Welcome to the new Independent website. We hope you enjoy it and we value your feedback. Please contact us here.

Business News

SSE defends profits surge of 40 per cent after hiking prices


The energy supplier SSE angered consumer groups yesterday by revealing a near 40 per cent surge in profits, weeks after slapping an extra £100 on fuel bills.

Half-year profits at the company, whose Southern Electric, Swalec and Scottish Hydro brands have 5 million customers, jumped 38 per cent to £397m – up £110m.

SSE raised its prices by 9 per cent in October, taking its average duel fuel bill to £1,354, £260 more than in January 2011. Then, it blamed higher wholesale, distribution and environmental costs.

Yesterday it sought to win over the public by saying that only 8 per cent of profits came from its residential supply business.

Richard Lloyd, executive director of Which? called for the Government to set up an independent review into recent price increases. He said: "Without greater scrutiny of energy prices, consumers simply will not believe that they're getting a good deal."

SSE, the UK's second-largest generator of electricity, posted its results just days after the City and energy regulators launched an investigation into allegations that energy traders manipulated wholesale prices.

Yesterday SSE said its profits were needed to reward investors, and said its margin on energy supply was 1.5 per cent. It also raised its dividend for shareholders by 5 per cent to 25.2p a share.

Lord Smith of Kelvin, SSE's chairman, said: "I believe that profit and dividend allow SSE to employ people, pay tax, provide services that customers need, make investments that keep the lights on and create jobs, while providing an income return that shareholders like pension funds need."