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Two new gas-fired power stations have helped SSE triple its profits from fossil fuel operations.
The energy supplier made adjusted operating profits of £312m from its thermal power division, compared with £100m for the same period last year. SSE’s thermal division covers its operations that generate power by burning fossil fuels.
Gas-fired generation accounted for 45pc of the company’s overall operating profits of £693m in the six months to the end of September.
SSE credited the “significant increase in earnings” to “additional capacity from Triton Power, acquired in September 2022, and Keadby 2 power station, in Lincolnshire, which entered commercial operation in March”. Between them, the two contributed £103m towards earnings.
SSE Thermal acquired Triton Power in partnership with Equinor for £341m last year. Triton operates three plants, though one is no longer generating and only one is of significant size.
Saltend, on the north of the Humber Estuary in East Yorkshire, is a gas-fired plant with a generation capacity of 1.2GW, enough to power more than one million homes.
SSE, which describes itself as “positioned at the heart of the clean energy transition”, provides power to four million homes in northern Scotland and southern England.
The company emitted 2.1 million tonnes of CO2 to the atmosphere over the six months. It argues that gas-fired power stations add security and flexibility to the network, helping to supply power at times when low wind or a lack of sufficient sunlight make renewable generation challenging.
SSE said: “Developing decarbonised alternatives to the existing gas-fired fleet will be vital to deliver SSE’s goal to cut carbon intensity by 80pc by 2030… SSE Thermal is developing options to progressively decarbonise its portfolio, most notably in carbon capture and storage and hydrogen technologies.”
SSE’s renewables division, which has just opened two of the UK’s largest new wind farms, also reported sharply improved performance. Operating profits rose by 479pc to £87m, though the company said this was mostly linked to hedging activities.
Its capacity for green electricity generation is increasing sharply, with the Seagreen wind farm off Scotland and the Dogger Bank wind farm in the North Sea going into operation this year.
Chief executive Alistair Phillips-Davies said: “There remains strong underlying political consensus on the big drivers of energy security and decarbonisation – accelerating renewables, network investment and flexible power generation – and these are the growth engines powering SSE.
“We are investing more than £20bn over the five years to 2027 and could invest more than £40bn over the decade to 2032.”
SSE’s operations are focused on two very separate areas of the UK, reflecting its origins in two geographically separate public sector electricity supply companies.
The North of Scotland Hydro-Electric Board and Southern Electricity Board, which supplied electricity in southern England, were privatised in the early 1990s and merged in 1998 to form SSE.
It means SSE supplies power to northern Scottish islands and communities such as Shetland and Aberdeen, as well as southern areas including Portsmouth and the Isle of Wight.
The company also owns the high voltage transmission lines across the north of Scotland and Scottish islands, plus a fleet of around 10 gas-fired power stations in both Scotland and England.
Its capacity to generate electricity from burning gas is similar to its potential output from offshore wind.
In Ireland, it operates as SSE Airtricity, providing power and gas to 750,000 homes and businesses. The company sold its UK electricity customer supply business to Ovo Energy in 2020 to focus on its core businesses of electricity transmission and power generation.