SSE benefits from networks businesses, Balancing Market, to see profits rise

SSE has begun the sales process for a 25% stake in its transmission business and it expects to make a decision on the timing of the sale of a similar stake in its distribution business this financial year, after the final price determination. The disposal plans were initially announced by the company in 2021 and the timing was announced with its results for the year to end March 2022. The year saw huge increases in operating profit in both networks businesses: SSEN Transmission increased to £380.5 million, up from £220.9 million the previous year, while operating profit in SSE Distribution was £351.8 million, up from £275.8 million.
Overall operating profit rose to £1,536.8 million from £1,333.5 million last year.
In the company’s generation business, operating profit from renewables fell from £731.8 million to £568.1 million, largely because of low wind levels. Total generation across all renewables and thermal plant fell significantly, from 28,287GWh to 23,792 28,287GWh.
When wind volume output was significantly lower than expected, excess forward sale contracts had to be ‘bought back’ in the market at higher prices, SSE said. But the company was able to benefit from offering its thermal and hydro plant (including pumped storage) in the Balancing Market, where they “performed particularly well”. The SSE Thermal segment saw operating profit rise to £306.3 million from £160.5 million, while gas storage moved from a loss of £5.7 million to a profit of £30.7 million. The company said it expects a step up in profit from the thermal business and adjusted earnings for 2022/23 of at least £337 millon, not excluding Keadby.

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