It was something of a surprise to hear SSE chairman Richard Gillingwater describe the group as having performed “pretty well” in its last financial year, in customer retention, having lost 210,000 accounts.
A further 230,000 have joined the exodus in the last three months, so perhaps in context, Mr Gillingwater is correct in his assessment.
Most businesses losing that number of customers to their rivals would face calls for the head of people like the man who chairs the board.
But the competitive retail energy market is a curiosity. The complexity of the tariffs on offer would baffle most quantum physicists, so when Ofgem’s next regulatory period begins in 2021, it has warned there will be a much “tougher” regime in place regarding pricing. This follows a claim from Citizens' Advice claim that energy suppliers made £7.5 billion in “unjustified profits” over the last eight years.
From another perspective, a shareholder so outraged with SSE’s performance that he pounded his fist on the lectern from where he’d been invited to address the board, said the only companies making money from energy service switches are the companies facilitating the switches.
If Ofcom’s boldness does dictate meaningful change, investors in companies like SSE may have to get used to seeing smaller profits from their retail operations.
Investors can at least take solace from the fact that SSE’s retail operation is its smallest, and the strength of its networks and wholesale operations, which together make almost 80p in every £1 of profit, provide the energy that powers a dividend which shows no signs of fading.
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