SSE said performance was in line with expectations in the three months to June 30th as renewable energy output jumped during the period.
After abnormal weather patterns last year dented renewable energy generation, output jumped 60% in the last quarter as normal conditions resumed.
SSE saw markedly better generation in both onshore and offshore wind, as well as milder improvements in pumped storage and hydro.
Renewables total output rose from 1,625 GWH in the three months to 30th June 2023 to 2,596 GWH in the same period this year.
Although SSE is making commendable steps forward in renewable energy generation, the company still generates most of its power from gas powered facilities which totalled 3,338 GWH output in the last quarter.
This, however, may not be the case for much longer. SSE provided an update on a raft of renewable energy projects due to come online in the near future. The company has recently generated the first power from onshore wind in the Shetlands and is due to launch a new farm in Ireland in early 2025. These are two among many projects to ramp up renewable energy power generation.
Given the company’s trajectory, it’s only a matter of time before the vast majority of SSE’s output is renewable.
“The UK’s determination to move away from fossil fuels has moved into overdrive following Labour’s election win, and SSE is moving in tandem with the new government to embrace the transition. In its latest trading update, SSE confirmed performance in line with expectations, with renewables output for the quarter up 60% year-on-year,” said Mark Crouch, analyst at investment platform eToro.
“SSE has already made significant investment to improve their electric power infrastructure and is committing a further £20.5bn to its investment programme, including what will be the world’s largest wind farm, Dogger Bank, off the coast of England, capable of powering six million homes.
“Projects like this though have come at the expense of shareholder dividends, dividends that in the past have been synonymous with utility stocks. And the glaring risk is that renewable energy methods are unreliable, thus profits will likely be volatile.
“However, the company believes that with the business continually expanding its high-quality asset base, shareholders stand to reap the rewards over the long term.”