Industry Analysis & Industry Trends
The Electricity Transmission industry is responsible for carrying electricity from power stations to the low-voltage distribution network, which delivers the electricity to end users. The industry is a highly regulated natural monopoly. Industry revenue is expected to reach £5.2 billion in 2016-17, an increase of 6.5% on the previous year. The industry is forecast to grow at a compound annual rate of 8% over the five years through 2016-17, as a result of mounting transmission costs and rising charges being levied on grid users. Higher transmission charges relate to the significant amount of capital investment into the transmission grid in order to accommodate new generation plants and to replace ageing systems... purchase to read more
Industry Report - Industry Investment Chapter
Electricity transmission is a capital-intensive process. For every £1.00 that industry players spend on capital, they are estimated to spend 39p on labour. This demonstrates the importance of capital in the production of electricity. Depreciation is a substantial cost item due to the high level of capital spending required to both maintain and expand the electricity transmission grid. Repair work can be extremely expensive, particularly work carried out on the underground transmission cables commonly used in urban areas. Capital investment has been particularly high in recent years, as electricity generators have switched to renewable energy sources, forcing transmitters to expand and update the existing network to accommodate the new facilities.
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