Provisions are recognised where a legal or constructive obligation exists at the reporting date, as a result of a past event, where the outflow

of economic benefit is probable and where the amount of the obligation can be reliably estimated.

Provisions are recognised for the costs of environmental remediation; decommissioning costs for certain assets that we are required to remove

Long-term provisions are measured based on management’s best estimates of the likely cash flows, discounted at an appropriate discount rate.

The unwinding of the discount is included within the income statement within finance costs. Short-term provisions are measured at the expected


	Environmental £m	Decommissioning £m	Other £m	Total provisions £m
At 1 April 2022	1,877	258	404	2,539
Exchange adjustments	114	5	12	131
Additions	142	91	222	455
Unused amounts reversed	(38)	(10)	(14)	(62)
Adjustment for change in discount rate¹	(176)	(48)	—	(224)
Unwinding of discount	72	10	6	88
Utilised	(100)	(9)	(176)	(285)
At 31 March 2023	1,891	297	454	2,642
Exchange adjustments	(37)	(2)	(8)	(47)
Additions²	600	34	138	772
Unused amounts reversed	(18)	(7)	(100)	(125)
Adjustment for change in discount rate	4	29	—	33
Unwinding of discount	85	11	6	102
Utilised	(107)	(9)	(149)	(265)
Reclassification to held for sale (note 10)	—	—	(3)	(3)
At 31 March 2024	2,418	353	338	3,109

1.In the prior year, environmental provisions in the US and the UK decreased by £176 million as a result of the change in the real discount rate from 0.5% to 1.5%. The impact of the

change in discount rate to the decommissioning provisions was recognised against the carrying amount of property, plant and equipment (see note 13).

2.Included within additions is a £496 million increase in provision related to changes in the scope of work required on the Group’s clean-up operations on the Gowanus Canal and nearby

legacy MGP sites in Brooklyn, New York. These arose from remediation design changes as communicated in the year by US environmental agencies.

We recognise environmental provisions for the estimated restoration and remediation costs relating to a number of sites owned and managed by


	2024			2023
	Discounted £m	Real undiscounted £m	Real discount rate	Discounted £m	Real undiscounted £m	Real discount rate
UK sites	108	118	1.0%	123	138	1.5%
US sites	2,310	2,579	1.5%	1,768	2,006	1.5%
	2,418	2,697		1,891	2,144

Remediation expenditure in the US is expected to be incurred until 2071, of which the majority relates to three Superfund sites (being sites where

hazardous substances are present as a result of the historical operations of manufacturing gas plants previously owned or operated by the Group

or its predecessor companies in Brooklyn, New York). The weighted average duration of the forecasted cash flows is 10 years. Under the terms of

Remediation expenditure in the UK relates to old gas manufacturing sites and also to electricity transmission sites. Cash flows are expected to be

The real undiscounted amount is management’s best estimate of the actual cash flows that will be required. The provisions are calculated based on

these cash flows discounted at the appropriate real discount rate for the jurisdiction, which is determined using the relevant government bond yield

Numerous estimation uncertainties affect the calculation of these provisions, including the impact of and possibility of changes to regulatory

alternative technologies, the expected timing, cost and duration of cash flows, and changes in the real discount rate. These provisions incorporate

our best estimate of the financial effect of these uncertainties, but future changes in any of the assumptions could materially impact the calculation

Changes in the provision arising from revised estimates, discount rates or changes in the expected timing of expenditure are recognised in the

income statement. A sensitivity of the impact of changes to the US environmental provision real discount rate and changes in estimated future cash

flows is shown in note 35. The facts and circumstances relating to particular cases are evaluated regularly in determining whether an environmental

We recognise provisions for decommissioning costs for various assets we are required to remove at the end of their lives, including the safe removal

of asbestos for certain of our generation units and the restoration of seabeds in respect of our interconnectors. Provisions to decommission

significant portions of our regulated transmission and distribution assets are not recognised where no legal obligations exist and where a realistic

An initial estimate of decommissioning costs attributable to property, plant and equipment is recorded as part of the cost of the related property,

plant and equipment. Changes in the provision arising from revised estimates, discount rates or changes in the expected timing of expenditure that

relates to property, plant and equipment are recorded as adjustments to their carrying value and depreciated prospectively over their remaining

•£170 million (2023: £182 million) of estimated liabilities in respect of past events insured by subsidiary undertakings and policy excesses incurred

•£76 million (2023: £108 million) of estimated liabilities in respect of interconnector excess revenues which will be repayable in future reporting

interconnectors’ performance against their cumulative caps and cash outflows will be required to settle these liabilities by the financial year