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SSE (SSE)

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ReallyVeryFoolish
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Re: SSE (SSE)

#358835

Postby ReallyVeryFoolish » November 21st, 2020, 5:15 pm

funduffer wrote:
richfool wrote:But what is SSE proposing to do with the proceeds of its sale of green assets, and why is it selling green assets at all? Are they really "non-core" assets?

It seems the likes of SSE are in the business of developing new Green infrastructure assets, like windfarms, but not so much in operating them over the long term, particularly if they are joint ventures. They prefer to recycle the capital into new green ventures.

Hence companies like Greencoat UK Wind (UKW), who are in the business of acquiring such assets and running them through their life, buy them up. They seem to produce steady and unspectacular returns on these assets over 20years+, paying a decent dividend (current yield is 5.3%). NIce way to generate some steady retirement income.

There is a very long, but interesting thread on green infrastructure investment here:

viewtopic.php?f=8&t=17343

I have small stakes in both SSE and UKW.

On the other hand - SSE developing the world's largest off shore wind farm with Equinor.

Dogger Bank Wind Farm is the world’s largest offshore wind farm in development. This Joint Venture project between SSE Renewables and Equinor was granted consent as a Nationally Significant Infrastructure Project in 2015. Dogger Bank successfully secured 15-year contracts (CfDs) for 3.6GW of new offshore wind energy in the UK Government’s most recent auction for low carbon power in 2019.


https://www.sserenewables.com/offshore- ... gger-bank/

RVF

UncleEbenezer
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Re: SSE (SSE)

#358967

Postby UncleEbenezer » November 22nd, 2020, 9:53 am

funduffer wrote:It seems the likes of SSE are in the business of developing new Green infrastructure assets, like windfarms, but not so much in operating them over the long term, particularly if they are joint ventures. They prefer to recycle the capital into new green ventures.

Hence companies like Greencoat UK Wind (UKW), who are in the business of acquiring such assets and running them through their life, buy them up. They seem to produce steady and unspectacular returns on these assets over 20years+, paying a decent dividend (current yield is 5.3%). NIce way to generate some steady retirement income.

I've tended to view the green infrastructure funds as complementary to a lot of more speculative development projects, many of them entrepreneurial rather than backed by an established bigco. Sale to UKW or its peers being the entrepreneur's exit strategy. And with the likes of SSE having a foot in both camps.

A view formed back in the days when SSE was best-known as a utility company. A supplier to consumers.

Is SSE's business evolving into something that sits uneasily with a utility company's level of long-term debt?

ReallyVeryFoolish
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Re: SSE (SSE)

#358981

Postby ReallyVeryFoolish » November 22nd, 2020, 10:40 am

UncleEbenezer wrote:
funduffer wrote:It seems the likes of SSE are in the business of developing new Green infrastructure assets, like windfarms, but not so much in operating them over the long term, particularly if they are joint ventures. They prefer to recycle the capital into new green ventures.

Hence companies like Greencoat UK Wind (UKW), who are in the business of acquiring such assets and running them through their life, buy them up. They seem to produce steady and unspectacular returns on these assets over 20years+, paying a decent dividend (current yield is 5.3%). NIce way to generate some steady retirement income.

I've tended to view the green infrastructure funds as complementary to a lot of more speculative development projects, many of them entrepreneurial rather than backed by an established bigco. Sale to UKW or its peers being the entrepreneur's exit strategy. And with the likes of SSE having a foot in both camps.

A view formed back in the days when SSE was best-known as a utility company. A supplier to consumers.

Is SSE's business evolving into something that sits uneasily with a utility company's level of long-term debt?

I am wondering if being a half share holder in the world's largest off shore wind farm is a bit of a game changer? Long term finance for assets of multi decade lifetime is part of the picture. Clearly there's a game plan and off loading the legacy domestic supply business was part of it. The massive off shore wind farm is another leg of that corporate reshaping? I am very interested in this development by SSE. I have been mulling over investing in the renewable energy sector but it's generally very expensive to enter at the moment. I am seriously considering swapping my NG shares for SSE shares on the back of the Dogger Bank project.

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Re: SSE (SSE)

#358985

Postby Dod101 » November 22nd, 2020, 11:31 am

SSE have always been a generator and controller of the grid in the northern half of Scotland. The retail side was always very small in comparison and no doubt they are glad to be rid of the hassle. They have also always been in renewable energy and 'green ' power. See their hydro electric schemes, dating back to the Second World War.

Dogger Bank is I think just a development of that philosophy, although a big one of course.

Dod

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Re: SSE (SSE)

#358988

Postby ReallyVeryFoolish » November 22nd, 2020, 11:41 am

Dod101 wrote:SSE have always been a generator and controller of the grid in the northern half of Scotland. The retail side was always very small in comparison and no doubt they are glad to be rid of the hassle. They have also always been in renewable energy and 'green ' power. See their hydro electric schemes, dating back to the Second World War.

Dogger Bank is I think just a development of that philosophy, although a big one of course.

Dod

Indeed, well understood. It seems the rise of renewable energy is now unstoppable and I am encouraged that the Dogger Bank project looks like it's big enough to at long last stimulate manufacture of the complete turbine hardware in the UK too rather than just the turbine blades (Siemens, Hull). We still have all the skills necessary to manufacture the hardware. I haven't really understood why it's taken so long to encourage (in this case GE) more manufacture domestically. There's always huge supply chain benefits to such activity.

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Re: SSE (SSE)

#358998

Postby UncleEbenezer » November 22nd, 2020, 12:36 pm

Dod101 wrote:SSE have always been a generator and controller of the grid in the northern half of Scotland. The retail side was always very small in comparison and no doubt they are glad to be rid of the hassle. They have also always been in renewable energy and 'green ' power. See their hydro electric schemes, dating back to the Second World War.
Dod

Indeed, that's why I invested in SSE in the first place. The "safe haven" (albeit politically exposed) of a utility, combined with the most significant renewables programme of any in its peer group.

That was before (or perhaps in the infancy of) the era of renewables infrastructure funds. It's an evolving field. And in terms of developing new assets, if many are in that game with a view to no dividends but making profit from a sale once the asset becomes operational, that kind-of makes an oddball of a bigco carrying long-term debt and paying a big divi.

Or maybe it's my perspective that's flawed, and the entrepreneurial ventures are just a small part of the market?

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Re: SSE (SSE)

#358999

Postby ReallyVeryFoolish » November 22nd, 2020, 12:43 pm

UncleEbenezer wrote:
Dod101 wrote:SSE have always been a generator and controller of the grid in the northern half of Scotland. The retail side was always very small in comparison and no doubt they are glad to be rid of the hassle. They have also always been in renewable energy and 'green ' power. See their hydro electric schemes, dating back to the Second World War.
Dod

Indeed, that's why I invested in SSE in the first place. The "safe haven" (albeit politically exposed) of a utility, combined with the most significant renewables programme of any in its peer group.

That was before (or perhaps in the infancy of) the era of renewables infrastructure funds. It's an evolving field. And in terms of developing new assets, if many are in that game with a view to no dividends but making profit from a sale once the asset becomes operational, that kind-of makes an oddball of a bigco carrying long-term debt and paying a big divi.

Or maybe it's my perspective that's flawed, and the entrepreneurial ventures are just a small part of the market?

I have been wondering if/when BP, Shell, Total, all of which are shifting towards renewable energy, will make some significant acquisitions? They have made some fairly small bolt on business purchases to date. Given their declared ambitions, can they be achieved without significant buying in renewable energy of existing operating assets? For example, when Shell wanted to quickly expand their gas portfolio they bought BG Group. The same might happen in renewable energy?

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Re: SSE (SSE)

#360127

Postby idpickering » November 26th, 2020, 7:10 am

DOGGER BANK WIND FARM

SSE Renewables, together with its 50:50 joint venture partner, Equinor, has reached financial close on the first two phases of what will be the world’s biggest offshore wind farm.

The two companies are proceeding with the first two phases of Dogger Bank Wind Farm, a ground-breaking project off the north east coast of England which, once all three phases are complete in March 2026, will be the largest in the world.

Each phase has a capacity of 1,200MW and will generate around 6,000GWh. In total, Dogger Bank will produce enough clean, renewable electricity to supply 5% of the UK’s demand, equivalent to powering six million UK homes.

The funding of the development of Dogger Bank A and B represents the largest ever offshore wind project financing anywhere in the world and SSE’s expected equity investment forms part of its £7.5 billion investment programme to March 2025, the renewables element of which will double its renewables output by 2025.

Total investment in the first two phases of the project will be around £6 billion and has already created hundreds of UK jobs, with more to come as project construction ramps up.

Dogger Bank Wind Farm is the largest of SSE Renewables’ projects currently in construction. SSE Renewables is currently also leading the construction of the Seagreen offshore wind farm (1,075MW, SSE Renewables share 49%), which will be Scotland’s largest on completion, and the wholly-owned Viking wind farm (443MW), the UK’s most productive onshore wind farm. Together these flagship renewable energy projects are driving SSE Renewables’ significant growth to 2025 and demonstrate the quality and value of its development portfolio.


https://www.investegate.co.uk/sse-plc-- ... 00065950G/

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Re: SSE (SSE)

#360210

Postby richfool » November 26th, 2020, 11:04 am

Cross post picked up from the HL website under SSE news, but is also in several other sources:
UK government to double subsidies for renewable energy in 2021

viewtopic.php?f=16&t=11176&p=360204#p360204


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