ordinarydividend at least in line with RPI for the foreseeable future

Our investment propositionWe aim to be a business focused on generating shareholder value through both dividends and asset/equity growth by

under predominantly regulated market conditions to service

low risk investing

in essential assets long-term sustainable consumer led demands

Reducing risk...

...Investing in essential assets...

...Our performance – returns and value added...

...Sustainable consumer-led demands

Developing the business

Total shareholder return Performance and returns

Focus on operating performanceManaging our cost base

Maximising incentives

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Generating strong cash flows

Delivering on commitments

Balance of activities Regulatedincome growth

Macro-economicprotection

Commodity andvolume protection

UK RAV

Group ROE Value addedper share

31 March 2014

31 March 2014 31 March 2014

31 March 2014 31 March 2014US Rate Base Net Debt

£ bn24.9

11.4% 57.2p

$ bn16.3 £ bn21.2

National Grid is a portfolio of distinct regulated businesses in the UK and the US and some unregulated businesses,primarily in the UK. This includes a mixture of cash generative developed assets with minimal investment requirements(such as our existing interconnectors and National Grid Metering business), businesses with low to medium levels ofgrowth and positive cash generation (such as our US and UK distribution businesses) and businesses with high levels ofinvestment and growth (such as our UK electricity transmission business and potential new unregulated investments).

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Maintaining strong credit ratings –key driver of value for the Group

Low single A credit ratings for UKoperating companies

Majority of US OpCos rated lowsingle A

NG plc rated BBB+

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Excludes $2.4bn of otherregulated assets including $0.3bnof working capital outside of ratebase

US capex remains broadly in linewith levels expected by ourdifferent regulators

Core growth

Additional opportunities

UK and US regulated ~5%

Accelerated UK load related

US network modernisation

US gas roll out

Business development:- UK interconnectors- US transmission and repowering

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Measure of value we create atoperational and group level

Reflects our ability to balancegrowth and pay dividends

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Captures total return per sharecreated on an operational basis

Shows increased value created inthe balance sheet, plus dividends,less increase to net debt

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Increased incentive to deliverinnovative and efficient capitalinvestments

Totex regime allows opportunityto grow RAV without investment

RPI inflation applies to RAV

May 2014

Operating returnmeasures

Regulators

Allowed

UnitedKingdom

UnitedStates

Shareholdervalue

Equity investors

Achieved Group ROE

Electricity Transmission Electricity Transmission

10.2% 12.4%

10.0% 12.8%

11.4%vs

last year11.7%*

9.9%

9.8%

13.0%

9.0%

Gas Transmission Gas Transmission

Gas Distribution

Total US

Gas Distribution

Total US

FERC

Gas Distribution Gas Transmission

12.2% 11.0%8.7% 8.3%

KEDNY KEDLI

US RoE

UK returns

NiMo Electric

Allowedreturns

2013/14 RAV and Rate base

Generating returns

7.2%

Basereturns

12.4%12.8%13.0%

Electricity Transmission

RAV andRate base

£0

$0

£24.9bn

$16.3bn

totalshareholder

return=

dividend yield+

growth in theper share value of

shareholders’equity

2014/15 priorities

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Strong balance sheet

Opportunities to improve returns

Priority remains delivery of attractive total returnsfor shareholders

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We manage a leveragedbusiness model to driveconsistent TSR performance byproviding growth in dividendsand assets

Balancing the rate of assetgrowth with secure financingproduces the optimal TSR

Additional investments need toenhance our TSR

Conclusion and outlook

Portfolio evolution

Distribution

Non-regulatedbusinesses

UK Transmission

Growth

YieldNot to scale

National Grid plc1 –3 StrandLondon WC2N 5EHUnited Kingdomwww.nationalgrid.com

Download our iPad appfree on the App Store

@nationalgridIR

Andy Mead

Victoria Davies

Senior Investor Relations OfficerT +44 (0)20 7004 3166M +44 (0)7752 890787andy.mead@nationalgrid.com

Investor Relations Officer+44 (0)20 7004 3171+44 (0)7771 973447victoria.davies@nationalgrid.com

John Dawson

George Laskaris

Director of Investor RelationsT +44 (0)20 7004 3170

john.dawson@nationalgrid.com

T +1 718 403 2526M +1 917 375 0989george.laskaris@

M +44 (0)7810 831944

US Investor Relations Director

nationalgrid.com

Tom Hull

Caroline Dawson

Investor Relations Manager+1 718 403 2487+1 917 524 4099tom.hull@nationalgrid.com

Investor Relations ManagerT +44 (0)20 7004 3169M +44 (0)7789 273241caroline.dawson@nationalgrid.com

Further information

National GridNational Grid plc

Important noticeThis document contains certain statements that are neither reported financial results nor other historical information. These statements are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of theSecurities Exchange Act of 1934, as amended. These statements include information with respect to National Grid’s financial condition, its results of operations and businesses, strategy, plans and objectives. Words such as ‘anticipates’, ‘expects’, 'should', ‘intends’,‘plans’, ‘believes’, 'outlook', ‘seeks’, ‘estimates’, ‘targets’, ‘may’, ‘will’, ‘continue’, ‘project’ and similar expressions, as well as statements in the future tense, identify forward-looking statements. Furthermore, this document, which is provided for information only, doesnot constitute summary financial statements and does not contain sufficient information to allow for as full an understanding of the results and state of affairs of National Grid, including the principal risks and uncertainties facing National Grid, as would be provided bythe full Annual Report and Accounts, including in particular the Strategic Review section and the ‘Risk factors’ on pages 176 to 178 of National Grid's latest Annual Report and Accounts, as updated by National Grid’s unaudited half year financial information for the sixmonths ended 30 September 2013 published on 21 November 2013 . Copies of the most recent Annual Report and Accounts are available online at www.nationalgrid.com or from Capita Registrars. Except as may be required by law or regulation, National Gridundertakes no obligation to update any of its forward-looking statements, which speak only as of the date of this document. The content of any website references herein do not form part of this document.

11.8%9.5% 8.8% 8.0%8.5%

6.4%

MassElec

MassGas

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UK and US

Electricity and gas

Transmission and distribution

lobalfunctionsLocal expertise and g

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RPI linked UK revenues

Asset growth leading to increasedrevenues

Updated rate cases

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Bad debt trackers and creditprotection

UK inflation linked revenuesand assets

Price control ‘re-openers’

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Revenue decoupling

Energy commodity pass through

Low carbon economy andlong term growth in demand

Replacingageing assets

Security of supply= system resilience

NiMo Gas 10.3%Narragansett Electric 10.1%

Narragansett Gas 9.9%

Investment: Asset Growth

5+% paUK Electricity Transmission

UK GasTransmission

UK Gas Distribution

US Regulated

Significant investment program

Several important upgrades required

Challenge to improve customer service

Sustain returns and growth

* Excluding major storms

New gas and electric rate plans were approved in 2013 for NewYork and Rhode Island:

Niagara Mohawk (Electricity and Gas)- Headlines for 3 year rate plan include 9.3% allowed RoEand 48% equity cap structure

Narragansett (Electricity and Gas)- Headlines for 1 year rate plan include 9.5% RoE and 49%equity cap structure

LIPA power supply agreement (PSA)- Headlines include 15 year agreement with 9.75% RoE

and 50% equity structure

Keyspan Energy Delivery New York (KEDNY)- Modifies existing rate agreement for a 2 year period- Headlines include 9.4% RoE, 48% equity structure, andcapex of approximately $300m per annum

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UK profile

8.8% 9.2% 9.0%

£ bn24.9

2011/12 2012/13 2013/14

Actual return as percentage of allowed return� �� �

� FERC�

� Electricity Transmission�

£10.9bn

£5.5bn

£8.5bn

� New York�

� Gas Transmission�

� Massachusetts�

� Gas Distribution�

� Rhode Island�

� Allowed return* Achieved return�� �

National Grid is an international electricity and gascompany based in the UK and northeastern US. We playa vital role in connecting millions of people to the energythey use, safely, reliably and efficiently.

In the US our electricity and gas distributionbusiness provide services to customers inNew York, Massachusetts and RhodeIsland. We also own and operate anelectricity transmission network spanningupstate New York, Massachusetts, RhodeIsland, New Hampshire and Vermont.

In the UK we own the electricitytransmission system in England andWales, and operate the system inGreat Britain. We also own andoperate the gas transmission systemin Great Britain as well as four of theeight gas distribution networks.

Electricity transmission owner(England and Wales)

GB electricity system operator

GB gas transmission owner

Over 7,000km of high voltageoverhead line

Over 400km of underground cable

329 substations located at 242 sites

Continuous real-time matching ofdemand and generation output, ensuringthe stability and security of the powersystem and the maintenance ofsatisfactory voltage and frequency

Designated as system operator for thenew offshore electricity transmissionregime

Over 7,500km of high pressure pipe

23 compressor stations connecting toeight distribution networks and to thirdparty independent systems for onwardtransportation of gas to end consumers

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Electricity transmission owner

Canadian interconnector

Electricity distribution

Own and operate electricity transmissionnetworks in upstate New York and NewEngland with voltages ranging from 69kVto 345kV

Largest electricity transmission serviceprovider in New York andby reference to the length of these highvoltage transmission lines

Own and operate a 224km direct currenttransmission line rated at 450kV that is akey section of an interconnector betweenNew England and Canada

Own and operate electricity distributionnetworks in upstate New York,Massachusetts and Rhode Island

~3.4 million electricity consumers in NewEngland and upstate New York

New England

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GB gas system operator

24 hour balancing of supply and demand

Gas distribution

LNG storage

Regulation

131,000km of gas distribution pipelineused to transport gas from the nationaltransmission system to around 10.9 millionconsumers on behalf of 26 active gasshippers

Own and operate three liquefied naturalgas (LNG) storage facilities

Ofgem currently provide the UK regulatoryframeworks for our gas and electricitybusinesses

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Electricity generation

Gas distribution owner

Gas storage

Regulation

53 electricity generation units on LongIsland that together provide 3.9GW ofpower under contract to LIPA

Our plants consist of oil and gas firedsteam turbine, gas turbine and dieseldriven generating units ranging from 2MWto 385MW

3.5 million consumers: New York,Massachusetts and Rhode Island

~58,000km of gas distribution pipeline inan area 26,400km

During cold weather we have 19 facilitieswhich supplement gas from the interstatepipeline system with LNG and propane

We currently have 1 federal and 3 stateregulators who provide frameworks for our12 US businesses

~

2

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US achieved Return on Equity %

Rate Base31 March 2014

RAV31 March 2014

UK regulated returns %2013/14

UK regulation US regulation

UK key facts and figures US key facts and figures

Cost of equity

Cost of debt

Gearing

Totex incentive rate

Total expenditure (nominal)*

7.0%

Index tracker

60%

47%

£19.9bn

6.8%

Index tracker

62.5%

44%

£7.0bn

6.7%

Index tracker

65%

63%

£11.9bn

Electricitytransmission

Gastransmission

Gasdistribution

Operations andasset management

Regulatoryengagement

Financial planningand execution

Delivering value through growth and shareholder returns

Electricity Transmission

* Including average 3.0% long run inflation

Gas Transmission Gas Distribution

2009/10

2009/10

2009/10 2012/13 2013/14

2009/10

2010/11

2010/11 2012/13 2013/142011/12

2010/11 2011/12

2010/11 2011/12 2012/13 2013/14

2011/12 2012/13 2013/14

3.5£bn

£bn

p

p

3.13.6 3.6 3.7 45.4 46.0 51.4 54.0

4.7 4.4 39.28 40.85 42.03

47.1

4.1 4.1 4.6 36.3733.68†

£ bn3.7

£ bn4.6

54.0p

42.03p

OperatingProfit*

OperatingCash Flow*

EarningsPer Share*

DividendPer Share

Essential qualities for success

10.2 12.4 10.0 12.8 9.9 13.0

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Maximise the use of our existingasset base

Maintain reliability and security

Plan and deliver the future system

Focus on customer satisfaction andstakeholder engagement

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Balance the ever more complexsupply and demand mix

Deliver incentive income

Drive cost savings and efficiency

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Secure the right rate plans forcustomers and investors

Agree appropriate incentive schemes

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Maintain an efficient balance sheet

Fund our growth

Minimise funding costs

Financing package

* Ofgem “Best View” scenario. Assumes inflation of 3% per annum (includes non-controllable costs)

RIIO regulatory framework

Revenue = Innovation + Incentives + Outputs

Covering 8 years (2013/14 – 2020/21)

Continued RPI linkage to revenues and RAV

Enhanced incentives and retention of capex savings

Total expenditure (totex) focus

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Scrip dividend – proactive management

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Supports high levels of growth and maintains A- credit ratingduring impact of RIIO transition measures on depreciation

Average take-up of around 20% over the first three years ofthe

Board will take more proactive approach to manage dilutionassociated with scrip

However, provides little value if capital raised is unnecessary

Scrip programme

Non-regulated businesses

We also own several non-regulated businesses providingservices closely linked with our regulated businesses includingGrain LNG, metering, interconnectors and property

Grain LNG – terminal capacity now up to 20% of UK demand

French interconnector (2,000MW) – Own and operate UKassets and portion of subsea cables

BritNed – joint venture with TenneT; a 1,000MW 260km subseaelectricity link between the UK and the Netherlands

Future opportunities include offshore transmission, additionalinterconnectors and further expansion to Grain LNG

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* Excludes $2.4bn of otherregulated assets including$0.4bn of working capitaloutside of rate base

US profile

31 March 2014

UK Gas Distribution

Gas distribution operating area

UK Transmission

Scottish electricitytransmission system

English and Welsh electricitytransmission system

Gas transmission system

Terminal

LNG terminal owned by National Grid

LNG terminal

Electricity interconnector

Gas interconnector

* Business performance excluding exceptional items, remeasurements and stranded cost recoveries † 2009/10 has been rebased for the rights issue

$ bn*16.3

$2.2bn

$9.8bn

$3.3bn

$1.0bn

US Regulated

Electricity transmission network

Gas distribution operating area

Electricity distribution area

LIPA

Generation

Gas and electricity distributionarea overlap