Business

Profits down at energy giant SSE

SSE said lower energy prices had driven a fall in profits

ENERGY firm SSE has seen adjusted pre-tax profits fall 3.3 per cent to £1.5 billion following lower energy prices and increased competition.

Profits at the gas production arm alone fell 94 per cent to £2.2 million in the year to March 2016.

The group's wholesale business also sustained a 6.6 per cent drop in operating profit to £442.5m.

Retail operating profits remained relatively flat at £455.2m while pre-tax profits across the company on an unadjusted basis were down almost 20 per cent to £593.3m.

SSE is the third largest generator in Ireland owning and operating 1,836MW of generation capacity including 544MW from renewables.

The company also trades across the interconnectors between Ireland and Britain

It is the largest generator of wind power in Ireland and has plans to increase capacity further.

Over the next two years, SSE wants to add 174MW of new Irish wind power generation capacity to its existing fleet.

It is currently constructing a 35MW wind farm at Tievenameenta in Co Tyrone with another 19MW facility due to commence shortly.

A much larger development at Doraville - with a 115MW capacity - is currently being considered by planners.

SSE Aitricity supplies electricity and gas to 790,000 homes and businesses throughout Ireland giving it a 20 per cent share of the total markets.

The business is also a 50 per cent shareholder in SGN which is currently partnering with Mutual Energy to deliver the Gas to the West project in the north which will bring gas to 40,000 new customers.

First gas is expected to be available in Strabane late this year with with connections to the other towns following during 2017.

SSE Airtricity has applied to the Utility Regulator to extend its gas supply licence to include the west alongside the current licences that it already holds to supply natural gas to customers in greater Belfast and the so-called ten towns area.

SSE chief executive Alistair Phillips-Davies said: "The operating environment presented a number of complex issues, including the impact of prevailing commodity prices and intense retail market competition. At the same time, SSE has continued to demonstrate financial discipline and commitment to its long-term strategic framework.

"The fact that some of the mist is beginning to clear around the legislative, political and regulatory environment means there are grounds for some cautious optimism for the next couple of years.

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