National Grid has dropped a Beijing-backed supplier as concerns mount over China’s involvement in critical infrastructure.
The FTSE 100 firm that runs Britain’s power network took advice from the National Cyber Security Centre – a branch of GCHQ – on the decision.
It terminated contracts with the UK arm of Nari Technology, backed by the Chinese government, in April, and has begun removing its components.
The move comes amid fears about foreign powers taking control of technology and businesses.
Ministers were last week urged to block a merger between mobile networks Vodafone and Three – owned by China’s CK Hutchison – using the National Security and Investments Act (NSI).
Cutting ties: National Grid took advice from the National Cyber Security Centre – a branch of GCHQ – on the decision
The Government this month used its powers to pause the sale of The Telegraph to an Abu Dhabi backed consortium. And in November it forced Nexperia, owned by Jiaxing-based Wingtech Technology, to sell its stake in chipmaker Newport Wafer Fab.
But there are fears the NSI, which allows the Government to scrutinise and block deals, could be watered down, making ministers ‘powerless to stop’ takeovers.
The Cabinet Office last month launched a consultation into the legislation over fears it is hampering merger and acquisition activity.
Deputy Prime Minister Oliver Dowden said he wants the act, which was introduced in 2022, to be ‘as pro-business and pro-investment’ as possible.
Luke de Pulford, executive director of the Inter-Parliamentary Alliance on China, warned last month: ‘We don’t want a return to the doomed Golden Era of relations with Beijing where China could walk into UK critical infrastructure with ministers powerless to stop it.’
The Financial Times said Nari subsidiary NR Electric UK no longer had access to sites where the components were installed.
A National Grid spokesman said the company would not comment on confidential contractual matters, but added: ‘We take the security of our infrastructure very seriously.’
The Department for Energy Security and Net Zero said: ‘We work closely with the private sector to safeguard our national security.’ NREC, the UK arm of Nari Technology, could not be reached for comment.
