Annual profits have dropped at SSE during a year that presented “a number of complex challenges to manage”, including looming pressure from the UK government to cap standard variable tariffs and its plans to merge with its rival Big Six supplier Npower.
Legislation for an energy price cap on standard variable tariffs (SVTs) has recently been passed by the House of Commons and is expected to be enforced by the end of the year, which will have a significant impact on SSE that has the highest proportion of customers on SVTs of the Big Six.
SSE said: “While electricity tariffs increased to recognise rising non-energy costs, overall profits were also impacted by customer account losses and the introduction of price caps for certain customer groups, offset by ongoing efficiency savings”.
Pre-tax profits fell 6% to £1.45 billion in the year to March, driven by the energy firm’s transmission and distribution business, where investment into large projects weighed on earnings.
Chairman Richard Gillingwater said further challenges were expected in 2018-19 – a “year of major transition for SSE”.