Since the start of 2025, the National Grid (LSE:NG.) share price has shot up by just shy of 35%. And for anyone who’s been reinvesting the dividends paid along the way, the returns are much closer to 39%.

That might not sound too explosive compared to some US tech stocks, but for a utilities business, this level of growth’s pretty extraordinary. Don’t forget that for most of the last decade, this FTSE stock has been flat.

So what’s going on? And will this momentum continue in 2026?

Why’s it rising?

There are a lot of factors influencing National Grid shares today. However, two of the most consequential are a £60bn infrastructure investment programme and a transformational regulatory uplift.

The goal’s to nearly double the size of the group’s transmission network by 2029. Beyond significantly boosting its capacity to support new AI data centres, the enormous investment programme also allows the company to increase its regulatory asset base (RAB), directly translating into more permissible revenue by regulators.

The timing of this comes as the new five-year RIIO-T3 price control framework comes into effect. Compared to RIIO-T2, the updated framework’s far less restrictive, enabling National Grid to earn higher regulated revenues and better fund its infrastructure investment plans.

Subsequently, the group’s underlying earnings for its 2027 fiscal year (ending in March) are now expected to grow 13%-15%. And this rate of expansion of a regulated entity is practically unheard of.

With that in mind, it’s no wonder that National Grid shares are on the rise. But is this growth now baked into its share price?

Is it too late to buy?

While National Grid’s 2027 fiscal year looks like it’s on track for a gangbusters year, future growth will likely slow. And the general consensus points towards 6%-8% earnings growth on a compounded annualised basis between now and 2031.

That’s still impressive. But it’s important to recognise this is dependent on management successfully executing its £60bn investment programme – something that’s far easier said than done.

Even if internal operations run flawlessly, external supply chain disruptions for transformers, cables, and substations could create expensive delays. And with other countries seeking to upgrade their own infrastructure in 2026, equipment shortages have already started to crop up.

With the forward price-to-earnings ratio now standing at 14.3, this growth does indeed appear fully priced in. And when combined with the emerging risk factors, it’s why a number of institutional analysts have started updating their recommendations from Buy to Hold.

As such, it seems unlikely the National Grid share price will deliver another 30%+ jump over the next 12 months. However, that doesn’t mean there isn’t a valid investment case to be made here.

For growth investors like me, National Grid’s most likely a bad fit in April. But for conservative investors looking to build a defensive portfolio of mission-critical companies with stable cash flows and long-term structural demand, National Grid might still be worth a closer look.