London, Jan 15, 2026, 09:26 GMT — Regular session
- SSE shares edged up roughly 0.2% in early London trading
- Company secured a 20-year CfD for 1.4 GW, with a strike price of £89.49/MWh, linked to inflation
- Traders are eyeing the UK’s upcoming wind auction scheduled for later this year, alongside SSE’s trading update set for Feb. 4
SSE shares nudged higher on Thursday, staying close to recent peaks after the UK utility locked in a long-term price agreement for a portion of its Berwick Bank offshore wind project. By 0926 GMT, the stock had gained 0.2% to 2,299 pence. (Investing)
The award matters because it sets a government-backed price for a significant portion of output just as developers grapple with rising construction costs and tougher financing conditions. The market sees these subsidy rounds as a key test of whether large offshore wind projects can secure investment without overburdening their balance sheets.
The UK government announced that its latest Contracts for Difference (CfD) auction—offering generators a fixed “strike price” for electricity—secured 8.4 gigawatts of offshore wind capacity. This marks the largest such procurement in both Britain and Europe. The average fixed-bottom offshore wind price was set at £90.91 per megawatt hour, with Berwick Bank among the successful projects. (Gov)
SSE has secured a 20-year CfD for 1.4 gigawatts from “Phase B” of the Berwick Bank project. The strike price stands at £89.49 per megawatt hour for 1,380 megawatts, based on 2024 prices and linked to CPI inflation. The company aims to make a final investment decision in 2027. (Investegate)
“We are delighted Berwick Bank B has won a CfD in AR7 for 1.4GW,” said Chief Executive Martin Pibworth. SSE noted that the remaining phases of the 4.1GW Berwick Bank project might be offered in future auctions, with the next expected late this year. (Sse)
For investors, the CfD win offers a clearer signal than usual: it locks in the project’s price exposure for 20 years without guaranteeing construction. The pressing question now is whether SSE can secure engineering, procurement, and grid deals at costs that align with its return goals.
SSE’s shares climbed 2% on Wednesday, ending the day at £22.95 and beating the broader market. The move came after news about the Berwick Bank contract emerged. (MarketWatch)
Peers are zeroing in on the fine print of AR7. The government highlighted big awards for projects like Dogger Bank South and Norfolk Vanguard. Developers and their partners will probably rush to secure supply chains and financing.
However, risks remain. Offshore wind ventures often face hurdles like permitting delays, grid bottlenecks, and rising construction costs. A CfD doesn’t shield projects from setbacks or force a rethink if expenses overshoot forecasts. Delays in starting up can push back cash returns, quickly dampening appetite in this yield-focused sector.
SSE’s upcoming triggers include its interim dividend payout on Jan. 30 and the third-quarter trading update due Feb. 4. Investors are also keen on any news about the schedule and funding for the UK’s next CfD auction, expected in late 2026. (Sse)
