SSE share price: Green light for £800m Scottish power plant project

on Dec 16, 2013
Updated: Oct 21, 2019
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iNVEZZ.com, Monday, December 16: British energy supplier SSE (LON:SSE) on Friday received approval from Scotland’s energy minister to build an £800 million hydroelectric pumped storage generating station at Coire Glas, near Spean Bridge in Lochaber, but the company said that the project’s future remains uncertain due to a lack of UK government support and high network costs. In addition, the project faces strong criticism for severe impact on the landscape and damage to tourism.

**Power plant plan**
The hydro power plant is designed to have a generating capacity of up to 600 megawatts, which will make it the biggest of its kind in Scotland with the potential to provide up to 10 percent of the country’s estimated peak electricity demand. Its pump storage station is designed to store up to 30 gigawatt hours of electricity, produced by wind and wave farms, for distribution to consumers as needed. The construction of the plant is expected to take five to six years and create about 150 jobs, Scottish Energy Minister Fergus Ewing said in a statement.

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The UK currently has four operational pumped storage facilities, with a combined capacity of nearly 3,000 megawatts and which store energy in times of low demand for use when consumption rises. The need for such reserve capacity is growing in line with the increasing use of renewable energy sources, which are intermittent and unpredictable.
Scotland is seeking to produce all of its electricity needs from renewable sources, primarily wind and solar, by 2020. Advocates describe the plants as ‘green batteries’ but opponents say that they use more energy than they produce.

**Project future unsure**

The UK government is not supporting pumped storage in its existing renewable energy subsidy scheme and does not plan to include the facility in its next mechanism from 2018. This fact, along with high transmission charges, put question marks on the viability of the project, according to SSE.

“As things currently stand the framework and the mechanism that operate within the energy system would not enable us to make an investment decision to build Coire Glas,” a company spokesman told Reuters. He added that SSE is unlikely to make a final investment decision on the project before 2015 at the earliest.
The BBC quoted SSE Renewables managing director Jim Smith as saying that the company would “engage further with both the UK and Scottish governments, as well as other relevant organisations, to develop an appropriate solution to the commercial challenges” for the project.

SSE’s share price closed 0.5 percent higher on Friday, outperforming a 0.08 percent decline in the FTSE 100 blue chip index. In today’s trading so far, SSE’s stocks have edged down 0.08 percent to be at 1,330p at 09:47 UTC, versus a 0.3 percent gain in the Footsie to that point.
**As of 9:33 UTC buy SSE shares at 1,330.00p.**
**As of 9:33 UTC sell SSE shares at 1,329.00p.**
Trade stocks with Hargreaves Lansdown from £5.95 per deal.
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