Scottish Power’s power supply business has been hit by the mild winter and the impact of the government’s energy price cap, new figures have revealed.
Figures released by Scottish Power’s parent company Iberdrola show earnings before interest, tax, depreciation and amortisation (EBITDA) in its liberalised business slumped by 67 per cent in the first three months of the year to £44 million.
According to Iberdrola, this was primarily due to mild weather in comparison with last year’s Beast from East and the introduction of the energy price cap.
There was better news for Scottish Power’s renewables division, which saw earnings rise by 30 per cent, up by £38.2 million to £166 million over the first quarter.
Iberdrola said this was due to increased wind volumes and “favourable market conditions”.
The company’s networks business also reported a 5 per cent rise in earnings, up £9.6 million to £216.6 million.
As a group, Iberdrola made a net profit of €963.9 million in the first quarter of 2019, an increase of 15 per cent on the same period last year.
Revenues across the group also rose by 8.5 per cent, reaching €10.138 billion.
The price cap was introduced on 1 January this year and a new, increased cap was brought in on 1 April after Ofgem made its calculations in February.
Ofgem then raised the level of the cap to £1,254 – an increase of £117.
The price cap for pre-payment meter customers increased by £106 to £1,242 a year for the same period of a six-month “summer” price cap.
The new level will be reviewed again later in the year.
“As the UK’s only integrated energy company to produce 100 per cent green electricity, we completed the essential journey to decarbonise power generation in January,” said Scottish Power’s chief executive, Keith Anderson.
“The strong performance of renewables shows we are delivering what consumers want in access to reliable, clean, lower cost energy.
“Combined with sustained investment in our networks business, as it completes vital upgrades essential to bringing on even more green power, we are firmly placed to drive forward the electrification of the UK’s economy where it matters most from the decarbonisation of transport and heating.”