Investing to create long-term value in Ireland
Following today's announcement by SSE plc of its Interim Results for the six months to 30 September 2017, we report on SSE's performance across its retail and wholesale businesses in Ireland and Northern Ireland.
SSE has also issued a statement on its retail household energy supply and services business in Great Britain. In Ireland and Northern Ireland, SSE will continue to supply energy and provide energy and infrastructure services to household and business customers.
Stephen Wheeler, Managing Director of SSE Ireland, comments:
“SSE has always recognised and valued the differences between the GB and Ireland energy markets; and the alignment of SSE’s retail and wholesale businesses across the island of Ireland continues to bring significant benefits for customers.
“We have a strong customer base, an excellent portfolio of assets and an exciting range of investment opportunities across Ireland in energy supply and services, generation and generation development, and wholesale telecoms. Our commitment to operate as a responsible and sustainable company across all our business units in Ireland and Northern Ireland remains unchanged.”
Sustainably sourcing and producing energy
SSE invests in a balanced range of businesses and invests only in assets for which returns are expected to be clearly greater than the cost of capital. All projects complement SSE's existing portfolio of assets and are governed and executed in an efficient manner and in line with SSE's commitment to strong financial management.
In the six months to 30 September 2017, SSE's onshore wind portfolio in Ireland’s all-island Single Electricity Market produced 717MWh representing a higher output of renewable generation.
SSE continues to operate under the policy support regime for renewable generation capacity in the UK, currently delivered through the Renewables Obligation (RO) (which also applies in Northern Ireland). In Ireland support is provided via REFIT 2.
In the six months to 30 September 2017, SSE's investment and capital expenditure totalled £779.5m. This included further investment in renewable energy in Ireland.
SSE has delivered two onshore wind projects that qualify for REFIT 2and the NI RO which are now managed by its Generation Operations division – this includes Galway Wind Park (174MW, SSE share 120MW), a joint venture with Coillte and now Ireland’s largest wind farm, and Slieve Divena 2 (18MW) in Co. Tyrone which was handed over in June 2017. In Co. Kerry a new addition, Leanamore (18MW), is in construction and is expected to be completed by early 2018.
SSE is continuing to advance its planning application for the Doraville development in Northern Ireland. In March 2017, it confirmed a new design layout which includes a reduction in turbine numbers and a change in turbine specification to optimise generation to 119MW.
Future development options for onshore wind projects are being explored. The Irish Government issued a consultation in September 2017 on the design of a new renewable electricity support scheme.
Providing reliable capacity
SSE's thermal assets produced over 10TWh in the half year to 30 September 2017, compared to 8TWh in the same period last year, the majority of which came from gas-fired generation at power stations in GB and Ireland. This includes 1.4TWh of generation from SSE’s Great Island gas-fired power station (464MW) in Co. Wexford which participates in Ireland’s Single Electricity Market. Increased output at this power station is due to excellent generation reliability and the position of gas relative to competing generation types.
Supplying energy and essential services across Ireland
In Ireland's all-island energy market, SSE's retail arm SSE Airtricity is the second largest provider of energy and related services across the Republic of Ireland (ROI) and Northern Ireland (NI), and the only retail energy brand to operate in each of the competitive gas and electricity markets across the island.
At 30 September 2017, SSE Airtricity supplied electricity and natural gas to 0.77 million household and business customer accounts in ROI and NI, reflecting a fall in customer numbers due to increased competitive pressures, particularly in electricity markets.
In Home Energy, the company has launched new retention products to reward customer loyalty as well as innovations designed to continually deliver high standards in customer experience. These include a new Easypay subscription option giving customers an easy way to pay for essential Home Services on their energy bill, convenient self-serve options that allow customers to order associated energy products and services from their online energy account, and the introduction of a new video chat customer service channel.
In NI, SSE Airtricity increased its household electricity prices by 7.5% from 1 October 2017 while in ROI electricity prices increased by 5.6% from 1 November 2017. These were the first such increases in both markets since 2013 and were as a result of increases in the cost of supply including wholesale and regulated networks costs.
In Business Energy, customer load has increased by 21% since 31 March 2017, while the company's Eco team has facilitated energy efficiency initiatives that are saving businesses almost 45GWh of primary energy annually. SSE's Energy Portfolio Management (EPM) team is leading preparations for the introduction of the new Integrated Single Electricity Market (I-SEM) next year. This team is providing a competitive route to market for other generators.
A forward facing business delivering long term growth
SSE Enterprise is a group of businesses that provides energy and telecoms services to industrial, commercial and public sector customers. SSE Enterprise Telecoms continues to accelerate new network development.
In Ireland, SSE is part of a consortium which has submitted a 'Detailed Solution' as part of a competitive bid process for the National Broadband Plan, being carried out by the Irish State.