SSE profits increase due to rising energy prices

Energy company SSE has reported a quadrupling of profits but underscored the scale of its investments in the UK’s renewable sector as the government prepares an unexpected tax on power generators.

SSE’s adjusted profit after tax rose to £450m in the six months to September from £111m in the same period last year, buoyed by volatility in gas and electricity prices which has sparked a cost of living crisis.

However, reported or unadjusted profit before tax swung to a loss of £511m from a profit of £1.7bn in 2021.

SSE’s “good strategic and financial performance” has enabled the energy group to invest a record £1.7 billion over the period, chief executive Alistair Phillips-Davies said, alluding to the need for government support to deal with the energy crisis .

“With a supportive government policy environment, the SSE alone could invest more than £24 billion in the UK by the end of this decade,” he said on Wednesday.

“By SSE’s own estimates, if the investments needed to meet the 2030 targets had been made by 2022, it would have saved around £30bn in UK gas spending that year,” he added.

Britain’s Chancellor Jeremy Hunt is expected to introduce a windfall tax on power generators in his autumn declaration on Thursday as the government seeks to fill a budget gap exacerbated by the need to support household and business energy bills this winter.

But electricity companies have warned the government not to discourage investment at a time when companies are being asked to accelerate the transition to renewable energy.

SSE earnings per share for the period were 41.8p, in line with previous guidance, with full year guidance unchanged at 120p per share.

The company, which is one of the largest renewable energy and grid operators in the UK, said it had delivered strong results from its gas storage business, offsetting lower renewable energy yields impacted by adverse weather conditions during the period.

SSE shares slipped 2 percent to £16.19 in early London trade. They’re down 3 percent this year.

https://www.ft.com/content/c89c4ca6-b7b2-426d-beeb-6430134efcb1 SSE profits increase due to rising energy prices

Adam Bradshaw

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