Although the final result is still not yet known by 08.00 BST Centrica shares were up almost 8 per cent and SSE shares were up over 5 per cent as updated exit polls show the Conservatives at 329 seats, while Labour languishes at 233, and the Liberal Democrats at a heavily reduced 6 seats.
Big six utilities Centrica and SSE shrugged off fears of Labour-led energy interventions following a shock election win from the Conservative Party after months of polls which suggested Labour leader Ed Miliband would become Prime Minister.
The industry came under heavy political pressure after former energy secretary Miliband proposed a raft of energy industry interventions eighteen months ago, which shadow minister Caroline Flint vowed would overrule the findings of the ongoing Competition and Market Authority probe.
Investors at Citigroup said the election result is a “benign outcome” for the industry “as the threat of arbitrary regulation and tariff setting, which was a high probability under Labour’s manifesto, has diminished”.
“Nevertheless, it is important to remember that the Conservative Party is keen to promote competition in energy supply, so the market shares of the ‘big six’ will likely continue to come under pressure. Moreover, the Conservatives are committed to implementing the proposals of the CMA post the ongoing investigation (provisional findings due likely by mid-June) and therefore risks on earnings have not disappeared,” Citi added.