London, 09:35 GMT, February 4, 2026 — Regular session
SSE Plc shares climbed 1.3% to 2,467 pence in early London trading Wednesday after the power utility lowered its full-year earnings forecast, blaming mixed weather conditions. The Perth, Scotland-based company now expects adjusted earnings per share of 144-152 pence for 2025/26, down from 160.9p last year. RBC Capital Markets noted the midpoint of 148p was slightly below Bloomberg’s consensus of 149.9p. (MarketScreener)
The update arrives at a sensitive time for U.K. utilities. Investors crave the regulated networks narrative, but not if it means a hit to earnings amid rising expenditures.
SSE is funneling cash into grid upgrades and offshore wind as Britain rewires its power system. This blend can steady revenues but brings regulation risk—and for renewables, a straightforward challenge: the wind isn’t always blowing when you need it.
In its Q3 trading update, SSE confirmed its business unit operating profit forecasts remain steady. Networks investment jumped 64% to around £1.8 billion over the nine months ending Dec. 31. The company reported a 7% rise in renewables output year-on-year but repeated that earnings guidance depends on weather, market conditions, and plant availability. SSE will provide another update on April 2. (Investegate)
SSE highlighted progress on its five-year, £33 billion “Transformation for Growth” plan, revealing that SSEN Transmission has secured 25 of 34 major consents for 11 grid projects in the north of Scotland. The group confirmed the Spittal–Peterhead link is now under construction and has secured cabling through a €2 billion deal with NKT. It’s still weighing whether to accept Ofgem’s RIIO‑T3 settlement ahead of the March 3 deadline. (SSE)
Ofgem’s RIIO‑3 price control spans electricity transmission, gas distribution, and gas transmission, lasting five years from April 1, 2026, through March 31, 2031. It establishes the guidelines for permitted spending and returns throughout the sector. (Ofgem)
Price controls are crucial as they determine the pace at which grid operators invest and the returns they can secure. For equity investors, this distinction separates a reliable compounder from a capital-intensive venture with limited upside. (Ofgem)
SSE aimed to prove it holds tools beyond regulatory control. It pointed to fresh, longer-term bank facilities for SSEN Transmission and spotlighted a 20-year contract-for-difference covering 1.4 gigawatts at Berwick Bank B — a government-backed scheme that boosts revenues if power prices dip below a set strike price.
Near-term pressures remain. A slump in wind conditions could drive earnings down to the lower end of guidance, while investor concerns about the RIIO‑T3 terms might weigh on valuation as construction costs ramp up.
Investors are now eyeing the April 2 closed-period notification for clues on this year’s performance, before the preliminary results drop on May 28 for the fiscal year ending March 31, 2026. (SSE)
