SSE unveils review of thermal generation operations

FTSE 100-listed electricity and gas company SSE has reported changes to existing thermal generation capacity expected during the 2013/2014 financial year.

FTSE 100-listed electricity and gas company SSE has reported changes to existing thermal generation capacity expected during the 2013/2014 financial year.

Across Britain, SSE currently owns or has a stake in over 4,300 megawatts (MW) of gas and oil-fired generation capacity, over 4,300MW of coal-fired generation capacity and 80MW of capacity at its biomass plant in Slough.

As a result of the review of its generation assets, SSE said that it had decided to change the operating regime of a number of generation plants, the net effect of which would be to reduce SSE's thermal generation capacity in Britain by around 2,000MW over the next year.

SSE reported that the changes would affect SSE's power stations at Ferrybridge, Keadby, Slough Uskmouth, and Peterhead.

The company said that the review was conducted "against a backdrop of challenging energy market conditions with continued extremely low 'spark spreads' and many new emission regulations which have weighed heavily on the viability of thermal generation plant".

These included "constraints imposed on power-generating plants not opted in to the Large Combustion Plant Directive, the early introduction of a Carbon Price Floor at an unexpectedly high level and the move towards full auctioning of CO2 emissions allowances under the EU Emissions Trading Scheme," the company reported.

Paul Smith, the Managing Director of Generation at SSE said: "We have made it clear that all of our power stations have to be able to operate economically over the medium term.

"The market conditions for some of our older generation plant have become increasingly difficult, but these changes to their operating regime should ensure they continue to contribute to the company's performance by safely delivering target levels of availability, efficiency, cost control and ultimately profit contribution."

He added: "SSE expects to maintain a diverse generation portfolio over the medium and longer term, but with a significantly lower carbon intensity than now. We have already committed to halving the carbon intensity of our generation portfolio every decade between now and 2050."

SSE's share price was unchanged at 1,484p at 12:30 on Thursday.

MF

Recommended

Share tips of the week – 30 September
Share tips

Share tips of the week – 30 September

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
30 Sep 2022
The best British tech stocks from a thriving sector
Share tips

The best British tech stocks from a thriving sector

Move over, Silicon Valley. Over the past two decades the UK has become one of the main global hubs for tech start-ups. Matthew Partridge explains why,…
29 Sep 2022
These 3 top value stocks offer
Share tips

These 3 top value stocks offer

Professional investor Adam Rackley of Cape Wrath Capital highlights three overlooked value stocks to buy.
29 Sep 2022
Three top-notch Asian stocks to buy
Share tips

Three top-notch Asian stocks to buy

Professional investors Adrian Lim and Pruksa Iamthongthong, managers of the Asia Dragon Trust, pick three of their favourite Asian stocks to buy now.
23 Sep 2022

Most Popular

Why everyone is over-reacting to the mini-Budget
Budget

Why everyone is over-reacting to the mini-Budget

Most analyses of the chancellor’s mini-Budget speech have failed to grasp its purpose and significance, says Max King
29 Sep 2022
How the end of cheap money could spark a house price crash
House prices

How the end of cheap money could spark a house price crash

Rock bottom interest rates drove property prices to unaffordable levels. But with rates set to climb and cheap money off the table, we could see house…
28 Sep 2022
Why UK firms should start buying French companies
UK stockmarkets

Why UK firms should start buying French companies

The French are on a buying spree, snapping up British companies. We should turn the tables, says Matthew Lynn, and start buying French companies. Here…
28 Sep 2022