Utility Week

UTILITY WEEK | 15TH - 21ST FEBRUARY 2019 | 17 This week Uncertain future for SSE Energy Services Energy firm considers options for retail arm after it loses 160,000 customers in third quarter SSE lost about 160,000 custom- ers over the three months to the end of December, the company has reported in its third quarter trading update. It finished 2018 with 5.88 mil- lion customer accounts in Great Britain compared with 6.45 mil- lion a year before. SSE said it is still consider- ing options for the future of its retail arm – SSE Energy Services – a„er plans for a merger with Innogy's Npower were scrapped in December. These options include a standalone demerger and listing on the Stock Exchange, a sale or an "alternative transaction". If none of these is viable it may be kept as a "sepa- rate, ring-fenced business" in the SSE group. SSE said the suspension of capacity market payments in November will blow a £60 million hole in its revenues for the 2018/19 financial year. It has therefore lowered its forecast for adjusted earnings per share (excluding SSE Energy Services) by 6p to between 64p and 69p. The company also announced that the £200 million proceeds from the recently announced sale of stakes in the Stronelairg and Dunmaglass onshore windfarms will be used to fund a share buyback programme. The buyback is expected to start before the completion of the transaction, which is due by the end of March. SSE chief executive Alistair Phillips-Davies said: "We continue to make good progress in our core businesses of regulated energy networks and renewable energy, complemented by flexible thermal generation and busi- ness energy sales." TG ELECTRICITY Clark open to CGN taking on Moorside Greg Clark has le„ the door open to a Chinese state-backed com- pany becoming involved in a bid to take over Toshiba's abandoned Moorside nuclear project. The business and energy sec- retary told Labour backbencher Albert Owen that CGN is not restricted from forming a consor- tium with another company, like EDF, to take forward other sites such as Moorside and Wylfa. Owen, who represents the constituency of Ynys Mon, the home to Hitachi's recently suspended nuclear project at Wylfa, had asked Clark during a Business, Energy and Industrial Strategy Committee hearing if he had a "principled objection" to CGN entering such a tie-up. In December, Utility Week reported that CGN had expressed an interest in taking over Toshiba's project. WATER Castle agrees £100m in financing facilities Castle Water has agreed new financing facilities to pay water charges in advance to wholesal- ers including Thames Water, Scottish Water, South East Water and Portsmouth Water. The combined £100 million agreements to include work- ing capital facilities are for a four-year term, and provided by the Bank of Scotland, HSBC and Santander. Iolo Morris, chief finance officer at Castle Water, said: "Cas- tle Water has carefully managed its credit risk, with around 80 per cent of new contracts coming from the English public sector." Chief executive John Reynolds added: "This refinancing places Castle Water in a strong position to continue expansion in the UK business water market." ENERGY Heat scheme open to applications The second stage of the £320 million Heat Networks Invest- ment Project has opened to applications, the Department for Business, Energy and Industrial Strategy (BEIS) has announced. Developers are being offered grants of up to £5 million and loans of up to £10 million to help get their projects over the line. The government is aiming to unlock about £1 billion of invest- ment using the "gap funding". BEIS said: "The Heat Net- works Investment Project has created a route to market for innovative energy projects across the country and demonstrates a key objective of the Clean Growth Strategy – to deliver technologies that lower bills, cut carbon and improve the quality of life for communities across the country." Phillips-Davies: good progress in core businesses Finance & Investment Stock watch 1300 1200 1100 1000 SSE SHARE PRICE, FIVE DAY Nov 2018 Feb 2019 SSE SHARE PRICE, SIX MONTH SSE shares took a brief hit last Friday aer the company revealed in a third quarter trading update that it expects the suspension of capacity market payments to leave a £60 million hole in its revenues for 2018/19. In the wake of the announcement, the share price initially fell from 1,170p to 1,155p but promptly bounced backed and at the time of writing had risen to 1,188p. 1290 1190 1180 1170 1160 1150 7 Feb 8 Feb 11 Feb 12 Feb pence pence

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