SSE is to double its renewables capacity and invest in UK electricity networks under a new net zero strategy.
The developer’s Net Zero Acceleration Programme aims to enable the delivery of over 25% of UK’s 2030 40GW offshore wind target and over 20% of UK electricity networks investment.
It will also deploy flexibility solutions and exporting renewables capabilities overseas to accelerate clean growth, lead the energy transition and maximise value for all stakeholders.
This will be done through a fully-funded £12.5bn (€14.8bn) strategic capital investment plan to 2026 alongside ambitious 2031 targets, aligned with net zero and 1.5 degrees
It is hoped that this investment will deliver ~4GW net renewables capacity additions and grow electricity networks underlying RAV to ~£9bn net of assumed 25% minority stake sales.
SSE said the plan increases and maintains a sustainable development pipeline in excess of 15GW.
The move will be supported by further renewables partnering; and minority stake sales in both SSEN Transmission and SSEN Distribution (modelling assumption of early FY24) to unlock value and optimise investment.
Capital allocation will be reshaped to c40% networks, c40% renewables, c20% other flexible generation, distributed energy and customer businesses.
SSE chair Sir John Manzoni said: “Over the past months the Board of Directors has carefully considered a range of strategic alternatives for the next phase of SSE’s growth and development.
“Having reviewed all options and taken independent advice, this resulting strategic update significantly accelerates growth in our core businesses, whilst providing efficient and competitive sources of financing and ensuring SSE continues as a reliable and resilient operator of critical infrastructure.
“The Board believes these plans represent the optimal pathway for SSE, positioning it as the UK’s clean energy champion with the scale to enable the delivery of over 25% of the UK’s 40GW offshore wind target and over 20% of upcoming UK electricity networks investment, deploy flexibility solutions to keep the lights on, whilst exporting its renewables capabilities overseas. SSE is creating long-term value for all of our stakeholders.”
Chief executive Alistair Phillips-Davies added: “In recent years we have made great progress in focusing the SSE Group on the delivery of the electricity infrastructure needed in the transition to net zero.
“We are constructing more offshore wind than anyone else in the world right now and expanding overseas, delivering the electricity networks needed for net zero and pioneering carbon capture, hydrogen and battery technologies to deliver system flexibility.
“Our Net Zero Acceleration Programme represents the next phase of SSE’s growth and involves a substantial ramping up of investment – equivalent to nearly £7m each day in net zero infrastructure – backed up by clear delivery and funding plans.
“It builds on our existing strong platform for growth and highly desirable pipeline to create significant value for shareholders and wider society while further enhancing the long-term potential of the business.
“Today’s announcement means SSE will maximise its long-term potential and capture growth opportunities during a critical time for the energy sector, strengthening and growing its core businesses, creating jobs, delivering for wider society and offering attractive shareholder returns.”