ScottishPower reports retail losses as consumers cut energy use | scottish power End-shutdown

Profits at ScottishPower, the renewable energy generator, were boosted by windy conditions last year, but the provider was hit when the British cut power consumption amid rising bills.

The power generation and supply group, owned by Spain’s Iberdrola, said the group’s underlying profit in 2022 had risen 3.6% to £1.6bn from a year earlier.

However, ScottishPower posted a £18m loss on its retail business, which, with 4.7m customers, is the sixth largest provider, after losing a £3m profit the year before.

It said that total gas volumes used in 2022 fell 18.3%, while electricity use decreased 4.5%.

The figures are among the first indicators of the scale at which homes and businesses cut their energy use amid higher bills last year.

The price of gas soared after the Russian invasion of Ukraine, raising already high wholesale gas costs and energy prices.

The costs were reflected in household bills, and the government stepped in to cover part of consumer bills through the energy price guarantee. Ministers encouraged the public to reduce their energy consumption with an advertising campaign.

A relatively mild winter in the UK is also expected to have reduced demand for gas.

ScottishPower said its retail profits were also hit by the cost of buying power at higher prices before the government guarantee, which covers wholesale costs for suppliers, was introduced in October. The company expects to recover a “significant proportion of the losses suffered in 2022” during this year.

Profits at ScottishPower’s renewables business, which includes Whitelee, the UK’s largest onshore wind farm near Glasgow, rose 24% to £730m, helped by windier weather, massive sales of IT and offshore assets, and higher energy prices. Wind farms produced a record amount of electricity in Britain last year.

A tax on electricity generators was introduced at the beginning of the year to capture windfall profits made as wholesale energy prices increased. However, ScottishPower said the gains made through higher power prices were partly offset by charges paid to National Grid to balance supply and demand.

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The company plans to invest £10bn in the UK by 2025, but Keith Anderson, chief executive of ScottishPower, has urged the government to allow renewable energy projects to develop more quickly.

“Extreme volatility in the energy market has reinforced the urgent need to decarbonise the economy,” Anderson said. “A crisis caused by fossil fuels can only be solved in the long term by accelerating investment in the fuels of the future. Clean energy and green networks are the answer. We need to build more and we need to build them faster.”

ScottishPower and its peers are being scrutinized by regulator Ofgem over the installation of prepaid meters. The Guardian reported last month that the provider had stopped recovering debt through the meters, but Ofgem later ordered all installations halted after it emerged that British Gas debt officers had ignored vulnerabilities in the meters. customers to install meters.

On Wednesday, Iberdrola said profits had risen 10% to €13.23bn (£11.6bn) in 2022, as growth in the US and Brazil made up for poor performance in Spain.

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