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SSE responds to UK government statements on electricity markets and gas capacity

12 Mar 2024

Commenting on the latest UK government update on the Review of Electricity Market Arrangements (REMA) and the need for new gas plant, SSE's Chief Commercial Officer Martin Pibworth said:

“Sensible reform of electricity markets can deliver the cleaner and more secure energy system the British public overwhelmingly supports and unlock billions of pounds of investment and thousands of good jobs across the UK.

“Clear, consistent and predictable policy is key to delivering these benefits and thats why it is important we build on the current GB system.

“We are glad to see nodal pricing being taken off the table and look forward to the objective assessment of the benefits of the evolution of the national market.  

Any final proposed reforms should pass a simple test: do they speed up investment and delivery? Independent analysis by LCP has suggested uncertainty caused by significant changes to market design could add c.£45bn to the cost of capital for every 1 percentage point increase in financing costs; a price ultimately paid by consumers.

“As the UK’s Clean Energy Champion, SSE could invest more than £40bn in the next decade, assuming a supportive policy environment. We want to get on with it. We look forward to working with policymakers on designing the practical reforms needed to speed up delivery.

On gas plant, Martin continued:

“This is welcome recognition of the pressing need for new flexible capacity from the end of the decade.

“However, the Government must establish concrete tests to ensure any new development is capable of rapid decarbonisation to avoid locking in carbon emissions and to deliver a clean power system.”