Last week Scottishpower released footage of the controlled demolition of stock towers at Longannet, its coal-fired power station on the River Forth. The plant ceased generating in 2016. The images were meant to be emblematic. Last month the privatised utility, which since 2006 has been Spanish-owned, proclaimed its green-only credentials. It announced an asset disposal deal that means all the electricity it generates in future would be wind-driven. Drax Group, which takes its name from a bigger and once coal-fired monster in North Yorkshire, is paying £702 million cash for a collection of other Scottishpower assets. This includes four gas-fired stations, three of them in southeast England, and, more surprisingly, a series of hydro schemes in south-west Scotland and the 440 megawatt Cruachan pumped storage station in Argyll, one of just four such strategic facilities in the UK. Scotland’s other vertically-integrated energy player – the old Hydro Board, known these days as SSE – is struggling with its own strategic repositioning. Last year it announced plans to hive off its retail supply business across Britain and merge it with another of the UK’s Big Six suppliers, the German-owned Npower. The combined group, with about 11.5 million customers, is to have its own market listing. Late last week SSE revealed the retail merger had developed a hitch. Blaming the UK government’s proposed price cap on domestic tariffs, SSE said it would have to revise the terms of its deal with the loss-making Npower, lest the merged business fail to get an “appropriate” credit rating. One market analyst called the situation “a shambles”. Others speculated the now-delayed merger, despite having competition clearance, might never materialise. The third leg of Scotland’s energy capacity is its two nuclear stations, at Torness and Hunterston. Both are now owned by EDF, the French group which is also building the new Hinkley Point C station in Somerset, scheduled to be operational by 2025. But UK government plans for further new nuclear build in Cumbria received a setback last week when Toshiba decided to liquidate its interest in developing a plant at Moorside. EDF is also moving into offshore wind, buying control of another big field, Neart Na Gaoithe in the outer Firth of Forth, from Mainstream. Eddie O’Connor, the Irish entrepreneur behind Mainstream, knows Scotland well. In 2008 he sold Airtricity, a previous creation, to SSE. Mr O’Connor has made a great deal of money globally harnessing wind power. From their disparate starting points, can Scotland’s big three power providers all profit from the wind too?
Times 14th Nov 2018 read more »
Big six energy supplier Npower has left its Germany parent company with an almost €750m writedown as it limps towards its merger with SSE. Energy giant Innogy said it booked a €748m impairment charge from its embattled UK supply arm, after Npower lost almost half a million customers since the start of the year. Innogy plans to wash its hands of Npower after the latest financial blow which adds to a €480m impairment relating to Npower in the first nine months of 2017. For the rest of Npower’s time under Innogy ownership the German energy company will report Npower’s financial results separately as “discontinued operations”. Npower had been expected to merge with SSE’s supply arm to form a new listed energy company by the end of the year, but the pair warned investors last week that it is likely to be delayed due to trouble in the energy markets. SSE said the spin-off of its supply business has been complicated by the Government’s impending energy price cap and tough market conditions, which could push the deal’s conclusion to next spring.
Telegraph 13th Nov 2018 read more »
BORDERS electricity and gas supplier Spark is in merger negotiations, having missed a £14.4 million renewables obligation payment, with its chief executive claiming the UK Government’s price cap has caused “chaos” in the sector. Spark, which has around 297,000 energy customers and employs more than 400 of its 430-strong workforce at its Selkirk head office, is in “ongoing” talks with industry regulator Ofgem over the missed payment. The company, which specialises in providing energy to the residential letting sector and is one of the largest private-sector employers in the Scottish Borders, said: “Due to its strong growth, Spark is eligible for annual Renewables Obligation Certificates (ROC) payments, and despite having met all its payments in previous years, this year it missed its annual paymen t which was due by October 31 – in common with an unprecedented number of other suppliers. The payment has been deferred pending further discussions with Ofgem.” Spark, which has an annual turnover of about £230 million and describes itself as “profitable”, said it was in merger talks with another medium-sized energy company, believed to be based in England.
Herald 14th Nov 2018 read more »