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Utility SSE profit rises; warns of uncertainties ahead of UK elections

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By Reuters
Utility SSE profit rises; warns of uncertainties ahead of UK elections
FILE PHOTO: An SSE company logo is seen on signage outside the Pitlochry Dam hydro electric power station in Pitlochry, Scotland, Britain, November 8, 2017. REUTERS/Russell Cheyne   -   Copyright  RUSSELL CHEYNE(Reuters)

By Susanna Twidale

LONDON (Reuters) – British utility SSE <SSE.L> reported higher first-half adjusted pretax profit on Wednesday but warned of challenges for energy firms due to the UK election next month and the opposition Labour Party’s campaign to nationalise energy networks.

SSE, one of Britain’s ‘Big Six’ energy firms, reported an adjusted pretax profit of 263.4 million pounds for the six months ended Sept. 30, up from 229.4 million pounds a year earlier.

The overall results did not include figures from SSE’s British retail arm, which SSE in September agreed to sell to OVO Energy for 500 million pounds.

SSE said on Wednesday the deal, which is being scrutinised by Britain’s Competition and Markets Authority (CMA), is on track for completion in early 2020 subject to gaining regulatory approval.

SSE is progressing well in the execution of its low-carbon strategy with the sale of SSE Energy Services leading to (a) group more focussed on renewable energy and regulated electricity networks,” Chair Richard Gillingwater said in a statement.

SSE’s half year profits were buoyed by the inclusion of around 110 million pounds of payments from Britain’s capacity market, which pays power producers to be available during times of high demand.

The European Commission last month approved reinstatement of the scheme, which had been on hold since last November after a European court ordered the Commission to secure more details on certain elements of the scheme, such as information on energy consumers willing to reduce their consumption when needed.

The company, which plans to shut its last coal-fired power plant by the end of March 2020, also called on the government to increase renewable power targets in the country as part of efforts to meet its climate coal of net zero emissions by 2050.

It said a moratorium on the development of new onshore windfarms should be lifted and the country should seek higher targets for offshore wind power.

(Reporting by Susanna Twidale in London, additional reporting by Muvija M in Bengaluru; Editing by Rashmi Aich and Susan Fenton)