UK energy giant SSE has expressed a level of uncertainty over its planned merger with Npower after the two companies delayed the deal as a result of incoming caps on default tariff prices.
SSE said the impending price cap on standard variable tariffs (SVTs) is expected to increase pressure on the firm’s retail division profits for the year 2019/2020.
The legislation that is set to come into effect in January led the two Big Six energy companies to announce that the proposed merger would be delayed in order to negotiate the deal.
SSE’s half-year results said: “There is now some uncertainty as to whether this transaction can be completed as originally contemplated.
“Nevertheless, the board believes that the best future for SSE energy services, including its customers and employees, will continue to lie outside the SSE group.”
This comes following widespread losses for SSE’s household gas and electricity supplier and the loss of customers, that are switching to smaller and cheaper suppliers.
SSE said: “The market for energy and related services in Great Britain remains intensely competitive, with over 70 suppliers competing for customers and around three million customers switching their electricity provider in the six months to 30 September.”