Low wholesale electricity prices of £35 a megawatt are putting a further strain on the company, according to sources. “In the absence of power price recovery, we forecast declining earnings per share, a tight balance sheet and a precarious dividend,” RBC Capital said. One city source said the group’s investment in around two gigawatts (GW) of renewable energy under a former Government subsidy programme means it is heavily exposed to falling wholesale prices. SSE’s fleet of onshore wind farms is supported through an older Government scheme which does not set a guaranteed minimum price for the generated power, unlike the new competitive regime. This means that as more renewables join the national grid, the older wind farms become steadily less profitable.
Telegraph 25th March 2016 read more »