Profit slip 6% as it loses another 400,000 customers, but Scots power giant announces new £350m high-efficiency low-carbon emissions gas-fired plant in Lincolnshire

The SSE Keady coal power station
The SSE Keady coal power station

A Scottish-based utility has announced plans to build a new £350 million gas-fired power station in Yorkshire after failing to win any new electricity supply contracts in the most recent government negative-auction round.

**Pearth-based SSE – one of the Big Six – will open the new 840MW combined cycle gas turbine (CCGT) power station at Keadby, Lincs.

SSE said it ’continues to believe the capacity market auction is the right mechanism’ to ensure the GB electricity system remains secure at the lowest cost to consumers.

The spokesman added: “Alongside wholesale market and ancillary services revenues, capacity market payments remain an important aspect of the economics of Keadby 2, and wwe intend to participate in future auctions to secure a capacity market agreement. 

“The decision to invest in Keadby-2, with its high thermal efficiency, is compatible with our new ambition to achieve a further 50% reduction in the carbon intensity of electricity we generate to around 150g/kWh.

“Keadby-2 is also expected to reduce carbon emissions for the overall GB electricity system by reducing the need for older, lower efficiency CCGTs as well as single cycle thermal generators, all of which produce higher carbon emissions when running.”

SSE has partnered with a Germany-based engineering conglomerate to build this first-of-a-kind, high-efficiency gas-fired generation technology in the UK, with construction working starting next week.

Meanwhile, profits at SSE fell by 6% last year as it lost another 430,000 gas and electricity customers

The utility last week reported a 6% fall in adjusted pre-tax profits to £1.45 billion in the year to March 31, while bottom-line profits were down 39% to £1.09 billion.

SSE cited ‘competitive pressures’ as the explanation for the number of its domestic energy accounts falling from 7.23 million to 6.8 million.

SSE is also trying to merge its retail consumer division (which supplies these gas and electricity customers) with N-Power. The British gas and electricity market regulator OFGEM is investigating the merger on anti-competition grounds which – if it is approved – will reduce the Big Six to the Big Five.

 ** Pearth is both the Gaelic and Scots names for what in English is translated as ‘Perth’.

*Like the Scottish Government, Scottish Energy News operates an all-inclusive linguistic policy and recognises all three of Scotland’s languages – English, Scots and Gaelic (unlike the Scottish Parliament); eg ** ‘Cooncil’ is the Scots language word for ‘council’ and is not pejorative; etc..

 Dictionar o’ the Scots Leid  / Dictionary of the Scots Language – http://goo.gl/7xo5Bk 

29 May 2018

Pixie Energy

Pixie logo Pixie Energy is an incubator and a facilitator of strategic research and project work, focusing on energy regulation, policy and markets at the local and national level. Find out more about Pixie Energy here.

Local Energy Matters: Scotland

Local Energy Matters: Scotland is a free-to-download brochure with a focus on energy tariffs in the two Scottish electricity distribution regions, as well news on local energy and low-carbon schemes.

Previous editions can be download here.

Scottish energy market overview

You can read an overview of the Scottish energy market here.

Scottish Government energy feed