SCOTTISH Hydroelectric owner SSE is facing renewed challenges after losing another 160,000 customers and issuing a fresh profit warning.

The Perth-based giant said the total number of its customers for gas and electricity in the GB household market fell to 5,880,000 at December 31 from 6,040,000 at the end of the preceding quarter amid competition from new market entrants.

The company also warned annual profits could be around eight per cent lower than expected after the EU ruled in November a scheme to support generators was unlawful on state aid grounds.

Read more: Profits plunge at SSE as challenges mount

SSE said it may not receive £60 million expected under the Capacity Market scheme, which pays firms to provide back-up power for periods of high demand. This was suspended following an EU Court of Justice judgement in November.

Adjusted earnings per share for the year to March 31 could be 6p lower than expected in November, at 64p to 69p against 70p to 75p.

SSE issued profit warnings in September and July, reflecting factors such as the expected impact of the introduction of the energy price cap, lower wind-farm output and high wholesale gas prices.

In December the group scrapped a controversial plan to merge its retail arm with npower citing the likely impact of challenging market conditions.

Read more: SSE shares fall after merger deal with npower scrapped

SSE said yesterday it is considering options including a demerger or sale of the retail business. If none of these is found to be viable it may keep the business.

Chief executive Alistair Phillips-Davies said: “We continue to make good progress in our core businesses of regulated energy networks and renewable energy.”

Read more: SSE sells windfarm stakes in bid to appease investors

He said SSE had created value for shareholders recently by selling stakes in its telecoms business and wind farms in Scotland for around £1bn.

SSE shares closed down 2.5p at 1171p.