Powering
resilient growth
SSE plc Annual Report 2026

Who we are
We are a leading UK-listed electricity company that invests in, develops,
buildsand operates electricity infrastructure and businesses needed for a clean,
secure and affordable energy system. Our diversified portfolio includes onshore
and offshore wind farms, hydro-electric power and batteries, flexible thermal
generation andelectricity transmission and distribution networks. Wealso
provide energy and services for businesses and othercustomers.
Our purpose
To be restless every day until we
makeelectricity clean, affordable
andavailable for all.
Our strategy
To create value for shareholders
andsociety in a sustainable way by
investing in, developing, building and
operating electricity infrastructure
andbusinesses needed in the clean
energytransition.
Inside:
SSE’s response to a
year of international
unrest and uncertainty
Page 4
Our new Chief
Sustainability Officer
reviews SSE’s year
Page 40
Explaining the Board’s
key role in guiding
our growth agenda
Page 78
Chief Executive Martin
Pibworth reflects on
his first year in the job
Page 12
Making good on our
bold and ambitious
£33bn investment plan
Page 17
How we manage risk in
a fast-paced operating
environment
Page 57

Creating value
through the
transition
SSE plc Sustainability Report 2026
Sustainability
Report
STRATEGIC REPORT 176
Our story 2
Energy market review 4
Our strategy 6
Our business model 7
Chair’s statement 8
Our stakeholders 10
Chief Executive’s review 12
Our KPIs 14
Review of the year 16
Chief Financial Officer’s review 17
Financial review 19
Business Unit operating review 26
– SSE Renewables 28
– SSE Thermal 30
– SSEN Transmission 32
– SSEN Distribution 34
– Energy Customer Solutions 36
– SSE Energy Markets 38
Sustainability 39
Chief Sustainability Officer’s review 40
– Our approach to sustainability 41
– Driving the climate transition 42
– Providing clean, secure and
affordableenergy 45
– Delivering sustainable infrastructure 47
– Championing a fair transition 49
– Protecting our natural environment 54
Risk 56
Introduction to risk 57
How we manage risk 58
Group Principal Risks 59
Disclosure statements 64
Climate-related financial disclosures 65
Carbon performance disclosures 73
EU Taxonomy assessment 74
Non-financial and sustainability
information statement 75
Viability statement and Going Concern 76
GOVERNANCE REPORT 77142
Chair’s introduction 78
Board of Directors 80
Group Executive Committee 83
Governance at a glance 84
The Board’s year 86
Assessing Board performance 94
Our stakeholders and
Section 172 Statement 95
Nomination Committee Report 98
Audit Committee Report 102
Energy Markets Risk Committee Report 110
Safety, Sustainability, Health and
Environment Advisory Committee Report 112
Remuneration Committee Report 116
Remuneration at a glance 119
Annual Report on Remuneration 120
Directors’ Remuneration Policy –
asummary 134
Compliance with the UK Corporate
Governance Code 2024 136
Other statutory information 139
Statement of Directors’ responsibilities
inrespect of the Annual Report and the
Financial Statements 142
FINANCIAL STATEMENTS 143264
Glossary 265
Shareholder information 266
Our year at a glance
About our reporting
The Annual Report is the centrepiece of SSE’s
communications to shareholders and wider
stakeholders. It aims to give a fair, balanced and
understandable overview of progress during
theyear,meeting the spirit as well as the letter
ofallour reportingrequirements.
We support evolving sustainability reporting
standards that encourage a more integrated view
of impacts. Our disclosures reflect the issues
most significant to our businesses and relevant
toour stakeholders. SSE’s required sustainability
disclosures are included here, with additional
detail in the separate Sustainability Report,
published at the same time.
APM
Alternative Performance Measures
SSE assesses the performance of the Group
usinga variety ofperformance measures.
Thesemeasures are not all defined under IFRS
and are therefore termed ‘non-GAAP’ measures.
A reconciliation from these non-GAAP measures
to thenearestprepared measure in accordance
with IFRSis presentedand described from
page144
. TheAlternative Performance
Measures SSE uses mightnot be directly
comparable with similarly titled measures
usedbyothercompanies.
Contents
In the face of a complex
operating environment we
metour financial objectives
for2025/26 and made good
progress on ourambitious
investment plans.
Group operating profit
£2,236.6m
Adjusted
£1,888.9m
Reported
Earnings Per Share
153.5p
Adjusted
105.5p
Reported
Dividend
68.7p
Adjusted investment
and capex
£3.6bn
Safety (TRIR) per
100,000 hours worked
0.17
Economic contribution UK/ROI
£9.66bn/
€1.36bn
Meet the people powering SSE
towards a clean energy future
Our people are at the heart of all that
wedo – enabling us to make electricity
clean, affordable and available for all.
Inthis report we’ve asked them to
explain their role in the energy transition.
All our corporate
reports can be found
on sse.com
Look out for ‘People Powering
SSE’ at the start of each section
ring
SS
E
y
futur
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of all that
e electricit
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b
le for all.
h
em to
rgy
transition
.
1
Strategic Report Governance Financial Statements
SSE plc Annual Report 2026

Our resilient portfolio
of assets and businesses
Our unique combination of Networks,
Renewables and Flexibility businesses and
assets is aligned tothe strategic themes
which underpin the energy transition in this
decade and the next.
Our index-linked earnings provide financial
resilience and our mix of businesses and
premium assets mean the SSE Group can
succeed in most market scenarios. We are
creating a new type of power system driven
by clean renewable energy, connected by
modernised electricity networks and backed
up by dispatchable generation plant.
Offshore, we develop huge wind farms
likeDogger Bank and Berwick Bank while
onshore our flexible thermal assets like
Keadby complement renewables by keeping
the lights on when the wind doesn’t blow.
Our customer-facing businesses provide
avaluable route to market and a direct
relationship with energy users. We also
tradeand sellenergy to maximise value
forour assets.
A once-in-a-generation
growth opportunity
In the transition to a more secure and more affordableenergy
system, SSE is leading the way throughthework it does in
Networks, Renewables andsystemFlexibility.
Our story
2
SSE plc Annual Report 2026
Flexibility
Keeping the lights on when
the wind doesn’t blow is a
key role for our thermal plant
and gas storage sites.
Renewables
Harnessing the natural power
of wind and water
to provide clean and
homegrown power.
Networks
Building the grid of the
future means we can transport
renewables generation to
where it’s most needed.

Dogger
Bank
Berwick
Bank
Crossaig
Cambushinnie
Denny
Craig Murrail
Inveraray
Creag Dhubh
Glenlochy
Fort Augustus
Bingally
Fanellan
Dounreay
Skye
Hurlie
Kintore
Netherton Hub
Greens
Orkney
Banniskirk
Carnaig
Emmock
Alyth
Westfield
Western Isles
Under construction
Scottish Power
Infrastructure
Awaiting consent
Consented
Key:
Delivering the energy
transition on land and sea
Transforming the
grid for tomorrow
Our £33bn fully-funded five-year
investment plan will transform the UK’s
electricity infrastructure and deliver
long-term benefits for society.
Of that, we plan to invest around £22bn
inthe electricity transmission network
inthe north of Scotland. This will help
move the clean homegrown energy
being generated in the north to densely
populated areas inthe south, where it is
most needed.
Our grid investment programme
comprises 11 major projects, six of which
are onshore and five offshore, all of
which continue to make good progress.
More than 75% of the associated
consents are now approved with the
remainder going through their respective
processes, see map and page 33
.
Around £5bn will be also invested in
SSE’sdistribution networks in thenorth
ofScotland and central southern England
to support growing demand from homes,
businesses andcommunities.
Building the world’s
largestwindfarms
Out in the North Sea, SSE is developing
offshore wind farms that will provide
clean energy for millions of homes. The
turbine installation stage on phase one of
Dogger Bank wind farm is complete and
further north we are looking to progress
the consented 4.1GW Berwick Bank
windfarm off the Scottish coastline.
Pioneering plant
forgreater security
Tarbert Next Generation Power Station
inCo. Kerry will be the first in Ireland to
run on Hydrotreated Vegetable Oil from
waste feedstocks when it opens in 2027.
Spread of SSE’s key assets:*
Renewables
Distribution
Transmission
Flexibility
* Indicative locations.
For details, see sse.com
3
SSE plc Annual Report 2026
Strategic Report Governance Financial StatementsFinancial StatementsGovernance

NESO’s intervention will prioritise grid connections for 2030
Navigating global volatility
The energy sector is a highly complex operating environment with geopolitical, climate and
supply chain challenges all a feature of 2025/26. Managing such risks is key to SSE’s success.
Key issues impacting our industry
– Conflict in the Middle East damaged key energy facilities in the Gulf,
restricted movement in the Strait of Hormuz and disrupted the global
supply of oil and gas. This had an immediate, sharp impact on
commodity prices and knock-on implications for energy bills.
– The recent turmoil underlines the need to accelerate electrification,
strengthen homegrown energy independence and protect consumers
from price volatility. Countries further down the energy transition
roadhave generally been better able to cope with the effects of
globalinstability.
– Prior to the conflict US-led trade tariffs had been another source of
economic uncertainty. The war in Ukraine, which caused a more
severe spike in UK gas prices than recent events in the Middle East,
entered its fifth year in February 2026 with little immediate sign of
resolution in sight.
£100bn
Estimated cost of UK achieving net zero by 2050 – similar to
energy-related costs from Russia’s 2022 invasion of Ukraine
What we are doing about it
– By investing £33bn in electricity Networks, Renewables and Flexibility,
SSE is helping to build a secure, homegrown energy system that is less
dependent on imported fossil fuels. This, in turn, offers better energy
affordability for customers over the long-term.
– The Climate Change Committee (CCC) said in March 2026 that
achieving the UK’s net zero target by 2050 would cost less than a
single oil shock. The CCC estimates the cost of delivering the energy
transition will be about £4bn a year, or close to £100bn by 2050, which
is roughly equivalent to the energy-related costs related to Russia’s
2022 invasion of Ukraine.
– SSE’s strategy is broadly aligned to the direction of UK and European
governments, whilst our portfolio remains resilient and agile enough
tocope with global volatility and policy shifts that might arise.
Risk conclusion: Macro-geopolitical environment remains highly volatile
with ongoing conflicts and their consequences on UK billpayers is a
concern see page 59
Key issues impacting our industry
– Over the past 12 months the UK Government has acted to protect
consumers with incremental measures to improve short-term energy
affordability. In Autumn 2025 it announced plans to cut an average of
£150 off household energy bills via the removal of various green levies.
– Then in April 2026, in response to the conflict in the Middle East,
theUK Government announced an extension and increase of the
Electricity Generator Levy and the introduction of voluntary CfDs
forolder assets operating under Renewables Obligation contracts.
– The National Energy System Operator (NESO) introduced measures
totackle the backlog of generation projects seeking connections
which had become four times what was needed to meet 2030 climate
targets. New plans will prioritise projects that are actually required.
– The UK Government is clear on its Clean Power 2030 goals, but there
has been a weakening of political and public consensus. A 2025
YouGov survey found 68% of the UK public said they believed reducing
household energy costs was a higher priority than achieving net zero.
– Local, Welsh and Scottish Elections took place on 7 May reshaping
theUK’s political landscape at a regional level and exposing deeper
divisions within central government at Westminster.
68%
Of the UK public said lower bills mattered more than net zero
What we are doing about it
– We are committed to a strategy that is aligned to the clean energy
mission, but mindful of the cost of the transition to the billpayer. We
see homegrown clean power as the best antidote to Britain’s exposure
to fossil fuel volatility. We will continue to advocate for increased
budgets for renewables auctions and the speeding up of consenting
times for grid upgrades. We have adjusted our battery storage pipeline
to align with NESO’s connection reform changes.
– Evolution in fair market design will also enable us to continue investing
in the UK’s energy future. For example we are keen to progress with
our pumped storage project at Coire Glas in Scotland if viable to do so.
– May’s local and national elections proved successful for the challenger
parties and underlined the structural fragmentation of UK politics.
Weremain committed to our political neutrality and our engagement
with representatives of all parties in all the jurisdictions we operate in.
– Risk conclusion: Implications of increased concern over the cost of
the energy transition need to be managed see page 62
Energy market review
Politics and regulation
Conflict in the Middle East had an impact on energy prices
Geopolitical unrest
4
SSE plc Annual Report 2026

We work closely with our partners to aid smooth project delivery
Key issues impacting our industry
– 2025 was the warmest year on record for the UK, surpassing the
previous record set in 2022. Four of the UK’s last five years all appear
inthe top-five warmest years since 1884 and the Met Office stated
thathuman-induced climate change made this 260 times more likely.
– Storms were another meteorological feature of 2025-26. Storm Floris
in early August was not unprecedented for a storm but was one of the
most severe to affect Scotland during the summer.
– Storm Amy in early October hit north-western parts of the UK, with
heavy rain falling widely, resulting in the wettest day of the year for
theUK overall. It caused 750 faults across our network in Scotland.
– UK output from renewable technologies in 2025 increased 6%
toarecord 152.5TWh, and a record share of 52.5% of electricity
generation. Wind and solar generation also broke previous records
contributing 30% and 6.9% of overall output respectively.
52.5%
Amount of energy generated by renewable technologies
in2025 – a record share for the UK
What we are doing about it
– Strategically, SSE’s 2030 Goals align with national climate ambitions
while operationally we are focused on managing the immediate impact
of changing weather patterns on our assets.
– In response to Storm Amy SSEN Distribution engineers battled storm
force conditions to restore over 82% of supplies within 48 hours. The
Priority Services team handled escalations from 311 customers in
vulnerable situations. More than 30,000 free meals were also served to
the most affected communities from mobile food vans and local cafés.
– We manage the risk of our changing weather affecting our renewables
output and our assets directly, using modelling and forecasting
measures. We also input into UK national adaptation frameworks to
help legislators plan for climate change and our individual Business
Units have their own climate resilience plans.
Risk conclusion: Increasingly changeable weather patterns can affect our
network customers as well as make renewable output more
unpredictable see page 60
Key issues impacting our industry
– Rising costs and scarcity of supply chain materials for large capital
projects remained a challenge for the energy sector across 2025/26.
The 2026 Thomson Reuters Global Trade Report revealed that tariff
volatility had also fundamentally reshaped the trade landscape, with
supply chain concerns doubling year-on-year as companies tried to
adapt to increased regulatory complexity and cost pressures.
– The clean energy transition is now a global effort meaning that SSE is
effectively in competition with other nations for finite supply chain raw
materials and the talent needed to deliver those projects.
– Regulatory scrutiny on broader energy resilience also intensified
following major power failure incidents at Heathrow, as well as in Spain
and Portugal. In 2025/26 we saw a number of high profile and costly
cyber crime incidents in the UK with data theft disrupting parts of the
retail and manufacturing sectors.
100%
Year-on-year increase in companies’ supply chain concerns
What we are doing about it
– We work closely with our project partners to ensure supply chains can
deliver against future commitments. Some markets are experiencing
higher prices and longer lead times but our projects with longer term
commitments do provide greater certainty on availability of materials.
– Ofgem’s strategic approach to regulation has provided welcome
visibility on investment to 2030 via the ASTI and LOTI programmes.
Wealso have an investable and deliverable RIIO-T3 settlement with
supply chain secured, and resources and people in place.
– Conflict in the Middle East did adversely affect input costs and
supplierterms. But our experienced global supply chain combines its
operations with a strong local presence. This is backed by a structured
relationship management programme, which ensures co-ordination
between all parts of the supply chain.
– A review of cyber and physical security guardrails was conducted for
project partnerships in higher risk jurisdictions. Our employees
underwent mandatory training and scenario planning exercises.
Risk conclusion: SSE has measures in place to mitigate supply chain and
commodity cost challenges see page 63
Looking ahead
Conflict in the Middle East had and will continue to have a direct
impact on consumers in terms of prices they pay for oil and gas.
Governments need to respond with measures designed to
accelerate electrification, strengthen homegrown energy
independence and protect consumers from price volatility.
SSE sees the road ahead clearly for the UK. We need to speed up
the pace of the clean energy transition to become energy secure
and independent. Our investment plan, backed by the efficient
operation of our existing assets, delivers on all these fronts.
The biggest upgrade to Britain’s electricity network in decades
will allow energy projects to connect, electrifying the economy
by enabling connection for data centres, EVs, heat pumps
andother technologies. Renewables-led investments are the
quickest and most affordable route to generating homegrown
power in the UK and Ireland, decoupling the countries from
commodity volatility.
But we are also mindful that we must listen to and address
legitimate concerns over affordability. We will continue to argue
that investment in green energy brings long-term dividends for
all parts of society. Whatever the short-term volatility ahead we
will keep making the case for change with the best interests of
our stakeholders in mind.
Operational and supply chain challenges
Climate change
Changing weather patterns require planning and adaptation
5
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

We work to deliver social and environmental benefits that are recognised and supported by our
stakeholders. This is measured by four business goals aligned to the UN Sustainable Development Goals.
Cut carbon
intensity by 80%
Increase renewable
energy output fivefold
Enable low-carbon
generation and demand
Champion a fair
and just energy transition
Transforming for growth
Our £33bn fully-funded five-year investment programme will
help transform the UK’s electricity infrastructure.
Our strategy
A well-defined funding route offers long-term value creation with clear
visibility over earnings growth and a sustainable and progressive dividend policy.
Maintains our strong balance sheet, backed by capital discipline and investment-grade credit ratings
Optimal capital
allocation to 2030
High quality
earnings
Value-adding
growth
80%
Networks
20%
Renewables and
Flexibility
~80%
Index-linked EBITDA
225-250p
Adjusted EPS
10-13%
Adjusted EPS CAGR
1
FY26-FY30
5-10%
Dividend per share growth
p.a.FY25-FY30
Our investment plan
~£33bn
net capex
Our 2030 goals
Selective and disciplined
Renewables growth
Market-leading Networks Regulated
Asset Value (RAV) growth
1 Compound Annual Growth Rate.
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SSE plc Annual Report 2026
~£40bn
FY30
~25%
CAGR
1
~£13bn
FY25
~9GW
FY30
~12%
CAGR
1
~5GW
FY25

Key:
M
Market-focused
businesses
R
Economically
regulated businesses
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Everything we do at SSE is informed by two fundamental values that
guide our behaviours and ensure we look after people and the planet.
Safety Sustainability
–Employees
– Shareholders and debt providers
– Energy customers
– Governments and regulators
– NGOs, communities and society
– Suppliers, contractors
and partners
The efficient operation of our
business model, and the competitive
advantage it gives us, supports the
creation of a future energy system
that is cleaner, more affordable, and
more secure. Through it, we make
asignificant economic contribution
to society, support the supply chain,
create quality jobs, remunerate
shareholders and deliver positive
outcomes for energyusers.
– People to deliver our strategy,
invest in our projects, buy our
products and provide our licence
to operate.
– Assets to generate revenue and
drive the energy transition.
– Pipelines of development for
sustainable growth.
– Funding to finance our investment
plans.
– Policy and regulatory frameworks
that support investment.
– Supply chain partners to support
delivery of major projects.
– Natural resources to produce
electricity.
– Innovation to maintain our
competitive advantage and drive
the business forward.
Delivering on our purpose
We are aligning people, assets and capital to pursue growth
ambitions and secure long-term benefit for all stakeholders.
What we do
We generate, back up and transport the electricity needed in
everyday life. We do this by investing, developing, building, and
operating in three key areas of the energy value chain, through
a balanced portfolio of regulated and market businesses:
Our business model
What guides us
What we rely on
Why it matters
Who we do it for
The value we create for stakeholders is
described in detail on pages 10-11
Read more on Group performance in the
year on page 17
For more on the competitive advantage
ofthe SSE’s business mix, see page 26
R
M M
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SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Chair’s statement
Powering the
energy transition
The solution to market shocks is to stay the
course on a homegrown future energy
system built on Networks, Renewables and
back-up Flexibility.
Industry has a responsibility to help
government navigate the systemic,
structural changes that will be needed for
electrification of the economy. As a clean
energy champion, SSE stands ready to
playits part as a critical delivery partner,
providing Networks, Renewables and
back-up Flexibility infrastructure.
We recognise that government must
manage the inevitable tension between
short-term affordability pressures and the
need for long-term thinking to attract
investment in a new energy system,
butambitious policy and regulatory
frameworks are undoubtably needed. It has
therefore been heartening to see positive
developments in market design, investable
regulatory price controls, planning reform
and competitive auction frameworks.
Doubling down on clean energy
All future energy scenarios assume a
dramatic ramping up of electricity demand
out to 2050 and successfully meeting that
challenge will be contingent on three
things: an upgrade of the transmission
network on a scale not seen since the
Second World War; a rapid expansion of
clean, homegrown energy supply; and
more policy and investment focus on
energy storage and flexibility technologies
to balance the system.
SSE’s response has been clear and
consistent. By maintaining a strategic focus
on Networks, Renewables and Flexibility,
and by pivoting capital to where the
immediate need is most pressing and the
potential to create value is greatest, we have
positioned ourselves as a leading player in
the world’s leading clean energy market.
The five-year £33bn investment plan we
announced in November 2025, and the
upweighting of capital allocation to
regulated electricity networks, is a doubling
down on our commitment to the clean
energy transition. The market response to
this plan, and the success of the associated
£2bn equity placing, adds weight to our
conviction that we have the right strategy
and the right team to deliver it. As we
execute our ambitious growth strategy we
are creating lasting value thanks to proven
capability, world-class assets backed by
anenviable development pipeline, and a
business mix that is resilient to volatile
market conditions.
And our delivery can be measured by
progress on major projects in the north of
Scotland and theNorth Sea over the past
year. In transmission, construction is well
under wayon six of 11 onshore grid
reinforcement projects and excellent
progress is being made on the 505km
subsea Eastern Green Link 2. The turbine
installation stage is complete on the first
phase of Dogger Bank, turbine installation
continues at pace on the second and
foundations are being laid on the third.
Meanwhile, Berwick Bank, which will
overtake Dogger Bank asthe world’s largest
offshore wind farm when it is complete, is
working towards Final Investment Decision
having secured consent and a competitive
contract for future output from Phase B.
The pages of this report reflect an eventful
year for SSE. Under new leadership and a
strengthened management team, we have
significantly raised our ambitions and
repositioned the Company to seize a
once-in-a-generation growth opportunity
as the energy transition gathers pace.
I am particularly pleased that, in the face of
a highly challenging operating environment,
we have met our financial performance
expectations and made good progress on
building the nationally important electricity
assets that are necessary for a cleaner, more
secure and more affordable energy system.
The world we operate in
The clean energy transition is an achievable
but highly complex task, particularly given
the fracturing of international consensus
onthe case for decarbonisation. There are
political challenges and policy trade-offs
amid stubbornly low economic growth;
there are significant funding requirements
that will only be met if investors are fairly
rewarded for the risk they take; and energy
users need reassurance that the long-term
benefits will outweigh any short-term costs.
All of this was brought into even sharper
relief by the outbreak of conflict inthe
Middle East which, like the war in Ukraine
before it, highlighted just how sensitive the
global economy is to energy shocks. But we
are steadfast in our pursuit of a transition-
aligned purpose and in practice that means
focusing our efforts on efficient operation of
our assets and execution of our investment
plans. In the meantime, our thoughts are
with those affected by the devastating
effects of war, and we continue to monitor
the situation closely and assess our risk
profile accordingly, but the immediate
impact has been limited given the resilience
of our business mix.
“The five-year £33bn investment programme we
announced in November 2025… is a doubling down
on our commitment to the clean energy transition.”
8
SSE plc Annual Report 2026

Sir John with colleagues at Peterhead power station in Scotland
A more stable energy future
Energy market volatility has a pervasive
effecton us all. It curtails economic growth
and places inflationary pressure on hard-
pressed consumers. This is particularly acute
in markets – like the UK and Ireland – that
rely, in part, on imported gas to generate
electricity. The solution is energy
independence founded on a secure,
renewables-led system that puts us in a
stronger position with less reliance on
imported gas and less exposure to market
volatility. Energy prices will of course be
subject to external pressures while the
transition takes place, but the long-term goal
is clear and resilience is improving steadily
asnew renewables capacity comes on line
and enabling networks are strengthened.
This transition is as much about everyday
economics as climate science. Government
and industry must work together as ageing
gas generation plant and the closure of
nuclear facilities add urgency to the task.
And delays merely exacerbate the cost of
the transition, as competition for resources
and talent grows, with other parts of the
world pursuing transitions of their own
energy systems.
For the required investment to be delivered
successfully, planning consent processes
must be smooth and efficient, policy
structures must accommodate both
renewables and flexible back-up
technologies, and those structures need
tobe clear, consistent and long-term.
A purpose to match our ambition
We are a purpose-led organisation.
Thatpurpose continues to be about
long-term delivery for the greater good
ofall stakeholders. We do, however, see
theneed to adapt to an evolving energy
landscape. With that in mind, we have
updated the way we describe what we do:
“to be restless every day until we make
electricity clean, affordable and available
forall”. We feel this accurately reflects our
increasing ambition in a competitive world
and our determination to continually
seekout ways to create better value for
allour stakeholders.
At the same time, how we deliver on
thatpurpose needs to adapt to a changing
world too, with a greater emphasis on
commerciality and the competitive
advantage SSE has as a cohesive group
ofbusinesses. The broad principles of
safetyand sustainability are foundational
values and these will continue to foster a
performance culture that encourages doing
the right thing for people and the planet.
The science-based 2030 Goals that we set
in 2019 continue to provide a measure of
SSE’s role in addressing climate change.
Inthe context of geopolitical, market and
policy factors we continue to monitor
thechallenges we might face in meeting
our goals – particularly those on carbon
intensity and renewables output – within the
ambitious timescales we have set ourselves.
The people powering SSE
I’ve been delighted by the start made by
ournew Chief Executive, Martin Pibworth,
who brings a healthy restlessness to the
role. Martin has quickly established a strong
and effective leadership partnership with
Chief Financial Officer Barry O’Regan.
Barry’s capital discipline complements
Martin’s commercial focus and together
they have significantly raised our growth
ambitions. They are ably supported by a
strengthened executive team that plays to
the collective strength of the Group and
the15,000 employees who are delivering
on our purpose and strategy every day.
On behalf of the Board, I thank the whole
SSE team for their commitment and
resilience through a period of change both
inside and outside of the Company. It’s all
the more pleasing to see safety performance
remain stable through a period of sharply
accelerating construction activity in which
so much has been achieved.
And while employees are on the front line
ofthe effort to transform the energy
system, they are just one part of the story.
Over the past year we have engaged with
investors, retail shareholders, governments,
regulators, suppliers and customers and
that work continues as we strive for greater
energy security and do what we can to
address the cost pressures felt by consumers.
Looking ahead
We are facing into a multi-decade
opportunity to consolidate our position
asone of the world’s foremost electricity
companies. The north of Scotland
transmission grid is being rewired to ease
constraints on the system and unlock
renewables; our distribution networks are
being modernised at pace to accelerate
electrification; our renewables development
pipeline is key to national climate and
energy security ambitions; and we are
investing in new and existing flexibility
assets to provide resilience against system
intermittence and market turmoil.
Indelivering all of this we are driving
economic growth and supporting quality,
long-term jobs as we help provide the
energy security that is so important in an
increasingly uncertain world.
SSE is set up for unprecedented growth,
with the right businesses, assets and people
to deliver on a fully-funded investment
programme that will create value for all.
TheBoard has full confidence in SSE’s ability
to deliver on an ambitious, future-focused
strategy and we look forward to working
with the executive team to promote the
success of SSE for the benefit of all
ourstakeholders.
Sir John Manzoni
Chair, SSE plc
27 May 2026
“We are a purpose-led organisation. That purpose
continues to be about long-term delivery for the
greater good of all stakeholders.”
9
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Employees
Governments
and regulators
Shareholders
and debt providers
NGOs, communities
and civil society
Suppliers, contractors
and partners
Energy
customers
Our stakeholders
Our contract with society
As a responsible company, we carefully consider the impact of our decisions
and actions on the many people who have a stake in what we do.
Our social contract
Everything we do as SSE has an impact on
those around us. Whether that’s building
energy infrastructure or serving our
customers. So we must always ensure our
strategy considers the views of communities
and organisations affected by our actions.
Our unwritten contract with society is there
to make sure both sides benefit from what
we do. SSE builds and maintains energy
projects. Indoing so we support the
economy, createjobs, pay taxes and deliver
community funds. In return society and
shareholders provide us with skilled labour
and financial backing. Our right to operate
as a profitable business depends on this
being a fair exchange.
Who are our stakeholders?
Our stakeholders include employees,
shareholders, customers, regulators and
legislators, communities and partners.
Theyare divided into six groups, as per the
table below, and we interact with them in
arange of ways such as ongoing dialogue,
consultations, roadshows and events.
Externally this means anything from
responding to government consultations
onenergy market design, to engaging with
communities adjacent to our operations
and conducting workplace surveys to
ensure employees have a say in what we do.
This helps us take better strategic decisions
and ensures we meet our legal and
regulatory requirements to consider all
stakeholder views.
For more on stakeholders’ priorities and
our Section 172 Statement see page 95
Reciprocal, value-creating relationships
INPUT:
Talent, skills and
experience
INPUT:
Public policy and
regulatory frameworks
INPUT:
Customer priorities,
expectations
and revenue
INPUT:
Provision of
finance, strategic
direction and
stewardship
INPUT:
Social, environmental
and energy-related
perspectives
OUTPUT:
Return on
investment
and interest
OUTPUT:
Robust social
contract through
which value
is shared
OUTPUT:
Inclusive and high-
performing workplace
OUTPUT:
Investment in
critical energy
infrastructure
OUTPUT:
Reliable and
inclusive provision
of energy
and services
INPUT:
Quality goods,
services and
investment
OUTPUT:
Sustainable
relationships,
value creation and
partnership expertise
10
SSE plc Annual Report 2026

Employees
Around 15,000 people are directly
employed by us in the UK, Ireland and
selected overseas markets.
Why we engage
Engagement helps us attract, retain and
develop a talented workforce now and for
the future.
How we engaged
– Conducted annual survey to gauge
employee sentiment on strategy and
culture – with key issues addressed
through an action plan
– Embedded safety culture through
industry-leading immersive safety
training for our employees and partners
– Provided leadership visibility and
engagement via roadshows and virtual
events followed up with Group-wide and
Business Unit specific communications
– Consultations with recognised trade
unions on employee issues including
impact of 2025 efficiency programme
15,197
Direct SSE employees
Read more on page 49
Shareholders
and debt providers
We have a broad range of shareholders
and debt providers who expect returns
on their investments.
Why we engage
To ensure confidence and support from
those that invest in and lend capital to us.
How we engaged
– Hosted results presentations and investor
roadshows as well as published regular
trading updates
– Responded to shareholder enquiries and
held face-to-face interactions with retail
shareholders at our Annual General
Meeting
– Engaged with credit rating agencies and
debt providers to explain our strategy and
highlight ESG credentials of our plans
£31bn
Market capitalisation
as at 31 March 2026
Read more on page 93
Energy
customers
We directly serve energy supply
customers in GB and the island of Ireland.
We also provide grid connection to
networks customers in our distribution
andtransmission operating licence areas.
Why we engage
To provide a reliable energy service to all
ourcustomers and support them as we
enable the clean energy transition.
How we engaged
– Engaged proactively with affected
networks customers during storms
– Promoted benefits of SSE’s existing and
proposed business plans for electricity
network price control settlements
– Provided supportive measures for
energysupply customers and advice
onenergy efficiency
4.96m
Networks and supply customers
Read more on pages 34 and 46
Governments
and regulators
We engage with legislators to influence
market design in support of our role in the
energy transition. We remain politically
neutral across all our engagement.
Why we engage
To ensure policy supports our investment in
critical national infrastructure that benefits
customers and society.
How we engaged
– Contributed to government consultations
and responded to calls for evidence
andparliamentary enquiries
– Liaised with UK and Irish governments to
support growth, deliver energy security
and meet climate goals whilst mindful of
the affordability challenge
– Hosted ‘Business of Leading the Energy
Transition’ event in London and attended
global conferences such as COP30 and
New York Climate Week
£3.6bn
Capital expenditure invested
in infrastructure in2025/26
Read more on page 4
NGOs, communities
and civil society
Meaningful engagement with those
affected by our actions ensures our
projects bring both social and
environmental benefits.
Why we engage
We rely on the support of the communities
we work in and the broader backing
ofsociety as we seek to deliver a clean
energy transition.
How we engaged
– Delivered record amount of community
investment funding in 2025/26.
– Listened and responded to concerns
from communities in the north of
Scotland as we took forward our plans
totransform SSEN Transmission’s
overland network
– Delivered community investment
programmes across our technologies and
first of the 1,000 new homes adjacent to
transmission projects in the Highlands
– Partnered with local authorities and
NGOs to ensure communities receive
societal and environmental benefits e.g.
signing the Highland Social Value Charter
£24.9m
Investment in communities
in 2025/26
Read more on page 53
Suppliers, contractors
and partners
We depend on our supply chain and the
shared expertise of partners to deliver
projects safely, on time and on budget.
Why we engage
Healthy reciprocal relationships with those
we work with ensure we can maximise
shared value from our activities.
How we engaged
– A further 4,500 employees and contract
partners completed our immersive safety
training in 2025/26; taking the overall
total to over 14,000 since it started
in2022
– Communicated socioeconomic value of
our projects in the north of Scotland, and
benefits they bring for local supply chain
– Facilitated industry-government
engagement on circular economy
throughSSE’s Powering Net Zero Pact
– Direct interaction through SSE’s
long-running Supplier Relationship
Management initiative
– Promotion of sustainability best
practicethrough EcoVadis supply chain
management tool
c.5,600
Active suppliers
Read more on page 48
11
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

A purpose to
beproud of
Martin Pibworth looks back on the
progress made by SSE in a year
of exceptional events that have
only added urgency to the clean
energy transition.
Chief Executive’s review
Fanellan substation, both key strategic
points on the new network we are
preparing. The scale of the investment is
vast, and the need to bring communities
with usis significant, but progress continues
to be on track.
Back in November we talked about
achieving consents and starting
immediately on the work of building
outinfrastructure that will ease system
constraints and send more low-cost clean
energy into markets that would otherwise
be supplied by expensive imported gas.
Since then, visiting sites and watching how
drawings are becoming buildings and assets
has been quite incredible; all done to the
highest standards and, of course, with the
utmost consideration of our team’s safety
and the impact we are having on the
environment around us.
And the progress we’re making with
world-class renewables infrastructure is
equally impressive. I’m pleased with the
progress on Dogger Bank offshore wind
farm. These are complex projects
undertaken in difficult conditions and the
first phase had its challenges. Dogger Bank
A is now delivering into the national grid as
commissioning works continue. Atthe same
time, we are rapidly installing turbines on
Dogger Bank B and immediately generating
into the market.
By the time we complete the full wind farm,
it will be producing 6% of the UK’s current
demand at a CfD price well below the
current market price. Dogger Bank offers
outstanding value to bill payers and if we
end up building all three phases of Berwick
Bank, the volumes we will produce will be
even greater.
The renewables industry has been
througha tough time thanks to supply
chainchallenges and planning blockages
but wehave held our capital discipline and
restructured for optimal efficiency while
continuing to invest in both our engineering
and operational skillsets. We believe that
our response will not only benefit investors,
but will have a significant positive impact
onconsumers and society as a whole.
Committed to excellence
Every business we operate has increased
relevance as a result of the geopolitical
context. We have known for some time that
the growing need for electrification offers
increasing capex possibilities for our
distribution licences as consumer demand
for power connections and usage increases.
We have seen this accelerate over the second
half of the last financial year; and whilst
wehave been careful not to overstate the
possibilities for data centres, opportunities
are emerging in our southern region.
Recent world events have laid bare the high
cost of over-reliance on imported fuels. In
March 2026, when conflict broke out in the
Middle East, gas prices doubled as traders
assessed the market impact. But UK power
prices remained broadly in line with the
previous year, held down by increased
renewable energy production delivered to
markets by enhanced electricity networks.
As the world took stock of that first month
of fighting in March, we were busy
generating 1.7TWh of power from wind
andhydro sources, transmitting 1.56TWh
ofclean homegrown energy through the
system and dispatching the most efficient
flexible thermal plant in Europe to provide
vital system back-up. There is no greater
demonstration of the economic benefits of
the energy transition: clean power offering
improved energy independence and
reducing the national exposure to volatility
in commodity markets.
I am very proud of SSE’s contribution to this,
and excited about the progress we have
made in accelerating these positive dynamics
through my first year as Chief Executive.
Delivering world-class assets
Right now, the most critical piece in
theenergy transition jigsaw is the
transmission network in the north of
Scotland. Last summer I took a helicopter
ride tracking the routes of the overhead
lines that we will build through the ASTI and
LOTI investments over the next few years;
Ialso visited the construction sites at
Netherton and the planned location of
“Right now, the most critical piece in the energy
transition jigsaw is the transmission network in
thenorth of Scotland.”
12
SSE plc Annual Report 2026

In the summer of 2025, I spent time
withsome of our engineers looking after
low-voltage networks and observed
first-hand real skill backed by an exemplary
safety culture.
Later I watched the same teams deal
withthe impacts of Storm Floris with the
highest levels of customer empathy and
professionalism. During this event we
experienced record 82mph wind gusts
forAugust which knocked out supply for
72,000 of our customers. It is testimony to
the team that 98% of customers had been
restored within 48 hours despite the very
difficult working conditions. Again, it speaks
of a level of operational excellence that
extends across every business in the
SSEGroup.
And that has been the outstanding
takeawayfrom my first year as Chief
Executive; all our businesses are positioned
positively behind a commercial purpose
ofproviding clean, homegrown, reliable
energy supply. My message to everyone at
SSE has been that delighting our customers
and our stakeholders as we provide our part
of the energy transition is a key measure
ofsuccess.
Our people are rightly proud of the
14,506GWh of renewable energy we
produced last year; the 10.8GW of
electricity (mostly clean) we moved through
our networks and delivered to end users;
and the promise of delivering the substantial
national benefit of the £33bn investment
plan that we outlined to investors in
November last year and remain fully on
track to deliver.
Change for the better
That does not mean we haven’t embraced
change over the last few months. My best
wishes and thanks go to a number
ofwell-regarded senior colleagues who
haveleft SSE, some after long periods
ofexceptional service.
Naturally, this has created opportunities and
I’m excited by the arrival of executive hires
in the areas of IT, Procurement, Legal,
Sustainability and Business Development.
The fresh experience and insights our new
colleagues bring to the organisation, and a
deepening of our management pools, will
enable our continued growth and success.
The Group Executive Committee and I have
spent significant time evolving our culture
into something that everyone at SSE can get
behind as we focus on strategic delivery
andsector-leading performance.
This has led to a new purpose statement:
“Be restless every day until we make
electricity clean, affordable and available for
all.” And the way we execute that purpose
will be guided by behaviours that emphasise
accountability, ambition, honesty and
commerciality right across SSE.
The case for electrification
There is real impetus behind electrification
of the economy, driven by consumer
behaviour as much asanything else. We
need look no further than the recent surge
in EV demand in response to energy cost
concerns. But theenergy transition that is
needed to supportelectrification will
require industry and governments to work
in tandem.
Whilemaintaining our strict political
neutrality, over the past year we have taken
a more robust position on what we believe
the correct policy responses should be to
the cycles and contexts that continually
emerge. On that basis I am pleased to
report that we have enjoyed good access
to,and constructive engagement with,
allgovernments and regulators and we’ve
usedthat to advocate for the mutual best
interests of investors and consumers.
It has also been pleasing to see that the UK
Government’s response to recent events
has been to double down on its clean
power agenda, increasing budget for
renewables auctions and taking steps
tospeed up consenting times for grid
infrastructure.
Thisbroadly aligns with our strong view that
Networks, Renewables and Flexibility offer
the best value for energy users. And
tangible benefits from our investments are
already coming through, with the network
system operator confirming in May that
SSEN Transmission’s work to reduce
constraint costs delivered almost £300m of
savings for consumers in the last year alone.
The value of resilience
Above all, my first year asChief Executive
has provided me with a stark reminder that
inaworld of ever increasing uncertainty,
our carefully integrated portfolio offers
resilience in most market scenarios and
theopportunity for long-term growth
andenduring value creation.
As markets have fallen and spiked; as global
politicians have debated and contested,
asnew events have surprised and amazed;
what is evident is that SSE continues to have
an important part to play in a transformative
shift to an energy system that is not only
secure, but cleaner and more affordable too.
Backed by an astonishing depth of
capability and a striking employee
commitment to achieving our purpose,
weare strongly placed to deliver against
theplans we set out last November, and
pivot to further growth as policy converges
with the energy transition. It makes me feel
proud and indeed privileged to have the
opportunity to lead SSE at this time.
Martin Pibworth
Chief Executive
27 May 2026
Martin gets an update on the Eastern Green Link 2 project at Peterhead
“All our businesses are positioned positively
behind acommercial purpose of providing clean,
homegrown, reliable energy supply.”
13
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Our KPIsOur KPIs
How we performed
We use a number of key measures to track our financial, non-financial and operational
performance, and we keep them under review to ensure they align with our strategy.
Key
R
KPI linked to remuneration
Linking performance to pay
SSE’s Remuneration Policy is linked to both operational and financial performance. The individual targets and measures
used by the Remuneration Committee to inform decisions on Directors’ pay have been indicated on these pages with
the symbol shown here on the right. See the Remuneration Report in full from page 116
.
Dividend per share
(pence)
68.7
The recommended full-year dividend is in line
with the dividend plan to 2030 that balances
income for shareholders with the appropriate
funding for growth.
Earnings Per Share*
(pence)
APM
R
153.5
Adjusted
105.5
Reported
We have delivered on the earnings commitments
we made for the year in the face of mixed weather
conditions and a complex operating environment.
Profit before tax*
(£m)
APM
2,024.8
Adjusted
1,837.3
Reported
Performance was consistent with expectations
and benefited from an increased contribution
from SSEN Transmission.
Adjusted EBITDA
(£m)
APM
R
3,207.9
We extract interest, tax, depreciation and
amortisation from earnings to provide an optimal
measure of operational performance.
Adjusted net debt
and hybrid capital*
(£bn)
APM
R
10.1
Adjusted net debt and hybrid capital is consistent
with expectations given increasing investment,
with leverage stable at 3.3x net debt / EBITDA.
Combined
networks Regulated
Asset Value (RAV)
(£bn)
R
15.6
The acceleration of work to reinforce SSE’s three
economically-regulated electricity networks
contributed to higher RAV values in the year.
Adjusted
investment, capital
and acquisitions
(£m)
3,585.6
Another record year of investment was driven by
spending in our regulated electricity networks
divisions, with lower deployment of capital across
the other businesses, and no acquisitions.
2026
2025
2024
68.7
64.2
60.0
Adjusted Reported
2026
2025
2024
156.7
161.3
108.2
161.3
105.5
153.5
Adjusted Reported
2026
2025
2024
2,495.1
2,207.2
1,850.9
2,144.5
1,837.3
2,024.8
2026
2025
2024
3,207.9
3,349.3
3,295.6
2026
2025
2024
10.1
10.1
9.2
2026
2025
2024
15.6
12.9
10.9
2026
2025
2024
3,585.6
2,910.4
2,476.7
Total Recordable
Injury Rate per
100,000 hours
worked (employees
and contractors
combined)
R
0.17
Combined TRIR remained broadly stable.
WhileTRIR improved for SSE employees,
TRIRperformance for contract partners
worsened compared to the previous year.
2026
2025
2024
0.17
0.16
0.20
Financial performance
Safety performance
* We have refined our adjusted net debt and hybrid capital measure by removing a proportionate share of SSE plc’s external debt invested in subsidiaries with a non-controlling
interest, along with related net finance costs from adjusted net finance costs, adjusted profit before tax and adjusted Earnings Per Share measures.
14
SSE plc Annual Report 2026

Cut carbon intensity by 80%
UNSDG 13
Scope 1 GHG intensity
(gCO
2
e/kWh)
R
194
SSE recorded its lowest carbon intensity,
falling below 200gCO
2
e/kWh for the first time.
This was driven by increased renewables
output alongside lower thermal generation
output due to maintenance outages.
This KPI is on target but with risk –
see pages 43 to 44
Increase renewable energy output fivefold
UNSDG 7
Renewable
generation output
(TWh)
1
R
14.5
Renewables output was up 9% due to increased
capacity from initial turbine commissioning at
Dogger Bank A and Yellow River, which was
partially offset by mixed weather conditions.
This KPI is behind target – see page 45
Enable low-carbon generation and demand
UNSDG 9
Renewable capacity
connected within
SSENTransmission
network area
(GW)
2
R
10.8
Connected renewables in SSEN Transmission’s
network area remained stable. SSEN Transmission
has exceeded its goal to accommodate 10GW of
renewable generation by 2026.
This KPI is on target – see page 47
Pure electric or plug-in
hybrid vehicles
registered in SSEN
Distribution’s licence
areas
3
R
c.589,000
SSEN Distribution is progressing key innovation
projects with partners to support flexible
markets and future infrastructure provision
forthe mass adoption of electric vehicles.
Champion a fair and just energy transition
UNSDG 8
Contribution to
GDP UK/Ireland
(£bn/€bn)
9.66/1.36
We contributed £10.84bn to UK and Ireland GDP
– our highest contribution since 2018/19
(adjusted for current prices). This largely reflects
increased activity linked to delivery of our
investment plan.
See page 47
Jobs supported
in UK and Ireland
88,350
SSE saw an increase in total jobs supported
in2025/26, with 83,360 and 4,990 jobs supported
in the UK and Ireland respectively.
See page 47
2026
2025
2024
194
218
205
2026
2025
2024
14.5
13.3
11.2
2026
2025
2024
10.8
10.6
9.0
2026
2025
2024
c.589,000
c.487,500
c374,500
UK Ireland
2026
2025
2024
1.04
5.86
0.95
7.88
1.36
9.66
2026
2025
2024
88,350
67,190
54,830
Performance against 2030 Goals
1 Includes pumped storage, battery energy storage systems, biomass andconstrained-off wind in GB.
2 Prior period comparators restated to reflect data refinement. Transmission and distribution connected capacity within the SSEN Transmission network area, includes
pumped storage and battery storage.
3 Estimated using the UK Government’s vehicle licensing statistics data which have gone through a programme of data refinement. As a result, prior period comparators
are restated.
15
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Chief Financial Officer’s review 17
Financial review 19
Business Unit operating review 26
SSE Renewables 28
SSE Thermal 30
SSEN Transmission 32
SSEN Distribution 34
Energy Customer Solutions 36
SSE Energy Markets 38
Review
of the year
People Powering SSE
Isobel Green, Project Engineer, SSENTransmission,
Glasgow, Scotland
“I have a dual role as a substation
engineer and technical specialist.
So,I’m always busy helping to
buildthe grid we need in the
northof Scotland or doing industry
leading research. What we’re doing
isgoingto matter for generations
tocome, which is really exciting.”
16
SSE plc Annual Report 2026

Making good
on a £33bn plan
The early progress made in
delivery of an ambitious
investment programme is
creating real value and setting
us up for further growth to come.
Chief Financial Officer’s review
After a 2025/26 dominated by volatility and
uncertainty it’s pleasing to be able to report
a good set of financial results in line with
what we told the market through the course
of the year.
What we have achieved speaks to SSE’s
strategic alignment with prevailing policy
onthe energy transition and our ability
tocreate shareholder value in most
marketconditions.
A breakdown of the segmental contribution
made across the Group in the face of mixed
weather and macro uncertainty is detailed
in the Financial review across the
followingpages.
But in summary, an increased contribution
from our combined networks businesses
– which accounted for 40% of adjusted
operating profit – and the addition of new
renewables capacity helped us to meet our
projection of 153.5 Earnings Per Share for
the year.
A record capex year
A 20% rise in capital expenditure to £3.6bn
marks another record year for SSE spending
on critical national infrastructure and
highlights the good progress we are
makingon the £33bn investment plan
weannounced lastautumn.
That plan upweights our exposure
toregulated networks, particularly
transmission, which delivered an 80%
increase in investment year-on-year as
ourconstruction of mega projects in the
north of Scotland gathers pace.
This is a bold and ambitious plan that will
treble our investment over the five years
to2030. It breaks down to around 80% or
£27bn to be spent on regulated electricity
networks and the remainder allocated
selectively across renewables and system
flexibility projects.
Given the market support we received for
the plan in November, and the associated
£2bn equity placing, it is particularly
pleasing to be able to report such good
early progress and the value it is creating,
see pages 21 and 87
The pressing need to reinforce the grid to
unlock renewables is the single biggest
growth opportunity right now, and
accordingly SSEN Transmission accounts
for£22bn, or around 67%, of our
spendingplans.
The visibility we have over grid
reinforcement projects in the north of
Scotland gives us every confidence that
they will deliver a compound annual growth
rate of 30% and take our RAV growth in
SSEN Transmission to around £30bn.
This growth is out to FY30 but we see
potential for more to come beyond
thatasthe system operator reassesses
reinforcement needs in the next decade.
Aligned and agile
Our balanced mix of businesses and
premium options drives immediate value
today and promises growth for the future.
SSE’s strategic focus on Networks,
Renewables and Flexibility not only plays
into the energy transition that is under
wayin our home markets; it also gives
usresilience against macro-economic,
political or regulatory uncertainty thanks to
our unique mix of regulated and market-
based earnings.
We have deliberately positioned
ourselvesas a clean energy champion
byaligning our strategy to the direction
ofgovernment policy.
At the same time, we have retained the
optionality and agility to pivot to where the
value is – as can be seen in our regulatory
networks focus – but also to adjust to
anyshifts in policy direction on the
energytransition.
Fit for the future
We have every confidence in our plan
butrecognise that its execution requires
arelentless focus on delivery and
operational excellence.
Over the course of the year we have been
realigning the Group behind our investment
priorities and part of that has been keeping
momentum behind the operational
improvements that came through an
efficiency review launched in 2025.
This has meant some tough but necessary
resourcing decisions and a cultural shift to
amore commercially-minded SSE that is fit
for the growth opportunities in front of us.
The efficiency review is now largely
complete, with the exception of an ongoing
transformative change programme in SSEN
Distribution. Actions taken as a result of the
“Given the market support we received for the plan
... it is particularly pleasing to be able to report such
good early progress and the value it is creating”
17
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Chief Financial Officer’s review continued
Barry O’Regan engages with colleagues after SSE’s AGM in Perth
Group review are expected to deliver
recurring efficiency and cost control savings
across SSE.
As detailed in the accounts, reported
operating profit for the year reflects
one-off exceptional charges associated
with restructuring costs alongside
impairment reversals and an asset
impairment charge related to UK onshore
wind projects that have been impacted by
grid connection delays.
Disciplined delivery
Financial discipline guides everything we
do, from the investment decisions we make
to our commitment to maintaining a strong
balance sheet.
Our debt levels remain low with 92%
secured at fixed rates and leverage is stable
at 3.3x net debt to EBITDA – well within the
thresholds of our strong investment grade
credit ratings which were reaffirmed by
ratings agencies after we announced our
investment programme last year. Our
investment plan includes a range of funding
levers, including asset rotation options
across the portfolio that will mainly be
delivered towards the end of the plan
asrequired.
As set out in the plan, we are also
committed to a progressive dividend policy
targeting annual growth between 5-10%.
Consistent with that commitment, and in
line with the returns achieved in the past
year, we are recommending a 7% increase
individends for the year.
Looking ahead
The robustness of our planning can be seen
in the earnings forecast we have for FY27
which is unchanged since 2023. We expect
to meet an adjusted EPS target of 168 to
193p, consistent with the 175 to 200p range
we had prior to the equity raise in November.
Over the same period, we anticipate our
record-breaking run for capital expenditure
to continue at over £5bn for the year.
Looking further out to FY30 our
guidanceisalso unchanged at 225 to 250p,
underpinned by around 80% of EBITDA
being index linked in 2029/30 due to the
upweighting of our investment in
regulatednetworks.
Barry O’Regan
Chief Financial Officer, SSE plc
27 May 2026
Key Performance Indicators
Financial Performance
Adjusted Reported
March 2026 March 2025
1
March 2026 March 2025
1
EBITDA £m 3,207.9 3,349.3 2,768.2 2,738.3
Operating profit £m 2,236.6 2,419.2 1,888.9 1,962.2
Profit before tax £m 2,024.8 2,144.5 1,837.3 1,850.9
Earnings per share (EPS) pence 153.5 161.3 105.5 108.2
Full year dividend per share
(DPS)pence
68.7 64.2 68.7 64.2
Investment and capital
expenditure£m
3,585.6 2,910.4 4,780.7 3,837.0
Net debt and hybrid capital £bn 10.1 10.1 8.6 9.5
SSEN Transmission RAV – £bn
(100%basis)
9.0 7.2
SSEN Distribution RAV – £bn 6.6 5.7
SSE Total Electricity Networks
RAV- £bn (100% basis)
15.6 12.9
1 Comparative financial information has been restated, please see note 1.2 to the Financial Statements.
Performance against 2030 Goals March 2026 March 2025
Cut carbon intensity by 80%
– Scope 1 GHG intensity (gCO
2
e/kWh) 194 218
Increase renewable energy output fivefold
– Renewable generation output (TWh)
1
14.5 13.3
Enable low-carbon generation and demand
– Renewables connected in SSEN Transmission
network area (GW)
2
10.8 10.6
Champion a fair and just energy transition
– Contribution to GDP UK and Ireland (£bn / €bn)
3
9.66/1.36 7.88/0.95
– Jobs supported in UK and Ireland
3
83,360/4,990 62,000/5,190
1 Includes pumped storage, battery energy storage systems, biomass and constrained-off wind in GB.
2 Prior period comparators restated to reflect data refinement. Transmission and distribution connected
capacity within the SSEN Transmission network area, includes pumped storage and battery storage.
3 Direct, indirect and induced Gross Value Added and jobs supported, from third party economic
impactassessment.
Safety Performance March 2026 March 2025
Total Recordable Injury Rate per 100k hours
(SSE & contract partners)
0.17 0.16
18
SSE plc Annual Report 2026

Financial Review
Group Financial Review
For year ended 31 March 2026
In order to present the financial results and
performance of the Group in a consistent
and meaningful way, we apply a number of
adjusted accounting measures throughout
this financial report. The definitions we use
for adjusted measures are explained in the
Alternative Performance Measures section.
Group operating profit
The Group delivered strong operating
performance over the course of the year.
This included an increased profit
contribution from SSEN Transmission
whichgrew by around 75% on the prior year
reflecting the strong growth in investment
across the transmission network. Elsewhere
within Networks, profitability in SSEN
Distribution was significantly lower as
expected given the previous year included
alarge non-recurring inflation adjustment
to revenues.
For Renewables, profitability increased
byaround 4% reflecting increased output
from new capacity partially offset by
mixedweather conditions and lower
hedged prices.
Across Flexibility, SSE Thermal saw modestly
lower profits than prior year which reflected
market conditions and outage programmes
across the fleet. And Energy Customer
Solutions profits decreased, reflecting
lowerwind-related revenues combined
withlower volumes sold.
Reported operating profit, in addition to
themovements above, includes both the
net re-measurement on forward energy
derivatives which are unrelated to
underlying operating performance, as
wellas items which are excluded from
adjusted results on the basis they are
materially non-recurring, uncontrollable
orexceptional. Reported operating profit
decreased by 4% compared to the
prioryear, reflecting a lower net asset
impairment charge partially offset by a
higher net-remeasurement charge on
forward energy derivatives and Group
restructuring charges. These movements
include an increase in profitability of SSEN
Transmission, which is fully consolidated
within reported metrics.
Key Financial Metrics (£m)
Adjusted Reported
March 2026 March 2025
1
March 2026 March 2025
1
Networks operating profit
– SSEN Transmission 562.6 322.5 750.1 430.0
– SSEN Distribution 335.3 736.0 296.9 736.0
897.9 1,058.5 1 ,047.0 1,166.0
Renewables operating profit
– SSE Renewables 1,076.4 1,038.8 725.3 617.6
1,076.4 1,038.8 725.3 617.6
Flexibility operating profit
– SSE Thermal 195.4 211.4 243.0 195.3
– Energy Customer Solutions 136.9 192.1 136.2 189.2
– SSE Energy Markets 43.2 30.0 (145.8) (42.9)
375.5 433.5 233.4 341.6
– Corporate unallocated (113.2) (111.6) (116.8) (163.0)
Total operating profit 2,236.6 2,419.2 1,888.9 1,962.2
Net finance costs (211.8) (274.7) (51.6) (111.3)
Profit before tax 2,024.8 2,144.5 1,837.3 1,850.9
Tax charge (193.4) (297.9) (425.7) (518.0)
Effective tax rate (%) 9.6 13.9 24.3 29.4
Profit after tax 1,831.4 1,846.61 1,411.6 1,332.9
Less: hybrid equity coupon payments (72.9) (73.7) (72.9) (73.7)
Less: profits attributable to non-
controlling interests
– – (130.0) (69.8)
Profit after tax attributable to
ordinary shareholders
1,758.5 1,772.91 1,208.7 1,189.4
Earnings Per Share (pence) 153.5 161.31 105.5 108.2
Weighted avg. number of shares
forEPS (million)
1,145.4 1,099.2 1,145.4 1,099.2
Shares in issue at 31 March (million)
2
1,212.2 1,106.3 1,212.2 1,106.3
1 Comparative financial information has been restated, please see note 1.2 to the Financial Statements.
2 Excludes Treasury shares of 3.3m in March 2026 and 4.9m in March 2025.
Segmental EBITDA results are included in note 5 to the Financial Statements.
Fordetailed Business Unit financial performance commentary, pleaserefer to the
Business Operating Review.
Net finance costs
Our adjusted net finance costs – which
exclude coupons on hybrid bonds classified
as equity – were lower this year. The
year-on-year increase in the cost of debt, as
lower cost maturing debt has been replaced
by more expensive newly issued debt, has
been more than offset by an increase in
capitalised interest resulting from increased
capital expenditure activity in the year.
Reported net finance costs, which excludes
our share of interest in Joint Ventures and
Associates, were £(51.6)m compared to
£(111.3)m in the previous period reflecting
the increased capitalisation as noted.
Taxation
SSE is one of the UK’s biggest taxpayers,
and in the Total Tax Contribution survey
published in November 2025 was ranked
16th out of the 100 Group of Companies
in2025 in terms of taxes borne (those which
represent a cost to the company, and which
are reflected in its financial results).
We consider being a responsible taxpayer
tobe a core element of our social contract
with the societies in which we operate and
we seek to pay the right amount of tax,
inthe right place, at the right time. While
wehave an obligation to shareholders,
customers and other stakeholders to
efficiently manage our total tax liability,
wedo not seek to use the tax system in
away it is not meant to operate or use
taxhavens to reduce tax liabilities.
19
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Financial review continued
SSE was the first FTSE 100 company to be
Fair Tax Mark accredited and we have now
been accredited for 11 years.
In December 2025, we published our
“Talking Tax 2025: fair tax for a clean energy
transition” report. We did this because
building trust with stakeholders on issues
relating to tax is important to the long-term
sustainability of the business. We won
PwC’s Building Public Trust Award for Tax
Reporting in the FTSE 350 for the fourth
consecutive year in November 2025 for the
quality of our tax reporting.
In the year, SSE paid £424.9m of profit taxes,
property taxes, environmental taxes and
employment taxes in the UK, compared
with £592.1m in the previous year. The
decrease in total taxes paid was primarily
due to less corporation tax being paid on
UK profits. This was because of higher
capital allowances on the Group’s record
level of capital expenditure. In addition,
lessElectricity Generator Levy was paid
dueto lower electricity generation prices.
As with other key financial indicators, our
focus is on adjusted profit before tax and,
in line with that, we believe that the adjusted
current tax charge on that profit is the tax
measure that best reflects underlying
performance. SSE’s adjusted current tax
rate, based on adjusted profit before tax,
was 9.6%, compared with 13.9% in 2024/25
on the same basis. The decrease in rate
isprimarily due to higher UK capital
allowances under full expensing on the
Group’s capital investment programme.
Profit after tax and EPS
Adjusted profit after tax was (0.8)% lower
relative to the prior year, reflecting the
movements in adjusted operating profit,
partly offset by the lower adjusted current
tax rate and lower adjusted net finance costs.
Reported profit after tax reflects the
movements in reported operating profit and
net finance costs outlined above in addition
to a reported current tax rate of 24.3%. The
higher reported current tax rate reflects an
increase in deferred tax arising as a result
ofdifferences in accounting and tax bases
that give rise to potential future accounting
credits or charges. Within the reported tax
charge, deferred tax increased by 15% on
prior year, mainly due to the increase in our
capital investment programme.
Reflecting the movements above, and
theincreased number of shares following
the November 2025 equity issuance,
adjusted Earnings Per Share was (5)% lower
relative to the prior year at 153.5 pence with
reported Earnings Per Share decreasing
by(2)% to 105.5 pence.
Final dividend
We believe that dividends should be
sustainable and based on earnings
performance, while also enabling the
longer-term growth prospects of our assets
and operations. To that end, the dividend
plan to 2029/30 is designed to balance
income to shareholders with the
appropriate funding for a transformational
growth plan that will ultimately create
greater value and total return for
shareholders over the long term.
In line with that dividend plan and reflecting
the strategic progress made to deliver
sustainable earnings growth, we have
announced a final dividend of 47.3 pence
for payment on 17 September 2026. This
amounts to a 2025/26 full year dividend of
68.7 pence, representing an increase of 7%
on the prior year.
Capital expenditure programme
During the year ended 31 March 2026,
adjusted investment, capital and
acquisitions expenditure totalled £3,585.6m,
compared to £2,910.4m in the prior year.
The increased investment was driven mainly
by our regulated electricity networks
divisions, with lower overall deployment of
capital across the other businesses, and no
acquisitions expenditure.
Further detail on the capital expenditure in
the year can be found in the Business Unit
operating review.
Financial Outlook
Financial outlook for 2026/27
SSE’s unique mix of assets across Networks,
Renewables and Flexibility has been carefully
selected to provide a diverse and resilient
business mix that will perform in periods
ofsignificant macro-economic, political
orregulatory uncertainty. With increasing
investment into assets underpinned by
regulated and index-linked earnings, our
financial resilience is expected to grow as
the long-term strategic investment plan
isdelivered.
Given this resilience, we confirm the
individual performance expectations for
each Business Unit for the 2026/27 financial
year as follows:
– SSEN Transmission – It is expected
thatadjusted operating profit will be
significantly higher than 2025/26,
reflecting increased allowed revenue
generated by continued acceleration
ofinvestment.
– SSEN Distribution – We anticipate
thatadjusted operating profit will be
atsimilar levels to 2025/26.
– SSE Renewables – The business is
expected to deliver similar levels of
adjusted operating profit as 2025/26
asincreases in capacity offset lower
merchant power prices.
– SSE Thermal – It is expected that
adjusted operating profit will be
significantly higher than 2025/26,
reflecting the step up in contracted
Capacity Market payments.
Capital expenditure programme
Adjusted Investment and Capex Summary
March 2026
Share %
March 2026
£m
March 2025
1
£m
SSEN Transmission (net of 25% non-controlling
interest)
48% 1,717.6 953.5
SSEN Distribution 24% 851.8 635.8
Regulated electricity networks total 72% 2,569.4 1,589.3
SSE Renewables 21% 739.0 1,001.8
SSE Thermal 5% 197.5 183.8
Energy Customer Solutions 1% 34.8 80.0
SSE Energy Markets – 10.2 8.7
Corporate unallocated 1% 34.7 46.8
Adjusted investment and capital expenditure 100% 3,585.6 2,910.4
1 Comparative financial information has been restated, please see note 1.2 to the Financial Statements.
Final dividend
Dividend per Share (pence) March 2026 March 2025
Interim Dividend 21.4 21.2
Final Dividend 47.3 43.0
Full Year Dividend 68.7 64.2
20
SSE plc Annual Report 2026

– Energy Customer Solutions – We
anticipate that the adjusted operating
profit for these businesses will be lower
than 2025/26, reflecting the continuing
unwind of related wind income.
These expectations remain subject to
normal weather conditions, current market
conditions and plant availability.
Given the strong strategic progress made in
the year, and after considering the impact
ofcurrent and forecast market conditions,
we continue to reiterate our 168 – 193
pence adjusted Earnings Per Share guidance
range (being the original 175 – 200p target,
adjusted for the dilutive impact of the £2bn
equity raise completed in November 2025
resulting in an increased number of shares).
With capital expenditure and investment
continuing to ramp up in line with the long
term investment plan, full year capex is
expected to significantly increase to over
£5bn, in line with the phasing of the £33bn
investment plan announced in November
2025, with net debt continuing to be
comfortably within our recently reaffirmed
strong investment grade credit ratings.
Outlook to 2029/30
Five-year investment programme
In November 2025, we announced a
transformational £33bn five-year
investment plan to 2029/30, significantly
increasing exposure to UK electricity
Networks and driving long-term value
creation with attractive regulatory asset
value and earnings growth.
This plan represents a trebling of investment
over the five-year period, with around 80%
or £27bn to be invested in regulated UK
electricity Networks and around 20% or
£6bn selectively in Renewables and system
Flexibility projects:
– SSEN Transmission (~67% or ~£22bn)
delivering the RIIO-T3 investment
programme which is critical to
connecting renewables and alleviating
existing constraints within the electricity
transmission network. This investment,
together with that from our 25% partner,
is expected to increase gross RAV to
around £30bn by the end of 2029/30
representing an ~30% CAGR.
– SSEN Distribution (~15% or ~£5bn)
delivering the remaining RIIO-ED2
investment programme in addition to
anticipated strategic investment in ED3.
This investment is expected to increase
gross RAV to between £9 – 10bn by
theend of 2029/30 representing a
~10%CAGR.
– SSE Renewables (~12% or ~£4bn)
delivering its existing construction
programme together with highly
disciplined investment into exciting
growth options. This focus on financial
discipline and selective growth is
expected to result in a targeted ~9GW of
installed capacity by the end of 2029/30.
– SSE Thermal and other businesses
(~6%or ~£2bn) predominantly focused
on flexible generation technologies and
serving key customers.
The investment plan includes around £3bn
of currently uncommitted capex across
theSSE Renewables and SSE Thermal
businesses. In allocating this capital, we
continue to apply strict returns criteria for
new energy projects to ensure attractive
shareholder returns whilst ensuring
strategic alignment with our clean
electricity focus.
Industry-leading capital growth
The record programme of investment
outlined above is expected to deliver
industry-leading capital growth. In the
Networks businesses, gross RAV is expected
to more than treble to around £40bn and,
with selective and disciplined investment,
Renewables installed capacity is set to
almost double to around 9GW by the end
ofthe plan. This material capital growth
willcreate significant long-term value
forshareholders whilst unlocking
widereconomic benefits for society.
Resilient funding strategy
This programme is backed by a
comprehensive funding strategy that
maintains our strong balance sheet
alongside a continued commitment to
strong investment grade credit ratings with
net debt / EBITDA expected to remain below
4.5x throughout the course of the plan. In
addition to expected operational cashflow
generation an increase in adjusted net debt
and hybrid capital and a £2bn equity placing
which was completed in November 2025,
around £2bn of targeted asset rotations are
expected across the portfolio, aligned with
investment needs across the five-year plan.
Outlook to 2029/30
Investments made in Networks and
selective Renewables and system Flexibility
projects are expected to drive a significant
uplift in earnings, with an adjusted Earnings
Per Share CAGR of between 10-13% from
2025/26, delivering 225– 250 pence in
2029/30. This growth isunderpinned by
~80% of EBITDA being index linked in
2029/30, due to the upweighting in
Networks investment, providing consistent,
predictable and highlyvisible earnings as
the business growsmaterially.
A sustainable and progressive
dividendpolicy
We are also committed to continuing
ourexisting sustainable and progressive
dividend policy to 2029/30. This policy
targets annual dividend per share growth
ofbetween 5 – 10% from an unaltered 64.2
pence 2024/25 baseline. We have continued
to retain the existing scrip dividend option for
shareholders whilst also restricting earnings
dilution from the scrip by capping take-up
at25% through a share buyback ifnecessary.
Supplemental Financial
Information
Exceptionals and re-measurements
Exceptional items
We recognised an exceptional charge
withincontinuing operations of £162.6m
before tax in the current period. £84.7m
ofthis relates to Group restructuring costs
(including £21.8m of asset impairments)
with a further £77.9m charge for UK
onshore wind projects affected by grid
connection delays, partially offset by
valuation uplifts across Gas Storage and
Triton Power.
Further detail on exceptional items can
befound within note 7 and the definition
of exceptional items can be foundin
note3.2 of the Financial Statements.
Group-wide Operating Model and
Efficiency Review
During 2025, in line with SSE’s commitment
to capital and operational discipline, we
commenced an Operating Model and
Efficiency Review, intended to ensure that
SSE has the right structures, resourcing and
accountabilities to maximise the growth
opportunities ahead.
This review is now largely complete,
withthe exception of the ongoing SSEN
Distribution transformative change
programme. Actions taken as a result of the
review are expected to deliver recurring
efficiency and cost control savings across
the Group.
Operating derivatives
SSE enters into forward purchase contracts
(for power, gas and other commodities) to
meet the future demands of the energy
supply businesses and to optimise the value
of its generation assets. Some of these
contracts are determined to be derivative
financial instruments under IFRS 9 and
assuch are required to be recorded at
theirfair value as at the date of the
Exceptional items
Exceptional items £m
Group restructuring charges 84.7
Net asset impairments 77.9
Total exceptional charge 162.6
21
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Financial review continued
financialstatements. We report the change
in the fair value of these forward energy
derivatives separately as this mark-to-
market movement does not reflect the
realised operating performance of the
businesses in the year. The underlying value
of these contracts is recognised as the
relevant commodity is delivered, which for
the majority of the position at 31 March
2026 is expected to bewithin the next
18months.
The change in the operating derivative
mark-to-market valuation was an £(168.1)m
negative movement from the start of the
period, reflecting a £(152.0)m negative
movement on fully consolidated operating
derivatives including affiliate and commercial
Contracts for Difference (CfDs) combined
with a £(16.1)m negative share of movement
on derivatives in jointly controlled entities,
net of tax.
As in prior years, the reported result does
not include re-measurement of ‘own use’
hedging agreements which do not meet the
definition of a derivative financial instrument
under IFRS 9.
Commodity stocks held at fair value
Gas inventory purchased for secondary
trading opportunities is held at fair value
with reference to the forward month market
price. Given the low level of gas storage
held at year end, combined with trading
churn, the book value of commodity
stockswere broadly in line with fair value.
Financing derivatives
In addition to the movements above,
apositive movement of £17.9m was
recognised on financing derivatives in
theyear, including mark-to-market
movements on cross-currency swaps
andfloating rate swaps that are classed as
hedges under IAS 39. These hedges ensure
that any fair value movement in net debt is
predominantly offset by a movement in the
derivative position. The positive movement
was primarily driven by Sterling weakness
on cross-currency swap contracts.
These re-measurements are presented
separately as they do not represent
underlying business performance in the
year. The result on financing derivatives will
be recognised in adjusted profit before tax
when the derivatives are settled.
Hedging position
Our long-established approach to hedging
looks to generally reduce broad exposure
tocommodity price variation in advance
ofdelivery. We continue to monitor
marketdevelopments and conditions and
periodically alter our hedging approach
inresponse to changes in exposure profile.
SSE Renewables
Energy output hedges are progressively
established through the forward sale
ofeither:
– Electricity – where market depth and
liquidity allow;
– Gas and carbon equivalents –
recognising that spark spread exposures
remain; or
– Gas equivalents only – recognising
thatcarbon and spark spread
exposuresremain.
This approach reflects that certain energy
products have lower available forward
market depth and liquidity. Whilst some
basis risk or commodity exposure will
remain, it facilitates the reduction of SSE
Renewables’ overall exposure to potentially
volatile spot market outcomes.
The table below notes both the proportion
of hedges and prices of those hedges for
electricity and for gas alone. Due to market
liquidity in later periods, there are no gas
and carbon equivalent hedges in place.
The table below excludes any volumes and
income under separate contracts such as
CfDs, Renewables Obligation Certificates
(ROCs) and Balancing Mechanism activity.
No hedging activity is undertaken for assets
in early-stage construction, with hedging
activity gradually built up over the
construction period as greater certainty
over operational dates is received.
Our established approach seeks to minimise
the volumetric downside risk for renewable
energy output by targeting a hedge of less
than 100% of its anticipated wind energy
output for the coming 12 months. The
targeted hedge percentage is reviewed
andadjusted as necessary to reflect any
changes in market and wind capture
insights. Forward hedges for both wind and
hydro are progressively established over a
36-month period, although the extent of
hedging activity will depend on the available
market depth and liquidity.
Target hedge levels are achieved through
the forward sale of either electricity or a
combination of gas or carbon equivalents
as outlined above. Any non-electricity
forward contracts will be converted into
electricity hedges ahead of delivery, which
may lead to increases or decreases in the
average hedge price achieved.
SSE Thermal
Hedging for the flexible thermal fleet is by
its nature dynamic, changing as market
values vary with a constant process of
re-optimisation to accrue future value
forSSE Thermal assets. At negative spark
spreads this hedge volume is therefore
likelyto be very low; and at higher prices
the hedge will be much larger.
At all times the thermal portfolio offers the
wider Group protection from price spikes,
renewables shortfall or asset availability
issues and therefore provides material risk
management value to the Company.
SSE Energy Markets
This business provides the route to market
and manages the execution for all of SSE’s
commodity trading outlined above (spark
spread, power, gas and carbon). This
includes monitoring market conditions and
liquidity and reporting net Group exposures.
The business operates under strict position
limits and VAR controls.
There is some scope for position-taking to
permit this business to manage around
shape and liquidity and providing market
insight whilst taking optimisation
opportunities. This is contained within
atotal daily Value at Risk (VAR) limit of £9m.
GB offshore wind, onshore wind and hydro 2025/26 2026/27 2027/28 2028/29
Total energy output volumes hedged – TWh 11.8 10.5 11.6 2.4
– Hedge in electricity & equivalents – TWh 6.2 8.4 4.2 0.2
– Electricity hedge price – £MWh £87 £76 £70 £73
– Hedge in Gas – TWh 5.6 2.1 7.4 2.2
– Gas hedge price – £MWh £78 £67 £72 £45
Note: where gas and carbon trades have been used as a proxy for electricity, a constant 1MWh:69.444 th and
1MWh:0.3815 te/MWh conversion ratio between commodities has been applied. These same ratios have been
used to convert underlying commodity prices into electricity £MWh and therefore no assumptions have been
made on either spark or carbon.
Certain re-measurements
Certain re-measurements within continuing operations £m
Operating derivatives (including share from jointly controlled entities
netof tax)
(168.1)
Commodity stocks held at fair value 10.4
Financing derivatives 17.9
Total net re-measurement charge (139.8)
22
SSE plc Annual Report 2026

Maintaining a strong balance sheet
A key objective of our long-term approach
to balancing capital investment, debt
issuance and securing value and proceeds
from disposals is to maintain a strong net
debt/EBITDA ratio. We calculate this ratio
based on a methodology that best reflects
our activities and commercial structure, in
particular to securing value and protecting
our balance sheet through prudent risk
sharing by using Joint Ventures and
non-recourse project financing.
We have the capacity (if required) to
exceeda 4.5x net debt/EBITDA ratio,
whilstremaining above the equivalent
ratiosrequired for a strong investment
grade credit rating. Reflecting the strength
of the Group’s balance sheet, the net debt/
EBITDA ratio at 31 March 2026 was 3.3x
andit is expected that this ratio will trend
upwards as our significant investment
programme is delivered.
Adjusted net debt and hybrid capital
SSE’s adjusted net debt and hybrid capital
was £10.1bn at 31 March 2026 which is
consistent with the £10.1bn at 31 March
2025. Cash inflows from the £2bn equity
placing in November 2025 and strong
operating cashflows have been offset
byourcapital investment programme,
dividend and interest payments.
Debt summary
SSE plc together with its subsidiary, Scottish
Hydro Electric Transmission (SHET) plc,
issued £2.5bn of new long-term debt and
hybrid capital in the year to March 2026
whilst also continuing to roll short-term
Commercial Paper at similar levels to
March2025. The debt issues include:
– In June 2025, SSE plc issued €1.3bn
(£1.1bn) dual tranche equity accounted
hybrid bonds being a €800m (£0.7bn)
hybrid bond at 4.00% and a €500m
(£0.4bn) hybrid bond at 4.50%, both
ofwhich remain denominated in Euro.
– In September 2025 Scottish Hydro
Electric Transmission plc issued a €750m
(£647m) eight-year Eurobond maturing
November 2033 with a coupon of
3.375% and an all-in GBP cost of 5.20%
once swapped back to Sterling.
– In September 2025 Scottish Hydro
Electric Transmission plc raised €100m
(£86m) by increasing the size of its
existing Eurobond repayable on
September 2032, with a coupon of
3.375% and an all-in GBP cost of 5.06%
once swapped back to Sterling.
– In October 2025 Scottish Hydro Electric
Transmission plc executed a £250m
5-year term loan with a 1-year extension
option at a cost of SONIA +75bps.
– In February 2026 Scottish Hydro Electric
Transmission plc issued a 1.5bn NOK
(£113m) 10-year private placement
maturing 11 February 2036 with a
coupon of 4.98% and an all-in GBP cost
of SONIA +125bps once swapped back
to Sterling
– On 27 March 2026, SSE plc executed a
€400m (£346m) 2-year Floating Rate
Note at a cost of EURIBOR + 47bps
which has been swapped to Sterling at
acost of SONIA +75bps. Proceeds from
the Floating Rate Note were received on
7 April 2026.
Over the next 12 months there is £1.2bn of
medium- to long-term debt and £0.5bn of
short-term debt maturing. SSE had access
to £6.5bn (gross of the Minority Interest in
SHET plc) of committed bank facilities at
31March 2026.
Key metrics
March 2026
£m
March 2025
1
£m
Net Debt / EBITDA
2
3.3 3.1
Adjusted net debt and hybrid capital (£m) 10,095.0 10,066.7
Average debt maturity (years)
3
5.7 5.6
Average cost of debt at period end (including all hybrid
coupon payments)
4.1% 4.0%
Adjusted net finance costs 211.8 274.7
1 Comparative financial information restated, please see note 1.2 to the Financial Statements.
2 Net debt represents the Group adjusted net debt and hybrid capital. EBITDA represents the full year Group
adjusted EBITDA, less £157.4m at March 2026 for the proportion of adjusted EBITDA from equity-accounted
Joint Ventures relating to project financed debt.
3 The average debt maturity assumes hybrids are refinanced on their first call date.
Principal sources of debt funding March 2026 March 2025
Bonds 56% 60%
Hybrid debt and equity securities 24% 16%
European investment bank loans 6% 4%
US private placement 7% 7%
Short-term funding 4% 10%
Index-linked debt 3% 3%
% of which has been secured at a fixed rate 92% 91%
Rating Agency Rating Criteria Date of Issue
Moody’s Baa1 ‘stable outlook’ ‘Low teens’ Retained
Cash Flow/Net Debt
13 February 2026
Standard
andPoor’s
BBB+ ‘stable outlook’ About 18% Funds from
Operations/Net Debt
13 November 2025
Fitch BBB+ ‘stable outlook’ 23 February 2026
Financial management and balance sheet
23
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Financial review continued
Hybrid bonds summary
Hybrid bonds are a core part of our capital
structure, helping to diversify the investor
base, supporting credit ratings and
providers of senior debt, as their 50% equity
treatment by the rating agencies is positive
for credit metrics. A summary of SSE’s
hybrid bonds as at 31 March 2026 can be
found opposite.
Summarising cash and cash equivalents
At 31 March 2026, we had cash and cash
equivalents of £1.5bn, which is higher than
the £1.1bn at March 2025 due to timing of
new debt issues and the £2bn equity raise
which has resulted in a higher surplus cash
position being held during the second half
of the financial year.
Cash collateral is only required for forward
commodity contracts traded through
commodity exchanges, with the level of
cash collateral either provided or received
depending on the volume of trading
through the exchanges, the periods being
traded and the associated price volatility.
At 31 March 2026 the collateral balance
andother deposits were a net liability (i.e.
collateral received) of £246m (2025: £63m
net liability). The collateral movement in
thecurrent year reflects an increase in the
variation margin on ‘in the money’ positions
due to higher commodity prices partially
offset by increase in initial margins following
an increase in volatility.
Short-term funding
We had £6.5bn (gross of the Minority Interest in SHET plc) of committed bank facilities in
place at 31 March 2026 to ensure the Group has sufficient liquidity to allow day-to-day
operations and investment programmes to continue in the event of disruption to Capital
Markets preventing the issuance of new debt for a period of time. The below table sets out
the facilities that have been entered as at 31 March 2026:
Maintaining a prudent treasury policy
Our treasury policy is designed to maintain
a prudent and flexible funding position.
Cash from operations is first used to
financeregulatory and maintenance capital
expenditure and then dividend payments,
with investment and capital expenditure for
growth financed by a combination of cash
from operations, bank borrowings, and
bond issuance.
SSE borrows as required on different
interest bases with financial instruments
being used to achieve the desired out-turn
interest rate profile. At 31 March 2026,
92%of borrowings were at fixed rates.
In addition to the facilities set out in the
table above, SSE plc signed a commitment
letter on 31 March 2026 which gives us the
right to enter a £1.5bn committed facility
between 31 March 2026 and 30 June 2026.
The revolving credit facilities can also
beutilised to cover short-term funding
requirements. There were no drawings
onany of the committed facilities at
31March 2026. Both the Syndicated
Revolving Credit Facilities have one-year
extension options and are classified as
sustainability linked with interest rate and
fees paid dependant on various ESG-related
metrics being achieved.
Issued Hybrid Bond Value
1
All-in rate
2
First Call Date Accounting Treatment
July 2020 £600m 3.74% Apr 2026 Equity
July 2020 €500m (£453m) 3.68% Jul 2027 Equity
April 2022 €1bn (£831m) 4.00% Apr 2028 Equity
June 2025 €800m (£679m) 4.00% Sep 2030 Equity
June 2025 €500m (£425m) 4.50% Jun 2033 Equity
1 Sterling equivalents shown reflect the fixed exchange rate on date of receipt of proceeds and is not
subsequently revalued.
2 All-in rate reflects coupon on bonds plus any cost of swap into sterling which currently only applies to
July2020 Hybrid.
A table detailing coupon payments on existing hybrids is shown below:
2025/26 2026/27 2027/28
Hybrid coupon payments
HYa FYa HYa FYe HYe FYe
Total equity hybrid coupon
(cash accounted)
1
£73m £73m £127m £127m £97m £97m
1 Coupon payments on €2.8bn of hybrid bonds remain denominated in Euros and are therefore subject to
foreign exchange adjustments.
Date Issuer Debt type Term Value
Oct 24 SSE plc Syndicated Revolving Credit Facility with
15 Relationship Banks
2030 £1.5bn
Oct 24 SHET plc Syndicated Revolving Credit Facility with
15 Relationship Banks
2030 £1.5bn
Dec 25 SHET plc Bank facility guaranteed by National
Wealth Fund
2029 £1.0bn
Dec 25 SHET plc Export Credit Facility guaranteed by EKN 2029 £0.5bn
Mar 26 SHET plc Export Credit Facility guaranteed by SACE 2030 £0.5bn
24
SSE plc Annual Report 2026

Borrowings are mainly in Sterling and
Eurosto reflect the underlying currency
denomination of assets and cash flows
within SSE. All other foreign currency
borrowings are swapped back into either
Sterling or Euros.
Transactional foreign exchange risk arises in
respect of procurement contracts, fuel and
carbon purchasing, commodity hedging
and energy portfolio management
operations, and long-term service
agreements for plant. Our policy is to hedge
any material transactional foreign exchange
risks using forward currency purchases and/
or financial instruments. Translational
foreign exchange risk arises in respect of
overseas investments; hedging in respect of
such exposures is considered on a case-by-
case basis.
Operating a Scrip Dividend Scheme
As part of the Group’s dividend plan to
2029/30, take-up from the Scrip Dividend
Scheme is capped at 25%. This cap is
implemented by means of a share
Pensions
The SSE Southern scheme’s surplus
decreased by £52.6m in the year due
primarily to a £78.6m actuarial loss, offset
by contributions to the scheme of £25.6m.
The Scottish Hydro Electric scheme is
partially insured against volatility in its
pensioner members through the purchase
of ‘buy-in’ contracts meaning a significant
portion of scheme liabilities are protected
from volatility. During the year the Scottish
Hydro Electric scheme’s surplus increased
by £10.6m.
Additional information on employee pension
schemes can be found in note 23
to the
Financial Statements.
JVs and associates
1
Asset type SSE holding
Proportional non-recourse
external debt SSE Shareholder loans
Marchwood Power 920MW CCGT 50% No external debt No loans outstanding
Seabank Power 1,234MW CCGT 50% No external debt No loans outstanding
Slough Multifuel 55MW energy-from-waste 50% No external debt £173m
Triton Power Holdings 1,200MW CCGT / 140MW OCGT 50% No external debt No loans outstanding
Beatrice Offshore Windfarm 588MW offshore wind farm 40% £512m Project financed
Dogger Bank A Wind Farm 1,200MW offshore wind farm 40% £974m £313m
Dogger Bank B Wind Farm 1,200MW offshore wind farm 40% £1,002m £16m
Dogger Bank C Wind Farm 1,200MW offshore wind farm 40% £931m Project financed
Ossian Offshore Windfarm ScotWind seabed 40% No external debt No loans outstanding
Seagreen Wind Energy 1,075MW offshore wind farm 49% £386m 972m
2
Seagreen 1A Offshore wind farm extension 49% No external debt £33m
Clyde Windfarm 522MW onshore wind farm 50.1% No external debt £127m
Dunmaglass Wind Farm 94MW onshore wind farm 50.1% No external debt £47m
Stronelairg Wind Farm 228MW onshore wind farm 50.1% No external debt £89m
Cloosh Valley Wind Farm 105MW onshore wind farm 25% No external debt £23m
Neos Networks Private telecoms network 50% No external debt £87m
1 Greater Gabbard, a 504MW offshore wind farm, is proportionally consolidated and reported as a Joint Operation with no loans outstanding.
2 For accounting purposes, £324m of the £972m of SSE shareholder loans advanced to Seagreen Wind Energy are classified as equity.
Contributing to employees’ pension schemes – IAS 19
March 2026
£m
March 2025
£m
Net pension scheme asset recognised before deferred tax 459.8 501.8
Employer cash contributions Scottish Hydro Electric scheme 0.9 0.9
Employer cash contributions SSE Southern scheme 25.6 25.5
Deficit repair contribution included above 16.0 15.5
In the year to 31 March 2026, the Group’s pension surplus decreased by £42.0m, from
£501.8m to £459.8m, primarily due to actuarial loss of £80.7m offset by the contributions to
the schemes.
repurchase programme, or ‘buyback’,
following payment of the final dividend.
Thescale of any share repurchase
programme would be determined by
subscription to the Scrip Dividend Scheme
across the full year, taking into account the
interim and final dividend elections.
Overall Scrip Dividend take-up for the
2024/25 financial year was 9.7%, and
therefore no buyback was required.
Joint Venture and associate non-recourse project financing
SSE’s financial results include contributions from equity interests in Joint Ventures (“JVs”) and associates, all of which are equity accounted.
The details of the most significant of these are included in the table below. This table also highlights the non-recourse project finance debt
within each Joint Venture, in proportion to SSE’s equity ownership. The total proportion of external non-recourse project finance debt was
around £3.8bn at 31 March 2026.
25
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Renewables
and Flexibility
Networks
Business Unit operating review
How our businesses fit together
SSE has a very deliberately diversified business mix that spans the clean energy value chain.
These businesses operate alongside each other to optimise growth and create lasting value.
SSEN
Transmission
SSE Renewables SSE Thermal
Who SSEN Transmission serves
Electricity generators, large electricity
demand customers and ultimately all
electricity customers across the north
ofScotland and the rest of GB.
How it supports SSE’s strategy
SSEN Transmission invests in the critical
infrastructure needed to connect sources of
clean power to the GB electricity transmission
network and transport it to areas of demand.
The business is 75% owned by SSE plc and 25%
by investment partner the Ontario Teachers’
Pension Plan Board.
How it is remunerated
Through economically regulated returns and
incentives that are recovered from users of
the GB transmission system. In addition to
baseline total expenditure agreed with Ofgem
as part of the regulator’s determination of
business plans, Uncertainty Mechanisms
permit recovery of additional revenue in a
given price control period to reflect additional
investment requirements. These Uncertainty
Mechanisms fund network upgrades during
the price control period.
Who SSE Renewables serves
Wholesale electricity customers across GB,
Ireland andselected overseas markets which
are increasingly seeking lower-carbon sources
ofenergy.
How it supports SSE’s strategy
SSE Renewables is driving the clean energy
transition through the development, financing,
construction and operation of world-class
renewables in domestic and selected
international markets. It also operates and
develops pumped hydro storage that provides
flexible and dispatchable electricity needed
fora smooth transition to a more secure
energysystem.
How it is remunerated
Through wholesale electricity markets,
ancillary services markets, capacity
markets, balancing markets, power
purchase agreements, and government
schemes for renewable energy.
Who SSE Thermal serves
Electricity suppliers, traders and other
generators through the energy market;
thenational grid, and ultimately
electricitycustomers.
How it supports SSE’s strategy
SSE Thermal is providing critical flexibility to
offset renewables variability as the energy
system transitions to clean energy. The
strategic importance of its Gas Storage
assets has beenhighlighted by recent world
events andthe increasing focus on national
energy self-sufficiency.
How it is remunerated
The wholesale energy market,
CapacityMarket and ancillary services
market provide the core revenue streams.
The fleet also responds to forward market
volatility and within day demand, providing
flexible generation and storage.
RM M
Corporate functions
Who the Corporate functions serve
The Corporate functions comprise areas such as HR, IT, Legal, Finance, Procurement & Commercial,
Corporate Affairs, Sustainability, and Risk, Governance & Assurance. These functions provide the
SSEBusiness Units with efficient, continuously improving shared services, as well directly aligned
partnering teams to enable informed decision making and delivery of strategic priorities.
Key:
M
Market-focused businesses
R
Economically regulated businesses
26
SSE plc Annual Report 2026

Routes to
market
Energy Customer
Solutions
SSE Energy
Markets
SSEN
Distribution
Who SSEN Distribution serves
Around 4m homes and businesses in two large,
diverse network areas in southern central
England and the north of Scotland.
How it supports SSE’s strategy
SSEN Distribution drives the decarbonisation
ofcommunities and supports the economies
inthe areas it serves. It does this through a
combination of strategic, future-proofed
network investment and the targeted
deployment of flexible solutions. Together,
these support the provision of more capacity
tomeet the demand from low-carbon
technologies connecting to the network
inever-increasing numbers.
How it is remunerated
Through economically regulated returns
recovered from customers and connecting
parties. Additional earnings come through
efficient delivery of investment and
performance-related incentives.
Who Energy Customer Solutions serves
720,000 domestic and business customers
in the all-island Ireland energy market, and
around 240,000 non-domestic accounts
inGreat Britain.
How it supports SSE’s strategy
Energy Customer Solutions is responding to
the energy transition as a route to market for
SSE’s low-carbon energy generation and
through the provision of a suite of energy
solutions to customers.
How it is remunerated
By competing for customers and direct
billing them or third party intermediaries,
through state-supported schemes and
through income from legacy wind farms
contracted to SSE Airtricity.
Who SSE Energy Market serves
SSE’s individual Business Units and the
SSE Group.
How it supports SSE’s strategy
The work SSE Energy Markets does is key to
managing risk associated with the operations
behind the delivery of the Group’s strategy.
Ittrades the principal commodities to which
SSE’s asset portfolios are exposed, as well as
thespreads between two or more commodity
prices (e.g. spark spreads); power (baseload and
other products); gas; and carbon (emissions
allowances). Each commodity has different
riskand liquidity characteristics, which impacts
the quantum of hedging possible.
How it is remunerated
It receives fees for providing energy trading
services to the constituent parts of SSEand
has a growing portfolio of third party assets
and external Power Price Agreements that
bring independent value to the Group.
M MR
How they support SSE’s strategy
The Corporate functions develop and maintain SSE’s strategic framework,
set functional and ESG goals, provide capital funding, ensure compliance
with regulatory requirements and offer policy insight relevant to, and in
support of, the delivery of Business Unit objectives.
How they are remunerated
They are funded by the Business Units through a recharge model
andcorporate unallocated costs which are set out in the
FinancialStatements.
See Our business model on page 7for
more on how SSE creates value
27
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Financial performance
Adjusted operating profit increased by 4%
to£1,076.4m from £1,038.8m in the prior
year. Earnings reflected higher output
delivered into a lower hedged price
environment, with 2025/26 hedge prices
around 20% lower than the prior year.
Output was supported by generation from
initial commissioning at Dogger Bank A
(1.2GW, SSE share 40%) and the delivery
ofYellow River (101MW), partially offset
bymixed weather conditions particularly
inhydro.
Reported operating profit increased by
17%to £725.3m from £617.6m in the prior
year. This reflects the above and other
movements including restructuring costs
associated with the Group’s Operating
Model and Efficiency Review and a
non-cash impairment of £155.8m relating
to Aberarder (50MW) and Strathy South
(208MW) onshore wind farms in Scotland,
reflecting construction programmes
impacted by delayed grid access.
Capex of £739.0m was invested during
theperiod, including £157m of equity for
Dogger Bank. Meanwhile £146m was
invested in onshore wind in Scotland and
Ireland. £48m of capex was delivered in
Southern Europe, with progress made at
onshore wind projects across Spain and
Italy. On Battery Energy Storage System
(BESS) projects, £96m was incurred in
progressing the delivery of Derrymeen,
Ferrybridge, Fiddlers Ferry and Monk Fryston.
Operational delivery
Onshore wind volumes increased by 13%
from 6.0TWh to 6.8TWh, reflecting
increased capacity including the addition
ofYellow River. This was partially offset by
variable weather conditions and increased
levels of system-driven curtailment in
Ireland alongside planned and unplanned
maintenance including an ongoing outage
at Hadyard Hill.
SSE Renewables
SSE Renewables is a leading developer and
operator of renewable energy generation,
focusing on onshore and offshore wind,
hydro and battery storage across the UK
and Ireland, and in carefully selected
international markets.
SSE Renewables Key Performance Indicators
March 2026 March 2025
Adjusted operating profit – £m 1,076.4 1,038.8
Reported operating profit – £m 725.3 617.6
Adjusted investment & capital expenditure – £m 739.0 1,001.8
GENERATION CAPACITY  MW
1
Onshore wind capacity – MW 2,570 2,454
Offshore wind capacity – MW 1,014 1,014
Conventional hydro capacity – MW 1,164 1,164
Pumped storage capacity – MW 300 300
Solar & Battery capacity – MW 231 50
Total renewable generation capacity (inc. storage) – MW
2
5,279 4,982
Contracted capacity
3
3,293 3,189
GENERATION OUTPUT  GWH
INCLUDING COMPENSATED CONSTRAINTS
Onshore wind output – GWh
4
6,813 6,012
Offshore wind output – GWh
4
4,573 3,878
Conventional hydro output – GWh 2,795 2,946
Pumped storage output – GWh 280 324
Solar & Battery output – GWh 46 46
Total renewable generation (inc. storage) – GWh 14,507 13,206
1 Capacity and output based on 100% of wholly owned sites and share of Joint Ventures.
2 Total renewable generation capacity is increased by 297MW. This principally reflects 101MW from
YellowRiver wind farm, Littleton solar farm 31MW and Ferrybridge BESS 150MW.
3 Contracted capacity includes sites with a CfD, RESS contract, eligible for ROCs, or contracted under
REFIT (CfD contracts may be still to commence).
4 Onshore wind output includes 1.7TWh of compensated constrained-off generation in 2025/26
and1.3TWh in 2024/25; Offshore wind output includes 1.4TWh of compensated constrained-off
generation in 2025/26 and 1.7TWh in 2024/25.
5 Biomass capacity of 15MW and output of 78GWh in 2025/26 and 69GWh 2024/25 is excluded,
withthe associated operating profit or loss reported within SSE Thermal.
Business Unit operating review continued
“Our capability as a leading
builder and operator of onshore
and offshore wind, hydro and
battery storage assets, our diverse
pipeline of nationally-significant
development projects and our
focus on disciplined delivery
putus at theheart of the clean
energy transition.”
Stephen Wheeler
Managing Director, SSE Renewables
28
SSE plc Annual Report 2026

In offshore wind, output increased by 18%
from 3.9TWh to 4.6TWh driven by ongoing
turbine commissioning work at Dogger
Bank A. Hydro production decreased by 5%
from 2.9TWh to 2.8TWh reflecting mixed
precipitation across the year.
In the GB T-4 Capacity Market auction
(2029/30 delivery year) SSE Renewables
secured one-year agreements for 935MW
of de-rated capacity across hydro (925MW)
including 137MW for Sloy hydro scheme
and 10MW of onshore wind at a clearing
price of £27.10/kW.
In Ireland’s T-4 auction, a one-year
agreement for 20MW of de-rated onshore
wind capacity for delivery year 2029/30 was
secured at a clearing price of €135.5/kW.
Strategic progress
SSE Renewables continues to progress the
delivery of Dogger Bank wind farm (3.6GW,
SSE share 40%). Following the completion
of turbine installation at Dogger Bank A in
February 2026, commissioning continues
and is expected to be substantially complete
by the end of calendar year 2026. Turbine
installation is progressing strongly at
Dogger Bank B (1.2GW, SSE share 40%) with
the installation run-rate far exceeding that
achieved on the first phase, resulting in 20
turbines currently installed and first power
achieved in early March. On Dogger Bank C
(1.2GW, SSE share 40%) installation of
transition pieces was completed in
November 2025, marking the successful
installation of foundations across all three
phases. When fully complete, Dogger Bank
will be capable of producing 6% of UK
current demand, delivering substantial
valuefor consumers from this nationally
significant infrastructure.
Berwick Bank wind farm, consented inJuly
2025 for up to 4.1GW of offshore capacity,
represents the potential of further critical
infrastructure delivery by SSE for theUK,
contributing to long-term energy security
and clean power targets. If built toits full
potential capacity, Berwick Bank could
become the world’s largest offshore wind
farm on completion. In January 2026,
Berwick Bank B secured a valuable route
tomarket via a 20-year contract for 1.4GW
of offshore capacity at a competitive
strikeprice for consumers of £89.49/MWh
through CfD Allocation Round 7. A final
investment decision is expected in 2027.
The UK’s intention to run Allocation Round
8 in the second half of 2026 is a positive
step for the energy transition. As with AR7,
ambition on capacity will be critical to
sustaining offshore delivery and value
forconsumers. In April 2026, further
information on the offshore planning
consent application for Arklow Bank Wind
Park 2 (800MW) was submitted to
Ireland’sstatutory planning body and a
determination is anticipated by the end of
the year. In May 2026, North Falls (up to
900MW, SSE share 50%) was granted
development consent for its offshore array.
Unlocking the power
of battery storage
atFerrybridge
SSE’s Ferrybridge station once
powered the nation by burning coal,
but the opening of a new battery
storage facility at the West Yorkshire
site marks a new era for clean energy.
Located where the 2GW Ferrybridge
coal power station stood before
being decommissioned in 2016, the
new 150MW/300MWh battery project
signals the site’s transformation as an
enabler of the transition to cleaner,
more flexible energy.
Designed to store electricity and
release it back to the grid when
demand is highest, Ferrybridge’s
battery storage facility can operate
atfull output for up to two hours.
Atpeak times, it’s capable of meeting
the equivalent electricity demand of
almost a quarter of a million homes.
By providing rapid response energy
storage, the site will play a key role in
balancing supply and demand and
strengthening the resilience of the
UK’s electricity network.
From coal to battery storage – Ferrybridge is providing the flexible power of the future
Ferrybridge battery storage can
provide flexible power to the
equivalent of
250,000
homes for a two-hour period at
times of exceptional demand
Onshore wind construction at Aberarder
and Strathy South in Scotland has been
impacted by delayed grid access, resulting
in the reported non-cash impairment.
Construction continues at the RESS4-
contracted Drumnahough wind farm
inIreland (58MW, SSE share 50%).
In England, Ferrybridge BESS (150MW)
andLittleton solar (31MW) entered
commercial operations in March 2026.
Battery installation continues at the Monk
Fryston (320MW) and Fiddlers Ferry
(150MW) BESS projects. In Northern Ireland,
following a final investment decision in
December 2025, construction has started
on the Derrymeen BESS (100MW) project.
In Southern Europe, Jubera wind farm
(64MW) in Spain entered commercial
operations in May 2026 and construction
ofa further 72MW of onshore wind capacity
is under way at sites in Spain and Italy.
In hydro, repowering of Lochay power
station (45MW) to extend its useful life
byatleast 40 years continues. The first of
the two new turbine generating units is
currently being installed and is expected to
be commissioned later this year. The Coire
Glas pumped storage hydro project (1.4GW)
has progressed to the Project Assessment
stage of Ofgem’s Cap and Floor scheme for
long-duration electricity storage, with the
minded-to decision on successful projects
expected in summer 2026.
29
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Financial performance
The net adjusted operating profit for
SSEThermal fell slightly to £195.4m
compared to £211.4m in the prior year.
Thisdecrease was largely driven by lower
market performance, due to lower plant
availability and periods of low volatility.
Reported operating profitability increased to
£243.0m compared to £195.3m in the prior
year. This reflects the movements above
including restructuring costs associated
with the Group’s Operating Model and
Efficiency Review, non-cash impairment
reversals of £48.5m relating to operational
Gas Storage assets and £29.4m relating to
the carrying value of the Group’s investment
in Triton Power.
Operational delivery
SSE Thermal’s overriding objective is to
maintain commercial availability of its
existing fleet and develop investment
options to support security of supply into
the 2030s and beyond. Flexible power
stations continue to secure value through
adiversified stack of revenues, including
theCapacity Market, intrinsic forward
sparkspread, the Balancing Mechanism
andotherancillary contracts.
SSE applies rigorous commercial
disciplinethrough any auctions and
remainsconfident that the value of SSE
Thermal assets will be realised through this
approach. Keadby 1 Power Station secured
aprovisional Capacity Market agreement
for686MW de-rated electricity generation
capacity, running from 1 October 2029 to
30 September 2030.
Agreements were not taken for Peterhead,
Medway, Burghfield and Chickerell power
stations due to the non-commerciality
ofthe clearing price. These assets
remaincontracted to 30September 2029,
withoptions to secure agreements in
futureauctions.
SSE Thermal assets in Ireland secured
agreements for 543MW of de-rated capacity,
valued at a total of around €288m, including
a five-year agreement for Great Island.
SSE Thermal key performance indicators
March 2026 March 2025
1
Adjusted operating profit – £m 195.4 211.4
Reported operating profit – £m 243.0 195.3
Adjusted investment and capital expenditure – £m 197.5 183.8
GENERATION CAPACITY
2
 MW
Gas-fired generation capacity – MW 6,210 6,210
Energy from waste capacity & Biomass – MW 43 43
Total thermal generation capacity – MW 6,253 6,253
GENERATION OUTPUT
3
 GWH
Gas-fired output – GWh 14,829.9
4
17,641.6
Energy from waste & Biomass output – GWh 186.2 182.4
Total thermal generation – GWh 15,016.1 17,824.0
Gas storage level at year end – mTh 33.1 79.3
Gas storage level at year end – % 18 47
1 2025/26 reporting merges SSE Thermal and Gas Storage segments. Comparative performance has
beenrestated.
2 Capacity is wholly owned and share of joint ventures, and reflects Transmission Entry Capacity.
3 Output is based on SSE 100% share of wholly owned sites and 100% share of Marchwood PPAs due to
thecontractual arrangement.
4 Gas-fired Output includes 56GWh oil-fired output.
Business Unit operating review continued
“Against a backdrop of increasing system
intermittency and market uncertainty, wehave
acritical role to play in supporting security of
supply through the efficient operation of flexible
thermal generation and development of new
low-carbon technologies.”
Finlay McCutcheon
Managing Director, SSE Thermal
SSE Thermal
SSE Thermal owns and operates
conventional flexible thermal generation in
GB and Ireland and gas storage in GB. It is
developing options for lower carbon power
generation and hydrogen storage, while
maintaining its existing flexible and efficient
fleet which continues to play a critical role
in the energy transition.
30
SSE plc Annual Report 2026

SSE Thermal delivered a successful summer
outage programme across the flexible
generation fleet. However, unplanned
outages at Keadby 2, Medway and Great
Island impacted availability outside of the
summer period.
SSE Thermal’s gas storage assets remain
animportant risk management tool for the
Group’s generation portfolio, with fast-cycle
assets an important part of a resilient
energysystem.
Favourable summer/winter spreads enabled
injection and withdrawal in the firsthalf of
the year. Cavern Eight at Atwick returned to
service at the beginning of October 2025,
delivering additional value.
Strategic progress
Construction is under way at the 300MW
Tarbert Next Generation power station,
targeting full commercial operation from
October 2027.
The station has secured €335m of revenues
through a 10-year capacity agreement. Final
investment decision was taken on Platin, a
170MW power station in County Meath, in
July 2025, and preparatory works are under
way with full site mobilisation expected
inthe coming months, targeting full
commercial operation from October 2028.
This project is also underpinned by a
10-year capacity agreement, with a total
value of around €250m. An amendment to
the planning consent was since secured to
enable Platin to run on natural gas as well
assustainable biofuels. A further 10-year
capacity agreement was secured to support
this atavalue of around €20m.
SSE Thermal has developed shovel-ready
programmes to extend the lives of its
existing, wholly-owned Combined Cycle
Gas Turbines (CCGTs) in GB. Subject to
securing multi-year Capacity Market
agreements, these investments would help
ensure that existing generation assets
remain ready to respond to system need,
providing the enduring flexibility which is
critical to enabling a renewables-led system.
In the UK, further detail is pending on
themechanisms to procure new-build
dispatchable capacity, including the
Hydrogen to Power Business Model, any
adaptations to the Capacity Market and
further allocation of Dispatchable Power
Agreements for Carbon Capture and
Storage (CCS) projects.
Construction under
wayat Tarbert
Next Generation
powerstation
SSE’s Tarbert Next Generation power
station in Co. Kerry has entered full
construction, with foundations and
civil works under way following
completion of early enabling works.
The up to €300m project will be the
first ofits kind in Ireland to run on
Hydrotreated Vegetable Oil (HVO),
asustainable biofuel sourced entirely
from waste feedstocks.
The 300MW ‘peaker’ plant will
provide flexible, reliable power to
strengthen Ireland’s security of
supply and support a renewables
ledelectricity system, with potential
for future hydrogen conversion.
The project marks the next chapter
for the iconic Tarbert site following
the decommissioning of the original
oil fired station in 2023, after more
than 50 years of operation. At peak
delivery, the new station is expected
to support around 200 full-time
construction jobs ahead of its
completion in 2027.
Tarbert’s next generation station will run on vegetable oil instead of traditional oil
Tarbert will support
200
jobs ahead of completion
in2027
These options could support investment in
SSE Thermal’s flexible generation pipeline,
including Keadby NextGeneration and
Ferrybridge Next Generation, Keadby CCS
and Peterhead CCS. For Peterhead CCS, SSE
is continuing to work with Scottish Cluster
partners and UK Government to agree a
programme of funded development work.
During the course of 2025, SSE reviewed
itshydrogen development strategy and,
inresponse to material policy delays to the
roll-out of low-carbon hydrogen, took the
decision to pause its standalone hydrogen
production projects. Near-term efforts
arefocused on enabling hydrogen in the
Humber region, and SSE Thermal’s role
asan offtaker or low-carbon hydrogen
forfuture hydrogen-to-power projects.
31
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Financial performance
Adjusted operating profit, which is presented
net of the business’s 25% non-controlling
interest, increased by 74% to £562.6m
from£322.5m in the prior year. Revenue
growth is driven by allowances agreed with
the regulator to fund increasing investment,
a proportion of which is returned in the
corresponding financial year. This
investment has been funded by SSEN
Transmission and its shareholders and
isquoted before debt interest and tax
payments are deducted. In addition, the
prior year included a one-off negative
timing adjustment relating to tax relief.
Reported operating profit increased to
£750.1m compared to £430.0m as a result
of the movements above but reflecting
thatnon-controlling interests are fully
consolidated for all profit metrics
underIFRS.
Net capex totalled £1,717.6m, an increase of
80% on the comparative year, supporting
the UK’s grid upgrade, and included £219m
on the Orkney link project where major
substation progress has been made, and
£212m on the Argyll and Kintyre upgrade
where substation and overhead line work
has progressed. Capex of £137m was
invested at the Eastern Green Link 2 (EGL2)
project where Peterhead converter station
work has advanced and the manufacturing
of the submarine cable is under way.
Remaining capex was delivered primarily
across the other large capital projects.
Operational delivery
SSEN Transmission continues to deliver
sector-leading operational performance,
securing the full reward through Ofgem’s
‘Energy Not Supplied’ incentive, the third
year the business has achieved this
throughout the RIIO-T2 price control,
underpinning its goal of zero interruptions
to homes and businesses.
Delivery of the capital investment
programme has continued at pace during
the year. With progress on the 11 major
projects detailed below, other progress in
the year included the Kergord to Gremista
132kV connection and Gremista Grid Supply
SSEN Transmission key performance indicators
March 2026 March 2025
Adjusted operating profit
1
– £m 562.6 322.5
Reported operating profit – £m 750.1 430.0
Adjusted investment and capital expenditure
1
– £m 1,717.6 953.5
Gross Regulated Asset Value (RAV) – £m
2
8,955 7,171
SSE Share Regulated Asset Value (RAV)
1,2
– £m 6,716 5,378
Renewable Capacity connected within SSEN Transmission
area – GW
3
10.8 10.6
1 Excludes 25% minority interest.
2 Estimated and subject to outturn of annual regulatory process.
3 Prior period comparator restated to reflect data refinement. Transmission and distribution connected
capacity within the SSEN Transmission Network area, includes pumped storage and battery storage.
SSEN Transmission
SSEN Transmission operates one of the
fastest growing regulated electricity
networks in Europe. It owns, operates
anddevelops the high voltage electricity
transmission system in the north of
Scotland and its islands and is owned 75%
by SSE plc and 25% by Ontario Teachers’
Pension Plan Board. All references to
performance indicators relate to 100%
ofthe business unless otherwise stated.
Business Unit operating review continued
“Through delivery of the 11 major projects in
ourinvestment programme we are creating a
resilient, efficient, and future-ready transmission
network that is capable of meeting ambitious
energy security and clean power targets.”
Rob McDonald
Managing Director, SSEN Transmission
32
SSE plc Annual Report 2026

Point, which was completed in April 2026.
Full energisation will follow completion of
SSEN Distribution’s ‘Shetland Standby
Project’, anticipated later in 2026.
The East Coast 400kV upgrade between
Kintore and Kincardine also continues
tomake good progress. Several sections
willbe replaced with higher capacity
conductors than initially planned, with
completion and full energisation of this
programme now expected in 2027.
In March 2026, SSEN Transmission
confirmed its acceptance of Ofgem’s Final
Determination for the RIIO-T3 period,
which commenced on 1 April 2026,
recognising it as an investable and
deliverable settlement overall.
Delivering on key consents
SSEN Transmission’s 11 major projects,
sixofwhich are onshore and five offshore,
continue to make good progress.
The business is sensitive to the views of the
communities hosting its major projects,
which is why, based on one of the largest
public consultation exercises Scotland has
ever seen, substations have been relocated
and routes have been altered. The business
is also providing new community benefit
funding – projected to be over £100m –
alongside supporting the delivery of
1,000new homes.
With all regulatory approvals of need
secured and supply chain frameworks for
delivery in place, securing all necessary
planning consents remains a top priority.
Ofthe 34 major consents required, 25have
been secured. These includes fivesubstation
sites, two overhead lines andtwo marine
licence consents achieved during 2025/26.
All outstanding consent decisions are
expected within the next 12 months. This
includes four substation consents that have
been appealed to the Scottish Government
following refusal by local Planning
Authorities, decisions that went against the
independent expert advice of Planning
Authority planning officers.
Cambushinnie substation was previously
approved by Perth and Kinross Council, but
following legal challenge that decision was
rescinded. The Cambushinnie consent is
expected to be re-determined by Perth
andKinross Council this Summer.
Delivering on construction
Timely delivery on all 11 major projects
remains a priority – including those which
are classed as ASTI projects. These remain
on track to be delivered in line with their
regulatory licence output dates, starting
with EGL2 in 2029.
In Argyll, the first steel lattice tower on the
9km Creag Dhubh-Inveraray overhead line
has been erected, with all earthworks and
the main substation buildings at Creag
Dhubh also complete ahead of the
electrical installation works.
Building the UK’s
biggest electricity
transmission project
A year into its five-year construction
programme, the Eastern Green Link 2
(EGL2) project has made impressive
progress. EGL2 is a 2GW high voltage
direct current (HVDC) electrical
‘superhighway’ cable link between
Peterhead in Aberdeenshire, Scotland
and Drax in North Yorkshire, England.
At the Peterhead converter station
site in Aberdeenshire, transformer
container units are now in place as is
a visitor centre for the community.
Last winter the Peterhead team
evenresponded to calls from NHS
Grampian to help healthcare workers
reach patients when the local roads
became impassable due to snowfall.
Similar progress has been made
across the 64km land cable route in
Yorkshire from Bridlington to Drax,
with horizontal directional drilling
progressing ahead of cable
installation.
The 505km HVDC link will transport
renewable energy south to around
two million homes when it opens
in2029.
SSEN Transmission is partnering with National Grid to bring energy to 2m homes
505km
of subsea and underground
cable – theUK’s biggest ever
electricity transmission project
The Orkney link has also made strong
progress, with major earthworks and
steelworks complete at Dounreay and
Finstown substations.
Early construction works have progressed
on the Skye Reinforcement.
The EGL2 project, thefirst subsea link to
bejointly delivered with National Grid
Electricity Transmission, marked 18 months
in construction in March2026, with
significant progress at both the Peterhead
and Wren Hall sites.
Following receipt of its marine licence in
November 2025, the Spittal-Peterhead
HVDC link became the fifth major project
toenter construction.
On the Eastern Green Link 3 (EGL3) project,
contracts have been signed with key supply
chain partners including Hitachi Energy
forthe HVDC convertor stations and NKT
formanufacture and installation of the
690km cable.
Longer-term opportunities
In summer 2026, NESO is expected to
update its second transition Centralised
Strategic Network Plan (tCSNP), Beyond
2030. This is expected to identify and
progress further onshore reinforcements
and subsea links for delivery during the
nextdecade.
33
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Financial performance
Adjusted operating profit decreased by
54%to £335.3m compared to £736.0m in
the prior year. This large decrease was
expected and driven by a non-recurring
timing effect in the prior year,
predominantly for cost inflation from
2022to 2024, which significantly
increasedprior year allowed revenues.
Reported operating profit decreased to
£296.9m compared to £736.0m in the prior
year, reflecting the movements above
inaddition to £(38.4)m of exceptional
restructuring costs.
Capex investment of £851.8m increased
by34% compared with the prior year,
reflecting the continued delivery aligning
with the RIIO-ED2 investment plan. In the
north, £288m was invested, including
commencement of major subsea cable
works at Loch A’Choire and Skye-Uist,
pole-mounted transformer replacements,
and other network reinforcement work. In
the south, £520m of investment supported
pole- mounted transformer replacements
and key network reinforcement schemes
atIver (West London), Fleet-Aldershot
(Hampshire) and Bramley-Thatcham
(nearReading).
Operational delivery
SSEN Distribution has completed the third
year of the RIIO ED2 price control period,
which runs to March 2028 and includes
£3.6bn of baseline expenditure (2020/21
prices), while more than £157m in additional
funding has been secured through
Uncertainty Mechanisms so far.
Overall customer satisfaction scores have
increased compared with 2024/25 to a
reward position in 2025/26 with a score of
9.05/10. This represents SSEN Distribution’s
strongest performance since Ofgem
introduced the Broad Measure Incentive
in2015. Improvements in Time to Connect
and Time to Quote also exceeded Ofgem
targets. However, storms in the north of
Scotland affected Customer Interruptions
and Customer Minutes Lost.
SSEN Distribution key performance indicators
March 2026 March 2025
Adjusted operating profit – £m 335.3 736.0
Reported operating profit – £m 296.9 736.0
Adjusted investment and capital expenditure – £m 851.8 635.8
Regulated Asset Value (RAV) – £m 6,611 5,737
Customer Satisfaction score 9.05/10 8.81/10
Customer Minutes Lost (SHEPD) average per customer 79 69
Customer Minutes Lost (SEPD) average per customer 54 51
Customer Interruptions (SHEPD) per 100 customers 71 59
Customer Interruptions (SEPD) per 100 customers 47 42
RAV, Customer minutes lost and Customer interruptions figures estimated and subject to outturn of annual
regulatory process.
SSEN Distribution
SSEN Distribution, operating under licence
as Southern Electric Power Distribution plc
(SEPD) and Scottish Hydro Electric Power
Distribution plc (SHEPD), serves around 4m
homes and businesses across two licence
areas in central southern England and the
north of Scotland.
Business Unit operating review continued
“We’re helping deliver economic growth and
greater customer choice in the communities
weserve, by enabling the uptake of low-carbon
technologies and theelectrification of industry.”
Chris Burchell
Managing Director, SSEN Distribution
34
SSE plc Annual Report 2026

Storm Floris was the most significant
summer storm the business has ever
facedand was classed as a Category Two
exceptional event, affecting almost 85,000
customers. Power was restored to 98% of
customers within 48 hours. October’s Storm
Amy was an exceptional “1-in-20” event,
making it the third-most damaging named
storm in the north of Scotland on record.
Supplies were restored within six days, a day
earlier than Storm Eowyn in January 2025,
despite Amy causing around 100 more faults.
SSEN Distribution gained £1m in reward
through the Consumer Vulnerability
Incentive. Almost 400,000 tailored Power
Cut Plans have been sent to customers and
– in an industry first – the business has
delivered the first of 20,000 home battery
packs to medically-dependent Priority
Services customers most in need.
The business’s Distribution System Operator
function earned an over £5m return through
Ofgem’s DSO Incentive in 2024/25, up from
£2m the previous year, reflecting better
stakeholder feedback and panel assessment.
Strategic progress
SSEN Distribution continues to make strong
progress against its RIIO ED2 plan while
laying the foundations for ED3. The capital
delivery programme has accelerated,
including completion of a £38m project to
install and energise five new subsea cables
connecting Scotland’s islands.
A new £950m framework has been
established to support long-term subsea
upgrades, complementing £1.4bn of
existing Capital Delivery agreements
foron-land infrastructure. These are
enabling major upgrades such as £155m
inSouthampton, £100m in Swindon
and£20m in south-west Dorset.
More than £150m of additional funding
hasbeen secured in 2025/26 through
Uncertainty Mechanisms, including £77m
for the Hebrides and Orkney (HOWSUM)
reopener to support economic growth and
increase capacity. A further £80m relates
tosubsea infrastructure and cyber security.
Ofgem is assessing an additional ~£770m of
UM requests, including ~£725m in Load-
Related Expenditure to support network
development through the remainder of ED2
and early ED3 mobilisation.
Connections remain a priority, with ramped
offers giving a proportion of requested
capacity to customers to help manage
increasing demand over time. The business
continues to support NESO’s Connections
Reform programme, meeting all deadlines
and guiding customers through the process.
For domestic customers seeking to
connect, a new ‘self-serve’ tool has already
generated initial cost estimates in as little
astwo minutes for 2,928 customers, while
the advent of smartphone video surveys is
further improving customer experience.
Keeping motorway
traffic flowing above
while working below
As part of its £9.6m investment
programme to upgrade electricity
infrastructure in Hampshire SSEN
Distribution has been thinking
outside the box to avoid traffic chaos.
Faced with the challenge of how
tolay cable across a busy section
ofthe M27 the team developed an
innovative solution to route the
cables well beneath the carriageways.
By adopting a more complex
underground approach the project
deployed a 260m Horizontal
Directional Drill to avoid unnecessary
disruption to motorway traffic. The
drill reached depths of 45 metres
using a mixture of water and
naturally-occurring clay to keep
thedrilled space clear, prevent
collapse and remove debris.
SSEN Distribution’s underground
drilling at Rownhams also helped
tominimise impact on local wildlife
and will help provide new EV charge
hubs on one of England’s
busiestmotorways.
Our underground cables are keeping motorists moving on the M27 motorway
£9.6m
of capital works will strengthen
electricity supplies for local
customers and support the
transition to EVs
SSEN Distribution plays a leading role in
developing the Electricity Networks Sector
Growth Plan, which focuses on maximising
the benefits to the wider economy of
ongoing electrification and decarbonisation,
through the creation of more sustainable
UK-based supply chains and new skilled jobs.
RIIO-ED3 Price Control
Strategic Development Plans, now
published for the entirety of SSEN
Distribution’s licence areas, underpin
long-term planning to 2050 and will inform
the ED3 business plan, which is due for
submission in December 2026. A period of
extensive engagement is currently under
way as the ED3 plan isformed.
Ofgem’s Sector Specific Methodology
Decision sets out the important role for
DNOs in enabling the benefits of increased
electrification and supporting economic
growth, through a combination of increased
network investment supported by flexibility.
It further outlines a number of financial
considerations which will require detailed
assessment, development and decision,
including potential adjustments to the Totex
Incentive Mechanism (TIM) and options to
reduce gearing to address inflation impacts,
alongside confirmation of the “enhanced
coordinator” role for DNOs in the rollout
oflow-carbon technologies.
Through ED3 and beyond, SSEN Distribution
is facing into a multi-decade growth
opportunity. To optimise the business for
delivery, work continues on a transformative
change programme that is taking cost out
of the business and putting it into the
systems, tools and processes needed
toexcel over the long term.
35
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Financial performance
Adjusted operating profit declined by 29%
to£136.9m from £192.1m in the prior year
primarily driven by lower wind related
revenues and lower supply volumes.
Thiswas partially offset by improved debt
performance and operational efficiencies.
The year saw lower customer numbers,
reflecting tighter market competition and a
decision to focus on stabilisation of the new
billing system in GB.
Reported operating profit decreased to
£136.2m compared to £189.2m in the
previous year, reflecting the
movementsabove.
Operational delivery
In the last 12 months an acceleration in the
development of data centres has created
opportunities for Energy Customer
Solutions. In Ireland, where the sector is
well established, energy sold to the data
centres increased by 4TWh to 6TWh, taking
the total power supplied to domestic and
non-domestic customers on the island to
10.6TWh. SSE Airtricity now supplies around
80% of the energy to data centres inIreland.
In GB, where data centre build-out is less
advanced, the focus has been on building
strategic relationships with key market
players, for example through the delivery
ofa private network solution to a Microsoft
data centre development in South Wales
and the expansion of network capacity to
Europe’s largest data centre conurbation
inSlough.
ECS’s supply businesses have faced difficult
market conditions over the last year. SSE
Airtricity saw modest customer losses after
reluctantly deciding to increase tariffs by an
average of 9.5% from October (4% Northern
Ireland), balanced with customer support
initiatives. Business Energy saw a reduction
in customer numbers due to market
competition and the knock-on impact
ofpreviously paused sales.
SSE Energy Customer Solutions Key Performance Indicators
1
March 2026 March 2025
Adjusted operating profit – £m 136.9 192.1
Reported operating profit – £m 136.2 189.2
Adjusted investment and capital expenditure – £m 34.8 80.0
Aged debt (60 days past due) – £m 289.8 298.6
Bad debt expense £m 27.3 42.5
Electricity and Gas sold
Electricity Sold – Airtricity – GWh 10,577 6,704
Electricity Sold – Business Energy – GWh 8,394 9,840
Gas Sold – Airtricity – mtherms 232 237
Gas Sold – Business Energy – mtherms 85 120
Customer numbers
All Ireland energy market customers – Airtricity – m 0.72 0.77
Energy customers’ accounts – Business Energy – m 0.24 0.31
1 Segmental reporting for SSE Airtricity and Business Energy have been merged for 2025/26.
Comparativeperformance has been restated.
Business Unit operating review continued
Energy Customer
Solutions
Energy Customer Solutions delivers a range of
energy products and services to the non-domestic
market in GB and both the domestic and non-
domestic markets in the island of Ireland. It creates
routes to market including Corporate Power
Purchase Agreements and green supply contracts
and offers energy solutions and distributed energy
products that stabilise costs, provide speed
topower and reduce carbon emissions.
“In a highly dynamic trading environment, we
remain focused on supporting customers facing
renewed cost pressures from energy market
shocks, whilst enabling the growing demand
driven by electrification and the rise of AI.”
Nikki Flanders
Managing Director, Energy Customer Solutions
36
SSE plc Annual Report 2026

Energy affordability remains a key concern
in both GB and Ireland with governments
implementing policy measures to support
customers. ECS continues to engage with
governments and other stakeholders
toinfluence policy direction, as well as
providing a range of support to customers.
ECS has supported customers to
electrifyand decarbonise their homes
andbusinesses in the last year. Notable
achievements include installing solar panels
on 400 homes of medically vulnerable
people in Ireland at no cost; and in GB, an
agreement with Transport for London to
partner on delivery of solar developments
that will partially power the London
Underground, with potential for
futureexpansion.
Strategic progress
The growing data centre sector will be an
area of focus for ECS over the coming year
both in Ireland, where a long-awaited Large
Energy Users policy has essentially lifted a
de facto moratorium on new facilities, and
in GB, where strong growth of the sector
isexpected in the UK Government’s AI
Growth Zones.
Energy Customer Solutions is exploring
“speed to power” opportunities with data
centre hyperscalers and large data centre
developers that face challenges securing
grid connections, including bridging
solutions, private networks and behind-the-
meter generation.
SSE’s existing and future pipeline of assets
across SSE Renewables and SSE Thermal,
aswell as existing relationships held by ECS,
are strategic strengths as the sector looks
for partners to help develop large-scale
energy solutions.
With global energy cost volatility potentially
continuing, SSE Airtricity and SSE Business
Energy are prepared for some challenges in
the first few months of the financial year.
Experience of previous global energy
volatility has informed planning, and
engagement with governments and
regulators continues to help shape
consumer support measures. ECS seeks to
support all customers, particularly those
that are vulnerable, and will continue to
offer tariff options that provide customers
with choices to suit their circumstances.
Powering the Tube with
solar through a new
partnership with TFL
Transport for London (TfL) has
appointed SSE Energy Customer
Solutions as its partner to deliver a
first-of-its-kind private wire solar
project for a major urban transport
network, connecting rooftop and
ground-mounted solar installations
directly to the Tube.
Once operational, it could generate
up to 65,000MWh each year,
providing clean electricity for millions
of journeys and covering around
two-thirds of the Victoria line’s
annual electricity demand. As
London’s largest electricity
consumer, this partnership
represents a major step in TfL’s
ambition to operate on 100%
renewable electricity by 2030.
TfL uses around 1.6 TWh of electricity
each year to power trains, stations
and operational infrastructure across
London. By generating power locally
and supplying it directly, the scheme
is expected to save more than 27,000
tonnes of carbon over 25 years –
equivalent to almost 32,900 flights
between London and New York.
27,000
tonnes of carbon could be
saved by TfL over the
course of 25years
TfL is partnering with SSE’s customer business to harness solar power for the Tube
37
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

The business continues to originate
contracts and execute structured
productsto optimise the SSE portfolio.
Trading activity in European power and
gasmarkets continued to grow steadily,
deepening insight into the global energy
complex. This capability is increasingly
important as the Group develops,
constructs and operates assets in carefully
selected international markets. SSE Energy
Markets will continue to add value to the
Group by providing a long-term view
onmarket fundamentals to inform SSE’s
strategic and investment decision making.
Immediate priorities for the business
includethe commencement of third-party,
large-scale battery energy storage systems
(BESS) contracts in 2026, and development
of systematic trading functionality, using
deep analytics to maximise value for the
Group’s portfolio.
Operational delivery
SSE Energy Markets has remained central
tomanaging market volatility, mitigating
riskand maximising value for the Group’s
market-based Business Units. Operating
asa single centre of excellence across all
trading periods, it secures value for SSE’s
asset portfolio, which continues to be
reported within individual Business Units.
Strategic progress
The business has continued to focus on
optimisation activities and position taking,
all within SSE’s strict position limit and Value
at Risk (VAR) controls, while also contracting
third party Power Purchase Agreements
andwider route to market services.
At the full-year, SSE Energy Markets held
2.9GW of CfD-backed route-to-market
contracts, of which 2.4GW were third party
including 15-year agreements with two
low-carbon solar farms. It also added
1.3GW of Combined Heat and Power (CHP)
and Open Cycle Gas Turbine (OCGT) sites
from Triton Power to its portfolio this year.
Financial performance
Adjusted operating profit increased by 44%
to £43.2m from £30.0m in the prior year.
Inaddition to this relatively low level of
baseline operating earnings, SSE Energy
Markets’ trading activities also drive
significant value for the energy-exposed
businesses. The increase in profitability is
mainly driven by optimisation trading on
commodity positions and an increase in
volume and margin achieved on green
certificate sales.
Reported operating loss increased to
£(145.8)m compared to a loss of £(42.9)m
inthe prior year. Despite favourable
movements noted above, reported
operating results include a higher value
ofnet remeasurement losses on forward
commodity derivatives relative to
theprevious year. These IFRS 9
re-measurements exclude any
re-measurement of ‘own use’
contractsandare unrelated to
underlyingoperatingperformance.
Business Unit operating review continued
SSE Energy Markets
SSE Energy Markets optimises all of SSE’s
market based assets by trading across key
commodity markets – power, gas and
carbon – and manages associated market
risks to secure and enhance long term value.
SSE Energy Markets key performance indicators
March 2026 March 2025
Adjusted operating profit – £m 43.2 30.0
Reported operating profit/(loss) – £m (145.8) (42.9)
“The trading expertise anddeep analytics offered by
SSE Energy Markets have never been more important.
Against a backdrop of heightened market volatility,
wehave continued to help the Group’s integrated
asset portfolio create value through all scenarios.”
Gordon Bell
Managing Director, SSE Energy Markets
38
SSE plc Annual Report 2026

People Powering SSE
Gillian O’Reilly, Head of Heritage (left) and Holly
Cammidge, Heritage Development Officer,
Pitlochry,Scotland
“SSE can trace its Scottish roots
backtothe hydro pioneers of the
1940sand has powered the Highlands
and the UK for over a century.
Wearestewards of SSE’s heritage
andwe want to showcase our role
asenergycustodians of the future,
throughour visitor centre, our events
andeven our Highland Grid book.”
eers of the
d
the Highlands
c
entury.
E
’s herita
g
e
ase
ou
r r
ole
o
f the future,
n
tre, our events
d
Grid book.”
Sustainability
Chief Sustainability Officer’s review 40
Our approach to sustainability 41
Driving the climate transition 42
Providing clean, secure and affordable energy 45
Delivering sustainable infrastructure 47
Championing a fair transition 49
Protecting our naturalenvironment 54
Governance Financial StatementsStrategic Report
39
SSE plc Annual Report 2026

Creating value
through the
transition
While navigating an increasingly complex
environment, we have continued to make
progress against our sustainability ambitions
– delivering on our climate goals while
supporting wider value for communities,
customers and the economy.
It’s been a year of good performance for
SSE. We reached an important milestone
with our carbon intensity falling below
200gCO
2
e/kWh for the first time, and we
remain on track to enabling the connection
of over 20GW of renewable energy to the
grid in the north of Scotland by 2030.
We’re pleased with this progress but
recognise we are delivering this against an
increasingly volatile and complex global
backdrop. The clean energy transition is not
a linear journey – something we’re seeing
reflected in our progress towards our 2030
renewables output goal, which we have
been clear we are unlikely to meet.
“The transition must be
delivered in a way that
works for people, for
theenergy system and
forthe wider economy
asa whole.”
External dependencies, evolving policy
frameworks and wider economic pressures
– including affordability – continue to
shape both the pace and pathway of
change. Ultimately, delivery of our long-
term ambitions will depend not only on our
actions, but also on the broader system in
which we operate. We remain focused
onmaking steady, meaningful progress –
and being open and honest about the
challenges and trade-offs we’re navigating
along the way.
The transition must also work for people.
Supporting customers with affordable and
reliable energy, investing in communities
and delivering a fair and inclusive transition
are central to how we operate. This year,
weawarded a record £25m through our
community investment funds, creating
tangible long-term benefits.
More broadly, the energy transition can
playan important role in supporting the
economies in which we operate. Last year,
our activity contributed £10.84bn to GDP
and supported over 88,350 jobs across the
UK and Ireland.
Around 95% of our £33bn investment plan is
expected to be taxonomy-aligned, meaning
it is invested in infrastructure that supports
the transition to clean energy. Sustainability
is not separate from our business strategy
– it underpins it. It ensures we deliver a
secure energy system in a way that creates
long-term value and builds lasting trust with
communities. That trust is essential if we are
to deliver the infrastructure needed at pace.
As we look ahead, we are under no illusion
about the scale of the challenge – but also
the opportunity. The transition must be
delivered in a way that works for people,
forthe energy system and for the wider
economy as a whole. Our focus is on doing
this well – building the infrastructure
needed while creating lasting value and
maintaining trust along the way.
Rhian Kelly
Chief Sustainability Officer, SSE plc
27 May 2026
Sustainability highlights
Our lowest recorded scope 1
GHG intensity
194gCO
2
e/
kWh
c. 95%
of our investment plan to 2030
will be taxonomy aligned
Through our activities we
contributed
£10.84bn
to UK and Ireland GDP
A record year for community
investment with
£24.9m
awarded through our
communityfunds
40
SSE plc Annual Report 2026
Chief Sustainability Officer’s review

Sustainability
We’ve made considerable progress against some of our 2030 Goals since they were first set in 2019, for
example towards our ambition to connect more renewables to the electricity grid in the north of Scotland.
However, over this time the context has evolved, and a number of external factors have shaped delivery of
the Goals. There are increasing challenges in meeting our carbon intensity goal and we do not expect to
meet our ambitious goal to increase renewables output fivefold by 2030. We discuss our progress in these
areas over the following pages.
Cut carbon intensity by 80%
Reduce scope 1 carbon intensity by 80% by 2030 to 61gCO
2
e/
kWh, compared to 2017/18 base year of 307gCO
2
e/kWh.
Increase renewable energy output fivefold
Build a renewable energy portfolio that generates at least 50TWh
of renewable electricity a year by 2030.
Champion a fair and just energy transition
Be a global leader for the just transition to net zero, with a
guarantee of fair work and commitment to paying fair tax and
sharing economic value.
Enable low-carbon generation and demand
Enable the connection of at least 20GW of renewable generation
capacity within SSEN Transmission’s licence area.
£10.84bn
contribution to UK and
Ireland GDP
88,350
jobs supported in the UK
and Ireland
* Includes pumped storage, battery energy storage systems, biomass and constrained-off wind in GB.
Progress: Behind target See page45
See page47
Progress: On target but with risk See page43
Progress: On target See page47
Our 2030 Goals
2026
2030 target
194gCO₂e/kWh
61gCO₂e/kWh
2026
2030 target
10.8GW
20GW
2026
2030 target
14.5TWh*
50TWh
Our approach to sustainability
Sustainability in our strategy
Sustainability is a fundamental value
underpinning SSE’s strategy. Our approach
is centred on four 2030 Goals, focused
onaddressing climate change while
ensuring the benefits of the clean energy
transition are shared with customers and
communities. These Goals are aligned with
the UN Sustainable Development Goals
(SDGs) and provide a clear framework
fordelivering progress over the short
tomedium term.
This approach ensures that in delivering
our£33bn investment plan to 2030, we do
this in a way that delivers broader value,
including supporting jobs, developing skills
and benefiting the communities in which
we operate.
Focusing on what matters
SSE’s 2030 Goals are aligned to the four
SDGs most relevant to our business,
supported by additional environment-
related SDGs that guide our approach
tonature. This framework enables us to
focus on the most material environmental
and social issues linked to our activities.
We further identify and prioritise these
through a double materiality assessment
(DMA), informed by stakeholder
engagement. This considers both our
impacts on the environment and society,
and how sustainability issues may affect
ourfinancial performance. Our most
recentreview confirmed continued
alignment with key priorities, and a
comprehensive refresh is under way
inlinewith evolving best practice.
Sustainability is central to how we do things and deliver on our strategy,
driving long-term value as we support the clean energy transition.
Read more about our approach to
materiality in our Sustainability Report 2026
at sse.com/sustainability .
How sustainability is governed
Oversight of sustainability is embedded
within SSE’s governance framework,
withaccountability held across the Board,
Group Executive Committee and sub-
committees, supported by the Safety,
Sustainability, Health and Environment
Advisory Committee (SSHEAC). The Chief
Sustainability Officer reports to the Chief
Executive and advises across the business.
Strengthening accountability, executive
remuneration is partly linked to ESG ratings
performance and delivery of the 2030
Goals. More detail on governance
arrangements can be found in the
Governance section, pages 78 to 142 .
41
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

A strategy for net zero
Our strategy is tackling climate change
head-on by delivering the electricity
infrastructure required for the clean energy
transition. Our Net Zero Transition Plan
andaccompanying science-based targets,
set out our pathway to net zero.
Our Net Zero Transition Plan
We are providing the practical solutions for
a clean power system and have committed
to reach net zero across scope 1 and 2
greenhouse gas (GHG) emissions by 2040,
and across scope 3 GHG emissions by 2050
at the latest, subject to security of supply.
Our Net Zero Transition Plan sets out the
action required to reach our longer-term
climate ambitions and make progress
against our four near-term targets, verified
by the Science Based Targets Initiative (SBTi).
See the graphic below for more details.
Last year we updated our Net Zero
Transition Plan to align with best practice
byconfirming three-yearly review cycles
and introduced two emission scenarios
following the publication of the UK
Government’s Clean Power 2030 Plan.
While we continue to make progress
againstour targets this year and the overall
direction of the energy transition is clear,
these scenarios remain relevant, as
achievement of our 2030 targets is
dependent on system-wide factors. These
include the pace of renewable deployment,
the timing of the transition of unabated gas
generation to a back-up role, alongside
policy and market support for low-carbon
flexible generation such as carbon capture
and storage and hydrogen, to maintain
system balance and security.
Our role in the transition also goes beyond
reducing our own emissions, with around
80% of our £33bn Transformation for
Growth investment plan directed towards
grid upgrades over the next five years.
Through our network businesses, we play
acritical role in enabling clean power
toreach more homes, businesses
andcommunities, supporting the
decarbonisation of the wider economy.
Driving the climate
transition
With increasing global volatility and record
temperatures, the need to accelerate the delivery
ofclean, homegrown energy is clear. We are at the
forefront of the energy transition, providing practical
solutions needed for a clean power system. At the
same time, we’re making sure our assets are more
resilient to climate change.
This graphic shows SSE’s near- and long-term carbon targets.
SSE’s Net Zero Transition Plan pathway
S1
Scope 1
S2
Scope 2
S3
Scope 3
Near term (2025 – 2035) Long term (2035 – 2050)
TARGETS
Carbon intensity
Reduce the carbon
intensity of scope 1
GHG emissions by
80%by 2030, from
a 2017/18 base year.
Absolute emissions
Reduce absolute
scope 1 and 2 GHG
emissions by 72.5%
by 2030 from a
2017/18 base year.
Supplier
engagement
Engage with 90% of
suppliers by spend
to set science-
based targets
by2030.
Gas sold
Reduce absolute
GHG emissions
from use of
products sold by
50% by2034 from
a2017/18 baseyear.
Scope 1 and 2
Net zero for SSE’s
scope 1 and 2
emissions by 2040.
Scope 3
Net zero for all
SSE’s remaining
scope 3 GHG
emissions by
2050.
S1 S1 S2 S3 S3 S1 S2 S3
Note: for definitions of scopes 1, 2 and 3 SSE follows the GHG Protocol.
For further information on SSE's Sustainability Reporting Criteria 2026 see sse.com/sustainability
Our progress
This year marked a milestone in our
carbon intensity performance, with
emissions falling below 200gCO₂e/
kWh for the first time. This reflects
increased renewables output from
new assets alongside lower thermal
generation due to maintenance
outages. Overall, our carbon intensity
of electricity generated has reduced
by 37% since 2017/18. However,
asoutlined last year, in the context
ofthe current market and policy
environment, SSE’s carbon intensity
goal is on target but with risk.
194gCO
2
e/
kWh 
Scope 1 GHG intensity
(2024/25: 218gCO
2
e/kWh)
4.93MtCO
2
e
Scope 1 and 2 absolute emissions
(2024/25: 5.7MtCO
2
e)
Sustainability continued
42
SSE plc Annual Report 2026

2017/18 2018/19 2019/20 2020/21 2021/22 2022/23 2023/24 2024/25 2025/26
10.2
8.8
8.2
7.1
5.7
6.0
4.3
5.2
0.9
0.7
0.6
0.5
0.5
0.4
0.5
0.5
4.1
3.9
3.6
3.4
3.7
4.8
4.5
0.4
3.8
4.5
4.5
Science-based targets five-year review
SSE was one of the first power sector
companies to have climate targets validated
by the Science Based Targets Initiative (SBTi)
in 2020. Consequently, the five-year review
of our targets is required by the end of
2026, and we will work closely with the
SBTito complete the review. We will also
continue to engage constructively with the
SBTi to support the development of the
Power Sector Net Zero Standard, helping
toensure it is credible, pragmatic and
appropriately reflects the practical realities
of the transition.
NetZero Transition Plan progress
As we move past the midpoint of the 2020s,
we continue to make progress towards our
near-term science-based targets as outlined
in Figure 2.
This year represented a milestone in carbon
intensity performance, with emissions
falling below 200gCO₂e/kWh for the first
time. We are now nearly halfway towards
our scope 1 carbon intensity reduction
target and three quarters of the way
towards our absolute scope 1 and 2
reduction target. On scope 3, we are
around two thirds towards our gas sold
target and supplier engagement target.
While progress towards net zero continues,
our transition plan recognises that
emissions are not linear, and that
performance can fluctuate due to
weatherconditions, market demand,
assetavailability and policy progress.
Scope 1 and 2 emissions performance
This year, SSE’s scope 1 GHG intensity of
electricity generated was 194gCO
2
e/kWh
(2024/25: 218gCO
2
e/kWh). This represents
a37% reduction against the 2017/18 base
year. Meanwhile, SSE’s scope 1 and 2
absolute emissions were 4.93MtCO
2
e
(2024/25: 5.70MtCO
2
e), representing a 55%
reduction against the 2017/18 base year.
Scope 3: Gas sold (Category 11), Joint Venture investments (Category 15), well-to-tank
emissions from raw fuels purchased (excluding gas sold) and transmission and distribution
emissions from electricity used in non-operational and operational buildings (Category 3),
SSEN Transmission network losses (Category 9), contractor vessels (Category 4), and
business travel (Category 6).
Scope 2: Electricity consumption in operational and non-operational buildings and SSEN
Distribution network losses
Other scope 1: Operational vehicles and fixed generation, sulphur hexafluoride and gas
consumption in buildings
Scope 1: Electricity generation carbon emissions
SSE’s total reported emissions decreased by 14% between 2024/25 and 2025/26,
mainly due to a decrease in scope 1 emissions from thermal generation, as well as
adecrease in scope 3 emissions from thermal generation investments and gas sold
tocustomers. Overall, SSE’s reported emissions have decreased by 42% versus the
2017/18 base year, falling from 15.2MtCO
2
e to 8.8MtCO
2
e in 2025/26. SSE’s total
reported emissions in 2025/26 consisted of 51% scope 1 emissions, 5% scope 2
emissions and 44% scope 3 emissions. For more detail see carbon performance
disclosures page 73 .
Figure 1: SSE’s GHG emissions by scopes between
2017/18 and 2025/26 (million tonnes CO
2
e)
Figure 2: 2025/26 progress against SSE’s science-based targets from
a2017/18 base year
SSE’s total reported emissions
Reduce the carbon intensity of scope 1 GHG emissions
Scopes 1 and 2
Scope 3
46% progress
76% progress
64% progress
68% progress
Reduce absolute scope 1 and2 GHG emissions
Reduce absolute GHG emissions from use of products sold by 50% by2034
by 80% by2030
by 2030
by 72.5% by2030
Engage with 90% of suppliers by spend to set science-based targets
2025/26: 194gCO
2
e/kWh (37% reduction from base year)
2025/26: 4.93MtCO
2
e (55% reduction from base year)
2025/26: 1.73MtCO
2
e (32% reduction from base year)
2025/26: 61% of our suppliers by spend have set, or committed to set science-based targets
Updated ‘say on climate’
resolution
Since introducing the shareholder
‘sayon climate’ resolution in 2021, we
have seen strong shareholder support
for our Net Zero Transition Report,
consistently receiving over 97% of
votes cast in favour each year.
At the 2025 Annual General Meeting
(AGM), the shareholder ‘say on
climate’ resolution was approved,
with 97.85% of votes cast in favour.
Shareholders also approved an
update to the framework introducing
a three-year voting cycle, aligning
with the UK Government’s Transition
Plan Taskforce guidance to review
transition plans every three years.
43
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Sustainability continued
Both SSE’s scope 1 carbon intensity
andabsolute scope 1 and 2 emissions
decreased compared to last year due to
increased renewables output from initial
commissioning at Dogger Bank and the
delivery of Yellow River, alongside lower
thermal generation output due to
maintenance outages.
SSE’s scope 2 GHG emissions were
0.41MtCO
2
e in 2025/26. This represents
a15% decrease from the previous year
(2024/25: 0.48MtCO
2
e). This was due to
lower electricity consumption at our
thermal power stations, and a significant
decrease inthe grid electricity emissions
intensity fordistribution losses between
2024/25 and2025/26.
Our other operational emissions are less
material and accounted for 2% of scope 1
and 2 emissions in 2025/26. We are involved
in a range of activities to reduce these
emissions such as exploring hydrotreated
vegetable oil (HVO) as an alternative fuel
atour Scottish island diesel generation
facilities, switching SSE’s fleet to electric
andtackling sulphur hexafluoride (SF) leaks.
For more information see page 55
.
Scope 3 emissions performance
SSE’s largest scope 3 emissions categories
are gas sold to customers (45%), emissions
from joint venture thermal generation
(32%)and upstream well-to-tank emissions
from fuels purchased for thermal
generation (19%).
Our total scope 3 emissions in 2025/26
decreased by 16% to 3.83MtCO
2
e (2024/25:
4.54MtCO
2
e). This was due to adecrease
inemissions from gas sold to customers,
reduced output at thermal generation
investments and less upstream well-to-tank
emissions from reduced generation at
SSE-operated sites.
Scope 3 emissions from gas sold to
customers in 2025/26 were 1.73MtCO
2
e
(2024/25: 1.95MtCO
2
e). This represents
a32% reduction against the 2017/18
baseyear. Emissions associated with joint
venture thermal generation decreased
to1.24MtCO
2
e in 2025/26. As set out in
ourtransition plan, we continue to work
with customers to help them reduce gas
consumption and with joint venture
partners to develop their transition plans.
Tackling scope 3 emissions embedded
inthe goods and services we buy is
challenging so our focus is to engage
oursupply chain to help them set their
ownscience-based targets and consider
low-carbon materials in our projects.
Overhalf of our suppliers by spend have
setscience-based targets.
Adapting to climate change
Last year the UK Climate Change Committee
(CCC) advised the UK Government to be
prepared for 2°C of warming by 2050 at a
minimum. The physical impacts of climate
change have the potential to adversely
affect our operations and interrupt energy
supply to homes and businesses. It’s
therefore more important than ever that
weensure our operations and networks
areboth prepared and resilient.
A key climate risk for SSE is the impact
fromextreme weather events such as high
winds or intense storms. We have made
investments to manage this risk and help
teams respond to problems as quickly as
possible. For example, we monitor short-
and long-term weather patterns, have
robust business continuity plans, and are
investing to improve the resilience of our
infrastructure.
Over 2025/26, SSEN Distribution
respondedto four named storms, which
saw it restore power to over 221,000
customers. See page46
for more detail.
In 2025/26, SSE joined the Green Alliance
Adaptation Taskforce alongside other
partners such as Aviva, Zurich and National
Trust to inform climate adaptation and
resilience policy development in the UK.
SSEN Distribution is also preparing its
adaptation plans for its next five-year price
control period, RIIO-ED3, from April 2028.
Time horizon Scenario sensitivity
2035 2050 2080 1.5°C 2.5°C 4°C
Transition risk Wind generation price
Physical
risks
Variable renewable generation risk
Extreme weather network damage
Transition
opportunities
Accelerated transmission growth
Accelerated wind investment
Valuable flexible hydro
Valuable flexible thermal
Driving distribution transformation
Figure 3: Summary of SSE’s key climate-related risks and opportunities
As part of meeting our climate-related financial disclosure requirements set out by the Financial Conduct Authority, SSE has
identified the material climate-related risks and opportunities related to the Company’s strategy. We review these every two years,
with the next review planned for 2026/27.
This table provides a summary of our material climate-related risks and opportunities, alongside time horizon assessed and the
scenario sensitivity. For more detail on the risks, opportunities, time horizons and scenario sensitivities see
pages 67 to 72
.
Time horizon of opportunity or risk:
SSE considered different warming scenarios over three time
horizons to assess the financial impact in each time period.
Scenario sensitivity:
Scenario sensitivity indicates the financial significance of different
warming scenarios as indicated by the scenario modelling.
Period of opportunity or risk Most material impact
High
sensitivity
Low
sensitivity
Warming scenario
not assessed
44
SSE plc Annual Report 2026

Providing clean, secure
and affordable energy
With affordability an ongoing concern for households,
thebest way SSE can help is by developing and connecting
renewable generation that reduces exposure to volatile
gasprices. Alongside this, we continue to provide secure,
reliable energy for our customers and support those in
vulnerable circumstances to stay connected.
Onshore wind has a role in a more affordable, renewables-led energy system
Delivering clean energy
Developing new sources of renewable
generation is a key way we can support
withenergy affordability. There is now
clearevidence that the UK’s investment
inrenewables has provided a buffer to
households and businesses from the worst
of the recent global price shock, and the
transition to a cleaner energy system offers
a credible path to lower bills over time.
SSE’s renewable generation output during
the year increased by 9% to 14.5TWh
(2024/25: 13.3TWh). Output was supported
by generation from initial commissioning
atDogger Bank A (1.2GW, SSE share 40%)
and the delivery of Yellow River (101MW),
partially offset by mixed weather conditions
particularly in hydro.
Work continues to progress on delivery of
all three phases of Dogger Bank wind farm,
with turbine installation progressing
strongly on Phase B. Berwick Bank wind
farm received consent in July 2025 for up
to4.1GW of offshore capacity, and Phase B
of that project subsequently secured a
contract through CfD Allocation Round 7 in
January 2026. Full detail of SSE Renewables’
progress across its projects and technologies
can be found in the SSE Renewables
business operating review on pages 28
and29
.
We remain committed to leading the way
inthe transition to a cleaner, more secure
and more affordable energy system
however the slowdown across renewables
markets in previous years mean that we
areunlikely to meet our ambitious goal
of50TWh of renewable generation output
by 2030. We welcome the steps taken
overthe year by the UK Government to
accelerate the energy transition, including
the announcement of the intention to run
CfD Allocation Round 8 in the second half
of 2026.
Our progress
Renewable output increased by 9%
compared to the previous year to
14.5TWh*. This was driven by
contributions from Dogger Bank A
and Yellow River, which is supporting
the delivery of home-grown, clean
energy. We continued to ensure
secure and reliable energy for
customers, providing targeted
support for vulnerable customers
andinitiatives to strengthen resilience
during supply interruptions.
14.5TWh*
Renewable generation output
1.3 million
Customers on SSEN Distribution’s
Priority Services Register
221,000
Customers who SSEN Distribution
restored power to in response to
storms over 2025/26
* Includes pumped storage, battery energy
storage systems, biomass and constrained-
off wind in GB.
45
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

SSEN Distribution’s emergency battery packs mark an industry first in GB
Powering essential
care at home
In an industry first in GB, SSEN
Distribution has delivered the first of
20,000 free home battery packs to
customers signed up for Priority
Services who are dependent on
electricity to power medical
equipment at home.
The portable battery pack provides
added support and peace of mind by
giving them the capability to power
some devices for a period of time if
there’s a power cut.
The packs can also be used with
devices providing light, heat and
communications, making it easier
for people to keep in touch with
carers, family or friends, and to
getinformation they need, if the
electricity goes off.
20,000
Free battery packs provided
to our networks customers
Supporting customers
Through our electricity distribution
business, we provide network connections
to homes and businesses across central
southern England and the north of
Scotland. We also provide energy products
and services to non-domestic customers in
GB and both domestic and non-domestic
customers in the island of Ireland.
Our aim is to make electricity clean,
affordable and available for all. You can
findexample of how we work to do this
fordomestic customers on this page.
Moreinformation about our non-domestic
customers can be found in the Energy
Customer Solutions Business Unit operating
review on pages 36 and 37
.
Energy price changes for households
inIreland
Following a three-year period of price
reductions and market-leading customer
supports, SSE Airtricity introduced a price
increase of 10.5% for electricity and 8.4%
forgas in April 2025, with a subsequent
9.5% increase for electricity in October.
These price changes were largely in
response to rises in external costs including
network charges and wholesale energy
costs, with such regulatory charges outside
of the supplier’s control. For customers
inNorthern Ireland, regulated gas prices
reduced by 8.47% in September 2025,
witha4% increase in electricity prices
introduced from in November 2025 due to
rising network andoperator charges, market
volatility andhigher cost of doing business.
SSE Airtricity has a longstanding commitment
to supporting customers with the cost of
energy. For winter 2025/2026, adedicated
fund was established to help those in need,
supplementing existing supports like
repayment plans, energy efficiency
programmes and charity partnerships.
Supporting medically vulnerable
customers through Solar PV
SSE Airtricity supports the delivery of the
Sustainable Energy Authority of Ireland
(SEAI) Solar PV Scheme for Medically
Vulnerable Customers, a Government
funded programme that strengthens
energyresilience for households reliant
onlife-supporting medical equipment.
Delivered in partnership with the SEAI,
thescheme provides fully funded Solar PV
systems to eligible customers identified
through the Priority Services Register (PSR).
These installations help lower electricity
costs and carbon emissions while improving
security of supply for essential medical
equipment in the home.
SSE Airtricity was proud to be the first
energy company to participate, having
delivered over 80% of installations, and
following a contract extension will continue
supporting the programme.
Additional support for vulnerable
customers
SSEN Distribution’s Priority Services Register
(PSR) identifies customers who may be
invulnerable situations and who can be
particularly affected in the event of supply
interruptions. With nearly 1.3 million
customers on the PSR, it enables the
business to provide tailored services and
additional support to those who need
themmost.
Over 2025/26, SSEN Distribution has been
taking a proactive approach to supporting
those on the PSR. More than 150,000 PSR
customers have now been issued with
dedicated Power Cut Plans, tailored to
individual needs and developed with input
from healthcare experts, charities and
people living with long term conditions.
Inan industry first, a programme of free
home battery packs for customers who
aremedically dependent on electricity has
also begun – see case study on this page.
Keeping customers connected
duringstorms
Increasingly frequent and severe extreme
weather events continue to test the
resilience of electricity networks. SSEN
Distribution plays a critical role in preparing
for and responding to these events, scaling
its operational response and deploying
additional resources to restore supplies
safely and as quickly as possible. Alongside
network restoration, SSEN Distribution
provides practical support to communities,
including proactive engagement with
customers on the PSR, enhanced customer
contact centre capacity and the provision of
support such as hot meals where needed.
During 2025/26, SSEN Distribution
responded to four named storms, restoring
power to approximately 221,000 customers,
handling nearly 100,000 queries from
customers over the phone and via social
media channels, and providing 37,500 free
meals in the most affected communities.
Sustainability continued
46
SSE plc Annual Report 2026

Creating lasting value
SSE’s investment in low-carbon
infrastructure generates strong economic
and social value across the UK and Ireland.
Around 80% of our £33bn investment plan
will be directed towards regulated electricity
networks. This will enable the connection
of clean, homegrown energy and its
transportation to the areas where it’s
mostneeded, whilst supporting national
climate ambitions.
In 2025/26, 10.8GW of renewable
generation was connected in SSEN
Transmission’s network area, surpassing
itstarget of 10GW by 2026, and putting us
over half-way towards our 2030 ambition
of20GW.
This investment is about more than
upgrading electricity infrastructure –
delivered at scale and over the long term,
itcreates value across communities,
supplychains and the wider economy.
In 2025/26, we contributed an estimated
£10.84bn to GDP in the UK and Ireland
– upfrom £8.68bn last year and our
highestcontribution since 2018/19 (adjusted
for current prices). We also supported
88,350 jobs, up significantly from 67,190
in2024/25. This largely reflects increased
activity as we progress with delivery our
£33bn investment plan.
Financing the energytransition
Green- and sustainability-linked finance
isessential to unlock the scale of
investmentrequired to deliver the clean
energy transition.
Measuring green economic activity
Green taxonomy frameworks are
usefultools for helping stakeholders
understand the scale of a company’s
greeneconomic activities.
Following the UK Government’s decision
not to proceed with a UK Green Taxonomy
framework, we continue to voluntarily work
towards aligning our reporting with the EU
Taxonomy. The high-level results of this
assessment are outlined in Figure 4.
In 2025/26, 92% of our adjusted investment
and capital expenditure was EU Taxonomy-
aligned. Looking ahead, around 95% of
ourfive-year, £33bn investment plan is
expected to be taxonomy-aligned.
A detailed breakdown of our economic
activities assessed under the principles of
the EU Taxonomy, together with the key
assumptions applied, is provided in the
Disclosure Statements on page 74
.
SSE’s tenth Green Bond issued
In August 2025, SSEN Transmission issued a
€750m, eight-year Green Bond to support
investment in critical energy infrastructure.
The proceeds will finance and/or refinance
electricity transmission projects as part of
SSEN Transmission’s £22bn investment
programme to upgrade networks in the
north of Scotland.
At the time of publication, the total
outstanding Green Bonds issued by SSE plc
and its subsidiaries is £5.1bn, and SSE
remains the largest UK corporate issuer
ofGreen Bonds.
Delivering sustainable
infrastructure
We are delivering a major programme of infrastructure
investment to support the clean energy transition. To ensure
this delivers lasting benefits for communities, the economy
and the wider energy system, sustainability is embedded
across our investment decisions, supply chains and how
we use resources.
Our progress
As we progressed our £33bn
investment plan, we delivered another
record year for capital investment and
saw a 16% increase in supply chain
spend. Over 92% of this capital
investment was EU Taxonomy
aligned, invested in infrastructure
thatsupports the transition to clean
energy. We also reached 10.8GW
ofrenewable generation capacity
connected in SSEN Transmission’s
network area, surpassing its RIIO-T2
target of 10GW by 2026.
10.8GW
Renewable generation
connected in SSEN Transmission
network area
£6.5bn
Total procurement spend
92%
Of SSE’s adjusted investment
andcapital expenditure is
taxonomyaligned
Figure 4: SSE’s Taxonomy Assessment 2025/26
Revenue
£10,186.5m
Adjusted operating
profit £2,236.6m
Taxonomy-aligned Taxonomy-eligible, non-aligned Taxonomy non-eligible
36%
16%
48%
91%
8%
1%
Adjusted investment
andcapital expenditure
£3,585.6m
92%
6%
2%
47
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

On top of project work, the MV Arrow will support wider island transport needs
Working with contract
partners to limit
community impact
SSEN Transmission worked with its
principal contractor, Balfour Beatty,
to secure a dedicated freight vessel,
the MV Arrow, to handle construction
materials for the Lewis Hub and
Western Isles High Voltage Direct
Current (HVDC) Link. This means
logistics can be managed without
disrupting public ferry operations
used by residents, businesses
andvisitors.
A release mechanism will allow the
vessel to be used by others when
notrequired for project delivery,
boosting resilience across the islands’
essential ferry network.
Alongside measures to manage
workforce travel and accommodation,
it helps safeguard transport, housing
and local services, ensuring
infrastructure investment delivers
benefits for communities aswell as
the energysystem.
Building sustainable supply chains
In 2025/26, our supply chain spend
increased by 16% to £6.5bn, from £5.6bn
the previous year. To manage this scale
ofinvestment we build long-term,
collaborative relationships with suppliers
that support the delivery of our strategy.
A sustainable supply chain is critical for SSE,
enabling the timely delivery of major
infrastructure projects, supporting
innovation, managing risk and ensuring
long-term value creation. As the clean
energy transition accelerates globally, we
face increasing competition for critical
materials and the skilled workforce required
to deliver major infrastructure projects.
Engaging suppliers on sustainability
Through our Sustainable Procurement
Code and Supplier Relationship
Management programme, we set clear
expectations on ethical behaviour,
environmental performance, safety and
social value, and work with suppliers to
improve sustainability outcomes across the
supply chain. This includes addressing risks
such as human rights, modern slavery and
carbon emissions, while strengthening
capability through training and knowledge
sharing initiatives. We also measure supplier
performance in key environmental, social
and governance areas through EcoVadis.
At31 March 2026, 74% of our suppliers by
spend had a valid EcoVadis scorecard.
Supporting supply chain growth
The delivery of SSEN Transmission’s
£22bninvestment programme in the
electricity networks in the north of Scotland
creates awide range of opportunities
andissupporting growth for our supply
chainpartners.
Over 2025/26, a number of key contract
partners expanded operations to support
the delivery of SSEN Transmission’s
investment programme. This included:
BAMopening a new shared office space in
Inverness, creating a dedicated Highland
hub for more than 200 people for its
engineering and energy operations in the
north of Scotland; NKT expanding its office
presence in Perth; and, Balfour Beatty
opening a new operational depot in Angus
which will support up to 70 local jobs.
Innovating for the energy transition
SSE invests in innovation to accelerate the
deployment of low carbon technologies
and demonstrate their practical application.
In 2025/26, research and innovation costs
totalled £17.7m (2024/25: £17.2m).
Our central Partnership Funding team helps
secure government funding to trial new
technologies and market models. SSE also
works collaboratively with our suppliers,
peers and leading academic institutions to
accelerate learning and delivery across the
energy system. More information on our
approach to innovation can be found in
ourSustainability Report 2026, available at
sse.com/sustainability
.
Using resources responsibly
Scaling investment brings increased
responsibility for how resources are used
across the lifecycle of projects. Embedding
circular principles helps minimise
environmental impacts while supporting
cost efficiency and supply chain resilience.
By focusing on efficient material use, waste
reduction and extended asset life, we can
reduce pressure on finite resources and
manage construction impacts responsibly.
This approach ensures circularity is
embedded into sustainable infrastructure
delivery, rather than a standalone issue.
Managing our waste
Guided by the waste hierarchy, we focus
onpreventing waste where possible and
prioritising reuse and recycling. We set two
annual waste targets for 2025/26 – to divert
97% of waste by volume from landfill and
recycle or reuse 65% of waste by volume.
SSE exceeded both targets this year,
reaching 99.2% and 72.5% respectively.
Sustainability continued
48
SSE plc Annual Report 2026

Ensuring a safe workforce
Safety is a fundamental value guiding
behaviour at SSE and our priority is that
everyone gets home safe. In a period of
accelerating construction activity, we met
our overriding safety goal of no life-
changing injuries and our Total Recordable
Injury Rate (TRIR) for SSE and contract
partners combined was stable, at 0.17 per
100,000 hours worked (2024/25: 0.16).
The TRIR improved for SSE employees to
0.09 (2024/25: 0.11) and exceeded the
expectation we set for the year of 0.12.
Wealso exceeded the expectation of
0.35we set for our contract partner TRIR,
however performance worsened compared
to the previous year at 0.31 (2024/25: 0.25).
Our contract partners are as much a part of
our Safety Family as our employees, and
we’ll continue to work closely with them to
ensure that, as we look ahead to a period of
increased workhours, this does not result in
an increased incident rate.
Last year we celebrated the first anniversary
of the Faskally Safety Leadership Centre in
Perth, where we host immersive training,
marked by a visit from Scotland’s First
Minister. Over 2025/26, around 4,500
employees and contract partners took part
in the training, taking the total number who
have completed it to over 14,000 since it
was introduced. The positive impact the
training is having is increasingly important
as we continue to deliver projects at pace.
Figure 5: SSE’s total recordable
injury rates
(per 100,000 hours worked)
Employees and contract partners
Employees
Contract partners
2025/26
2024/25
0.25
0.16
0.31
0.09
0.17
0.11
Shaping our workforce
Creating good jobs
At 31 March 2026, our total headcount
was15,197¹,down from 15,819 the previous
year. This follows a period of sustained
headcount growth of nearly 50% between
2021/22 and 2024/25.
Most recruitment activity over 2025/26
wasin our networks businesses and we
anticipate continued growth in those
workforces in the coming years as we
deliver our £33bn capital investment plan.
We expect overall headcount to remain
broadly stable across the Group,
reflectingdifferent growth rates across
ourBusiness Units.
Our focus remains on embedding new
talent, supporting internal mobility and
assessing long-term skills demands.
Building future skills capability
We support the UK Government’s Clean
Energy Jobs Plan for 2030 by continuing
toinvest in our workforce, building future
talent pipelines and collaborating with
industry partners.
In 2025/26, we invested £36.9m in learning
and development and launched a Leading
Leaders programme, equipping our senior
leaders with the skills and behaviours to
lead their teams. Through our wider digital
skills programme, we are embedding
responsible AI use through learning that
combines Group level coordination with
business specific training, tailored to
different roles.
Our early careers programmes remain a key
focus, with £22.8m invested in graduates,
apprentices, trainees and partnerships that
promote social mobility.
We also centralised external skills and early
careers activity into one team, helping us
toalign priorities, maintain our focus on
impact and forge stronger partnerships
asaGroup.
Championing a fair transition
Our long-term strategy is to support a clean energy
transition that creates value for society and shareholders.
Guided by our Just Transition Strategy, we focus on good
jobs, community partnerships and investment-led economic
growth, taking a place-based approach that targets the
areas wherewe can make the biggest difference.
Our progress
Over 2025/26, we continued to
sharevalue with the communities we
work in, contributing an estimated
£10.84bn to UK and Ireland GDP
anddelivering a record year for
ourcommunity investment funds.
Supporting our commitment to
creating a safe and secure workplace
we strengthened human rights
standards across our workforce
andsupply chain, and saw a further
4,500 employees and contract
partners complete our immersive
safety training.
0.17
Total recordable injury rate
(employees and contractors
combined)/100,000 hours worked
(2024/25: 0.16)
£10.84bn 
Contribution to UK and Ireland
GDP² (2024/25: £8.68bn)
£24.9m
Awarded through our community
investment funds (2024/25: £16.3m)
Beyond our direct workforce, we invest in
research with skills bodies and other groups
to understand how workforce needs are
evolving. Across SSEN Transmission and
SSEN Distribution, we are also working with
supply chain and industry partners to assess
workforce requirements and improve the
availability of sector-wide skills data.
49
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Championing fair working conditions
We are committed to fair pay and tackling
in-work poverty, paying a Living Wage in the
UK and Ireland. In the UK, we are real Living
Wage, Living Hours and Living Pension
accredited and have begun rolling the Living
Wage out in our supply chain inIreland.
We are engaging with UK suppliers in
higher-risk categories, including catering,
cleaning and security, to discuss introducing
a Living Hours clause. We also continue
tosupport the Living Wage Foundation
andsit on a number of their forums and
leadership groups.
Respecting human rights
In 2025/26, we updated our Human Rights
Strategy to strengthen alignment with the
UN Guiding Principles on Business and
Human Rights and ensure our commitments
remain long term and forward looking.
A new action plan for 2026/27 focuses on
identifying and managing human rights risks
across our operations and supply chain,
with closer alignment to UK Transparency
inSupply Chains guidance.
During the year, we delivered targeted
human rights training to procurement
colleagues and quality auditors, helping
them identify potential risks during supplier
and site visits. This training will continue
andexpand to vessel-related roles.
We also launched a Human Rights Incident
Procedure, setting out how we investigate,
remediate and report impacts, with a clear
focus on victim-centred remediation.
Further detail is available in our Human
Rights Report and Modern Slavery
Statement at sse.com
.
Engaging with employees
Learnings from our all-employee survey
Our annual employee engagement survey
provides important insights into employee
sentiment and the health of our culture,
gathering employee views on a range of
topics including inclusion, safety, strategy,
ethics and trust in senior leaders.
The 2025 survey saw a strong response
rate,with 85% of employees sharing their
views. Feedback showed positive views
towards our safety culture, wellbeing
andflexible working. The results also
highlighted the impact of organisational
change during the year, as we progressed
the Group Operating Model and Efficiency
Review. While participation was high, the
sustainable engagement index fell to 78%
(2024: 86%) and we saw a relative decline
across all scores compared to last year,
withemployees citing uncertainty caused
by efficiency measures as a key concern.
We are using the insights from the survey
toinform targeted action plans to
strengthen engagement and enhance the
employee experience.
Fostering a performance-led culture
A healthy corporate culture is one that gives
equal weight to doing the right thing and
delivery of business objectives that create
both commercial and social value.
Over the course of 2025/26 there was an
increased focus on enhancing our culture
toensure it aligns with our strategy, reflects
our operating environment and supports
the delivery of our ambitious growth plans.
As part of this we have updated the way we
describe our purpose (to be restless every
day until we make electricity clean, affordable
and available for all”) and refined our values.
We have also begun a Group-wide
programme to give managers and
employees greater clarity about the
accountability, ambition, honesty and
commerciality behaviours expected of
them, and to reinforce the guiding role
thatour fundamental values of Safety
andSustainability have in a more
performance-led culture.
Working with employeerepresentatives
Everyone at SSE has the right to freedom of
association and to join a trade union. We
work with our four recognised trade union
partners through the Joint Negotiating
andConsultative Committee (JNCC) and
through ongoing collaboration in other
forums. In 2025/26, 48.5% of our direct
workforce in the UK and Ireland was
covered by collective bargaining
agreements (2024/25: 46.4%).
During 2025/26, we worked with the JNCC
and sub-forums to support engagement
onefficiency-related restructures,
includingextended collective consultation
with more than 1,200 employees. As part
ofthese restructures, we appointed over
700 potentially affected employees into
roles within the new structures, or
redeployed them into alternative roles,
retaining valuable skills across the Group.
Whereemployees left due to redundancy,
we were able to accommodate most
preferences and requests, resulting in
morethan 90% ofredundancies made
onavoluntarybasis.
Building an inclusive team
Our approach to inclusion and diversity
Our Inclusion and Diversity Strategy IN, ON,
UP drives change – bringing talent into SSE,
building a culture where people choose to
stay and ensuring fair progression.
Creating good jobs:
Highlights in 2025/26
Total SSE headcount at 31 March¹
15,197 
(2024/25: 15,819)
35%
(2024/25: 34%)
of SSE new joiners have transitioned
from high- to low-carbon roles
88,350
(2024/25: 67,190)
Jobs supported across the UK
andIreland
2
Developing our people
96.3%
(2024/25: 96.3%)
of employees received training
ordevelopment
£36.9m
(2024/25: £41.0m)
invested by SSE in training and
development
23.2
(2024/25: 27.5)
average number of full-time
equivalent employee training hours
Sustainability continued
The four pillars of our Inclusion
and Diversity Strategy:
Ambition
Setting measurable goals
Setting ambitions and KPIs, and
using external benchmarking
Inclusive processes
Embedding best practice
Ensuring policies and
processes are inclusive to
support everyone
Education and
development
Focusing on behaviours
Building leadership confidence
and raising awareness for all to
create an inclusive workplace
Employee voice
Actively listening
Understanding what matters to
employees to inform and shape
the improvements needed
1 SSE’s 2025/26 safety data and total headcount
includes Enerveo Ltd. SSE’s headcount excluding
Enerveo Ltd is 14,722 (2024/25: 14,880). All other data
in this section, including prior year comparators and
proportions of total headcount, excludes Enerveo Ltd.
2 Direct, indirect and induced Gross Value Added and
full-time equivalent jobs supported, from third-party
economic impact assessment. Find the full analysis
and methodology at sse.com/sustainability
.
50
SSE plc Annual Report 2026

Table 1: Workforce diversity ambitions and progress drivers
Women Ethnic minority LGBTQIA+ Disability
2030 Ambitions
33% 15% 8% 16%
2
Performance¹ 31 March 2026: 31.4%
31 March 2025: 31.6%
31 March 2026: 11.4%
31 March 2025: 11.2%
31 March 2026: 4.2%
31 March 2025: 4.3%
31 March 2026: 15.6%
31 March 2025: 14.5%
Key initiatives
and outcomes
for 2025/26
(by ambition)
Hiring for difference:
Continued to embed
Leadership Group gender
hiring KPIs to ensure
fairness in recruitment.
In2025/26 64% of roles
used diverse shortlists,
94% used diverse panels
and 89% of job adverts
promoted flexible working
(69%, 90% and 86% in
2024/25).
Building faith inclusion:
Launched a faith-focused
plan, created a Ramadan
Support Guide and hosted
an Iftar with cross-faith
and senior leadership
involvement.
Creating safe listening
spaces:
Launched closed forums
through the LGBTQIA+
Belonging Community,
creating safe listening
spaces.
Improving accessibility:
Refreshed Disability,
Neurodiversity and
Chronic Health e-cards,
making it easier for
employees to share
adjustments and
supportneeds.
Future actions/
priorities
(by ambition)
Integrate gender-related
safety considerations into
travel, lone working and
offshore working
guidance for employees.
Continue to equip leaders
with the knowledge and
skills to lead effectively
and inclusively.
Expand partnerships with
local LGBTQIA+ social
enterprises, ensuring our
work represents the
communities we are
partof.
Roll out an Individual
Support Plan framework,
to support discussions
around necessary
adjustments; set up an
independent panel to
review adjustments.
Key initiatives
andoutcomes
2025/26 (across
all ambitions)
– Refreshed Belonging in SSE Community action plans; set out priorities and
measurable outcomes, identifying cross-cutting and intersectional actions
for2026/27.
– Delivered range of allyship initiatives to all employees across the Group.
– Embedded inclusive decision making into the leadership programme
‘Leading Leaders’.
– Launched the Career Aspirations Framework to strengthen career
conversations, empowering employees to take greater ownership of their
progression.
Future actions /
priorities (across
all ambitions)
– Deliver on Belonging in SSE Community action plans and our strategic
Inclusion and Diversity priorities.
– Improve accessible facilities, including quiet rooms, rest areas and PPE.
– Prepare for upcoming employment law developments.
– Strengthen leadership accountability for inclusive behaviours and outcomes.
1 Data is collected on SSE’s HR data reporting system. Gender information is captured from legal documentation at employee onboarding and recorded in SSE’s HR data
system, which maintains a 100% completion rate. Ininstances where employees transitioned after joining, the gender field on the HR data system is changed upon receipt
ofa formal employee request. Wider diversity data is based on an overall employee diversity disclosure rate of 2025/26: 77.5% and 2024/25: 76.7%.
2 Our disability ambition has been increased from 8% in previous years.
Key: Alignment to our Inclusion and Diversity Strategy pillars
All of the activities listed in the table support progress towards our inclusion and diversity ambitions. The icons signpost how the
activities align with the three other pillars of our Inclusion and Diversity Strategy.
Employee voice
Active listening
Inclusive processes
Embedding best
practice
Education and
development
Focusing on behaviours
Ambition
Setting measurable
goals
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Strategic Report Governance Financial Statements

Sustainability continued
Inclusion and diversity are embedded in
ourpurpose and strategy, including our
2030 Goal to champion a fair and just
energy transition. They are reflected
throughout the talent life cycle at SSE,
inemployee engagement, leadership
expectations and decision making.
As we navigate a changing external
environment in a sector shaped by historical
underrepresentation, this commitment
remains resolute. We will continue to take
action to widen access and strengthen
capability, helping to address thecontinued
challenges that the energy sector has in
attracting diverse candidates.
Progress against workforce inclusion
and diversity ambitions
SSE’s all-workforce diversity ambitions
enable us to monitor workforce composition
across a broad range of metrics. As shown
in Table 1, representation remained broadly
stable across all groups measured in 2025/26.
While representation has improved
consistently across all groups in recent
years, this year’s more varied data reflects
less overall recruitment, a higher
proportionof internal appointments,
andincreased turnover.
Following a period of sustained growth,
total hires fell from 3,315 in 2024/25 to
2,953 in 2025/26. Over the same period, the
proportion of internal recruitment increased
from 31% to 43%, largely reflecting internal
mobility linked to efficiency related
organisational restructures. This enabled
over 700 potentially affected employees to
move into new roles and helped us to retain
valuable skills. However, it also reduced
opportunities to bring in new, diverse talent.
In addition, while voluntary turnover
remained broadly stable at 5.7% (5.2% in
2024/25), overall turnover increased from
8.9% in 2024/25 to 12% in 2025/26, mostly
due to the organisational restructures.
Raising the bar on disability
Disability representation increased
from 14.5% in 2024/25 to 15.6% in
2025/26, surpassing our original 2030
target of 8%. To reflect this progress
we have reset our ambition to 16%,
guided by external benchmarking
andan Inclusion and Diversity
maturity assessment.
At 31 March 2026, women represented
31.6% of our workforce. During 2025/26,
32.4% of leavers and 29.5% of joiners were
women. As a result, the proportion of
women in our workforce held steady at
31.4% at 31 March 2026.
Looking ahead, we continue to drive
progress by embedding inclusive behaviours
across core business activities through the
Table 2: Progress against SSE’s senior leadership diversity ambitions
Diversity category Ambition Ambition year 31 March 2026 31 March 2025
Proportion of women represented on:
Board Group 50% with
no less
than 40%
Ongoing 45.5%
(6 men/
5women)
46.2%
(7 men/
6women)
Group Executive
Committee (GEC)
1
– – 25.0%
(9 men/
3women)
9.1%
(10 men/
1woman)
GEC and direct reports
(excl. administrative roles)
2
40% Ongoing
(previously
2025)
40.9%
(55 men/
38women)
38.6%
(51 men/
32women)
Leadership Group
3
40% 2030 27.3%
(a)
(1,033 men/
388women)
27.7%
(b)
(1,002 men/
383 women)
Proportion of ethnic minorities represented on:
GEC and direct reports (UK
only, excl. administrative
roles) 6% 2027 3.6% 2.4%
1 The GEC comprises all Committee members and the Committee secretary. As at 27 May 2026,
representation of women on the GEC is 23.1% following the appointment of Thomas Brostrøm as Managing
Director for Business Development on 1 April 2026.
2 In line with FTSE Women Leaders Review recommendations, SSE’s ambition for this cohort includes direct
reports, not GEC only.
3 Employees in SSE’s senior level pay grades.
(a) This data is subject to external independent limited assurance by Ernst & Young LLP (‘EY’). For theresults of
that assurance, see EY’s assurance report and SSE’s Sustainability Reporting Criteria 2026 on
sse.com/sustainability
.
(b) This data was subject to external independent limited assurance by Ernst & Young LLP (‘EY’). For theresults
of that assurance, see EY’s assurance report and SSE’s Sustainability Reporting Criteria 2025 on
sse.com/sustainability
.
3 SSE’s eight Belonging Communities are: Ethnicity and culture, Gender balance, Working families, LGBTQIA+,
Menopause, Armed forces, Disability, neurodiversity and chronic health, and Health and wellbeing. Overall
membership at 31 March 2026 was 4,842 (204/25: 4,450).
delivery of policies, intersectional action
plans, and continuous improvements
aligned to the four pillars of our Inclusion
and Diversity Strategy.
Through our eight Belonging in SSE
communities, we listen to and engage with
employees on a range of diversity issues
3
.
We remain focused on increased diversity
disclosure to help us better understand
representation across our workforce.
Table 1 shows our performance against
workforce ambitions, examples of key
initiatives and outcomes delivered over the
year, alongside priorities for 2026/27. Read
more about our inclusion and diversity
initiatives at sse.com/inclusion
.
Senior leadership inclusion and diversity
Performance against stretching diversity
ambitions for senior leadership, aligned
withbest practice, is outlined in Table 2.
Over 2025/26, the proportion of women
inthe GEC and GEC and direct reports
cohorts increased from 9.1% to 25.0% and
from 38.6% to 40.9% respectively.
The proportion of women on the Board
reduced from 46.2% to 45.5%, reflecting the
departure of Helen Mahy and Alistair
Phillips-Davies at the Annual General
Meeting in July 2025. Their respective roles
ofSenior Independent Director and Chief
Executive were filled by existing Board
members.
Turnover in the Leadership Group,
influenced by the efficiency review,
contributed to a marginal reduction in
therepresentation of women from 27.7%
to27.3% in 2025/26. We recognise that
progress at this level is not always linear and
we remain focused on inclusive, accessible
recruitment and succession planning to
build a diverse leadership pipeline.
Aligned with the Parker Review, SSE’s
ambition is to reach 6% ethnic minority
representation for GEC and direct
reportsby 2027. At 31 March 2026,
representation was 3.6% (2024/25: 2.4%).
Details on Board and GEC membership
changes, senior leadership targets, and
theNomination Committee’s priorities
areprovided on pages 98 to 101
.
Our pay gaps
In 2025/26, our median gender pay gap
remained broadly stable at 11.9% (11.5%
in2024/25). This follows a reduction from
18% in 2022, reflecting sustained action to
improve gender balance, particularly at
senior levels.
Our 2025/26 UK gender and ethnicity
paygaps are reported in full at sse.com/
inclusion
. Wewill publish our Ireland
Gender Pay Gap Report 2026 later
intheyear, in line with theIrish
Governmentrequirements.
52
SSE plc Annual Report 2026

Empowering communities
We work with communities to build local
capacity and create long-term social and
economic value in the areas where we
operate. Alongside our community
investment funds, we use our experience
and scale to advocate for better policy
andpractice across the energy sector.
Building a housinglegacy
In 2024/25, SSEN Transmission committed
to support the delivery of more than 1,000
new homes across the north of Scotland.
These homes will accommodate our
workforce and the majority will become
affordable and social housing. During
2025/26, agreements were signed for nearly
100 homes in the Western Isles, 47 in Angus
and almost 300 across Aberdeenshire, the
Highlands and Moray. We also announced
apartnership with Highland Council
torefurbish 18 vacant properties in Wick
into energy-efficient homes.
Delivering impact through
communityinvestment
Our community investment funds have
operated for nearly three decades and
nowsupport over 300 communities across
the UK and Ireland. Total community
investment increased from £16.3m in
2024/25 to £24.9m in 2025/26, largely
driven by the first awards from the new
Generation Green and Yellow River funds
inIreland, alongside significant growth
inestablished funds such as the Viking
Community Fund. This exceeds the
ambition of awarding £10m per year set
in2024. From 2026, we are doubling that
ambition to at least £20m a year to reflect
the scale of growth in our programme.
Across the Group, our funds supported a
wide range of local priorities, including
climate resilience, clean energy transition
and education.
Supporting communities through
advocacy and capacity building
We use our knowledge and scale to
influence policy on community benefit,
working with UK and Scottish Governments
to help support clearer national guidance,
community-led decision making and
investment in capacity building.
We see community capacity and wealth
building as essential to a fair transition.
Capacity building strengthens
governanceand supports more inclusive
decision making, ensuring long-term social
and economic benefit to communities.
Initiatives this year included a networking
event for 24 south of Scotland communities,
peer learning for 15 community development
agencies and a community wealth building
collaboration in South Lanarkshire. Through
our funds, we also supported 214 new or
retained community jobs, including seven
apprenticeship schemes.
Members of the SSEN Transmission team and officials at a housing project on Lewis
Leading the way on the
Highland Social Value
Charter
In November 2025, SSEN
Transmission became the first
company to sign the Highland
SocialValue Charter. Through
thiscommitment, and subject
toplanning consent, our £22bn
investment programme will deliver
key social benefits for Highland
communities. These include £1.8bn
of contracts for local businesses,
£200m of spending on roads and
bridges, and support for 500
permanent homes.
Our commitment to the Charter
supports our place-based approach
to a fair transition, helping ensure
that the Highlands share in the
opportunities the energy
transitionbrings.
£1.8bn
of contracts for local
businesses through the
Highland SocialValue Charter
SSE’s community investment
fund awards in2025/26
Total awarded through SSE’s
community investment funds
£24.9m
4
SSE Renewables
£17.1m
SSEN Transmission
£3.0m
SSEN Distribution
£0.7m
SSE Airtricity
£4.0m
SSE Thermal
£0.1m
4 A narrower definition of community investment has been externally assured for the purposes of sustainable
finance. In 2025/26, SSE awarded £20.8m
(a)
through its voluntary community investment funds. This excludes
community investment funds required by regulation or in SSE’s regulated businesses.
(a) This data is subject to external independent limited assurance by Ernst & Young LLP (‘EY’). Fortheresults of
that assurance, see EY’s assurance report and SSE’s Sustainability Reporting Criteria 2026 onsse.com/
sustainability
.
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Protecting our
naturalenvironment
The scale of our activities means we interact with the
environment in many ways, often in remote and precious
habitats. We work to minimise our impacts, ensuring that
weuse resources responsibly and support the restoration
ofnature around our operations.
Our approach to environment
We actively manage our environmental
footprint, aiming to mitigate any negative
environmental consequences arising from
our activities and to ultimately have a
positive overall impact.
This means protecting and restoring the
natural environment and ensuring we use
resourcesresponsibly and sustainably.
Collaboration is central to our approach –
wework with regulators, research
organisations, local communities and
othersto manage impacts responsibly
andstrengthen evidence-based decision
making across ouractivities.
This approach is embedded across our
operations and supported by clear
governance, standards and performance
monitoring, andunderpinned by nature-
related targets designed to protect
biodiversity and nativewoodland.
Our progress
During the year we continued to
strengthen our approach, expanding
restoration activity, deepening
partnerships and improving how we
measure nature-related outcomes.
Allin-scope projects met our
ambition of having biodiversity net
gain incorporated into design. We saw
aslight increase in the number of
environmental incidents, which we
continue to monitor as we note
increasing levels of activity to deliver
our investment programme.
28
All in scope projects have designed
in biodiversity net gain
2.32 million m
3
Total water consumed
(2024/25: 2.51* million m
3
)
Peatland restoration
atStrathy South
Alongside the 1,132ha of peatland
restoration SSE Renewables has
committed to deliver within the
boundary of Strathy South wind farm,
it is also supporting offsite peatland
restoration to deliver wider landscape
benefits. This includes funding 160ha
of peatland restoration at Armadale
Farm which borders the wind
farmsite.
Armadale Farm is a 2,290ha
traditional hill farm in Sutherland
which has a lot of damaged peatland,
including up to 210km of hill drains.
The support from SSE Renewables
has contributed to the farm’s work to
restore around half of its peatland.
Restoration activity has focused
onre-wetting degraded peat and
blocking historic drainage ditches
torestore natural hydrology across
extensive areas of the farm.
This hasstabilised water table
heights, improved habitat quality
andsupported land management
practices that are more resilient
overthe long term.
By investing in peatland restoration
beyond the project footprint, SSE
Renewables is supporting habitat
recovery at scale and strengthening
relationships with local communities,
demonstrating how infrastructure
delivery can contribute to wider
nature recovery across the landscape.
We are funding
160ha
of peatland restoration
beyond the boundary of
Strathy South wind farm
SSE Renewables is supporting peatland restoration on Armadale Farm
Sustainability continued
Targeting biodiversity net gain
This year marks the first active year of our
Group biodiversity net gain target. Our
target is for all in-scope, onshore large
capital projects in the UK and Ireland,
consented from April 2025, to incorporate
‘net gain’ in biodiversity into design.
Over2025/26, all 28 in-scope projects
achieved this.
You can find more information on our
nature-related targets in our Sustainability
Report 2026 at sse.com/sustainability
.
54
SSE plc Annual Report 2026

Managing environmental impact
To reduce our impact, we monitor and
manage environmental performance
acrossemissions to air, water use and
environmental incidents. This section
outlines our performance in these areas,
with further detail available in our
Sustainability Report 2026, which can
befound at sse.com/sustainability
.
Water use
Water is an essential resource for our
operations, particularly as a source for
power generation in hydroelectric plant
andas a coolant in thermal power stations.
As a shared resource, water must be
usedresponsibly and sustainably for
ourbusiness, local communities and
ecosystems. None of our generation
assetsare located in water-stressed areas
1
.
Figure 6: Water performance
(in million cubic metres)
Total water abstracted
Total water returned
Total water consumed
2025/26
2024/25
2.51
*
22,793
(b)
22,795
(b)
2.32
(a)
22,148
(a)
22,150
(a)
In 2025/26, our total water abstraction
slightly reduced to 22,150 million m³,
compared to 22,795 million m³ in 2024/25.
The vast majority, 98%, of the water we
abstracted in the past year was used in
ourhydro generation operations.
The volume of water passing through
ourhydro plants fell by 3% compared
totheprevious year. Although this water
istechnically recorded as abstracted,
itischannelled through turbines to
generateelectricity andis returned to
theenvironment almostimmediately,
resultingin minimal environmental impact.
Excluding hydro operations, our total water
abstraction decreased by 7%. This was
driven by a drop in water abstracted for
electricity generation from our thermal
assets to 505 million m³ (2024/25: 545
million m³). Total water consumption
remained stable year-on-year.
Our Peterhead power station in Scotland
isone of the main contributors to water
abstraction from our thermal assets due
toits ‘once through’ cooling system.
Areduction in output of around 23% from
Peterhead, compared to 2024/25, was a
significant driver in the downward trend
forwater abstraction.
Air emissions
Our operations result in emissions to air,
including nitrogen oxides (NO
x
) and
sulphuroxides (SO
x
), which are by-products
of thermal generation, and sulphur
hexafluoride (SF₆), which is vital for
electricalinsulation and safety but is a
potent greenhouse gas.
Figure 7: Air emissions
performance
(in tonnes)
Sulphur dioxide
Nitrogen oxides
2025/26
2024/25
3,299
(b)
303
(b)
3,725
(a)
420
(a)
Our diesel-fired Lerwick power station on
Shetland, accounts for the majority of our
NO
x
and SO₂ emissions. In 2025/26, we saw
an increase in these emissions, driven by
several factors, including a 31% increase
inoutput from Lerwick compared to the
previous year.
Figure 8: SF₆ emissions
performance
(in kgs)
Sulphur hexafluoride
2025/26
2024/25
281
(b)
244
(a)
Sulphur hexafluoride (SF₆) is a highly potent
greenhouse gas which is widely used in the
electrical industry due to its outstanding
insulating and interruption properties. In
2025/26, our reported SF₆ emissions fell to
244kg, down from 281kg in 2024/25.
Within SSEN Distribution, we achieved a 14%
reduction in SF₆ leakage volumes compared
to the prior year, and SSE Thermal recorded
justone SF₆ leakage incident in 2025/26,
resulting in a substantial decrease versus
theprevious year.
After having its best year to date in
managing SF₆ in 2024/25, SSEN
Transmission’s leakage volumes remained
steady last year. Notably, the first leakage
incident at a site using an SF₆ alternative
occurred during 2025/26, which led to
asignificant emissions saving when
compared to what would have occurred
ifthe leak had involved SF₆.
In previous years, SSE disclosed data for
particulate matter (PM10) and mercury
emissions from thermal generation plant,
above a de-minimis threshold of 10 tonnes
and 1kg respectively. In 2025/26, no plant
produced emissions above those thresholds,
and therefore were considered immaterial
in terms of impact.
Environmental incidents
While we work to reduce the risk of
environmental incidents, they can still
occur. When they do, we act promptly to
contain impacts, investigate causes and put
measures in place to prevent recurrence,
working constructively with environmental
regulators where needed.
In 2025/26 we had 15 permit breaches up
from nine the previous year. We recorded
atotal of 102 environmental incidents
compared to 115 the previous year. This
consisted of one major, 29 serious and
72minor incidents (2024/25: 0, 27 and
88respectively). 
We remain focused on reducing
environmental incidents, particularly as
activity increases in line with our investment
plan. Overthe past year we improved
environmental guidance and governance
controls across our contracts and have
developed enhanced environmental
trainingfor roll out over 2026/27.
1 As defined by the relevant environmental regulators in the jurisdictions where SSE’s assets are located.
(a) This data is subject to external independent limited assurance by Ernst & Young LLP (‘EY’). For the results of that assurance, see EY’s assurance
report and SSE’s Sustainability Reporting Criteria 2026 on sse.com/sustainability
.
(b) This data is subject to external independent limited assurance by Ernst & Young LLP (‘EY’). For the results of that assurance, see EY’s assurance
report and SSE’s Sustainability Reporting Criteria 2025 on sse.com/sustainability
.
* The 2024/25 data for the ‘Total water consumed’ metric has been restated by 0.14 million m³, for further details see SSE’s Sustainability Reporting
Criteria 2026 on sse.com/sustainability.
55
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Risk
Introduction to risk 57
How we manage risk 58
Group Principal Risks 59
Jonathan Marshall, Construction Manager
SSEN Transmission, Perth, Scotland
“Thanks to SSE I’ve been able to
transition from a 13-year career in
agriculture into my current role of
helping to build the grid of the future in
the north of Scotland. I’m delighted to
be able to bring across my transferable
skills and develop new ones as we
undertake the important work of
delivering the clean energy transition.”
People Powering SSE
56
SSE plc Annual Report 2026

Managing risk in a
fast-paced environment
Through our diversified business mix that spans the clean energy value chain,
SSE is well placed to navigate the complexity of the energy market.
We acknowledge the importance of
supporting consumers in managing the
effects of current market conditions in
theshort term. Accordingly, we actively
collaborate with regulators and legislators
to address these challenges—particularly
inregions where we supply energy to
households in Ireland and to business
customers across both the UK and Ireland.
Cyber defence
Cyber Security and Resilience remains
oneof our most material risk exposures,
driven in part by the continued increase in
geopolitical volatility. Over the past year,
several high-profile cyber incidents
affecting major UK companies reiterated
theimportance of sustaining robust focus
on our control environment.
We have increased investment in our
security improvement programmes and
implemented initiatives to strengthen our
technology maturity and supply chain risk
management. In addition, a programme
ofincreased proactive testing of business
continuity anddisaster recovery plans
commenced, offering further valuable
insights into the resilience of our most
critical systems.
Understanding emerging risks and
opportunities
A key priority for us is to continue to
monitor both the risks and opportunities
that the use of AI brings. Recent studies
indicate that young adults consider the
future impact of AI when career planning.
This shift provides an opportunity for us to
continue to offer purpose-driven career
pathways that align with our £33bn
investment plan. It also helps us address
therisk of not attracting, developing, or
retaining the necessary talent and skills
needed to achieve this. We also recognise
the opportunities that AI provides, such
asincreased process automation and
monitoring through improved data
driveninsights.
Remaining prepared and adaptable to
upcoming technological advances,
especially those involving AI, must also
remain central in our ongoing risk
management discussions. For more details
on how AI is currently being deployed
across the Group please see page 89
.
A dynamic risk management framework
that supports efficient decision making
andallows us to keep pace with shifts
inthesector and operating environment
isessential. At the core of our risk
management approach is a strong culture.
Everyone is responsible for managing risk
and are empowered to make considered
decisions when realising opportunities or
minimising risk exposures. For more about
SSE’s risk management framework,
seepages 58 to 59
.
Assessing Principal Risks
The operating environment has remained
volatile with a number of challenges
continuing to influence the markets in
which we operate. For more details about
this, see the Energy Market Review on
pages4 to 5 .
In response to the current conflict in the
Middle East and to ensure all relevant risk
considerations were made, an additional
assessment of the Principal Risks was
carried out by the Group Risk Committee
and approved by the Board ahead of
publication of this report.
As stated in our Chair’s Statement on
pages8 to 9
while the immediate impacts
on the Group are limited these have been
incorporated into the key developments of
the following Group Principal Risks: Cyber
Security and Resilience, Energy Affordability,
Portfolio Exposure, Political and Regulatory
Change and Supply Chain. Consideration
was also given to our preparedness to
manage these factors. The Group Executive
Committee and key risk sponsors consider
the materiality of all but one of the Principal
Risks to have remained stable (please see
page 59
for further details).
Decarbonisation and energy
independence
Although net zero sentiment has become
increasingly fragmented politically, both
within the UK and internationally, our
long-term strategy remains closely aligned
with the direction established by the UK
Government and its Clean Power 2030 Plan.
Recent geopolitical events, including the
conflict in the Middle East and the ongoing
war in Ukraine, have resulted in significant
disruptions to the energy market, creating
broader economic and inflationary
pressures on consumers. At SSE, we remain
committed to facilitating the transition to
acleaner, more secure, and affordable
energy system.
Introduction to risk
The pace of the energy transition was also a
factor considered as part of the longer-term
future risk discussions. SSE continues
tomonitor long-term energy demand
profilesso it can adapt to future market
opportunities. No new emerging Principal
Risks have been identified this year.
“In a dynamic and ever-
changing world the ability
to makes decisions with
full awareness of the risks
and opportunities, while
acting at pace, is integral
to SSE’s risk culture.”
Barry O’Regan
Chief Financial Officer
and Chair ofGroup Risk Committee
Risk in action
Following the outbreak of the
conflictin the Middle East, we have
continuously assessed potential
impacts to our strategy and
operations. Highlighting the dynamic
nature of our risk management
framework, an additional assessment
of the Group Principal Risks was
completed by the Group Risk
Committee and approved by the
Board in May.
57
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Strategic Report Governance Financial Statements

How we manage risk
At SSE, we strive to maintain a strong and dynamic risk culture that mitigates risk,
and fosters sound, commercial decision making when taking opportunities.
Our enterprise risk management framework
gives Business Units the ability to manage
risk exposures against their strategic
objectives and operations while also
enabling us to maintain a holistic view of
the Group risk profile. The risk management
framework is part of SSE’s system of internal
control (for more details, see page 109 )
and sets the standard for how risks are
managed across the Group, providing a
consistent approach embedded across
Business Units and Corporate functions.
Following a four-stage risk management
process, we:
– Identify potential risks that could
threaten the Group and/or Business Unit
in achieving our objectives.
– Assess risks by analysing and evaluating
each one. The likelihood and impact of
the risk occurring are considered against
financial and non-financial criteria, both
before and after applying mitigations.
– Respond by deciding on the most
appropriate risk treatment plans,
makingsure the relevant processes and
controls are in place to manage the risks.
– Monitor the risks through ongoing
evaluations and frequent reporting
through the Group Governance
Framework. The table overleaf shows
inmore detail how this applies for the
Principal Risks.
Assessing Principal Risks
It’s vital that we continue to evolve our
riskmanagement framework. This year,
following a comprehensive update to the
process in 2024/25, we continued to
improve our methodology for assessing the
Principal Risks, focusing on more efficiently
enabling risk-based discussions across
theGovernance Framework and senior
management teams. Dedicated risk
workshops were carried out with newly
appointed key risk sponsors and one-to-
one stakeholder interviews conducted
withall members of the Group Executive
Committee and Subject Matter Experts
(SMEs).
While our Principal Risks have not changed,
this collaborative way of working has
continued to provide valuable input and
diversity of thought, and an improved,
holistic output. The Board-approved
outcome of the Principal Risk assessment
ison pages 60 to63
.
Identifying emerging risks
To maintain a dynamic risk profile, we
consider emerging risks continuously in
response to changes in the operating
environment or events that could affect SSE.
Teams consider emerging risks which have
the potential to become Principal Risks in
the medium to long term. Common themes
that emerge are presented as part of the
assessment of the Group Principal Risks.
Complementing this, regular horizon
scanning exercises enable a more forward-
looking view of risk trends and an
assessment of their potential impact, both
positive and negative, on SSE’s strategy.
While a number of emerging themes were
identified and assessed, no new emerging
Principal Risks were identified this year.
Climate-related assessment
A climate assessment, in line with the
TaskForce on Climate-related Financial
Disclosures (TCFD) framework, identifies
and assesses climate-related opportunities
and risks relevant to SSE. For details of
theprocess, see the table overleaf.
Thisyear, the assessment resulted in a
minor update to the material climate-
related opportunities and risks relevant
toSSE (see pages65 to72 ).
Maturing risk management
Embedding and maturing our enterprise risk
management framework remained a focus
during the year, with several improvements
introduced to support more dynamic
internal risk reporting and greater individual
accountability. Work to more clearly
articulate our risk appetite internally is
evolving through input from our Group
Governance Framework. This will further
enhance the maturity of managing risks
andopportunities.
Work to continue to prepare for compliance
with Provision 29 of the Corporate
Governance Code 2024, which came into
effect on April 1 2026, was also undertaken
during the course of the year. Full details on
how we have prepared for compliance with
Provision 29 can be found on page 108
.
Details of each Principal Risk and key
mitigations for this year are on pages 60
to63
.
Risk Appetite Statement
SSE’s risk appetite is aligned with
achieving the Group’s strategic objectives.
We will only accept risk where it can be
managed effectively, and where it’s well
understood and consistent with our
purpose, strategy and values. Risk should
also be in line with stakeholders’
expectations, as well as offering
commensurate reward.
The basis for setting our risk appetite
isthat we have:
– A clear strategy to create value for
shareholders and society in a
sustainable way. This consists of
developing, building, operating and
investing in electricity infrastructure
and businesses needed in the clean
energy transition.
– A good understanding of the risks and
opportunities in the Great Britain and
Ireland energy markets and, through
our acquisitions, extensive knowledge
of European and other international
markets. We scrutinise any opportunity
to expand into new markets to make
sure they are consistent with our
strategic goals and values.
– No appetite for risks that could
undermine safety and security –
including cyber security. In areas
where SSE is exposed to risks for
which we have little or no appetite,
thenature of these risks means even
the most effective controls and
mitigations would not eliminate
themcompletely.
Three principles guide the Board in
deciding its appetite for specific risks:
1. Risks should be consistent with SSE’s
core purpose, financial objectives,
strategy and values.
2. Risks are only acceptable where we
can achieve the right reward, based on
objective evidence, and in a way that is
consistent with SSE’s purpose, strategy
and values.
3. Risks should be controlled and
monitored by allocating the right
levelof management and other
resources and maintaining a healthy
business culture.
The Board sets the tone for determining
the nature and extent of the risk it is
willing to take to achieve strategic
objectives, and for making sure risks are
managed effectively across the Group.
58
SSE plc Annual Report 2026

Collaboration through risk workshops and interviews has
continued to strengthen the assessment of the Principal Risks.
Following an increase in materiality for
several Principal Risks last year, our risk
exposures have remained relatively stable.
Following the outbreak of conflict in the
Middle East, and to ensure all relevant risk
considerations were made, an additional
assessment of the Principal Risks was
carried out by the Group Risk Committee
and approved by the Board ahead of
publication. As set out in our Energy Market
Review on pages 4 to 5 while the
immediate impacts to the Group are limited,
these have been incorporated into the key
developments of the following Group
Principal Risks: Cyber Security and
Resilience, Energy Affordability, Portfolio
Exposure, Political and Regulatory Change
and Supply Chain.
As a result of this year’s assessment the risk
descriptions of four of the Principal Risks
– Energy Infrastructure Failure, Financial
Liabilities, Large Capital Projects
Management and Supply Chain – have been
updated to reflect a clearer articulation of
the current risk exposures to the Group.
Each risk has also been updated to reflect
key changes in the risk environment over
the course of the year that, while not
impacting the materiality of the exposures
to the Group, may require changes in how
these are managed or monitored.
Following this year’s assessment the
materiality of the Energy Affordability
Principal Risk has increased slightly, and the
Political and Regulatory Change Principal
Risk remains heightened, both impacted
bythe current conflict in the Middle East.
While our £33bn five-year capex plan
alignswell with the UK Government’s
commitment to the clean energy transition,
we acknowledge that broader political
sentiment towards net zero is becoming
increasingly fragmented. Energy
Affordability remains closely linked to this
risk and while consumers need protection
from fluctuating energy prices in the short
term, in the longer term accelerating
affordable, clean and reliable energy
willlikely remain akey concern for
governments and consumers.
For details of SSE’s Principal Risks including
the developments throughout this year that
have driven risk materiality, and their key
mitigations see pages 60 to63
.
Principal Risks:
1
Climate Change
2
Cyber Security and Resilience
3
Energy Affordability
4
Energy Infrastructure Failure
5
Financial Liabilities
6
Large Capital Projects Management
7
People and Culture
8
Political and Regulatory Change
9
Portfolio Exposure
10
Safety and the Environment
11
Speed of Change
12
Supply Chain
Group Principal Risks
Risk Management Process
Stage Principal Risk Assessment Climate-related risks and opportunities
Identify
We consider risks over three time horizons: 1, 3 and 10 years.
Bottom-up risk data from Business Units is combined with
top-down analysis from oversight forums which consider both
risks and opportunities. This analysis is then complemented by
relevant external information.
A specialist TCFD climate assessment identifies risks and opportunities
over the short (to 2035), medium (to 2050) and long term (to 2080). This
involves senior business leader interviews, Business Unit risk assessments
and a materiality test tocapture climate-related opportunities and risks.
Assess
For each Principal Risk, risk workshops and interviews provide
aforum to discuss the risk environment, ultimately informing
updated risk assessments for approval. The key risk sponsors
and SMEs provide commentary on:
– the adequacy of the risk description;
– contextual changes to the risks;
– whether the risks have increased or decreased in materiality
during the year; and
– the adequacy of the control environment.
The outputs of these risk discussions are then collated into
assessment reports and presented back to each oversight forum
for discussion and approval.
SSE assesses the climate impact on its operations over the:
– short and medium term from the perspective of market, policy or
regulatory transition opportunities and risks; and
– over the medium and long term from the perspective of the physical
risks of climate change.
Materiality is tested for each climate-related opportunity or risk, based
onits:
– ability to have a substantive potential financial impact on SSE’s
strategy; or
– its significant impact on SSE’s stakeholders.
Respond
Following completion of the assessment activities the oversight
forums confirm:
– the risk trend (more, less or equally material);
– overall effectiveness of the risk, control and monitoring
environment; and
– whether further actions are required to improve the control
environment.
The Group Executive Committee approves the assessments,
with final endorsement from the Board.
Critical controls are in place to manage risk including climate-related risk,
these include:
– business continuity plans;
– crisis management and incident response, large capital project
governance; and
– internal and external assurance.
The climate-related opportunities and risks (see pages 69 to 72
),
combined with SSE’s Sustainability Report 2026 and CDP Climate Change
response, provide further information on these actions and controls.
Monitor
Risks are reviewed quarterly within the Business Units and
Corporate Functions, with clear pathways in place for
escalation. The Group Risk Committee receive regular
bottom-up risk reporting information and frequently reviews
and monitors the Group Principal Risks, ensuring appropriate
actions are taken to manage changes in risk exposures.
Climate Change is a Group Principal Risk to SSE, and has the ability
toaffect the achievement of its strategic objectives andlong-term
success (see page 60
). Scenarios related to thephysical risks associated
with climate change form part of SSE’s viability assessment (see page 76
).
Climate-related key developments are also considered against all relevant
Group Principal Risks.
Reduced in materiality
Increased in materiality
Not changed significantly
Risk trend key:
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Reduced in materialityIncreased in materiality Not changed significantlyRisk trend key:
1
Climate Change
Developments this year
SSE remains well aligned to the UK Government’s
commitment to support the transition to clean energy,
therefore the risk exposure to the Group has not
changed materially over the course of the year.
Otherdevelopments include:
– Recognition that confidence in reaching the 1.5°C
target by 2050 is reducing.
– Increasingly fragmented political sentiment around
netzero.
– Increased intensity of named storms and extreme
weather events, risks causing damage to critical
national infrastructure.
– The UK experienced its warmest year on record
in2025.
– Delay in EU regulations (such as implementation
ofCSRD) creates reporting simplification for now.
– £33bn capex investment plan announced with 80%
networks and 20% renewables/flexibility focus.
– Successful AR7 results.
Key mitigations
– Leadership, governance and oversight
through multiple forums including
Safety, Sustainability, Health and
Environment Advisory Committee
(SSHEAC) and the Group Executive
Committee (GEC).
– Group Climate Change Policy and
Group Sustainability Policy.
– Monitoring of UN Sustainable
Development Goals (UNSDG) impacts.
– Lobbying and stakeholder
engagement.
– External reporting around compliance
with submissions such as sustainability
reporting and TCFD.
– Group Adaptation Steering Committee
and Business Unit adaptation plans.
– Large Capital Projects Framework.
The risk that SSE’s strategy is misaligned
to national and international
decarbonisation pathways and is
insufficiently resilient to a climate-
changed world.
Key risk sponsor: Chief Sustainability Officer
Residual likelihood: Medium
Residual impact: Medium
Risk trend:
2
Cyber Security
and Resilience
Developments this year
While there has been no increase in the materiality of
this risk, it remains a key focus for the Group, due to the
continued potential threat of a malicious cyber-attack.
Other developments include:
– Several high-profile cyber-attacks on UK companies
resulting in significant financial losses.
– Geopolitical volatility resulting in a continued
heightened threat level and an increased risk of
nation state attacks.
– Increased sophistication of social engineering and
vulnerability threats via the use of technologies such
as AI.
– Increased regulatory and reporting obligations.
– Continued investment in our security improvement
programme to strengthen the resilience of our systems.
– Ongoing modernisation of our IT estate.
– Improved collaboration between IT and Operational
Technology (OT) on cybersecurity risk management.
– The introduction of Zero Trust Network Access
technology.
Key mitigations
– Group Cyber Security Policy and
Group Data and Information
Management Policy.
– Incorporating key technology and
infrastructure risks into system
designs.
– Regular internal and third party testing
of IT and OT networks and systems.
– Continued strengthening and
embedding of the cyber risks and
controls framework to identify threats
and reduce exposures.
– Service level agreements for
business-critical IT services.
– Reviewing and testing business
continuity plans in response to
changes in the threat to the Group.
The risk that key infrastructure, networks
or core systems are compromised or are
otherwise rendered unavailable.
Key risk sponsor: Chief Information Officer
Residual likelihood: High
Residual impact: High
Risk trend:
3
Energy Affordability
Developments this year
There has been a slight increase in the materiality of this
risk during the year. While the energy price cap reduced
by 7% in April 2026, due to the conflict in the Middle
East and the subsequent impact on fuel prices, it is
likely that the overall costs to consumers will rise during
the year. Other developments include:
– The UK Government’s decision to retain a single
national GB-wide wholesale market.
– Continued pressure on consumers from high energy
costs and inflation rates.
– Ongoing geopolitical volatility, including the conflict
in the Middle East, impacting fuel costs and
increasing focus on ensuring energy security and
independence.
– The UK Government November 2025 Budget
confirmed plans to remove £150 from household
energy bills from April 2026.
– Consumer energy debt rose by 20% over 2025.
– Increase in the Electricity Generator Levy (EGL) from
45% to 55%.
Key mitigations
– Affordability schemes to support
financially vulnerable customers.
– Engaging with governments,
regulators, customers and relevant
counterparties.
– Regular review of aged debt and bad
debt management.
– Long-term price forecasting.
– Operational processes for pricing,
billing and collections.
– Adopting and implementing
government support mechanisms
across multiple jurisdictions.
The risk that energy customers’ ability
tomeet the costs of providing energy,
ortheir ability to access energy services,
is limited, giving rise to negative political
or regulatory intervention that has an
impact on SSE’s regulated networks
andenergy businesses.
Key risk sponsor: MD Corporate Affairs,
Regulation and Strategy
Residual likelihood: High
Residual impact: High
Risk trend:
Group Principal Risks continued
60
SSE plc Annual Report 2026

Reduced in materialityIncreased in materiality Not changed significantlyRisk trend key:
4
Energy
Infrastructure Failure
Developments this year
This risk has not materially changed this year, although
major incidents at Heathrow as well as in Spain and
Portugal, have prompted an expediated increase in
regulatory requirements. Other developments include:
– Continued volatile and extreme weather, including
wild fires, impacting assets and generation outputs.
– Further increased strategic investment, including
our£33bn investment plan, to ensure capacity
andresilience in the energy system.
– Geopolitical unrest leading to a continued
heightened physical and cyber security threat level
and supply chain challenges.
– Improved cyber security controls to further
strengthen resilience.
– Proactive, regular engagement with communities
during storm events and the planning and
development stages of major projects.
Key mitigations
– Asset management policies and
frameworks.
– Engineering Centres of Excellence
review and development of plans to
ensure the ongoing integrity of
generation assets including crisis
management and business continuity
plans.
– Proactive testing of business continuity
and resilience plans.
– Capital investment plans to ensure the
ongoing health and integrity of
network assets.
– Stakeholder engagement strategies.
– Dedicated cyber security programmes.
– Maintaining physical security of critical
national infrastructure and key assets.
The risk of critical energy infrastructure
failure, whether in respect of assets
owned by SSE or those owned by others
which SSE relies on, that prevents the
Group from meeting its obligations.
Key risk sponsors: MD Transmission, MD
Distribution, MD Renewables and MD Thermal
Residual likelihood: Medium
Residual impact: Medium
Risk trend:
5
Financial Liabilities
Developments this year
The risk remains stable with the execution of the
planned funding strategy to accommodate the new
£33bn investment plan. Other developments include:
– New capex plan with 80% Networks and 20%
Renewables/Flexibility focus.
– Continued positive engagement with funding
markets including the generation of £2bn of funding
from an equity placing (see our Financial Review for
further details).
– The Group Treasury Policy was enhanced with
improved monitoring of metrics and reporting.
– Continued volatility in gilt rates, impacting UK
borrowing costs.
– UK inflation rate rose to 3.3%.
– Operational improvements including greater
automation and IT system upgrades.
Key mitigations
– Financial management policies and
frameworks.
– Regular oversight and governance
through the Board and Committees.
– Committed borrowings and facilities
always available in line with policy.
– Approval of all material counterparty
credit limits is a matter reserved for
theBoard.
– Detailed and continuous financial
modelling and forecasting on a Group
and Business Unit basis.
The risk that funding is not available to
meet financial liabilities as these falldue
under normal and stressedconditions
without incurring unacceptable costs
orrisking damage to our reputation.
Key risk sponsor: Group Treasurer
Residual likelihood: Medium
Residual impact: Medium
Risk trend:
6
Large Capital Projects
Management
Developments this year
The materiality of this risk remains stable due to the
improved certainty in key future project pipelines
following the publication of critical regulatory
decisions. Other key developments include:
– Key strategic delivery partners appointed to deliver
the majority of planned transmission projects.
– RIIO-T3 determination issued by Ofgem and
successful AR7 results for Berwick Bank providing
regulatory certainty for project pipelines.
– Consenting secured for the majority of planned
transmission projects.
– The volume, size and complexity of large capital
projects continues to increase.
– Potential supply chain challenges resulting from
theconflict in the Middle East.
– Increased competition for capacity in key
supplychains.
– Northern European capacity mechanisms remain
unclear, resulting in delays to deployment.
– US decision not to deploy additional offshore wind
capacity for at least five years, opening up supply
chain availability in the UK and Europe.
Key mitigations
– Large Capital Projects Governance
Framework to govern, develop,
approve and execute major capital
investment projects consistently and
effectively.
– In-depth quality reviews by Large
Capital Projects quality and assurance
teams.
– Ongoing interaction with key suppliers
through SSE’s supplier relationship
management programme.
– SSE generally manages insurance
placement by organising owner-
controlled insurance for major
projects, allowing greater control over,
and flexibility of, the provisions in
place.
– Appropriate governance
arrangements, including those for joint
venture (JV) and partner management.
The risk that SSE develops and builds
major assets that do not realise intended
benefits or meet the quality standards
required to support the Group’s
Transformation for Growth objectives
within forecast timescales and budgets.
Key risk sponsors: MD Transmission, MD
Distribution, MD Renewables and MD Thermal
Residual likelihood: High
Residual impact: High
Risk trend:
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7
People and Culture
Developments this year
The materiality of the risk remains unchanged as the
Group continues to implement an organisational
strategic change. Other developments include:
– Executive leadership changes including new Chief
Executive, Chief Sustainability Officer and Chief
Information Officer.
– Group Operating model review successfully
implemented 2025/26 efficiency savings.
– All-employee survey participation was high in
2025/26, with a relative decline across scores versus
internal benchmarks due to the uncertainty caused
by the efficiency review.
– Continued strengthening of our approach to
employee engagement, for further details please
seepages91 to 92
– Changes in UK policy around security clearance
andimmigration.
– Technological changes, such as the ongoing
introduction of AI within SSE, and the impacts on
ways of working.
– Continued focus on ensuring onboarding of new
recruits is consistent with cultural expectations.
Key mitigations
– Employment Policy and
Whistleblowing Policy.
– Inclusion and Diversity plan,
seepages50 to 52
.
– SSE governance arrangements,
including those relating to JV and
partner management.
– Our employee guide to good business
ethics, ‘Doing the right thing’.
– Internal mechanisms, including our
independent Speak Up service, for
employees to report wrongdoing.
– Regular succession planning reviews
by our business leaders.
– Continued development of our
approach to managing talent.
– Performance Edge is our approach
tosupporting employees to develop
their careers and manage their
performance.
The risk that SSE is unable to attract,
develop and retain an appropriately
skilled, diverse and responsible
workforce to deliver strategic objectives,
and maintain a healthy business culture
which encourages and supports doing
the right thing.
Key risk sponsor: Director of HR
Residual likelihood: Medium
Residual impact: Medium
Risk trend:
8
Political and
Regulatory Change
Developments this year
The risk exposure remains elevated given the continued
fragmentation of the political environment in the UK
and internationally. This is compounded by ongoing
geopolitical conflicts, including in the Middle East.
Other developments include:
– RIIO-T3 determination issued by Ofgem and
successful AR7 results for Berwick Bank providing
regulatory certainty for project pipelines.
– Although net zero sentiment has become
increasingly fragmented politically, our long-term
strategy remains closely aligned with the direction
established by the UK Government’s Clean Power
2030 Plan.
– Alignment with measures introduced by the National
System Operator (NESO) to reduce the backlog of
projects seeking connections.
– Recent UK Government proposals to introduce
voluntary Wholesale CfDs.
– Increase in the EGL from 45% to 55%.
Key mitigations
– Political and Regulatory Engagement
Policy.
– Advice, guidance and assurance for
business areas from Corporate Affairs,
Regulation and Legal teams on
interpreting political, regulatory and
legislative change.
– Engagement with regulators,
politicians, officials and other
stakeholders, led by the Corporate
Affairs and Regulation teams. For
details of SSE’s Stakeholder
Engagement, see pages10 to 11
.
– SSE Governance arrangements
including regular engagement with
theBoard and Group Executive
Committee on political and regulatory
developments which may affect our
operations or strategy.
– Change management processes to
manage all aspects of significant
regulatory and legislative change.
The risk associated with operating in a
fast-paced, highly regulated environment
which is subject to constantly changing
political, regulatory and legislative
expectations and interventions.
Key risk sponsor: MD Corporate Affairs,
Regulation and Strategy
Residual likelihood: High
Residual impact: High
Risk trend:
9
Portfolio Exposure
Developments this year
While the conflict in the Middle East has had an impact
on fuel costs, the materiality of this risk to us has not
changed significantly during the year. Strengthened
controls have enabled us to keep pace with the inherent
exposures. Other developments include:
– Increase in short-term weather-related volatility due
to the volume of renewable generation on the UK
energy system.
– Overall lower demand growth, but highest demand
peak seen this winter.
– UKA carbon price increase.
– UK Government decision not to progress with
zonalpricing and retain single national GB-wide
wholesale market.
– Ongoing geopolitical volatility continues but
currently has limited impact on SSE’s asset base.
– The establishment of new route to market contracts
and Power Purchase Agreements.
Key mitigations
– Operational oversight of commodity
positions by the Group Energy Markets
Exposure Risk Committee (GEMRC),
and monitoring Group hedging
arrangements by the Board Energy
Markets Risk Committee (EMRC). For
more details see pages110 to 111
.
– Trading controls including VaR and
PaR measures to monitor and control
exposures. Trading limits are reviewed
regularly by the Energy Markets Risk
Committee and approved by the Board.
– Treasury policy and procedures.
– The use of hedging instruments to
minimise exposures to fluctuations in
foreign exchange markets. For details
see Financial Statements page236
.
The risk to the Group’s portfolio value
associated with fluctuations in both the
price and physical liquidity of key energy
market indices or drivers – primarily gas,
carbon and electricity.
Key risk sponsor: MD Energy Markets
Residual likelihood: High
Residual impact: High
Risk trend:
Reduced in materialityIncreased in materiality Not changed significantlyRisk trend key:
Group Principal Risks continued
62
SSE plc Annual Report 2026

10
Safety and the
Environment
Developments this year
Safety is our number one priority. While the risk has not
materially changed, we continue to adapt our control
environment to keep pace with inherent exposures.
Other developments include:
– Improved safety performance among direct
employees with a Total Recordable Injury Rate (TRIR)
of 0.09.
– Higher demand for contractor skills and capabilities
resulting in increased competition.
– More volatile and extreme weather, a increase in
named storms and the risk of wildfires, affected
assets and working conditions.
– There has been a continued focus on the health and
wellbeing of our employees. More details of how we
have strengthened our approach to this can be found
in the Sustainability Report.
Key mitigations
– Board oversight provided by SSHEAC.
– Group Safety and Health Policy and
Group Environment Policy.
– Safety, Health and Environment (SHE)
Management System.
– LCP Framework.
– Safety training and awareness,
including through our industry-leading
immersive safety training centre.
– Regular SHE assurance reviews by
each Business Unit.
The risk of harm to people, property or
the environment from SSE’s operations.
Key risk sponsor: Director of SHE
Residual likelihood: Medium
Residual impact: Medium
Risk trend:
11
Speed of Change
Developments this year
There has been no material change in this risk during
the year as the Group continues to keep pace with
changes in the operating environment, as required.
Other developments include:
– New executive leadership and ongoing review of
ourorganisational strategy and culture.
– £33bn investment plan announced.
– Growing demand for specialist skills leading to
increasing workforce competition.
– Political sentiment around net zero is becoming
increasingly fragmented.
– Ongoing geopolitical volatility.
– The impact of climate change and extreme weather
events is increasing our need for agility.
– Acceleration of the regulatory environment and
market reform.
– Global pace of change for digital enablement
(including AI) is increasing.
– The introduction of a new Transformation function,
focusing on opportunities for continuous
improvement across the Group.
Key mitigations
– Group Operating Model Policy.
– The Board ensures alignment of risk
appetite and strategic objectives by
regularly reviewing the Group’s
commercial strategy, business
development initiatives and long-term
options.
– The Group Executive Committee is
responsible for making sure that
Business Unit strategies are consistent
and compatible with the overarching
Group strategy.
– Continued investment in technology
advancements to build SSE’s ability to
make proactive decisions in response
to rapid change.
– Regular analysis of the energy sector,
current market and opportunities to
anticipate potential change affecting SSE.
The risk that SSE is not able to respond
with agility to the evolving systems and
energy markets within which it operates,
in a fast-paced, ever-growing
technological world.
Key risk sponsor: Chief Executive
Residual likelihood: High
Residual impact: High
Risk trend:
12
Supply Chain
Developments this year
The context of the risk has evolved over the year, to
focus on building confidence in the ability of supply
chains to deliver reliably against its commitments.
There has, however, been no significant change in the
materiality. Other developments include:
– Ongoing geopolitical volatility, including the conflict
in the Middle East and the war in Ukraine, has the
potential to impact supply chains and create increased
commercial exposures.
– Key strategic delivery partners appointed to deliver
the majority of planned transmission projects.
– RIIO-T3 determination issued by Ofgem and
successful AR7 results for Berwick Bank providing
regulatory certainty for project pipelines.
– Increased competition for specialist skills and
capabilities.
– Datacentre growth has increased the demand for
supply chains associated with flexible generation.
– Ongoing implementation of legislative changes.
Key mitigations
– Group Procurement Policy.
– Strategic supplier relationship
management tailored for each
Business Unit.
– Robust commercial terms in place
andongoing contract management.
– Procurement and Commercial teams
ensure effective demand management
via dedicated business partners.
– Third party due diligence.
– Category management surveillance
ofmarkets and environments to
anticipate and develop proactive
response to constraints.
– Large Capital Projects Framework.
The risk that SSE is unable to secure a
viable, competent and sustainable supply
chain to meet existing operational needs
and the growth required to deliver the
Group strategy.
Key risk sponsor: Chief Procurement Officer
Residual likelihood: High
Residual impact: High
Risk trend:
Reduced in materialityIncreased in materiality Not changed significantlyRisk trend key:
63
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Climate-related financial disclosures 65
Carbon performance disclosures 73
EU Taxonomy assessment 74
Non-financial and sustainability
information statement 75
Viability statement 76
Going Concern 76
Disclosure
statements
John O’Sullivan, Nature Strategy Manager,
SSE Renewables, Galway, Ireland:
“I’m fortunate to be responsible for
ensuring we protect nature across
oursites including Galway Wind Park,
which is our flagship asset in Ireland.
Living locally makes me feel connected
to the site. We are always developing
new ways to minimise our impact on
the environment, so we generate clean
energy and leave a lasting legacy.”
People Powering SSE
64
SSE plc Annual Report 2026

Climate-related financial disclosures
An integrated approach
toclimate disclosures
This statement summarises how we fulfil
our requirements under relevant mandatory
UK climate-related financial disclosures.
Weare at the heart of the energy transition,
and our business strategy is tackling climate
change head-on, by focusing on delivering
the electricity infrastructure needed for the
clean energy transition. The consideration
of climate-related risks and opportunities is,
therefore, naturally embedded into our
policies and practices. Considering this,
wehave integrated our climate-related
disclosures throughout this Annual Report
providing a holistic understanding of how
climate-related impacts are managed.
Navigating SSE’s climate-related disclosures
TCFD recommendations SSE’s current disclosure position Additional information
Governance
a) Describe the Board’s
oversight of climate-
related risks and
opportunities
Responding to climate change is integral to SSE’s strategy. SSE’s
Board provides oversight of climate-related risks and opportunities
through its consideration of the Group’s purpose, strategic
priorities and long-term value creation, including decisions on
business model evolution, capital investment and resilience in the
energy transition.
Governance Report
– Governance of climate-related matters page 84
– More on climate-related work in the year page 84
b) Describe
management’s role
inassessing and
managing climate-
related risks and
opportunities.
Clear climate-related responsibilities are assigned to SSE
committees and senior management, including the Chief
Executive and Chief Sustainability Officer. Management is
responsible for assessing and managing climate-related risks and
opportunities, embedding these considerations into strategic
planning, capital allocation, risk management processes and
delivery of theTransformation for Growth plan.
Governance Report
– Governance of climate-related matters page 84
– More on climate-related work in the year page 84
Strategic Report
– How sustainability is governed page41
Strategy
a) Describe the
climate-related risks
andopportunities
theorganisation has
identified over the short,
medium, and long term.
SSE’s material climate-related risks include physical risks arising
from extreme or changing weather conditions and a transition risk
associated with market, policy and pricing dynamics in a
low-carbon electricitysystem.
SSE’s material climate-related opportunities arise from the Group’s
role across regulated networks, renewables and flexible generation
in supporting the transition to a low-carbon energy system.
SSE assesses climate-related risks and opportunities over defined
short, medium and long-term time horizons aligned to its business
planning, capital investment and Net Zero Transition Plan.
Disclosure statement
– Assessing SSE’s climate-related opportunities and risks
pages67 to 68
– Detailed climate-related opportunities and risks tables
pages69 to 72
– Time horizons for scenario analysis page 67
b) Describe the impact
of climate-related risks
and opportunities on the
organisation’s business,
strategy, andfinancial
planning.
SSE’s strategy and Transformation forGrowth plan places
climate-related risks and opportunities at the centre of how the
Group evolves its business model and allocates capital. Transition
opportunities drive growth inregulated networks, renewables and
flexiblegeneration, while physical and market-related transition
risks are considered in asset design, portfolio diversification and
resilience planning.
In the year ended 31 March 2026, SSE’s assessment primarily focuses
on the anticipated financial effects of material climate-related risks
and opportunities, within its own operations and assets, along with
qualitative consideration of selected value-chain impacts.
Strategic Report
– Our strategy, investment plan, 2030 Goals and
business model pages6 to 7
– Performance against 2030 Goals page15
Disclosure statement
– Assessing SSE’s climate-related opportunities and risks
pages67 to 68
– Detailed climate-related opportunities and risks tables
pages69 to 72
– EU Taxonomy assessment page74
Financial review
– Note 4.1(v) Impact of climate change and the
transition to net zero – financial judgement and
estimation uncertainty page 160
Mandated UK climate disclosures
SSE is compliant with the Financial Conduct
Authority (FCA) UK Listing Rule UKLR 6.6.6R(8).
This rule requires organisations to include
climate-related financial disclosures aligned
with the Task Force on Climate-related
Financial Disclosures (TCFD)
recommendations, recommended disclosures
and associated guidance (including the
TCFD Annex) in their annual reports. These
disclosures also satisfy UK mandatory
climate-related financial disclosure
requirements under the sections 414CA
and414CB of the Companies Act 2006.
Climate change has been considered in
preparing the Group’s consolidated financial
statements for the year ended 31 March 2026
on pages 151 to 243
. Further information
has been included in note 4.1(v)
‘Impact
of climate change and the transition to net
zero – financial judgement and estimation
uncertainty’ on page 160 .
Approach to UK SRS
The UK Sustainability Reporting Standards
(SRS) S1 and S2 were published in February
2026. We welcome the introduction of UK
SRS S2 as a pragmatic, internationally
aligned framework for climate-related
financial disclosures.
For the year ended 31 March 2026, we
continue to report in line with the UK
mandatory climate-related financial
disclosure requirements. We have also
undertaken a high-level assessment of
ourexisting TCFD aligned disclosures
against the requirements of UK SRS S2.
Thisdisclosure statement presents progress
towards alignment with S2 Climate-related
disclosures, with further alignment
plannedover future reporting cycles.
65
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Strategic Report Governance Financial Statements

TCFD recommendations SSE’s current disclosure position Additional information
c) Describe the resilience
of the organisation’s
strategy, taking into
consideration different
climate-related
scenarios, including a
2°C or lower scenario.
SSE conducts scenario analysis on an annual basis to assess the
resilience of its strategy and financial plans under a range of
plausible climate-related futures, including scenarios aligned
tolower emissions pathways and higher-warming outcomes,
reflecting a range of potential transition and physical conditions.
Disclosure statement
– Approach to climate scenario analysis page67
– Detailed climate-related opportunities and risks tables
pages69 to 72
– Viability statement page76
Risk management
a) Describe the
organisation’s processes
for identifying and
assessing climate-
related risks.
SSE identifies climate-related risks and opportunities through
itsestablished risk identification process, consolidated from
business-unit risk assessments, senior management oversight
forums and relevant external information.
Climate-related risks are assessed across short-, medium- and
long-term horizons, tested for materiality, and prioritised within
the Group Risk Management Framework alongside other
principalrisks.
Strategic Report
– Summary of SSE’s key climate-related opportunities
and risks page44
–Climate-related assessment page58
– Risk management process page59
Governance Report
– Governance of climate-related matters page84
Disclosure statement
– Assessing SSE’s climate-related opportunities and risks
pages67 to 68
b) Describe the
organisation’s processes
for managing climate-
related risks.
SSE’s system of internal control establishes the policy framework,
standards and governance arrangements for managing risks across
the Group, including those related to climate change.
Strategic Report
– How we manage risk page58
Disclosure statement
– Assessing SSE’s climate-related opportunities and risks
pages67 to 68
Governance Report
– Governance of climate-related matters page84
– System of internal control page109
c) Describe how
processes for identifying,
assessing, and managing
climate-related risks
areintegrated into the
organisation’s overall
riskmanagement.
Climate change is a Group Principal Risk, with climate-related risks
identified, assessedand managed through SSE’s Group Risk
Management Framework.
Climate-related risks are currently embedded within the Group
Risk Management Framework, while integration of climate-related
opportunities is in development.
Strategic Report
– How we manage risk page58
Disclosure statement
– Viability statement page76
Governance Report
– Governance of climate-related matters page84
Metrics and targets
a) Disclose the
metricsused by the
organisation to assess
climate-related risks and
opportunities in line
withits strategy and risk
management process.
SSE uses a combination of targets, metrics and management
incentives, including its 2030 Goals and Net Zero Transition Plan,
tomonitor progress against climate-related objectives.
Strategic Report
– Performance against 2030 Goals page15
– SSE’s Net Zero Transition Plan pathway page 42
– SSE’s Net Zero Transition Plan Progress pages43
to 44
– Reporting on our impacts pages53 to55
– Carbon pricing page 67
Governance Report
– Annual report on remuneration pages120 to 133
b) Disclose Scope 1,
Scope 2, and, if
appropriate, Scope 3
greenhouse gas (GHG)
emissions, and the
related risks.
SSE measures and discloses year-on-year carbon performance
and progress against its Net Zero Transition Plan, with emissions
data informing capital allocation decisions and linking to
climate-related remuneration metrics.
Strategic Report
– SSE’s Net Zero Transition Plan Progress pages43
to 44
Disclosure statement
– Carbon performance disclosures page73
Governance Report
– Annual Report on Remuneration pages120 to 133
c) Describe the
targetsused by the
organisation to manage
climate-related risks
andopportunities
andperformance
againsttargets.
SSE has long-term net zero ambitions supported by near-term
science-based emissions reduction targets. Performance against
these targets is monitored and is used to inform strategic
planning,capital allocation decisions and the management
ofclimate-related transition risks andopportunities.
Strategic Report
– Performance against 2030 Goals page15
– Figure 2: 2025/26 progress against SSE’s science-
based targets from a 2017/18 base year page43
Useful information
– Further information is presented in SSE’s Net Zero Transition Plan and SSE’s Sustainability Report
– Information on SSE’s GHG emissions data and how it is produced is available in SSE’s Sustainability Reporting Criteria 2026
– Detailed information can be found in SSE’s CDP submission
All of this information can be found at sse.com/sustainability
.
Climate-related financial disclosures continued
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SSE plc Annual Report 2026

Figure 1: SSE’s Going Concern statement, Viability statement
and climate-related financial disclosures time horizons
20302027 2035 2050 2080
Going Concern statement
Time horizon to December 2027
Climate-related financial disclosures
Time horizons:
– Short term to March 2035
– Medium term to March 2050
– Long term to March 2080
Viability statement
Four-year time horizon toMarch 2030
Assessing SSE’s climate-
related risks and opportunities
We have a well-established approach to
identifying material climate-related risks and
opportunities (CRROs), which is informed by
climate scenario analysis. Theresults of this
exercise are provided in the detailed CRRO
tables on pages 69 to72
.
Approach to climate scenario analysis
We identify material CRROs on a biennial
basis, or sooner if a material business
change occurs. Scenario analysis based
onthe outcome of that assessment is
performed annually.
The most recent biennial review was
completed during 2024/25 and confirmed
the material CRROs which could have
thepotential to impact our prospects.
Nomaterial business changes have been
identified in the period to 31 March 2026
that would require an update to that
assessment. Our material CRROs continue
to be monitored through SSE’s established
risk identification, assessment and
management processes.
Each year, we review and update our climate
scenario analysis, incorporating information
from external scenario providers and
considering relevant economic, policy and
political developments affecting our own
operations and assets. We assess a range
ofscenarios with temperature outcomes
of1.5°C, 2.5°C and 4°C over time horizons
to 2035, 2050 and 2080.
This annual scenario analysis supports
ourassessment of the potential financial
implications of CRROs, informs the
integrated Group Risk Management
Framework, and provides strategic insight
into how climate-related factors may
influence our long-term strategy and
investment decisions.
Time horizons for scenario analysis
We have defined time horizons for assessing
CRROs that are aligned to our business
planning and strategic objectives. The
short-term time horizon is aligned to our
financial, operational and capital investment
plans. Medium- and long-term time
horizons are aligned to the period over
which climate-related impacts are more
likely to emerge.
Figure 1 sets out the relationship between
our climate-related scenario analysis
timehorizons and the time horizons
appliedin the Group’s Going Concern
andViability statements.
Assessing financial impacts of CRROs
We assess the potential financial impacts
ofCRROs relative to an operating profit
measure. Scenario analysis uses defined
financial quantification pathways, together
with internal and external data sources,
toassess the potential impact of each
material CRRO under a range of scenarios.
Additional sensitivity analysis is performed
to provide further insight into the potential
variability of outcomes and the implications
for the Group’s business operations and
financial performance.
Carbon pricing
As a generator of electricity, we are exposed
to policies that influence the price of carbon
and take carbon pricing into consideration
in its investment and operational
decision-making. In Great Britain two
carbon pricing schemes apply: the UK
Emissions Trading Scheme (UK ETS), a
cap-and-trade mechanism for emissions
permits, and (until April 2028) the GB
Carbon Price Support (CPS) mechanism,
anadditional administratively set carbon
price top-up. In Ireland, the EU Emissions
Trading Scheme (EU ETS) applies. Thermal
generators over a threshold size are exposed
to carbon costs under all of these schemes.
Approach to scenario analysis
Material CRROs
Identified through an assessment
andprioritisation process
Impact pathways
Developed for each CRRO,
considering the business and
financial impacts of possible
climate-related events
Financial quantification pathways
Developed for each CRRO, with
identification of data points and
external scenarios
Scenario selection
Relevant scenarios selected for each
CRRO, considering temperature
outcomes, time horizons and
otherfactors
Quantification
Using internal data and publicly
available data from TCFD
recommended providers
Resilience assessment
Quantification output assessed,
considering resilience of business
model and strategy tothe CRROs
across the time horizons and
warming scenarios
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As part of our capital investment planning
and scenario analysis, we consider a range
of carbon price assumptions to assess
thepotential financial impacts of
climate-related transition risks. In Great
Britain, carbon prices in the range of £75
to£140 per tonne of CO₂ are considered,
while in Ireland a range of €94 to €184
pertonne of CO₂ is considered. These
assumptions include low, central and high
carbon price pathways and are used to
inform the assessment of investment
resilience and the potential impact of
climate-related policies on our
generationportfolio.
SSE monitors policy developments related
to carbon pricing and Carbon Border
Adjustment Mechanisms (CBAM). While
CBAM does not directly apply to SSE’s
generation activities, it may influence
market dynamics, procurement costs and
cross-border electricity trade through its
interaction with existing carbon pricing
regimes. Carbon pricing related risks
andopportunities are overseen through
SSE’sestablished governance and risk
management frameworks, including
theGroup’s Large Capital Projects
governance framework.
Scenario selection and assumptions
Climate scenarios are used to assess the
potential impacts of the identified CRROs
under different warming pathways.
Theseclimate scenarios are not forecasts
orpredictions of future outcomes. The
analysis is subject to inherent uncertainty,
particularly over longer time horizons, and
is intended to support strategic decision
making rather than estimate precise
financial impacts. In addition, the climate
scenarios we have applied extend beyond
normal business planning and forecasting
cycles and, in some cases, beyond the
expected operating life of a significant
proportion of the Group’s assets.
We select external scenario datasets based
on the characteristics of each material
CRRO, including the nature of the transition
or physical risk or transition opportunity
being assessed, and the geographic scope
of the Group’s operations. This approach
supports the assessment of both transition
and physical climate-related risks across a
range of temperature outcomes, consistent
with our broader risk and opportunities
management and strategic planning
processes.
For the 2025/26 climate scenario analysis,
we have used external scenarios from the
following sources:
– International Energy Agency (IEA) World
Energy Outlook 2025,
– National Energy System Operator (NESO)
Future Energy Scenario (FES) Pathways
framework 2025, and
– Intergovernmental Panel on Climate
Change (IPCC) models and Met Office
UK Climate projections
Table 1: External models and scenarios used in SSE’s climate scenario analysis 2025/26
Warming scenario Transition scenarios Physical scenarios
1.5°C IEA World Energy Outlook 2025 Net Zero
Emissions(NZE) by 2050
NESO FES Pathways framework 2025 –
HolisticTransformation and Electric Engagement
IPCC Representative Concentration Pathway – RCP2.6
UK Met Office Climate projections (UKCP18) tool
2.5°C IEA World Energy Outlook 2025 Stated Policies(STEPS)
NESO FES Pathways framework 2025 – FallingBehind
4°C IPCC Representative Concentration Pathway – RCP8.5
UK Met Office Climate projections (UKCP18) tool
The specific scenarios within these datasets,
and the warming pathways to which they
relate, are set out in Table 1. External
scenarios applied are consistent with those
used in the prior year, with updated data
sourced from the relevant providers.
Assessment of impacts
This year’s scenario analysis indicates that
our overall climate-related opportunity
outlook remains positive. Several
opportunity sensitivity ranges increased
year-on-year, reflecting updated external
scenario inputs and changes to underlying
financial and operational assumptions in
line with our strategy and Transformation
for Growth investment plan.
Climate-related risks remain broadly
consistent with the prior year. Year-on-year
movements in disclosure ranges reflect
updated external scenario data and
refinements to key assumptions.
Our material CRROs continue to be
considered within our Net Zero Transition
Plan and inform decisions on business
model evolution, capital investment and
long-term value creation. Detailed scenario
outcomes and supporting assumptions are
set out in the tables on pages 69 to 72
.
Climate-related financial disclosures continued
68
SSE plc Annual Report 2026

Detailed climate-related risks and opportunities tables
The following tables describe: the key scenario and assumptions applied; the potential financial impact; the geographical and asset impact
within our operations; the impact on the business strategy and mitigation; and the related 2030 Goal for each of the material CRROs.
Transition risk
The potential financial impact of the wind generation price transition risk is stated in GBP billion (£bn), based on one-year annualised
earnings before interest and tax (EBIT), and presented as a range to reflect the sensitivities applied to the scenario.
Financial impact change from prior period:
Growth
Stable
Decline
Wind generation price
Scenario inputs
– 2025 IEA NZE and STEPS
scenarios for wind
generation.
– SSE’s projected merchant
wind output from existing
and pipeline wind portfolio.
– Internal projections of price
adjustments arising in a
renewables-dominated
electricity system.
Financial impact
Increased wind generation capacity and changing
consumer demand may result in power prices being lower
for non-contracted wind assets.
The outcomes of both scenarios continue to indicate
considerable growth intotal wind generation and a
subsequent impact on the achievable price for wind assets.
This is most evident in the 1.5°C 2050 scenario, where
total wind generation growth isforecast to be greatest.
Scenario
2035
(£bn)
2050
(£bn)
1.5°C up to (0.2) (0.7) to (0.9)
2.5°C up to (0.1) (0.2) to (0.3)
As wind generation capacity increases, the
average market electricity price for wind power
is expected to be lower than the average price
for electricity.
Geographical and asset impact
UK, Irish and European wind farm assets with
no revenue support contracts (e.g.Contracts
for Difference).
Mitigations
Our balanced portfolio of generation capacity (across wind, hydro, solar, battery and
thermal), power hedging strategies, revenue stabilisation agreements and long-term
offtake agreements are key to mitigating future low wind prices.
Related 2030 Goal
Increase renewable energy output fivefold.
Physical risks
The potential financial impact of all scenarios for physical risks stated in GBP billion (£bn), based on one-year annualised earnings before
interest and tax (EBIT), and presented as a range to reflect the sensitivities applied to each scenario.
Financial impact change from prior period:
Growth
Stable
Decline
Variable renewable
generation
Scenario inputs
– 2025 IEA NZE scenario for
wind generation.
– UK Met Office climate
projections (UK CP18) tool
aligned to IPCC RCPs 2.6
& 8.5 for average wind
speeds.
– Projected output of SSE’s
existing and pipeline
windportfolio.
Financial impact
Predicted lower wind speeds and variable rainfall levels
have the potential to reduce renewable electricity
generation and related EBIT.
The outcomes of both scenarios continue to indicate a
marginal decline in wind speeds, offset by significant
growth in wind generation.
Scenario
2050
(£bn)
2080
(£bn)
1.5°C up to (0.1) (0.2) to (0.3)
4°C up to (0.1) (0.2) to (0.3)
Climate change models predict sustained
higher temperatures that cause greater
extremes in weather patterns, including
variable wind and rainfall patterns. These
scenarios could result in reduced renewable
electricity generation and a fall in earnings.
Geographical and asset impact
Wind farm portfolios in the UK, Ireland
andEurope, and hydro assets in the north
ofScotland.
Mitigations
We continue to review climate projections using the Met Office UK Climate Projection
(UKCP18) to understand the potential impact on renewable generation assets and
infrastructure. The technical and geographical nature of SSE’s renewable capacity,
alongside meteorological monitoring, crisis management and business continuity
plans are some of the ways that we manage and mitigate this risk.
Related 2030 Goal
Increase renewable energy output fivefold.
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Extreme weather
network damage
Scenario inputs
– 2025 NESO FES Electric
Engagement and Falling
Behind pathways for
consumer demand.
– UK Met Office climate
projections (UK CP18) tool
aligned to IPCC RCPs 2.6
& 8.5 for average winter
wind speeds and mean
summer temperature.
– Storm and heat costs to
SSE’s existing and pipeline
network assets.
Financial impact
This risk has the potential to cause physical damage to
network assets, increasing repair and maintenance costs,
and to disrupt supply to customers, increasing exposure
toregulator penalties and reputational issues, negatively
affecting EBIT.
The outcomes of both scenarios continue to indicate a
marginal decline in wind speeds and an increase in average
temperatures. The financial impact assessed under the
1.5°C 2080 scenario is greater due to faster network asset
growth and overall physical exposure of the network.
However there could be more frequent and intense
extreme weather events in the future.
Storms continue to pose a material risk to SSE, particularly
in relation to customers. In the financial year to 31 March
2026, SSE experienced four UK Met Office-named storms
that had an impact on customers and network assets.
Scenario
2050
(£bn)
2080
(£bn)
1.5°C up to (0.1) (0.2) to (0.3)
4°C up to (0.1) up to (0.2)
More extreme weather events, including
disruptive flooding events, heat waves and
extreme winds, may cause greater damage
toelectricity distribution network assets,
resulting in faults and outages.
Geographical and asset impact
SSEN Distribution network assets in the north
of Scotland and central southern England.
Mitigations
We have mitigation methods in place, such as monitoring short- and long-term
weather patterns, crisis management and business continuity plans and investment
programmes to improve infrastructure resilience. SSEN Distribution has set out a
resilience strategy, with defined climate adaptation actions, including flood risk
mitigation, within its current price control Business Plan and is developing its
adaptation plan for the next price control period, RIIO-ED3.
Related 2030 Goal
Enable low-carbon generation and demand.
Climate-related financial disclosures continued
In addition to providing practical support for customers in severe weather, SSEN Distribution has a clear resilience strategy in its business plan
70
SSE plc Annual Report 2026

Transition opportunities
The potential financial impact of all scenarios for transition opportunities is stated in GBP billion (£bn), based on one-year annualised
earnings before interest and tax (EBIT), and presented as a range to reflect the sensitivities applied to each scenario.
Financial impact change from prior period:
Growth
Stable
Decline
Accelerated
transmission growth
Scenario inputs
– 2025 NESO FES Holistic
Transition and Falling
Behind pathways;
– The projected share of
renewable capacity
connected to SSEN’s
network.
Financial impact
Based on scenarios, the opportunity to invest in an
accelerated expansion of SSEN’s transmission network
presents a potentially significant increase to EBIT.
The outcomes continue to indicate a growth opportunity
in connected renewable capacity, which is more
considerable in the 1.5°C scenarios.
Scenario
2035
(£bn)
2050
(£bn)
1.5°C 1.0 to 1.3 1.4 to 1.9
2.5°C 0.6 to 0.8 1.0 to 1.3
Electrification of the UK economy presents
anopportunity to accelerate returns from
required investment in SSEN’s electricity
transmission network.
Geographical and asset impact
SSEN Transmission network assets in the
north of Scotland.
Strategy
SSEN Transmission owns, operates and develops the high voltage electricity
transmission system in the north of Scotland. Its RIIO-T3 plan is centred on the
delivery of 11 major projects across the price control period, from 2026 to 2031.
Related 2030 Goal
Enable low-carbon generation and demand.
Accelerated wind
investment
Scenario inputs
– 2025 IEA NZE and STEPS
scenarios for wind capacity.
– Electricity capacity
projections for SSE’s
existing and pipeline
windportfolio.
– Internal projections of price
adjustments arising in a
renewables-dominated
electricity system.
Financial impact
Based on the scenarios, investment in wind assets at scale
could result in significant increases to EBIT under both
warming scenarios and timeframes.
The outcomes continue to indicate the growth opportunity
from SSE’s strong pipeline of options focused on offshore
and onshore wind.
Scenario
2035
(£bn)
2050
(£bn)
1.5°C 1.1 to 1.5 2.0 to 2.7
2.5°C 0.6 to 0.8 1.0 to 1.4
The transition to clean power presents an
opportunity to accelerate investment in
installed onshore and offshore wind
generation capacity.
Geographical and asset impact
UK, Irish and European wind farm portfolios.
Strategy
SSE Renewables has a strong pipeline of development options focussed on offshore
and onshore wind. Our Transformation for Growth plan is targeting ~9GW of installed
capacity by the end of 2029/30.
Related 2030 Goal
Increase renewable energy output fivefold.
Valuable flexible hydro
Scenario inputs
– 2025 IEA NZE and STEPS
scenarios for hydro
generation.
– SSE’s projected output
from existing and pipeline
hydro portfolio.
– Internal projections of price
adjustments arising in a
renewables-dominated
electricity system.
Financial impact
Based on scenarios, the opportunity to provide flexible
low-carbon hydro generation that balances intermittent
electricity generation from wind assets has the potential
toincrease EBIT in the longer term.
The outcomes indicate a similar level of growth in both
temperature scenarios as modelling shows new assets
being operational in both the 2035 and 2050 time horizons.
Scenario
2035
(£bn)
2050
(£bn)
1.5°C up to 0.1 0.2 to 0.3
2.5°C up to 0.1 up to 0.2
An increasing reliance on intermittent
electricity generation sources presents an
opportunity to invest in new low-carbon
hydro assets that earn returns from flexible
balancing of the electricity system.
Geographical and asset impact
Hydro assets in the north of Scotland.
Strategy
SSE Renewables operates and develops conventional hydro and pumped storage that
provides flexible and dispatchable electricity. We continue to develop opportunities to
expand our flexible low-carbon hydro generation, which could include new assets
such as Coire Glas.
Related 2030 Goal
Increase renewable energy output fivefold.
71
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Valuable flexible thermal
Scenario inputs
– 2025 IEA NZE and STEPS
scenarios for CCUS and
Bioenergy generation;
– SSE’s projected output
from pipeline low-carbon
thermal generation assets.
Financial impact
The opportunity to invest in new low-carbon thermal
generation assets has the potential to increase EBIT in the
longer term.
The outcomes continue to indicate more growth in
low-carbon thermal generation in the 1.5°C scenarios.
Scenario
2035
(£bn)
2050
(£bn)
1.5°C 0.2 to 0.3 0.4 to 0.7
2.5°C up to 0.1 up to 0.1
Intermittent weather patterns present an
opportunity to invest in low-carbon thermal
assets that will generate returns from
providing flexible capacity, security of supply,
and price stability to the electricity system.
Geographical and asset impact
GB carbon capture and storage (CCS) power
stations (including investments in joint
ventures), and sustainable biofuel power
stations in Ireland.
Strategy
SSE Thermal is continuing to develop a pipeline of options for new low-carbon
thermal assets across a range of technologies from CCS to biofuels and hydrogen.
Related 2030 Goal
Cut carbon intensity by 80%.
Driving distribution
transformation
Scenario inputs
– 2025 NESO FES Electric
Engagement and Falling
Behind pathways for
electricity consumer
demand.
– SSE’s projected electricity
distributed on the existing
and pipeline network.
Financial impact
Increased expansion of SSEN Distribution’s network has
the potential to increase EBIT in the longer term.
The outcomes continue to indicate considerable growth
inconsumer demand in the UK as consumers adopt
low-carbon technologies and energy efficiency measures.
More significant growth is projected in the 1.5°C scenarios.
Scenario
2035
(£bn)
2050
(£bn)
1.5°C up to 0.2 0.5 to 0.7
2.5°C up to 0.1 0.3 to 0.4
UK climate policy presents an opportunity
totransform SSEN Distribution’s networks to
meet the potential five- to ten-fold increase
inconsumer demand.
Geographical and asset impact
SSEN Distribution network assets in the north
of Scotland and central southern England.
Strategy
SSEN Distribution serves around 4m homes and businesses across two licence areas in
central southern England and the north of Scotland. Its RIIO-ED2 Business Plan 2023
to 2028 sets out the flexibility and network investment required to accelerate net zero.
SSEN Distribution isnow preparing its next Business Plan for the RIIO-ED3 price
control period.
Related 2030 Goal
Enable low-carbon generation anddemand.
Climate-related financial disclosures continued
Cable laying in the Ardnamurchan Peninsula is part of the expansion of SSEN Distribution’s network that will increase earnings over the long term
72
SSE plc Annual Report 2026

Carbon performance disclosures
The tables on this page represent our disclosures in line with the UK Government Streamlined Energy and Carbon Reporting requirements.
SSE takes an operational control consolidation approach to define its organisational boundary for GHG emissions.
SSE’s inventory details its direct and indirect GHG emissions performance (scopes 1, 2 and 3). This is shown as total emissions, as well as
split out by geographical location. We also provide a carbon intensity measure based on scope 1 GHG emissions released for each unit of
electricity we generate.
Our GHG inventory is prepared in accordance with the UK Government’s environmental reporting guidelines (BEIS, March 2019); aligned
tothe Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (revised edition) developed by the World Resources
Institute and the World Business Council for Sustainable Development (2004); and ISO 14064-1:2018 Specification with Guidance at the
Organization Level for Quantification and Reporting of Greenhouse Gas Emissions and Removals.
For more information on SSE’s GHG emissions data and how it is produced, see our Sustainability Reporting Criteria 2026 available at
sse.com/sustainability.
Table 2: SSE’s carbon performance
Unit 2025/26 2024/25
Total reported GHG emissions MtCO
2
e8.77
(a)
10.24
(b)
Scope 1 GHG emissions Total MtCO
2
e4.52
(a)
5.22
(b)
UK/Non UK MtCO
2
e (4.02/0.50) (4.58/0.64)
Scope 2 GHG emissions
1
Total MtCO
2
e 0.41
(a)
0.48
(b)
UK/Non UK MtCO
2
e (0.41/<0.01) (0.48/<0.01)
Scope 3 GHG emissions
2
(Categories 3, 4, 9, 11 and 15 only)
Total MtCO
2
e 3.83
(a)
4.54
(b)
UK/Non UK MtCO
2
e (3.00/0.83) (3.65/0.89)
Scope 1 GHG emissions intensity Total gCO
2
e/kWh 194
(a)
218
(b)
Renewable generation output
3
Total GWh 11,467 10,237
UK/Non UK GWh (9,892/1,575) (8,897/1,324)
Non-renewable generation output
4
Total GWh 11,901 13,740
UK/Non UK GWh (10,733/1,168) (12,335/1,405)
Generation output Total GWh 23,367 23,977
UK/Non UK GWh (20,624/2,743) (21,231/2,729)
(a) This data is subject to external independent limited assurance by Ernst & Young LLP (‘EY’). For the results of that assurance, see EY’s assurance report and SSE’s Sustainability
Reporting Criteria 2026 on sse.com/sustainability.
(b) This data was previously reported in the SSE plc Annual Report 2025 where it was subject to external independent limited assurance by Ernst & Young LLP (‘EY’). Forthe results of
that assurance, see EY’s assurance report and SSE’s Sustainability Reporting Criteria 2025 on sse.com/sustainability
.
1 SSE Scope 2 emissions are calculated using the location-based method described in the Greenhouse Gas Protocol.
2 SSE Scope 3 GHG emissions reported consist of Category 11 – Use of Sold Products (Gas Sold) of 1.73 MtCO
2
e
(a)
; Category 15 – Investments (Joint Venture investments); Category
3 – Fuel- and Energy-Related Activities (excluding upstream emissions associated with gas sold); Category 9 – Downstream Transportation and Distribution; Category 4 –
Upstream Transportation and Distribution; and Category 6 – Business Travel. Category 1 – Purchased Goods & Services and Category 2 – Capital Goods are excluded as SSE
continues to develop and refine its accounting approach to calculate these figures to an acceptable level of accuracy. The upstream emissions associated with gas products sold is
also excluded from Category 3.
3 Total includes pumped storage, battery energy storage systems and biomass output and excludes constrained-off wind.
4 Total excludes output from joint venture power stations where SSE does not have operational control (Seabank Power Limited, Triton Power Limited and Slough Multi-Fuel
Limited), and includes 100% of output from joint venture power stations where SSE has full operational control under Power Purchase Agreements (Marchwood Power Limited).
Our energy consumption
Between 2024/25 and 2025/26, the electricity we purchased for use in our assets (thermal power stations, gas storage facilities and
non-operational buildings such as offices, depots and data centres) decreased by 3%. Electricity consumption in our gas storage assets
increased by 1% and made up 75% of the total electricity we used from renewable sources. Our total fuel consumption used to power our
thermal power stations, fleet, vessels and non-operational buildings reduced by 14% this year, primarily due to a decrease in generation at
our operated power stations.
In 2025/26, around 50% of the electricity we purchased for our assets (offices, depots, thermal power stations, gas storage facilities, and
data centres) was from renewable sources, consistent with the previous year. Within this, we purchased 100% of the electricity used in our
directly managed offices from renewable sources, backed by renewable guarantees.
We submitted our most recent Energy Opportunity Scheme (ESOS) assessment in 2025, which identifies cost-effective, energy-saving
measures across our operations, with the phase 4 assessment due next year. We are also a member of the Climate Group’s EP100 initiative,
which encourages businesses to double the energy productivity associated with office and depot buildings by 2030 from a 2011 base year.
Table 3: Energy use (in GWh):
2025/26 2024/25
Purchased fuel from non-renewable sources UK/Non UK 21,613.3/2,649.9 24,680.3/3,386.1
Purchased electricity from renewable sources UK/Non UK 104.8/0.9 103.5/0.9
Purchased electricity from non-renewable sources UK/Non UK 105.0/0 112.1/0
73
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

EU Taxonomy assessment
We continue to voluntarily work towards aligning our reporting with the EU Taxonomy
Regulation to provide stakeholders with an understanding of our green economic activities.
Since 2021/22, SSE has voluntarily assessed its economic activities against the EU Taxonomy criteria for climate change mitigation, in
accordance with the principles of the EU Taxonomy. Metrics are assessed by taxonomy-eligible activity and disclosed at the SSE Reported
Segment level. The results of this assessment for 2025/26 are summarised in Table 4.
SSE’s taxonomy-aligned activities in 2025/26 include SSE’s transmission and distribution networks, as well as onshore and offshore wind
generation, solar PV, battery storage, and hydro generation (run-of-river and pumped storage) activities. These are economic activities
covered by the EU Taxonomy that meet the EU Taxonomy’s technical screening criteria, do no significant harm to other environmental
objectives, and meet minimum social safeguards.
Taxonomy-eligible, non-aligned, activities are economic activities that are covered by the EU Taxonomy, but do not meet one or more of
the EU Taxonomy’s technical screening criteria, do no significant harm requirements, or minimum social safeguards requirements. For SSE,
these activities are associated with SSE Thermal’s generation business. As these activities continue along their decarbonisation pathways,
itis expected that emerging activities, such as low-carbon flexible generation, may qualify as taxonomy-aligned in future reporting periods.
The remainder of SSE’s economic activities are considered taxonomy non-eligible, as they are not identified in the EU Taxonomy
Regulation as contributing to climate change mitigation. These activities comprise of SSE’s Energy Customer Solutions, Energy Markets and
Corporate businesses.
Assumptions
SSE’s policies governing these disclosures have been developed in accordance with the principles of the EU Taxonomy Regulation.
Linkage principle
SSE has applied a ‘linkage principle’ while calculating taxonomy metrics. This stipulates that any capital expenditure, revenue, or operating
profit/loss that can be justifiably linked to an identified taxonomy economic activity can be classified as taxonomy-eligible or taxonomy-
aligned. Applying this principle, revenue and operating profits from SSE’s balancing activities, hedging and trading can be included in the
calculation when they directly support taxonomy-eligible or taxonomy-aligned activities, reflecting the integrated nature of SSE’s operating
and commercial arrangements.
Proxies
Where financial metrics are not disaggregated by taxonomy-eligible activity, proxies have been applied to allocate amounts on a reasonable
and consistent basis. This primarily relates to Energy Markets trading and power sales activities. In these cases, revenue has been allocated
based on the proportion of purchased power volumes sourced from renewable versus non-renewable assets. Operating profit or loss has
been apportioned using internal contractual trading arrangements that reflect the underlying economic substance of the activities.
Materiality
SSE has adopted a top-down approach to assess the alignment between its existing segmental reporting and the EU Taxonomy criteria.
Inline with the simplifications introduced by Delegated Regulation (EU) 2026/73, SSE has applied a materiality threshold when screening
emerging activities. This approach enables SSE to focus its taxonomy assessment on activities that are strategically significant and material
to the Group.
Table 4: Assessment of SSE’s economic activities against the EU Taxonomy
Economic activities
SSE’s reported segments
(i)
Adjusted investment and
capital expenditure
(ii)
Revenue
(iii)
Adjusted operating
profit/(loss)
(iv)
£m % £m % £m %
A. Taxonomy-eligible activities (v)
A.1 Environmentally sustainable activities (Taxonomy-aligned)
4.9 Transmission and distribution of electricity SSEN Transmission 1,717.6 47.8 1,210.3 11.9 562.6 25.2
4.9 Transmission and distribution of electricity SSEN Distribution 851.8 23.8 1,116.5 11.0 335.3 15.0
4.1 Electricity generation using solar photovoltaic technology
4.3 Electricity generation from wind power
4.5 Electricity generation from hydropower
4.10 Storage of electricity
SSE Renewables 739.0 20.6 412.0 4.0 1,076.4 48.1
Energy Markets 2.6 0.1 979.3 9.6 61.6 2.8
Total of environmentally sustainable activities (Taxonomy-aligned) (A.1) 3,311.0 92.3 3,718.1 36.5 2,035.9 91.1
A.2 Taxonomy-eligible but not environmentally sustainable activities
(not Taxonomy-aligned activities)
4.29 Electricity generation from fossil gaseous fuels
SSE Thermal 197.5 5.5 669.8 6.6 195.4 8.7
SSE Energy Markets 2.6 0.1 955.8 9.4 (13.0) (0.6)
Total of Taxonomy-eligible but not environmentally sustainable activities
(notTaxonomy-aligned activities) (A.2) 200.1 5.6 1,625.6 16.0 182.4 8.1
Total A.1+A.2 3,511.1 97.9 5,343.7 52.5 2,218.3 99.2
B. Taxonomy non-eligible activities
Non-eligible activities (B) 74.5 2.1 4,842.8 47.5 18.3 0.8
Total continuing operations (A+B) 3,585.6 100 10,186.5 100 2,236.6 100
Notes:
(i) Alignment is based on segmental reporting in SSE’s financial year end statements. (see note 1.2 Basis of preparation for segmental changes in the year to 31 March 2026).
(ii) Adjusted investment and capital expenditure: calculated as adjusted capital expenditure related to assets or processes associated with taxonomy-eligible economic activities that
is accounted for based on IAS 16, IAS 38 and IFRS 16 and thereby included within adjusted capital expenditure (see note 5.1.(iii)).
(iii) Revenue: derived from the disaggregation of revenue from contracts by customers, in line with the requirements of IFRS 15 ‘Revenue from Contracts with Customers’ (see note 5.1.(i)).
(iv) Adjusted operating profit/(loss): calculated as adjusted operating profit/loss related to the businesses aligned with the taxonomy categories (see note 5.1.(ii)).
(v) Taxonomy eligibility and alignment assessments have not been subject to independent external assurance.
74
SSE plc Annual Report 2026

Non-financial and sustainability information statement
SSE reports extensively on its non-financial impacts within its Annual Report and welcomes
continued and increasing focus from regulators, shareholders and other stakeholders.
This table outlines how SSE meets the Non-financial Information and Sustainability reporting requirements contained within the
Companies Act 2006. For more information on SSE’s business model in Section 414CB (2)(a) see page 7 . Further disclosure can also be
found in SSE’s Sustainability Report 2026.
Reporting requirement and
SSE’smaterial areas of impact
Relevant Group Principal
Risks, pages 60 to 63
Relevant Group Policies
on sse.com
Policy embedding,
due diligence, outcomes and
keyperformance indicators
Climate matters
– Delivering net zero
– Managing climate-related issues
– Carbon performance,
metricsandtargets
–Climate-related financial
disclosures
Climate Change Group Climate Change
Policy
Performance against 2030 Goals,
page 15
Our strategy, page 6
Driving the climate transition,
pages 42 to 44
Climate-related financial
disclosures, pages 65 to 73
Environmental matters
– Responsible resource use
– Managing impacts on the natural
environment and biodiversity
Safety and the
Environment
Group Environment Policy Protecting our natural
environment, pages 54 to 55
Delivering sustainable
infrastructure pages 47 to 48
Safety, Sustainability, Health and
Environment Advisory Committee
Report, pages 112 to 115
Employees
– Protecting health, safety
andwellbeing
– Investing in training andlearning
– Culture and ethics
– Fair remuneration
– Employee voice
– Promoting inclusion anddiversity
People and Culture
Safety and the
Environment
Group Employment Policy
Group Safety and Health
Policy
Performance against 2030 Goals,
page 15
Championing a fair transition,
pages 49 to 53
Safety, Sustainability, Health and
Environment Advisory Committee
Report, pages 112 to 115
Social matters
– Ensuring a just transition
– Contributing to jobs and GDP
– Sustainable procurement and
supporting local supply chains
– Paying a fair share of tax
– Supporting customers with
energy affordability
– Sharing value with local
communities
Energy Affordability
People and Culture
Group Procurement Policy
Group Sustainability Policy
Group Taxation Policy
Performance against 2030 Goals,
page 15
Championing a fair transition,
pages 49 to 53
Delivering sustainable
infrastructure pages 47 to 48
Providing clean, secure and
affordable energy pages 45 to 46
Human rights, anti-corruption
andanti-bribery
– Reinforcing an ethical
businessculture
– Prevention of bribery
andcorruption
– Approach to human rights
Large Capital Projects
Management
People and Culture
Supply Chain
Group Corruption and
Financial Crime Prevention
Policy
Group Human Rights Policy
Group Whistleblowing
Policy
Championing a fair transition,
pages 49 to 53
75
SSE plc Annual Report 2026
Strategic Report Governance Financial Statements

Viability statement
SSE creates value for shareholders and
society in a sustainable way by developing,
building, operating and investing in the
electricity infrastructure and businesses
needed in the energy transition. The
delivery of SSE’s purpose and execution of
its strategy depends on the skills and talent
of a diverse workforce, the quality of its
assets and the effective identification,
understanding and mitigation of risk.
As required within provision 31 of the UK
Corporate Governance Code, the Board
hasformally assessed the prospects of the
Company over the next four financial years to
the period ending March 2030. The Directors
have determined that as this time horizon aligns
with the financial planning period, a greater
degree of confidence over the forecasting
assumptions modelled can be established.
In making this statement the Directors have
considered the resilience of the Group taking
into account its current position, the Principal
Risks facing the Group and the control
measures in place to mitigate each of them.
The Directors recognise the significance of
the strong balance sheet with committed
lending facilities as shown in the table below.
The Group is an owner and operator of
critical national infrastructure and has
aproven ability to maintain access to
capitalmarkets during stressed economic
conditions. The Group continued to
demonstrate this through the increase
of£3.5bn of committed facilities and the
issuance of £2.5bn of new long-term debt
and Hybrid capital in the year to March 2026
taking the total the Group has issued in the
Debt Capital markets to £6.4bn over the
past 5 financial years. Further detail relating
to planned funding is available in A6.3
Accompanying Information to the
FinancialStatements in the Annual Report
and Accounts.
The Group has a number of highly attractive
and relatively liquid assets – including a
regulated asset base which benefits from
astrong regulated revenue stream as well
asthe operational wind portfolio – which
provide flexibility of options. This has been
demonstrated through the success of
disposals in recent years, including the sale
of a 25% stake in the Transmission business
in FY22/23.
To help support this Statement, over the
course of the year a suite of severe but
plausible scenarios has been developed
foreach of SSE’s Principal Risks. These
scenarios are based on relevant real life
events that have been observed either in the
markets within which the Group operates or
related markets globally. Examples include
failure of critical IT assets (for Cyber Security
and Resilience); failure of third party
services (for Supply Chain) and the physical
impacts of climate change on networks
assets through more frequent and
increasingly severe storm events (for
Climate Change). Scenarios are stress
testedagainst forecast available financial
headroom and in addition to considering
these in isolation, the Directors also
consider the cumulative impact of different
combinations of scenarios, including those
that individually have the highest impact.
Upon the basis of the analysis undertaken,
and on the assumption that the
fundamental regulatory and statutory
framework of the markets in which the
Group operates does not substantively
change, and the Group continues to be able
to refund its debt at maturity, the Directors
have a reasonable expectation that the
Group will be able to continue to meet its
liabilities as they fall due in the period to
March 2030.
Going Concern
The Group’s Going Concern
assessment covers the period to
31December 2027, including a
reviewof the three month period
beyond this date which identified no
significant events or circumstances
that could affect this conclusion.
Theassessment includes stress
testing sensitivities to the Group’s
cash flow and funding projections
including removal of proceeds from
unconfirmed future divestments,
negative and positive sensitivities
onoperating cash flows and
uncommitted capex and other
adjustments.
The Group has also considered its
obligations under its debt covenants,
with no breaches in the year and
none expected over the assessment
period. This assessment confirmed
that the Group has sufficient cash,
committed bank facilities and funding
headroom toenable it to meet its
obligations asthey fall due during the
period assessed.
The Directors consider that the Group
has adequate resources to continue in
operational existence for the period
to 31 December 2027, and the
financial statements are therefore
prepared on a Going Concern basis.
See note 1.2
to the Consolidated
Financial Statements on page 156 .
£bn Matures Comment
SSE plc revolving
credit facility
1.50 October 2030 1-year extension options available (in favour of the Group)
SSE plc 1.50 June 2026 Commitment letter which allows SSE to enter a £1.5bn
committed facility between 31st March 2026 and 30th
September 2026
SSEN Transmission
revolving credit
facility
1
1.50 October 2030 1-year extension options available (in favour of the Group)
SSEN Transmission
bank facility
1.0 December 2028 a £1.0bn committed 12-year bank facility with an £800m
guarantee from the UK National Wealth Fund
SSEN Transmission
ECA facility
0.5 January 2030 a £0.5bn committed ECAfacility supported by EKN
(Swedish ECA)
SSEN Transmission
ECA facility
0.5 March 2030 a £0.5bn committed ECAfacility supported by SACE
(Italian ECA)
6.50
1 The Transmission facilities are available to that Business Unit only.
76
SSE plc Annual Report 2026

Chair’s introduction 78
Board of Directors 80
Group Executive Committee 83
Governance at a glance 84
The Board’s year 86
Assessing Board performance 94
Our stakeholders and Section 172 Statement 95
Nomination Committee Report 98
Audit Committee Report 102
Energy Markets Risk Committee Report 110
Safety, Sustainability, Health and
Environment Advisory Committee Report 112
Remuneration Committee Report 116
Remuneration at a glance 119
Annual Report on Remuneration 120
Directors’ Remuneration Policy – a summary 134
Compliance with the UK Corporate Governance Code 2024 136
Other statutory information 139
Statement of Directors’ responsibilities in respect
of the Annual Report and the Financial Statements 142
Governance
People Powering SSE
Mike Dotts, Website and Social Media Manager
SSENTransmission, Perth, Scotland
“I’m passionate about telling stories and
bringing what we do to life, but equally
about helping our teams communicate
more effectively and consistently using
our digital channels. With such an
important mission to build the grid of
the future, clear communication and
strong community understanding
areessential.”
77
SSE plc Annual Report 2026
Financial Statements
77
SSE plc Annual Report 2026
GovernanceStrategic Report

Chair’s introduction
The Board’s work across this year has
placed sharp focus on strategic execution
and priorities for future growth in what
continues to be a highly dynamic operating
environment. This has been underpinned by
the case for, andSSE’s role in, the transition
to an energy system that is clean, resilient
and affordable.
Delivering the right outcomes
Our previously agreed strategic priorities
were anchored within the Net Zero
Acceleration Programme Plus – a five-year
c.£17.5bn spending commitment to 2027
which pre-dated our current capex plan. At
each Board meeting, wereceive updates on
flagship projects and review key capital
investment metrics, with a broad
programme of analysis supporting
assessment of SSE’s strategic situation.
The opportunities available to SSE are
closely linked to external policy and
regulatory frameworks, and across 2025/26,
we saw an unlocking of the catalysts
needed to deliver unprecedented growth
within regulated electricity networks.
Theenablers to this growth were subject to
robust Board review and included, amongst
other matters, appraisal of supply chain
capacity and the level of funding required
toexecute at scale. Our assessments were
strengthened by expert inputs, and market
testing where permitted, and these shaped
the final form of our investment plan
announced in November 2025.
Thanks to strong shareholder response
tothe accompanying £2bn equity placing,
the £33bn investment plan is fully funded
across its delivery period to 2030. And
against a backdrop of heightened concerns
over energy affordability and geopolitical
market volatility, we believe the priorities
within the plan directly support the
outcomes of energy independence and a
clear path to wider societal benefits that will
come with electrification of the economy.
Ensuring long-term value
The Board has received deep dives into the
growth trajectory and individual projects
behind the upweighted investment in
regulated electricity networks, and reviewed
regular reporting to ensure visibility over
delivery and emerging challenges. We have
also offered constructive engagement on
our major offshore wind projects,
continuing to monitor progress and
milestones at Dogger Bank and Berwick
Bank. At the same time, SSE continues to
advocate for policy frameworks that
support low-carbon thermal, and we
remain committed to the efficient operation
of existing plant that plays a role in security
of supply. SSE’s 2030 Goals, which have
been in place since 2019, continue to set
out our ambitions to support a clean energy
transition and provide focus as we assess
the headwinds to achieving them.
SSE is not immune to the impact of external
crises, and the Board applies this view in its
approach to appraising and managing risk.
In line with standing practice, we have spent
time assessing SSE’s Principal Risks and Risk
Appetite, drawing on all available inputs,
and have received updates from the Energy
Markets Risk Committee on its review of
portfolio exposures. To ensure we are
equipped to understand the threat landscape
and opportunities posed by global digital
transformation, detailed updates covered
our cyber security position and priorities,
complemented by an externally facilitated
session on AI providing independent insight
on disruptive trends and adoption.
Working with those around us
SSE’s position in the external environment is
embodied by an established social contract
with our key stakeholders, which is reflected
in the structured Group-wide approach to
stakeholder engagement. Feedback to the
Board from senior teams directly informs
boardroom discussions, work on strategy
and the priorities we set in advocating for
fair energy policy. Our direct engagement
with governments and regulators during the
year has allowed constructive dialogue on
market design, energy affordability and the
delivery of the UK Government’s Clean
Power 2030 Plan.
Building energy infrastructure has tangible
impacts at a local level. The Board is
updated on business-led engagement
covering work with communities and
sustainability priorities to deliver lasting
economic and wider social impact. SSE
seeks to provide a transparent account of its
approach, with comprehensive disclosures
across the Board-approved Net Zero
Transition Plan and Human Rights Report
and Modern Slavery Statement. Our Safety
Sustainability, Health and Environment
Advisory Committee (SSHEAC) oversees
performance in selected ESG-benchmarks,
and the Audit Committee has reviewed
enhancements to internal assurance
arrangements and work to address revised
internal control disclosures which apply
toSSE from 1 April 2026.
An annual engagement plan, aligned
tothefinancial calendar, supports
continuedawareness of shareholder views.
Iwelcomed broad-ranging discussions on
areas of investor interest through in-person
and virtual meetings, including the annual
Chair Roadshow and our standalone ESG
event. Feedback provided to the Executive
Directors following the strategic update in
November was shared with the full Board,
and will inform reporting on progress and
the existing approach to disciplined
investment and shareholder returns.
Engaging with people andculture
Understanding how colleagues experience
life at SSE is an enduring Board priority.
Webuild insight through a rich programme
of engagement, which includes site visits,
analysis of employee survey results and
Governing
long-term growth
As a Board we remain committed to setting
the right conditions for SSE’s long-term
success, through a transparent approach to
corporate governance and clear dialogue
with stakeholders.
Chair’s introduction
78
SSE plc Annual Report 2026

atwice-yearly review of our culture
dashboard. This work is strengthened by
Lady Elish Angiolini, who champions the
employee voice through her dedicated
engagement role. Reinforcing our
commitment to the safety of our people,
the SSHEAC continued its operational site
visits which provide direct assurance on
working practices and SSE’s safety culture.
Together with my fellow Board members,
we visited 20 locations during the year
andheld open conversations with a
diversecross-section of employees and
contractors. These visits showed us the
pride and commitment across roles, whilst
also highlighting the uncertainty associated
with work undertaken in the year on
organisational efficiency. Recognising this
feedback, a central consideration in our
discussions with management was the
support being provided to colleagues
through this period of change.
SSE’s purpose remains a cornerstone of our
culture, providing long-term direction and
sustained focus on positive outcomes for
stakeholders and society. As the challenges
associated with a successful energy
transition have become more clear, it was
agreed that an updated definition – one that
better reflects the scale and urgency of
action required – was an appropriate next
step for SSE. Remaining rooted in SSE’s
societal role, the refreshed purpose, “to be
restless every day until we make electricity
clean, affordable and available for all”,
provides a platform for the performance
and behaviours needed to deliver the next
chapter of growth, and supports a continued
commitment to doing the right thing.
Maintaining strong leadership
Through the Nomination Committee,
wecontinue to champion tangible actions
on diversity and a proactive approach
tosuccession.
As announced last year, we welcomed
Martin Pibworth to the role of Chief
Executive following the AGM in July 2025.
His depth of sector knowledge, commercial
acumen, and long-standing career at SSE
has supported a smooth transition in
executive leadership, and it has led to a
step-up in our strategic ambitions which
I’mdelighted with. On behalf of the Board,
Ireiterate deep thanks to Martin’s
predecessor, Alistair Phillips-Davies, for his
28 years of devoted service to SSE and the
exemplary platform for growth which he
left us with.
Across non-Executive membership Helen
Mahy stepped down after nine years of
tenure on 17 July 2025, and as planned
from that date, Hixonia Nyasulu became
Senior Independent Director and Dame
Angela Strank SSHEAC Chair. Both Hixonia
and Dame Angela assume these roles
withhighly relevant leadership experience.
We thank Helen for her commitment and
the experience she provided to the Board
throughout her tenure.
Our performance as a Board is assessed
annually within a structured review cycle.
Following the external process in 2024/25,
this year was modelled on an internal
performance review and facilitated by
lastyear’s lead evaluator. In the interests
ofcontinuous improvement, the findings
have informed focus areas for the next
12months, while reaffirming we continue
todischarge our remit effectively.
The report which follows is intended to
provide a clear account of the Board’s work
over the year. We welcome feedback and
encourage engagement on our approach to
corporate governance.
Sir John Manzoni
Chair, SSE plc
27 May 2026
Sir John Manzoni learns about our progress to modernise the grid in Scotland
Driving transparent
governance
The report across pages 77 to 142
explains our approach to corporate
governance within SSE, and we report
for the first time against the UK
Corporate Governance Code 2024.
The Compliance Statement on
pages
136 to 138
confirms how we have
applied the Code’s Principles and
details adherence to the Code’s
Provisions. Disclosures outside of the
Compliance Statement describe the
key outcomes of Board and Board
Committee activity. These are
structured around the thematic
areasof Board work in the year and,
where appropriate, detail the
materialstakeholder factors
informingdecisions.
Annual General Meeting
(AGM)2026
The AGM will take place on 16 July
2026 at the Perth Concert Hall.
Shareholders are encouraged to
participate in the event, and the
Notice of AGM sets out the options
for voting and joining on the day.
“SSE’s purpose remains acornerstone
ofour culture, providing long-term
direction andsustained focus on positive
outcomes for stakeholders and society.”
79
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Sir John Manzoni
Chair
Martin Pibworth
Chief Executive
Barry O’Regan
Chief Financial Officer
Hixonia Nyasulu
Senior Independent Director
Committee membership Committee membership Committee membership Committee membership
Date of appointment
– Chair since April 2021;
non-Executive Director since
September 2020
Current external appointments
– Chair, Diageo plc
– Non-Executive Director, KBR Inc.
Prior experience
– Over 24 years at BP including
Chief Executive, Refining &
Marketing and Chief Executive,
Gas & Power
– President and CEO, Talisman
Energy Inc.
– Chief Executive of the UK Civil
Service and Permanent Secretary
of the Cabinet Office
Key skills relevant to SSE
– A dynamic and engaging leader
with diverse perspectives from
multiple sectors, organisational
settings and geographies.
– An extensive business career
spanning global commodity
markets and large energy
infrastructure, providing insight
into complex operating
environments and project
delivery.
– Knowledge of energy regulation,
politics and public policy
informed by energy sector and
senior UK Government roles.
– Experience of stakeholder
management with a collaborative
and transparent approach to
engagement.
– An advocate for succession
andleadership development,
emphasising people capability,
diversity, culture, and long-term
organisational success.
Date of appointment
– Chief Executive since July 2025;
Executive Director since
September 2017
Current external appointments
– Chair, CBI Scottish Council
Prior experience
– Chief Commercial Officer at SSE,
appointed in November 2020
– Group Energy and Commercial
Director at SSE, appointed
in2017
– Group Executive Committee
member at SSE, appointed
in2014
– Managing Director, Energy
Portfolio Management at SSE,
appointed in 2012
– Senior commercial leadership
roles within SSE since joining
in1998
Key skills relevant to SSE
– Proven focus on strategic
execution and commercial
growth through value enhancing
opportunities across SSE’s
businesses.
– Expert knowledge of complex
energy markets and SSE’s asset
base, enabling governance and
risk management.
– Successfully led end-to-end
delivery of large infrastructure
projects, including through Joint
Ventures.
– Experience of leading
constructive stakeholder
engagement to understand key
priorities, including the role of
sustainability initiatives to create
long-term value.
– Leadership skills to manage
change and drive company
culture to support delivery of
SSE’s purpose and strategy.
– Leads SSE’s Group Executive
Committee, SSE’s Business Units
and the Group functions of:
Corporate Affairs, Regulation
andStrategy; Sustainability; HR;
and Procurement.
Date of appointment
– Chief Financial Officer since
December 2023
Current external appointments
–None
Prior experience
– Finance Director, SSE
Renewables, appointed in
April2019
– Director of Treasury and
Corporate Finance at SSE,
appointed in January 2013
Key skills relevant to SSE
– Skilled in developing and
implementing financial strategy
including the approach to
funding and assessing the
optimal capital structure for SSE,
which enabled him to oversee
SSE’s equity placing in
November2025.
– Long-standing energy sector
knowledge, enabling a
disciplined approach to capital
allocation and project
investment.
– Active understanding of
shareholder views, capital
markets, and the approach to
investor relations.
– Experience of internal controls,
risk management and the role
ofassurance and audit in
supporting SSE’s regulatory
requirements.
– Expertise in treasury operations,
liquidity management and debt
issuance.
– Leads SSE’s Finance, and Tax and
Treasury teams, and the Group
functions of: Risk and Audit; IT
and Cyber Security; General
Counsel and Company
Secretarial; and Investor
Relations.
Date of appointment
– Senior Independent Director
since July 2025; non-Executive
Director since January 2025
Current external appointments
– Vice Chair and Non-Executive
Director, Olam Agri Holdings
Prior experience
– Non-Executive Director,
AngloAmerican plc
– Chair, Sasol Ltd
– Senior Independent Director,
Vivo Energy plc
– Senior leadership roles at
Unilever South Africa
Key skills relevant to SSE
– A strong sense of corporate
governance and leadership,
drawn from board-level
experience across multiple
continents within the energy,
chemicals, industrial and
consumer sectors.
– Experience of risk management,
including the importance of
environmental, social and
governance (ESG) considerations
to drive sustainable growth and
ethical business practices.
– Insight into the role of
stakeholder perspectives within
the work of the Board.
– Supports fostering diverse and
inclusive leadership teams to
enhance organisational culture.
S REN E
A
S
N
Board of Directors
Key for Board
Committees
A
Audit Committee
E
Energy Markets Risk Committee (EMRC)
N
Nomination Committee
R
Remuneration Committee
S
Safety, Sustainability, Health and Environment
Advisory Committee (SSHEAC)
Committee Chair
80
SSE plc Annual Report 2026

Lady Elish Angiolini
LTDBEKC
Independent Non-Executive
Director for Employee
Engagement
John Bason
Independent non-Executive
Director
Tony Cocker
Independent non-Executive
Director
Dame Debbie Crosbie DBE
Independent non-Executive
Director
Committee membership Committee membership Committee membership Committee membership
Date of appointment
– Non-Executive Director since
September 2021
Current external appointments
– Chair, Angiolini Inquiry
– Chair, Board of Trustees,
Reprieve
Prior experience
– Lord Advocate of Scotland
– Solicitor General for Scotland
Key skills relevant to SSE
– Possesses a governance
background from the public
sector, which has involved legal
leadership positions and
oversight of independent public
inquiries, bringing broad legal
perspectives to the Board.
– Experience of working with
government and within
regulatory and socio-political
environments.
– Strong ambassadorial skills
from international work in
judicial, governmental,
diplomatic and academic fields,
enhancing SSE’s stakeholder
relationships.
– An advocate for the employee
voice and organisational
culture, which strengthens
Board awareness of employee
sentiment and views.
Date of appointment
– Non-Executive Director since
June 2022
Current external appointments
– Chair, Bloomsbury Publishing
plc
– Chair, Primark Strategic
Advisory Board
– Chair, UK Deposit Management
Organisation
Prior experience
– Finance Director, Associated
British Foods plc
Key skills relevant to SSE
– Recent and relevant financial
experience, with a proven track
record of developing financial
and commercial strategy
including M&A, corporate
transactions and large capital
projects.
– Understanding of operational,
financial and regulatory
considerations across different
jurisdictions, through global
business leadership experience.
– Sound judgement surrounding
sustainability strategy, with
practical knowledge of ESG
reporting and investor
expectations.
– Experience of listed-Board
responsibilities applying strong
governance, financial
stewardship and risk awareness.
Date of appointment
– Non-Executive Director since
May 2018
Current external appointments
– Chair, Infinis Energy
Management
– Chair, Future Biogas Holdco
– Chair, Energy Systems Catapult
Prior experience
– CEO and Chair, E.ON UK
– Senior leadership roles across
corporate strategy, global
energy trading and operational
oversight from over 20 years at
E.ON SE and Powergen
Key skills relevant to SSE
– Extensive CEO and
management experience across
renewables, thermal
generation, commodity
portfolio management, and
energy trading.
– Technical and operational
acumen spanning the energy
system.
– Understanding of commodity
risk management and the
approach to trading governance
and controls.
– Strong UK and European energy
industry experience with
expertise in utilities regulation,
trends relevant to SSE’s
operations, and innovation and
industrial strategy.
Date of appointment
– Non-Executive Director since
September 2021
Current external appointments
– Group CEO, Nationwide
Building Society
– Fellow, Chartered Institute of
Bankers
Prior experience
– CEO, TSB Bank plc
– Chief Operating Officer and
Executive Director, Clydesdale
Bank
– Member, FCA Practitioner Panel
Key skills relevant to SSE
– Experience of operating within
highly regulated environments,
with capabilities across risk
management, internal controls,
digital and cyber security
contributing to Board oversight
of these areas.
– Understanding of optimising
capital allocation and the
approach to investment
appraisal.
– A leader with awareness of
organisational responsibilities
to employees and society.
– Skilled in leading
transformation, with a focus on
improving efficiency,
strengthening delivery and
enabling effective operations.
RSN
RA
N
A EN EAN
Key for Board
Committees
A
Audit Committee
E
Energy Markets Risk Committee (EMRC)
N
Nomination Committee
R
Remuneration Committee
S
Safety, Sustainability, Health and Environment
Advisory Committee (SSHEAC)
Committee Chair
81
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Melanie Smith CBE
Independent non-Executive
Director
Dame Angela Strank DBE
Independent non-Executive
Director
Maarten Wetselaar
Independent non-Executive
Director
Committee membership
E RN
Committee membership Committee membership
Date of appointment
– Non-Executive Director since
January 2019
Current external appointments
– CEO, ATG Entertainment
– Deputy Chair, Sadler’s Wells
– Chair, Mokaraka Trust
Prior experience
– CEO, NEC Group
– CEO, Ocado Retail
– Strategy Director, Marks &
Spencer plc
– Global Strategy and Marketing
Director, Bupa
– Chief Operating Officer,
TalkTalk Telecom Group plc
Key skills relevant to SSE
– Strong track record in digital
and commercial transformation
leadership spanning retail,
consumer services, logistics
and technology, shaped by
experiences in a variety of
senior roles.
– Expertise in strategic planning
and execution, having overseen
significant portfolio investment
decisions to help position
businesses for sustainable
growth.
– Customer insight informed
byexperience across diverse
consumer sectors including
energy, retail and insurance.
– A people-centric leadership
style, with wide-ranging global
experience and a strong
appreciation of company
culture.
Date of appointment
– Non-Executive Director since
May 2020
Current external appointments
– Non-Executive Director,
Rolls-Royce plc
– Non-Executive Director and
Chair of Sustainable
Development Committee,
Mondi plc
Prior experience
– 38-year career at BP; member
of Executive Management team,
Group Chief Scientist and Head
of Downstream Technology
– Senior leadership roles across
R&D, engineering, digital and
renewables at BP
Key skills relevant to SSE
– Chartered Engineer and expert
in technology, science and
engineering within the broader
energy and manufacturing
industries.
– Led and collaborated on
large-scale and complex
projects, internationally and in
culturally diverse environments.
– Strong corporate social
responsibility experience
through involvement in climate
science research and
sustainability initiatives,
spanning safety, the energy
transition, inclusion and
diversity, ethics and supply
chain responsibility.
– Recognised contributor to
advisory bodies, helping to
shape scientific and
technological advancement
through fellowships of the
Royal Society, the Royal
Academy of Engineering, and
the UK Energy Institute as well
as being a long-standing
advocate for women in STEM.
Date of appointment
– Non-Executive Director since
September 2023
Current external appointments
– CEO, Moeve (formerly CEPSA)
– Senior advisor, AtlasInvest
Prior experience
– 29-year international energy
career
– Senior leadership roles across
26 years at Shell, including:
Director of Integrated Gas,
Renewables and Energy
solutions; Executive Vice
President for Integrated Gas;
and Executive Vice President
Finance, Upstream International
Key skills relevant to SSE
– Global energy industry
expertise, with senior leadership
experience across four
continents, operating in
multi-country environments
and markets.
– Strong grounding in
renewables, low-carbon fuels,
and green hydrogen value
chains, and strategic experience
in energy transition business
models.
– Knowledge of commodity
markets, particularly related
toliquefied natural gas, having
held senior commercial and
financial roles across trading
and integrated gas.
– Listed company experience
including capital markets and
investor relations, as well as
leadership of major capital
investment programmes with
long-term strategic goals.
R
N
S
EAN
Board changes
2025/26
Following the conclusion
of the AGM on 17 July
2025, the following
changes took effect:
– Alistair Phillips-Davies
was succeeded by
Martin Pibworth as
Chief Executive. At this
time, Martin Pibworth
stepped down from
the SSHEAC and
EMRC.
– Helen Mahy stepped
down as non-
Executive Director
after just over nine
years’ service.
– Hixonia Nyasulu
succeeded Helen
Mahy as Senior
Independent Director,
and became a
member of the Audit
Committee and
SSHEAC.
– Dame Angela Strank
succeeded Helen
Mahy as Chair of the
SSHEAC.
– Tony Cocker stepped
down from the
SSHEAC.
Board of Directors continued
Key for Board
Committees
A
Audit Committee
E
Energy Markets Risk Committee (EMRC)
N
Nomination Committee
R
Remuneration Committee
S
Safety, Sustainability, Health and Environment
Advisory Committee (SSHEAC)
Committee Chair
82
SSE plc Annual Report 2026

Thomas Brostrøm
Managing Director,
Business Development
Chris Burchell
Managing Director,
SSENDistribution
Nikki Flanders
Managing Director,
Energy Customer Solutions
Rhian Kelly
Chief Sustainability Officer
Thomas Brostrøm joined SSE as MD,
Business Development on 1 April 2026,
bringing over 15 years of international
leadership experience from renewables,
project development, investment and
portfolio management roles with ACWA
Power, Shell and Ørsted. He leads SSE’s
projects in selected markets across all
technologies through to final
investment decision.
Chris has been MD, SSEN Distribution
since 2020, bringing operational and
commercial experience from senior
transport roles at Arriva, Go-Ahead
andRailtrack. He has sector expertise
across utilities and infrastructure
havingserved on Ofwat’s Board and
chairing the Rail Delivery Group. He is
Non-Executive Chair of the Rail Safety
and Standards Board.
Nikki has been MD, Energy Customer
Solutions since joining SSE in 2019. She
brings over 25 years of retail and energy
experience from senior roles at
Centrica, Telefónica and Drax and
serving as a Non-Executive Director
with Pendragon Plc, and has led large
scale transformation in retail-led
organisations across sectors.
Rhian has been Chief Sustainability
Officer since joining SSE in 2025.
Shebrings significant sustainability
experience from prior roles at National
Grid, where she led international climate,
environmental, strategic public policy,
and inclusion initiatives. As a Director
atthe CBI, she helped shape national
infrastructure and low-carbon policy.
Finlay McCutcheon
Managing Director,
SSE Thermal
Rob McDonald
Managing Director,
SSENTransmission
Sam Peacock
Managing Director, Corporate
Affairs, Regulation and Strategy
John Stewart
Director of HR
Finlay has been MD, SSE Thermal since
2024 following several senior leadership
roles in SSE, including MD, Energy
Markets, and directorships across
Onshore Renewables and Business
Energy. Finlay first joined SSE in 2010 as
a commercial director in SSE’s Offshore
Renewables team.
Rob has been MD, SSEN Transmission
since 2019, and possesses deep
knowledge of the energy sector and
regulation. Previously, as MD, Corporate
and Business Services, he led the
functions of legal, regulation,
compliance, safety, and large capital
projects services. He first joined SSE
in1997.
Sam has been MD, Corporate Affairs,
Regulation and Strategy since 2020
inwhich he leads corporate strategy,
regulation, communications and
external advocacy. Upon joining SSE
in2011, he brought expertise from
senior roles at Ofgem, Edelman and
inGovernment, shaping policy
engagement and strategic positioning.
John has been Director of HR since
2009, drawing on senior experience
across the UK and US energy and
watersectors. He oversees talent,
development, employee engagement,
and inclusion and diversity, aligned to
SSE’s culture and strategic priorities.
Liz Tanner
Group General Counsel and
Company Secretary
Stephen Wheeler
Managing Director,
SSERenewables
Peter Lawns
Deputy Company Secretary,
Secretary to the Committee
Liz has been Group General Counsel
and Company Secretary since 2023.
She is a barrister, and leads SSE’s
company secretariat, legal, data
protection and large capital project
services, and serves on the GC100
Executive Committee. She first joined
SSE in 2002.
Stephen has been MD, SSE Renewables
since 2022, having previously led SSE
Thermal and SSE Ireland. Before joining
SSE in 2008, he helped grow Airtricity’s
renewables platform and spent over a
decade with ABB and Siemens in
international energy roles.
Peter has been Secretary to the Group
Executive Committee since 2023 and
Deputy Company Secretary since 2013.
He is a Fellow of the Chartered
Governance Institute and oversees SSE’s
corporate governance and reporting,
entity management, and share
registration and share plans. He first
joined SSE in 2005.
The Group Executive Committee oversees performance, operations and
theimplementation of Group strategy through the executive management ofSSE’s
Business Units and corporate support services.
The Committee is led by SSE’s Chief Executive, Martin Pibworth. SSE’s Chief Financial Officer, Barry O’Regan,
is also a member. Their respective biographies are set out on page 80
.
Group Executive Committee
83
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Governance at a glance
Board composition as at 27 May 2026
Skills to support long-term success
This matrix shows how the skills and expertise of the non-Executive
Directors enable the Board to support SSE’s long-term success.
TheBoard is strengthened by the diverse approaches, thinking
styles,background and experience of its members, as described
inthebiographies on pages 80 to 82 .
Sir John Manzoni Hixonia Nyasulu Lady Elish Angiolini John Bason Tony Cocker Dame Debbie Crosbie Melanie Smith Dame Angela Strank Maarten Wetselaar
Experience of SSE’s operating context and disruptive trends
Energy sector, energy regulation and energy markets
Government and public policy
Clean energy, renewables and climate science
Global business, scale and complexity
Digital and data
Stakeholders and social impact
Skills to challenge and set a sustainable strategy for SSE
Large capital project management
Financing, economics and capital markets
Partnering, M&A and transactions
Risk management
Consumer insight
Responsible leadership of a large organisation
Corporate governance and leadership
Culture, safe working and people development
Meetings and attendance
Board
Nomination
Committee
Audit
Committee
Energy
Markets Risk
Committee
(EMRC)
Safety,
Sustainability,
Health and
Environment
Advisory
Committee
(SSHEAC)
Remuneration
Committee
No. of meetings held 754453
Sir John Manzoni 7/7 5/5 – 4/4 5/5 3/3
Barry O’Regan 7/7 – – 4/4 – –
Martin Pibworth
1
7/7 – – 1/1 1/1 –
Lady Elish Angiolini
2
6/7 4/5 – – 5/5 2/3
John Bason 7/7 5/5 4/4 – – 3/3
Tony Cocker
3
7/7 5/5 4/4 4/4 1/1 –
Dame Debbie Crosbie 7/7 5/5 4/4 4/4 – –
Hixonia Nyasulu
4
7/7 5/5 3/3 – 4/4 –
Melanie Smith 7/7 5/5 – 4/4 – 3/3
Dame Angela Strank 7/7 5/5 – – 5/5 3/3
Maarten Wetselaar 7/7 5/5 4/4 4/4 – –
Alistair Phillips-Davies
5
3/3 –––––
Helen Mahy
5
3/3 2/2 1/1 – 1/1 –
1 Martin Pibworth stepped down from the EMRC and SSHEAC on 17 July 2025.
2 Lady Elish Angiolini gave prior notification that the meetings of the Board, Nomination Committee and Remuneration Committee in
May 2025 conflicted with her appointment by The King as His Majesty’s Lord High Commissioner to the General Assembly of the
Church of Scotland in 2025.
3 Tony Cocker stepped down from the SSHEAC on 17 July 2025.
4 Hixonia Nyasulu joined the Audit Committee and SSHEAC on 17 July 2025.
5 Alistair Phillips-Davies and Helen Mahy retired from the Board on 17 July 2025.
In each instance of non-attendance, papers were shared before the meeting and comments given to the Chair where appropriate.
3
Governance of
climate-related matters
Climate-related risks and
opportunities are strategically
important to SSE and effective
oversight is embedded across our
Governance Framework. Key
responsibilities are summarised
below, and formally documented in
the Board’s Schedule of Reserved
Matters, Committee Terms of
Reference, and within Board roles.
The Board reviews and approves
SSE’s material sustainability and
climate change impacts through
work on strategy, operations
and risk. It sets the Group
Sustainability and Climate Change
Policies and approves climate-
related financial disclosures.
Seepage 89
.
The Audit Committee, Group Risk
Committee and Sustainability-
related Financial Disclosures
Committee govern the
development and assurance of SSE’s
climate-related disclosures. The
Audit Committee recommends
whether these are fair, balanced and
understandable and reviews the
impact of climate change on SSE’s
financial statements. See pages 103
to 104
.
The Nomination Committee
considers the Board skills and
experience needed to assess SSE’s
operating environment, including
the current and future impact of
climate change. See pages 98 to
101
.
The Safety, Sustainability, Health
and Environment Advisory
Committee oversees how
keyGroup Policies are
implemented, including
environmental and climate
adaptation matters. See pages 112
to 115
.
The Remuneration Committee
agrees how climate factors are
integrated within the Directors’
Remuneration Policy. See pages 116
to 135
.
The Group Executive Committee
identifies SSE’s material
sustainability impacts and oversees
the management of climate
interventions, targets and plans set
by Business Units and corporate
functions. As a member, the Chief
Sustainability Officer provides
advice on sustainability and climate
strategy and priorities.
Board gender balance
Men
Women
Board ethnicity
White British or other White
Māori
Black/African/Caribbean/
BlackBritish
Board independence
(Excluding the Chair)
Independent non-Executive
Directors
Executive Directors
Non-Executive
Directortenure
5
0-3 years
Hixonia Nyasulu,
Maarten Wetselaar
3-6 years
John Bason,
Lady Elish Angiolini,
Dame Debbie Crosbie,
Sir John Manzoni
6+ years
Dame Angela Strank,
Melanie Smith,
Tony Cocker
years
average tenure
9
1
1
2
8
6
5
Rolling three-year women’s
representation – 43%
84
SSE plc Annual Report 2026

Our Governance Framework, depicted below, confirms the role of the Board and how it delegates authority and accountability for
aspects of SSE’s operations to supporting Committees. The agreed roles and responsibilities of each Committee are set out in Terms
of Reference, and ensure proper decision making and oversight of delegated areas. Issues material to SSE are retained for the Board’s
decision and are documented in a Schedule of Reserved Matters. This can be found on sse.com alongside the Terms of Reference
for the Board’s Committees.
More on our Governance Framework and supporting governance practices
can be found in the statement of compliance with the UK Corporate
Governance Code on
pages 136 to 138
.
Promotes the long-term sustainable success of SSE. It establishes our purpose and strategy, which centre on creating value for
shareholders and society in the clean energy transition. It sets and fosters a healthy and ethical business culture across the Group.
SSE Board
Responsible for agreed areas of work to support the role of the Board. Two of the Committees are unique to SSE: the EMRC reviews
the governance to support our energy market trading activities and associated risk exposures; and the SSHEAC supports and
challenges our strategy, initiatives and performance on safety, sustainability, health, and environment matters.
Safety, Sustainability,
Health and Environment
Advisory Committee
(SSHEAC)
See pages 112 to 115
Remuneration
Committee
See pages 116 to 135
Energy Markets
Risk Committee
(EMRC)
See pages 110 to 111
Audit
Committee
See pages 102 to 109
Nomination
Committee
See pages 98 to 101
Board Committees
Group CommitteesBusiness Unit Executive Committees
Oversees execution of strategy, performance and day-to-day
operations, and is responsible for the executive management
of our Business Units and corporate support services.
Seepage83
for Committee membership.
Group Executive Committee
Oversee strategy, performance and regulatory approvals
required under electricity network licences. The Transmission
and Distribution Executive Committees report directly to these
dedicated Boards and refer to the Group Executive Committee
where appropriate, and when business separation rules allow.
SSEN Distribution Board
Lead the delivery of Business Unit strategy, performance, andtargets
alignedwith Board-set objectives. See
pages 26 to 38
for more on
ourBusiness Units.
Develop and recommend policy,
controlsand frameworks for material areas
across SSE.
Our Governance Framework
Group
Energy Markets
Exposure Risk
Group
Disclosure
SSE
Renewables
SSE
Thermal
SSEN
Distribution
Energy
Customer
Solutions
SSE Energy
Markets
SSEN
Transmission
Group Risk
Group Safety,
Health and
Environment
SSEN TransmissionBoard
75%
85
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

The Board’s year
The Board sets and oversees our strategy
and the priorities that support its delivery.
Each year, a programme of work considers
progress against set objectives and changes
in SSE’s strategic situation. This reviews
developments in the operating environment,
to identify where adjustments to the agreed
direction are required, and draws on both
external perspectives and insights from
ourown subject matter experts.
Investing in long-term growth
Strategic discussions in 2025/26 were
pivotal in the Board’s decision to accelerate
investment in UK electricity networks and
the ultimate shaping of the £33bn, fully-
funded investment plan, announced in
November 2025. This five-year investment
plan represents thenext stage of the earlier
Net Zero Acceleration Programme Plus, and
was agreed following review and discussion
ofthe opportunities available to SSE’s
businesses. This section explains thefactors
considered by the Board, in concluding
thatthe plan and its associated outcomes
maximise SSE’s potential for creating
long-term value.
Considering relevant factors
Supportive policy and regulation
The Board assessed the strength of the
policy and regulatory landscape for
networks investment and the level of capex
already secured under regulatory price
controls – which together provided visibility
of the significant growth opportunity within
SSEN Transmission to 2030. The UK
Government’s Clean Power 2030 Plan and
strategic plans from the National Energy
System Operator provide a clear roadmap
for investment in our core domestic markets
under all electricity demand scenarios, with
SSE’s strategic pillars of Renewables,
Networks and system Flexibility being crucial
for an orderly transition to a clean energy
system.
Delivering clean energy for all
Our integrated portfolio of businesses
provides the foundations to develop, build
and connect homegrown power to the UK
energy system. The Board reaffirmed a clear
focus on delivering the major electricity
infrastructure required for both energy
security and economic growth, with
upgrades to network infrastructure a
catalyst to unlocking progress. Recognising
the impact of national plans on the local
communities in which we operate, the
Board confirmed the requirement for
continued consultation with these groups
across investment decisions and as
projectsprogress.
Earnings visibility and value creation
The growth opportunity in regulated
networks is underpinned by stable index-
linked returns, with our market-facing
businesses continuing to pursue
opportunities in line with disciplined
investment criteria. The combination of
regulatory income, a considered investment
approach, and a commitment tostrong
investment grade credit ratings underpins
attractive capital growth. Itfurther lays the
foundations for sustainable earnings growth
and value creation into the next decade.
The Board approved retaining the existing
dividend policy to 2029/30 and the scrip
dividend option, recognising their role
within SSE’s investment proposition for
existing shareholders.
Advocating for affordability
Energy affordability is a key driver of
transitioning to a cleaner, homegrown
energy system. Across the year, Board-level
engagement with government and
regulators enabled constructive discussion
on the frameworks and policy needed to
deliver reform at the required pace and
scale. In support of this work, the Board
approved our advocacy priorities which
shape executive and business-led
engagement across SSE. The Board
considered the outcomes within the £33bn
investment plan as the necessary steps to
support system affordability in the long
term, and reviewed actions to remain
aprogressive and critical partner to
government on the solutions required
todeliver change.
Capability to deliver at scale
Delivery of the infrastructure projects
whichunderpin capital growth will require
workforce and supply chain capability
andcapacity. The Board considered the
foundations for performance laid by SSE’s
operating model and prior investment in
criticalskills across business areas. Within
strategic partnerships, a separate deep dive
on SSEN Transmission considered work to
establish a resilient supply chain. Thisset
out the proactive procurement strategy
tosecure framework agreements for all
projects and the initiation of a business-led
supply chain forum to support engagement
on innovation and delivery.
Overseeing delivery and execution
The Board concluded SSE was strongly
positioned to pursue the opportunities
which formed the investment plan; to
deliver the infrastructure needed for a
cleaner, more resilient domestic energy
system which will, in the long run, be more
affordable. The clear deliverables provide
ameasurable framework for the Board to
review and report on progress, with the
flexibility to address risks and opportunities
which are identified through its iterative
work on strategy.
For more on our £33bn investment
plan, see pages 3 and 6 .
Across the year, the Board considered SSE’s strategy, performance and long-term
direction. This section sets out some of the topics discussed by the Board, and
relevant outcomes of its work, to support its leadership and governance role.
Reviewing strategic direction
Key investment plan outcomes
– Clarity over investment plans
across the five years to 2030.
– Increased capital investment into
regulated electricity networks.
– Significant capital growth targets.
– Maintaining high-quality earnings
and existing dividend policy.
– Fully-funded investment strategy.
Fully-funded to 2030
80%
Networks
20%
Renewables and
Flexibility
~£33bn
net capex
£33bn
investment plan
86
SSE plc Annual Report 2026

Assessing equity funding
The funding requirement
The Board’s considerations on funding
the £33bn investment plan centred on
preserving a strong balance sheet and
maintaining strong investment grade
credit ratings. To achieve these outcomes,
the Board assessed the timing and cash
requirement over the five-year period
alongside self-funded options. Following
a range of inputs, including independent
financial and legal advice, assessment of
the evolving policy environment, and
identified priorities from SSE’s shareholder
engagement, the Board reviewed the
mechanisms which could be used to
funda portion of the plan with equity.
What was agreed
A £2bn non-pre-emptive placing, for
eligible institutional investors, was
announced alongside the agreed
investment plan. A share placing process
was judged to be in the best interest
ofallshareholders given the size of
equityrequired, in addition to the high
associated expenditure with pre-emptive
alternatives, and increased potential for
anegative impact on the shareprice.
Theplacing was underpinned by
allocation guidelines, established by the
Board, to align as closely as possible with
the principles of pre-emption. To ensure
as many shareholders as possible had the
opportunity to participate, the Board
approved a retail offer to take place
concurrently with the placing on thesame
pricing terms, and with allocations
prioritising existing shareholders.
Toconfirm its commitment to the plan,
amajority of the Board, including the
Executive Directors, participated in
theplacing by way of subscription.
Outcomes achieved
The placing, retail offer, and subscription,
in total, comprised 97,916,637 new
Ordinary Shares in SSE, representing
approximately 8.8% of the issued share
capital prior to the equity raise.
Theproceeds totalled around £2bn
(equivalent to an aggregate nominal value
of £48.96m) which would be used as part
of the overall investment plan funding.
The placing represented the largest UK
placing in five years, with the book of
demand multiple times oversubscribed,
signifying strong investor support for our
strategic growth plans.
Aplacing price of 2,050 pence was
achieved, representing a premium of 3.8%
to the closing price on 11 November 2025.
The placing was priced on 12November
2025, with settlement taking place on
14November 2025. In line with the
Pre-Emption Group’s Statement of
Principles surrounding the disapplication
of pre-emption rights, apost-transaction
report was publishedfollowing
completion of the share issue. The full
report can be found at www.frc.org.uk
.
See page 93
for how investors’ views
were considered in the Board’s
assessment of funding options.
Overseeing strategic progress
The Board reviews updates from SSE’s Business Units on performance and strategic delivery, including work with key stakeholders to
understand and address their priorities. The following examples provide detail of this oversight activity and decisions taken by the Board.
Accelerating delivery of critical network infrastructure
What the Board considered and why it is important
Investing in electricity networks is critical to enabling
theScottish and UK Governments to meet their energy
security and clean power targets for 2030 and beyond.
Working with Ofgem, governments, communities and
wider stakeholders ensures relevant views are
considered when accelerating investment.
During the year, the Board was informed of progress in
delivering SSEN Distribution’s RIIO-ED2 Business Plan
and work towards submission of the ED3 plan later in
2026. Itreceived updates on the delivery of SSEN
Transmission’s RIIO-T2 Business Plan, progress under
thePathway to 2030 investment programme, and
thebusiness’ acceptance of Ofgem’s RIIO-T3 Final
Determination, recognising it as an investable
settlement to deliver criticalinfrastructure between
2026 and 2031.
Stakeholder interests and outcomes
– Delivering a legacy. As part of SSEN Transmission’s investment
programme, the Board was updated on the business’ pledge to create
economic and social value for communities across the north of
Scotland, including the delivery of 1,000 new homes, over£100m
ofcommunity benefit funding, and a10% net gain in biodiversity
across the region.
– Planning progress and community consultation. The Board reviewed
progress on securing planning consent for SSEN Transmission’s
Pathway to 2030 projects, and an approach to consultation which
allows communities to be represented and voice their perspectives.
– Securing the supply chain. The Board oversaw work to secure supply
chain capacity for SSEN Transmission’s projects. This included
agreements with manufacturers of HVDC converter stations and
subsea cables for projects like Eastern Green Link 3.
– Improving customer performance and efficiency. TheBoard
reviewed SSEN Distribution’s ongoing transformation programme,
which has introduced new digital technology and led to an increase
incustomer satisfaction scores. It was kept apprised of work to build
the upcoming plan for the ED3 price control, which is likely to see a
change in investment approach to meet growing electricity demand
ahead of need.
87
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Financial StatementsGovernanceStrategic Report

The Board’s year continued
Overseeing strategic progress continued
Creating value through clean energy investments
What the Board considered and why it is important
The Board considered the development, construction
and operation of our renewable energy projects and
assets. This included the consented Berwick Bank
offshore wind farm which secured a Contract for
Difference for Phase B of its project, and the Coire Glas
pumped storage hydro project which advanced to
Ofgem’s Project Assessment stage under the new long
duration energy storage cap and floor mechanism. The
Board also monitored construction activity at the Dogger
Bank wind farm in the North Sea, as well as the transition
of projects such as the Yellow River onshore wind farm
into commercial operations. The Board’s consideration
ofthese projects, and the investments needed to deliver
them, support the creation of a low-carbon energy
system and contribute to long-term energy security
andaffordability for consumers.
Stakeholder interests and outcomes
– Supply chain security. The Board received regular updates on
industry-wide supply chain conditions and on management’s
engagement with key suppliers to understand constraints and risk.
– Fostering community engagement. The Board remained updated
onthe approach to community engagement across key projects,
supporting the requirement to work with stakeholders on material
issues across asset development, delivery and operations.
– Maintaining financial discipline. The Board considered the
importance of financial discipline, including key risks and commercials
in its investment decisions on renewable projects in SSE’s
development pipeline to ensure shareholder value.
– Employee impact of efficiency measures. The Board was kept
informed of the impact of organisational changes on employees, aspart
of its oversight of efficiency measures to ensure SSE Renewables
remains well positioned for long-term growth. Particular attention
was paid to ensuring employees were treated with fairness and
respect across consultation processes.
Delivering flexibility in the clean energy transition
What the Board considered and why it is important
The Board continued to examine opportunities to deliver
the future flexibility required for a renewables-led power
system. These included the potential to extend the life
ofexisting, large-scale flexible generation assets, in line
with system requirements and the UK Government’s
CleanPower 2030 Plan, as well as the development of
new technologies to provide low-carbon flexibility to the
power system. The Board continues to assess the extent
to which constrained supply chains and shifting energy
policies affect the development andpace of these
newtechnologies.
Stakeholder interests and outcomes
– Investing in flexibility. The Board supported the final investment
decision to build Platin power station, which will be able to run on
sustainable biofuels and natural gas, with the potential to convert to
hydrogen. This demonstrates an enduring commitment to supporting
the electricity system in Ireland by addressing shorter-term supply
challenges while laying the foundations for a low-carbon future.
– Supporting security of supply. TheBoard supported proposals to
develop options to extend the life of existing Combined Cycle Gas
Turbines in Great Britain, and enable disciplined participation in
Capacity Market auctions. The Board recognises existing assets have a
role to play in backing a renewables-led system, especially in light of
policy delays on low-carbon alternatives.
– Impact of policy on pipeline. The Board kept the evolving commercial
and operational context under close review, recognising its impact on
the delivery of low-carbon infrastructure and maintenance of existing
assets. It recognises that supportive government policy and
constructive engagement is essential to deliver Carbon Capture and
Storage and hydrogen projects and to maintain system flexibility and
resilience.
Providing solutions for our customers
What the Board considered and why it is important
Our Energy Customer Solutions business serves the
non-domestic supply market in Great Britain, and the
whole energy supply market on the island of Ireland.
Across the year, the Board considered updates on
business performance and future plans, alongside the
broader issue of affordability and low-carbon solutions
for consumers.
Stakeholder interests and outcomes
– Addressing affordability. The Board assessed the issue of energy
affordability, agreeing engagement priorities on policy to deliver
meaningful change. In doing so, it acknowledged the impact of
commercial decisions on customer bills in Ireland and the support
measures in place to help people navigate rising household costs.
– Supporting a just transition. The Board was updated on the steps
being taken in Ireland to advance national climate targets. This
included constructive engagement with government and the National
Energy Affordability Taskforce on a just transition for customers.
– Growing demand drivers. The Board reviewed the evolving demand
drivers of data centres and the electrification of heating and transport
as strategic opportunities, alongside its role as a route-to-market for
green energy for both business and domestic customers.
– Supporting decarbonisation. The Board considered the low-carbon
solutions and energy efficiency measures on offer to support homes
and businesses to reduce their carbon footprint and energy usage.
88
SSE plc Annual Report 2026

Keeping people safe
Safety remains our number one priority
andis the first agenda item at each Board
meeting, underscoring the Board’s
commitment to keeping our people safe. To
support this, the Board monitored key safety
metrics and received regular performance
updates, enabling it to challenge Business
Units and the Group Safety team on
areasrequiring attention or continued
improvement. It was pleased both the SSE
and Contract Partner Total Recordable
Injury Rate (TRIR) exceeded the agreed
performance expectation for the year.
As the operating model and efficiency
review progressed in 2025/26, particular
emphasis was placed on employee health
and wellbeing. The Board received frequent
updates on the support measures available
to employees and requested wellbeing
remained a management priority.
Together with the SSHEAC, the Board
considered fatigue management in
Distribution where engagement with trade
unions on working-hours arrangements
forfrontline colleagues was a key focus.
Theannual contract partner safety event
– which continues to support our work
withcontract partners across large capital
projects – provides meaningful insight
surrounding partner perspectives. Feedback
was shared with the Board after the event
and it will continue to inform how we
engage and foster the highest standards of
safety across operations.
For more on Board work surrounding safety
culture, see page 90
and for the SSHEAC
Report, see pages 112 to 115 .
0.17
Combined TRIR SSE employees and
contractors
Reviewing external volatility
The Board is acutely aware of the complex
geopolitical and operating landscape,
characterised by a fragmented global
outlook on decarbonisation, slow economic
growth and tensions in the Middle East. To
assess the impact of these challenges on
SSE’s current position and future plans, it
has received standing monthly reports
covering both developments and active
engagement on energy policy, with
long-term scenario planning a feature of
strategic work.
On commodity markets, monthly
management reports cover significant price
movements and notable global trends, and
as conflict escalated in the Middle East, this
was supplemented by a specific analysis
ofthe potential impacts of the observed
market volatility on SSE. The Board’s
assessment of energy markets risk
continues to be supported by the EMRC
which provides feedback to the Board
aftereach Committee meeting.
For further details surrounding energy
markets see the EMRC Report on pages110
to 111
and for more on ourapproach to
risk management see pages 56 to 63 .
Taking sustainable action
Sustainability is a core element of
theBoard’s work plan, supporting its
responsibility for overseeing SSE’s principal
sustainability impacts, including climate
change. During the year, the Board
reviewed and approved the 2025/26
sustainability priorities, ensuring they
directed the policies and practices
neededto deliver our climate and wider
sustainability goals. The Board also
approved our Human Rights Report and
Modern Slavery Statement, endorsing
changes made to align with the UK
Government’s Transparency in Supply Chain
Guidance. These will support monitoring
ofthe associated KPIs to drive informed
decision making and targeted improvement.
The Board tracked key developments in
climate policy and regulation, guided by
SSE’s newly-appointed Chief Sustainability
Officer, Rhian Kelly. Asreported in the
Annual Report last year, theBoard approved
an updated Net Zero Transition Plan in April
2025. This confirmed revised scenarios that
sharpen the pathway to reaching our
climate targets andensuring the plan
remains robust, credible and aligned with
evolving externalexpectations.
For more on our climate and sustainability
goals, see pages 41 to 55
.
194gCO
2
e/
kWh
Scope 1 intensity of generated electricity
performance in the year
Building digital resilience
The Board oversees our digital strategy,
including AI, and is kept informed about
matters related to IT and digital, cyber
security and data protection by senior
management in these areas.
The Board reviewed actions surrounding
the approach to cyber security and the
evolving threat landscape in which cyber
activity is increasing in both frequency and
severity. Through its review itconsidered
progress being made to strengthen our
resilience and cyber security culture,
including a set of objectives and measurable
outcomes to drive continuous
improvement. External regulatory
developments were reported, alongside
thepublication of the Cyber Governance
Code of Practice by the UK National Cyber
Security Centre, which was recognised as
avaluable governance tool.
For more on SSE’s Cyber Security and
Resilience Principal Risk, see page 60
.
The Board received a report from the Group
Data Protection Officer, including key
metrics on breaches, training, personal data
assessments and emerging risks, along with
actions to maintain and strengthen our data
protection framework including work on
supplier due diligence. It emphasised the
need for the privacy programme to keep
pace with new laws, rising regulatory
expectations and evolving cyber threats,
and reinforced the importance of strong
engagement with data protection across
the Group.
Deepening knowledge of AI
To ensure AI is governed appropriately,
the Board invested time in building its
own capability and understanding of
the technology’s potential and its
associated responsibilities. Board
members took part in an externally
ledsession on the future of AI, gaining
clearer insight into the risks,
opportunities, costs and global trends
shaping adoption. This improved
understanding will make sure the
Boardcan provide stronger challenge
and clearer strategic direction as we
increase our use of AI. Throughout the
year, the Board monitored progress
onAI deployment across the Group,
including advances within the Energy
Customer Solutions business.
89
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

The Board’s year continued
Outcomes of Board work
As a result of monitoring and measuring
how our culture has been embedded,
theBoard endorsed:
– A comprehensive annual all-employee
survey, replacing the current bi-annual
cycle and interim ‘pulse’ survey.
– Supported by the Group Executive
Committee, implementation of the
action plan to address feedback
receivedand relative scores from the
all-employee survey.
– A refresh of our corporate identity
statements and introduction of an
internal framework of definitions on
behaviours and strategic drivers which,
in the context of the fundamental values
of Safety and Sustainability, are intended
to foster a performance culture that
encourages doing the right thing.
– Continued investment in our immersive
safety training.
– Enhancements to whistleblowing
arrangements to further strengthen
accessibility and confidence in
raisingconcerns.
The Board fosters a culture that supports
delivery of our purpose and strategy and
enables colleagues to act with integrity and
take informed decisions. To ensure culture
is consistently embedded, the Board agrees
our values and expected behaviours
andoversees how cultural drivers are
communicated. This includes setting and
receiving updates on key Group-wide
policies, culture-based engagements and
training initiatives, and SSE’s employee
guide to good business ethics, “Doing the
Right Thing”. It also assesses how leadership
behaviour and day-to-day operations
reinforce cultural expectations.
See page 50
for more on how SSE defines
a healthy, ethical business culture.
Assessing and monitoring culture
SSE’s Culture Dashboard draws on multiple
data sources and indicators, aligned to the
tenets of our culture, to allow cultural health
to be measured and tracked. The Board
reviews the dashboard, accompanying
analysis and actions, to confirm culture is
promoted and embedded in line with
expectations. A summary of the Board’s
principal activities to reinforce culture
during the year, aligned to the cultural areas
within the dashboard, are set out below.
Communication during change
As progress was made under the Group
Operating Model and Efficiency Review,
SSE navigated a period of organisational
change. During this time, the Board
received updates on how employees
were experiencing the changes taking
place; through feedback from the
executive team, by monitoring standing
cultural indicators and observations from
within its employee engagements.
The annual employee survey provides
arich source of information on how
culture is embedded and being felt by
colleagues. While survey participation
was high in 2025/26, a relative decline
across scores versus internal benchmarks
was observed, with employees citing
uncertainty caused by efficiency work
asa key concern. Proposed actions to
address this feedback were reviewed
bythe Board, where a key outcome
wasaprogramme of enhanced Group
Executive Committee-led engagement.
This has seen Group-wide debriefs of key
developments within its leadership work,
and has ensured colleagues are informed
of efficiency objectives andoutcomes.
Driving cultural expectations
Safety culture
The Board reviewed key safety metrics
and targets and engaged directly
through operational site visits to
observe safety behaviours in practice.
Investment in immersive safety training
has had a demonstrable impact,
strengthening colleagues’ confidence in
identifying and managing risks and
contributing to improved safety
perceptions. The SSHEAC oversaw
actions to strengthen safety culture
across all work settings, ensuring
behaviours, training and reporting
aligned with expectations (seepages
112 to 115
).
Inclusion and diversity
The Board continued its oversight of
inclusion and diversity, with support
from the Nomination Committee,
through work on succession planning
Employee feedback enables the Board to assess the strength of SSE’s culture:
Overall employee
engagement
Safety Inclusion Our strategy Doing the
right thing
Communication
78% 89% 81% 83% 87% 54%
Feedback from
employees through the
annual employee survey
Feel we promote
a safe workplace
culture
Feel we have an
inclusiveculture
Feel engaged with
ourstrategy
Feel empowered to do
the right thing
Feel informed by
ourcommunication
approach
Culture metrics 2025/26
and in reviewing supporting strategy,
plans and activities below Board level
(see pages 98 to 101
).
Aligning culture with strategy
The Board undertook a programme
ofemployee engagement activities
(seepages 91 to 92 ), including site
visits and in-person roundtables prior
totheAGM to discuss topics that matter
most to colleagues. Alongside this, the
Chief Executive held ‘Conversations
withthe Chief Executive’ roadshows,
strengthening alignment between our
strategic priorities and our culture.
TheBoard approved a refresh of our
corporate identity statements (see
outcomes opposite) to strengthen
SSE’sperformance culture.
People and doing the right thing
The Board considered a wide range
ofemployee insights during the year,
including all-employee survey results,
whistleblowing arrangements and
reporting, and exit interview feedback,
to build a rounded picture of how
colleagues experience our culture.
Thiswas bolstered by the twice-yearly
review of the Culture Dashboard.
Communication
See Communication during
changeabove.
90
SSE plc Annual Report 2026

Listening to our employees
The Board is committed to ensuring that
everyone in SSE has a voice. It uses a broad
range of engagement channels to reach
employees working across business areas
indiverse operational and office-based
settings. This approach is strengthened by
our Non-Executive Director for Employee
Engagement, Lady Elish Angiolini, who
undertakes a complementary programme
of activity.
The Non-Executive Director for Employee
Engagement programme is designed to
allow meetings with a cross-section of
colleagues in different roles and stages
oftheir career. Insights are reported back
tothe Board on employee sentiment,
priorities, and working environments, to
ensure the employee voice is consistently
represented at Board level. The importance
of this engagement, and how it informs the
Board’s work, is explored in the Q&A below
with Lady Elish Angiolini.
How the Board engages
Each of the engagement methods used by
the Board creates value in a different way.
As explained below, the format chosen for
any Board activity is driven by the purpose
and desired outcome of the engagement,
alongside the subject matter on which
views are sought.
Engagement formats
Employee sessions. In-person and virtual
meetings allow direct understanding of
employee perspectives.
Q&A
With our Non-Executive
Director for Employee
Engagement, Lady Elish
Angiolini
Lady Elish meets colleagues in
Perth prior to the AGM 2025
Why is meeting employees important
to you and what stands out from your
conversations?
Meeting colleagues across the business
andhaving open, honest conversations
helpsme understand what matters most to
our people, and how our culture is felt in
practice. I’m always impressed by the visible
commitment to our purpose across the
organisation, as well as the resilience and
professionalism at all levels.
How do these insights support
the Board?
By dedicating time to hear from employees,
Ican then make sure that their views are
represented and shared in Board discussions
and decision making. And that we continue
tounderstand the impact of our work on
everyone in SSE.
Can you share an example of this
inaction during the year?
Prior to the Annual General Meeting (AGM),
Ijoined the Chair and several non-Executive
Directors to meet with around 60 middle and
senior managers from across Business Units,
where we discussed strategy, resilience and
change. The support of our managers during
a period of organisational change and
strategic growth is so important given their
role in delivery. It was very useful for the
Board to hear their views and understand
howstrategic decisions are experienced.
Why is leadership visibility important
in these engagements?
Being visible and accessible helps build trust,
fosters honest conversations and reinforces
the Board’s commitment to listening to and
learning from our people. Looking ahead,
making sure employee voices continue to be
heard at the highest level remains vital and
Iam proud to champion this area.
7
Board site visits
andengagements
5
Sessions with the
Non-Executive Director for
Employee Engagement
18
Chief Executive
roadshowsessions
8
Executive Director-led online
sessions
over
26,700
Overall employee attendance
atonline sessions
5,364
Largest online attendance
Employee surveys. All-employee surveys
capture the majority of employee views and
support the Board in measuring progress
onimportant issues, in assessing culture,
and in guiding initiatives and decisions.
Digital and written communication.
Articles and blogs provide updates on Board
work that share and reinforce strategic and
cultural messages.
Roadshows and conferences. These virtual,
face-to-face and hybrid events allow
interaction with employees on specific
topics and embed SSE’s purpose, strategy
and culture.
Site visits. Travelling across locations
enhances understanding of our different
working environments and allows
interaction with employees on site.
Focus groups. Small group sessions
facilitate discussion on key topics and the
gathering of valuable insights.
Employee representatives andgroups.
Consultation and engagement takes place
with employee representatives including
trade unions and employee-led Belonging
in SSE communities.
Engagement
highlights
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The Board’s year continued
Engaging withemployees
The Board’s engagement activities saw it
travel across the UK and Ireland in 2025/26.
An overview of some of the engagements
which took place and relevant outcomes is
set out below.
Great Island power station
Overview of engagement. Dame Angela
Strank and John Bason engaged with
employees to hear about their day-to-day
working experiences. Time spent with plant
operators, maintenance crews and local
management enabled candid conversations
on safety, ways of working and site culture.
Outcome. A strong focus on safety
practices, operational standards and
teamwork was evident, alongside the pride
employees take in their work and the role
Great Island plays within the Irish energy
market and local community. Discussions
also highlighted the importance of ongoing
technical training to support safety and
efficiency, with colleagues valuing the
opportunity to discuss their work and
experiences with Board members.
SSEN Transmission, north of Scotland
Overview of engagement. Board members
visited SSEN Transmission infrastructure in
the north of Scotland, including the Eastern
Green Link 2 and Accelerated Strategic
Transmission Investment (ASTI) projects,
which are central to the required
transmission network growth.
Outcome. The Board observed clear
collaboration between SSE and its
contractpartners, supported by high
engineering standards, technical expertise
and disciplined project management.
Constructive engagement with teams
deepened understanding of the challenges
and opportunities in delivering large-scale
infrastructure. Positive takeaways from the
visit were the strong representation of
women in senior on-site roles, including
engineers and project managers, and clear
evidence of community engagement to
ensure wider project benefits.
SSE Airtricity Customer Operations
Overview of engagement. Lady Elish
Angiolini met with employees in the SSE
Airtricity Customer Operations team to
discuss how digital tools, alongside
traditional channels, are being used to
deliver accessible, responsive and high-
quality customer service.
Outcome. Our colleagues shared how
digital innovation can support inclusive
customer service, and showed a clear
understanding of how their work supports
our customers and SSE’s wider purpose.
SSEN Distribution Operations and
NewForest Lines Training School
Overview of engagement. Hixonia Nyasulu,
Dame Angela Strank and Sir John Manzoni
visited SSEN Distribution operational sites
tohear first-hand from engineers and
contractors working on critical network
projects. Time was also spent at the New
Forest Lines Training School, enabling
Board members to hear from apprentices
about their development as the next
generation of engineers.
Outcome. By meeting with employees
andapprentices, the Board gained valuable
on-the-ground insight into workforce
capability, training and culture. The visit
reinforced the Board’s confidence in the
strength of SSE’s apprenticeship and
trainingprogrammes.
Conversations with the Chief Executive
Overview of engagement. Informed by
feedback from the Great Place to Work
Survey, the Chief Executive held a series of
in-person and virtual engagement events
with employees to support open dialogue
and share perspectives on the Group’s
strategic direction.
Outcome. The sessions delivered deeper
insight surrounding areas of importance for
employees, and enabled specific concerns
to be directly addressed in action plans.
Italso deepened Board understanding of
workforce support and sentiment during
aperiod of change.
Dogger Bank wind farm
Overview of engagement. Lady Elish
Angiolini met with colleagues and contract
partners at the Dogger Bank wind farm, to
gain insight into the delivery of one of the
world’s largest offshore wind projects.
Outcome. Our colleagues shared thoughts
on the importance of safety, the pace
ofinnovation and the need to prioritise
learning and skills development to build the
capability of engineers in the early stages of
their careers. Colleagues also highlighted
how on-site Board attendance was valued,
and showed recognition of their work and
the project’s strategic importance.
Listening to our employees continued
Sites visited in 2025/26
Non-Executive Director for
Employee Engagement sessions
Board site visits
Chief Executive roadshows
Key:
Non-Executive Director for
Employee Engagement,
LadyElish Angiolini, visits the
Dogger Bank wind farm site.
Chief Executive, Martin
Pibworth visiting Leeds.
Hixonia Nyasulu visits
the Netherton site
nearPeterhead.
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Active engagement with our shareholders
ensures the Board hasa clear understanding
of key investor priorities and expectations.
The Investor Relations team leads an
extensive programme of dialogue with
participation from management and Board
members. This not only informs the Board’s
considerations surrounding strategic
direction but also fosters alignment and
trust between SSEand its shareholders.
Institutional investors
Our engagement programme reached in
excess of 50% of SSE’s issued share capital
in the year; an increased level of engagement
in light of the equity raise which took place
in November 2025. The timeline opposite
sets out the Board’s key interactions within
this programme, outside of which itwas
kept informed of investor sentiment through
various updates across the year. These
included monthly reporting on investor and
market movements, independent feedback
from our brokers on market conditions and
investor sentiment, and regular papers from
the Investor Relations team summarising
wider shareholder engagement and
feedback. Theexamples set out on this
page demonstrate how engagement
duringthe year influenced Board work.
Retail shareholders
Retail shareholders are supported through
adedicated helpline and online Investor
Centre managed by our registrar,
Computershare Investor Services plc
(Computershare). TheInvestor Relations
team and CompanySecretariat are available
to provide support with these channels.
Ourinvestor website also provides a breadth
of relevant information for retail investors,
from regulatory news and published reports
to notifications of known scam activity.
The Board continues to support initiatives
toefficiently manage our share register,
engage with retail shareholders and prevent
their assets from becoming dormant. These
include an asset reunification programme in
conjunction with Georgeson, a subsidiary of
Computershare. See page 266
for details
of this programme.
Understanding shareholder views
Considering investor views on funding
Prior to announcing our fully-funded,
£33bn five-year investment plan in
November 2025, there was significant
investor focus and market commentary
on the various funding options for the
Group beyond 2027. The Board listened
to the range of views expressed,
alongside feedback received during the
May 2025 Full-year Results roadshow
and the June 2025 Chair roadshow.
Alongside operational cash flow
generation, and incremental debt and
hybrid capital, the Board judged the
issuance of new shares, combined
withtargeted asset rotation across the
portfolio, would be the optimum path
tomaximise shareholder value. As
described on page 87
, a non-pre-
emptive placing of shares was chosen
asthe most suitable approach to equity
funding, given the quantum required and
shareholder authorisations which had
been granted at the AGM 2025.
To the extent reasonably practicable and
permitted by law, the Chief Executive
and Chief Financial Officer took part in
awall crossing process toconsult with
anumber of major shareholders
ontheproposed investment plan and
associated placing. The strong interest
and support shown by these investors
informed the Board’s decision to move
forward with the placing.
For more on the five-year investment plan
and the placing, see pages 86 to 87
.
Active engagement on ESG issues
Our investor engagement programme
fosters open and transparent discussion
on ESG issues, recognising that
meaningful sustainability credentials are
an important measure for investors,
analysts and brokers when judging our
non-financial performance.
In June 2025, we held our second
in-person Sustainability Investor
Roundtable, to provide institutional
investors the opportunity to engage
directly with the Chair, Chief Executive
designate, and Chief Sustainability
Officer on sustainability priorities.
Theupdated Net Zero Transition Plan was
a key topic, especially the political and
regulatory interdependencies and the
move to a three-yearly ‘say on climate’
vote at the AGM. Investors expressed
strong support for this approach, which
was reflected at the AGM 2025, where
nearly 98% of the votes cast were in favour
of both the new voting cycle andNet Zero
Transition Report. Other discussion points
included the energy affordability challenge
for customers, thereality of a non-linear
decarbonisation pathway, and the
balance between decarbonisation and
providing security of supply for consumers.
The Board interacted with
shareholders throughout 2025/26,
supported by senior management
and the Investor Relations team. In
addition to the below engagements,
the Board receives and responds to
letters from shareholders throughout
the year.
Q1 2025/26
– The Remuneration Committee
Chair wrote to shareholders to
confirm the decision to proceed
with the proposed changes to
remuneration and to clarify
technical matters on the
measuresapplied.
– Executive Directors met
shareholders during the Full-year
Results roadshow.
– The Chair, Chief Executive
designate and Chief Sustainability
Officer hosted the Sustainability
Investor Roundtable.
Q2 2025/26
– The Chair, and in some cases the
Senior Independent Director
designate, met a number of major
shareholders during the pre-AGM
roadshow to understand investor
views on the proposed AGM
resolutions.
– The Board considered and approved
the Q1 Trading Statement.
– The Board attended the AGM 2025
in Perth and responded directly
toshareholder questions.
– Executive Directors met investors
atindustry conferences.
Q3 2025/26
– The Board considered feedback
from a number of major
shareholders from thewall-
crossing process ahead ofthe
November equity placing.
– The Board considered and
approved the Half-year Results for
the year ended 31 March 2026.
– Executive Directors met
shareholders at the Half-year
Results roadshow.
Q4 2025/26
– Executive Directors met investors
atindustry conferences.
– The Board considered and
approved the Q3 Trading Statement.
Engagement
highlights
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Performance review cycle
The review cycle, illustrated below, reflects
the continuous and structured approach to
assessing Board performance. The process
ensures the Board and its Committees
continue to operate effectively, supporting
strong governance and continual
improvement. For 2025/26, the process
aligned with an internal review and was
facilitated by Alice Breeden at Consello UK
Limited, who conducted the external review
last year.
The internal review process comprised a
structured one-to-one interview between
each Board member and the independent
reviewer and included consideration of
each Board member’s skills. The topics
covered in the interviews were wide ranging
and included:
– The purpose and role of the Board.
– Board and Committee operations.
– Board skills and composition.
– Board culture and dynamics.
– Strategy development and execution.
– Board learning and development.
Considering Board skills
Each year, the Nomination Committee
reviews the skills needed on the Board
to effectively lead SSE. As part of this
year’s review, a skills assessment
aligned to the agreed Board skills
matrix was completed. This confirmed
the current mix of skills remains
appropriate for SSE’s strategic situation
and operating environment. For more
on the Board’s skills, see
page84 .
The Board carries out an annual review of its performance, which considers the impact of its
work, the strength of its decisions, and the contribution each Director makes.
The Board
During a year of significant strategic
development, it was confirmed that Board
members were highly engaged, providing
constructive challenge, as well as offering
support to ensure a smooth and effective
Chief Executive transition. To support
continued effectiveness, the review
identified the following areas for ongoing
focus and refinement.
Strategy and purpose
Noting clear progress across SSE’s strategic
and investment priorities, it was agreed to
focus on the pace of execution to ensure
sharp alignment with agreed plans.
Succession planning
There was a shared view that succession
planning should remain proactive – to
deliver future leadership resilience and
continued orderly refreshment across
non-Executive positions.
Culture and dynamics
Following planned changes across key
Board roles, it was agreed maintaining the
current positive boardroom culture was
important and should continue to
benurtured to support good performance
and constructive debate.
Chair performance
The Senior Independent Director (SID)
undertook the Chair’s evaluation, drawing
on one-to-one discussions with the Board.
The findings agreed the Chair offers
balanced support and challenge, fosters
open Board discussions, and builds trusted
relationships, with his communication with
stakeholders viewed as highly effective.
TheBoard concluded the Chair devotes
sufficient time to the role, provides effective
leadership, and meets the expectations of
the UK Corporate Governance Code 2024.
Individual Director performance
Individual Director performance was
reviewed through one-to-one meetings
with the Chair, covering personal
development needs, training and boardroom
culture. When considered alongside each
Director’s skills, time commitments and
independence assessments (see page 100 ),
the process confirmed that all Directors
contribute positively.
Board Committees
The performance review concluded that
each Committee provided effective Board
support. The development of action plans
toconsider and monitor progress has been
overseen by the Committee Chairs, with
further details in each of the Committee
Reports. See pages 98 to 135 .
Findings and opportunities
Assessing Board performance
Progress on actions
The Board has taken steps to address the opportunities for refinement agreed in last year’s
external performance review. Detail of progress made is set out in the table below.
Refinement opportunities Outcomes and progress
Executive talent and succession
The review highlighted the
importance of continued
focus on executive talent and
succession planning.
– Formal and informal talent engagement between
Board members and the wider talent pipeline has
taken place.
– Board oversight and onboarding activities supported
the transition of Chief Executive.
– An induction programme was completed for the SID.
Strategic opportunities
In light of SSE’s ambitious
growth strategy, an
opportunity was identified to
strengthen alignment on
international markets.
– A session at the annual Board strategy day considered
strategic principles and opportunities across
international markets. The outcome was greater
clarity and alignment on the investment criteria for
international opportunities.
Board operations
It was agreed to keep
refining meeting materials
and to allocate additional
time for the non-Executive
Directors to meet privately.
– The use of a standardised template for Board papers
has been further embedded.
– Additional rigour has been applied when compiling
Board agendas to prioritise material items.
– Additional time has been scheduled for non-Executive
Director meetings.
2024/25
External performance review
2025/26
Internal performance review
2026/27
Internal performance review
2027/28
External performance review
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Our stakeholders and Section 172 Statement
An implicit social contract places key stakeholders – the people, communities and
organisations affected by our actions – within the Board’s decisions.
The Board fosters a reciprocal relationship
with stakeholders that results in
meaningfulinfluence across our business
plans and objectives. While situations will
exist where not every stakeholder interest
can befully addressed, their views are
considered to the greatest extent possible
indecision making across SSE.
This section summarises how the Board has
upheld our social contract through the
discharge of its duties under Section 172
ofthe Companies Act 2006. For an
introduction to our six key stakeholder
groups, see pages 10 to 11
.
How we make decisions
Board priorities
It is the Board’s duty to lead by example and
set the conditions to ensure decisions are
taken fairly and responsibly across the
Group. Our Governance Framework
supports this, through which the Board sets
ambitions and expectations to create
long-term success. These expectations
arereflected in our purpose, strategy and
culture – and in the belief that stakeholder
views should be considered when making
long-term plans and day-to-day decisions.
Cementing SSE’s place at the heart of the
clean energy transition remains the guiding
principle of stakeholder engagement.
Eachyear, the Board approves a set of
engagement priorities which cover the
cross-cutting issues requiring meaningful
and constructive engagement with all
stakeholders. Those agreed to frame
activities across SSE for 2026/27 include:
– Communicating with investors and
otherstakeholders on execution of our
£33bn investment plan.
– Engaging with employees on a refreshed
purpose and a cultural shift designed to
drive performance.
– Maintaining strategic alignment with
theenergy transition ambitions of
governments and regulators in our
homemarkets.
– Working with communities where
weareseeking to build large-scale
infrastructure to explain economic and
community benefits where there are
local concerns.
Considering the long term
Our strategic approach to creating value for
shareholders and society leads to actions
with significant long-term impact. Four
2030 Goals (see page 41
) and a revised
£33bn investment plan underpin strategic
delivery to 2030 and beyond. Clear
parameters set by the Board are reflected
across SSE’s strategic work and objectives,
including in capital investment, the Group
budget, dividends and resource planning.
Our Board-approved risk management
framework – the Group’s Principal Risks,
emerging risks and Risk Appetite Statement
– also shape long-term perspectives.
Considering climate impacts
The significant threat that climate change
poses to the natural world is integrated into
numerous aspects of the Board’s work plan.
We are committed to open and transparent
disclosure to allow stakeholders to assess
our environmental performance and the
Considering our key stakeholders
Employees
Shareholders and
debt providers
Energy
customers
Governments
and regulators
NGOs,
communities
and civil society
Suppliers,
contractors and
partners
Our purpose
To be restless every day until we make electricity clean,
affordable and available for all.
Our strategy
To create value for shareholders and society in a
sustainable way byinvesting in, developing, building and
operating electricity infrastructure and businesses needed
in the clean energy transition.
Our culture
See pages 50 and 90
How we take decisions
potential impact of various climate
scenarios on future financial performance.
See pages 65 to 72 for more information.
Considering business conduct
The Board leads and monitors SSE‘s culture,
by setting the tone and framework within
which agreed values and accepted
behaviours can be embraced by employees.
This includes doing the right thing through
responsible business conduct and making
apositive difference for key stakeholders.
See page90
for more information.
Key learnings
SSE’s strategic stakeholder engagement
isdesigned to ensure all perspectives
areheard and to cultivate a useful
understanding of key stakeholder priorities.
Aligned with legislative and regulatory
requirements, this approach combines
business-led andBoard-level interactions to
enable stakeholders to influence business
plans and objectives.
Examples of how stakeholder interests have
been considered in Board discussions and
principal decisions are set out across the
Governance Report on pages87 to 88
.
Inaddition to those examples, the Board
engaged with the interests of stakeholders
in other ways, asset out overleaf.
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Our stakeholders and Section 172 Statement continued
Employees
Our strategy and success depend on the shared talent, diversity, innovation and
values of the people we employ.
How the Board engaged
– Employee-focused work by the
Non-Executive Director for
EmployeeEngagement.
– Site visits and attendance at
engagement events, allowing
employees to engage directly with
Executive and non-Executive
Directors.
– Assessments and reviews of
SSE’sculture.
– Updates on the impact of
organisational changes across SSE.
Key engagement issues in the year
– Employee sentiment on strategy and
culture, as work progressed under
theGroup Operating Model and
Efficiency Review.
– Employee wellbeing and support to
address the impact of the 2025
efficiency programme.
– SSE’s employee offering, including
reward, benefits, flexibility, inclusivity
and development opportunities.
Impact on Board decisions
Feedback from employees shaped action
plans to address all-employee survey
results, which included enhanced senior
leadership communication and the move
to a full survey annually. Seepages90 to
92
for more.
Shareholders
and debt providers
We must be well-financed, with the ability to remunerate shareholders, secure debt
at competitive rates andgrow the business.
How the Board engaged
– A programme of physical and virtual
Director-investor meetings and
roadshows covering financial
announcements, long-term priorities
and issues raised by investors.
– Director attendance at investor
conferences.
– Direct engagement at the AGM, where
shareholders asked questions
in-person and online.
– Executive Directors engaging with
credit rating agencies used by debt
providers.
Key engagement issues in the year
– Clarity around SSE’s investment plans
beyond 2027.
– Financial performance compared to
market expectations.
– Impacts on existing dividend policy
arising from the investment plan
decision.
Impact on Board decisions
This year, shareholder engagement
informed the Board of investor priorities
when considering funding options
forpart of our £33bn investment
programme. Seepages86 to 87 and93
for more.
Energy
customers
Consumers create demand for the energy and services we provide and setthe tone
for our purpose.
How the Board engaged
– Updates from our customer-facing
Business Units on the influence of
customer factors on business
direction and propositions.
– Monitoring performance to ensure an
appropriate level of customer service
and investment.
– Overseeing how SSE responds and
supports its customers during
significant storms through
management updates.
Key engagement issues in the year
– Energy affordability and support
mechanisms for energy supply
customers.
– Impact of significant winter storms
onour SSEN Distribution customers.
– Proposed business plans for electricity
network price control settlements.
Impact on Board decisions
Engagement highlighted priorities around
affordability, service quality and support
for vulnerable customers, as the Board
oversaw deliveryof our regulated
investment plans and wider
transformation initiatives to enhance
customer experience. Seepages86 to
88
for more.
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Governments
and regulators
We rely on policy frameworks and public services that support investment in critical
national infrastructure, are fair on customers and maintain the momentum behind
the clean energy transition.
How the Board engaged
– Direct constructive engagement
withthe UK Government (and the
devolved administrations) and Irish
Government, regulatory bodies,
andpolitical stakeholders.
– Overseeing the implementation of
SSE’s Political Engagement Policy
andrelated advocacy priorities.
– Monitoring engagement with
regulators to make sure strategic,
financial, operating and investment
frameworks stay aligned to the
external landscape.
Key engagement issues in the year
– Supporting with the delivery of the UK
Government’s Clean Power 2030 Plan.
– The commencement of RIIO-T3 and
execution of RIIO-ED2.
– Engagement with the UK Government
on the potential impacts of zonal
pricing.
Impact on Board decisions
This year, the Board reviewed
regulatorydevelopments and endorsed
engagement priorities to promote
policyframeworks to enable sustained
investment through to 2030 and beyond.
See pages86 to 88
for more.
NGOs, communities
and civil society
We need the support of the communities wework in and the backing of civil society
to pursue aclean energy transition.
How the Board engaged
– Receiving updates on our 2030 Goals
aligned to the UN Sustainable
Development Goals.
– Considering the community impact
and benefits of large capital projects.
– Deepening understanding of local
community priorities through
sitevisits.
Key engagement issues in the year
– Impact on communities in the north
ofScotland from SSEN Transmission’s
Pathway to 2030 projects.
– Balancing delivery of UK climate goals
while remaining mindful of energy
affordability.
– Objectives and outcomes of SSE’s
community investment programmes.
Impact on Board decisions
During the year, the Board oversaw
theapproach to supporting local
communities and promoting biodiversity
in the areas where our projects are
developed and operated. See pages86
to88
formore.
Suppliers, contractors
and partners
We rely on a healthy supply chain andwork with partners with capabilities to
support innovative project development and efficient ownership structures.
How the Board engaged
– Executive Director meetings with
strategic partners and suppliers.
– Progress updates on joint venture
project strategy.
– Reports on contractor safety
performance and initiatives.
Key engagement issues in the year
– Continued engagement with SSE’s
immersive safety training programme.
– Securing supply chain capacity for
delivery of large capital projects
to2030.
– Ensuring economic opportunities
inlocal supply chains in the north
ofScotland.
Impact on Board decisions
During the year, the Board championed
our immersive safety training
programme, now completed by over
3,100 partners, and oversaw actions to
secure SSEN Transmission’s supply chain
capacityfor its Pathway to 2030 projects.
See pages86 to 88
for more.
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The role of the Committee
The Nomination Committee brings a
dedicated focus to people-centred
matters. It leads the process for Board
appointments, monitors senior talent
pipelines, promotes leadership
diversity and ensures that proper
procedures are in place for the
nomination, selection, training and
performance review of Directors.
For details of the role and
responsibilities of the Committee, see
its Terms of Reference on sse.com
.
ensure these transitions were executed
effectively, which was particularly crucial for
the role of Chief Executive. Under Martin’s
leadership, the membership of the Group
Executive Committee (GEC) has been
expanded, to drive further momentum
behind strategic plans and ensure SSE
iswell positioned within a volatile and
challenging external environment.
Alistair and Helen have passed on excellent
platforms to build on, and both leave SSE
with our profound thanks and best wishes
for the future. Looking ahead, I highly value
the expertise and depth of knowledge that
Martin, Hixonia and Dame Angela have
demonstrated in their new roles, and
believe these changes clearly augment our
Board’s capabilities as we progress the next
phase of SSE’s strategic growth.
Within the year, Liz Tanner, our Group
General Counsel and Company Secretary
signalled her intention to retire. Following
acompetitive recruitment process, a
recommendation was made to appoint
Tracey Wood as her successor from late
2026. We look forward to working with
Tracey when she joins SSE later in the year.
As the complexities of the clean energy
transition become more apparent, we
remain focused on assessing the Board’s
skills and experience to ensure they are
aligned to the needs of SSE and its
operating context. This will ensure our
Board members can continue to deliver
meaningful contributions to Board and
Committee discussions.
Building a diverse talent pipeline
The effort to transform the energy system
isone that will span decades. It is therefore
integral to SSE’s success that we maintain
astrong talent pipeline and strategic
approach to future workforce and skill
requirements. A diverse pipeline, that
reflects the multitudes of experiences and
perspectives within our communities, is of
critical importance. We are proud to have
achieved our ambition of 40% female
representation within the GEC and its direct
reports by October 2025. However, we
recognise there is always more work to do,
with a key priority monitoring progress
towards our ambition of 6% ethnic minority
representation in senior leadership by
December 2027. Mindful of the findings
from the FTSE Women Leaders Review
published in February 2026, we remain
committed to strengthening the diversity of
our senior talent pipeline and will continue
to identify levers to drive meaningful
progress against our diversity ambitions.
Setting priorities for 2025/26
The outcomes of the annual Board and
Board Committee performance review (see
page 94 ) have given us a clear plan for the
year ahead. We will continue work with our
Executive Directors and Group HR team to
embed new senior leadership recruits and
to build our talent pipeline. To support
planned Board departures, we’ll maintain
focus on our medium- and long-term
succession plans and the skills to guide
thenext phase of investment to 2030,
andthe challenges and opportunities that
lie beyond.
On behalf of the Committee, I’d like to
thank you for reading our report and hope
it’s an informative account of our work.
Sir John Manzoni
Chair of the Nomination Committee
27 May 2026
I’m pleased to present our Committee
report for 2025/26. This year marks one of
considerable change for SSE, as we have
accelerated the Group’s strategic ambitions
under the helm of a new Chief Executive
and a strengthened senior leadership team.
In response, we’ve proactively overseen
theBoard transitions following our AGM
inJuly 2025, whilst also advancing robust
succession planning to ensure we’re fully
prepared for orderly Board changes as
theyarise. We reviewed Directors’ time
commitments and non-Executive Directors’
independence. And we continued to
consider tangible initiatives to promote
greater inclusion and diversity.
Evolving Board membership
In 2024/25, we led thorough succession
planning processes for the key roles of
Chief Executive and Senior Independent
Director (SID), in line with the planned
departures of Alistair Phillips-Davies and
Helen Mahy after the AGM in 2025. This
resulted in several significant changes to
ourBoard and Committee membership,
including the appointments of Martin
Pibworth as Chief Executive; Hixonia
Nyasulu as SID; and Dame Angela Strank
asSafety, Sustainability, Health and
Environment Advisory Committee (SSHEAC)
Chair. Our priority this year has been to
Nomination Committee
Report
“As the complexities of the clean energy
transition become more apparent, we
remain focused on assessing the Board’s
skills and experience to ensure they are
aligned to the needs of SSE.”
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Membership and attendance
The Committee comprises all of SSE’s non-Executive Directors and the Board Chair, who is also the Committee Chair. The Group
General Counsel and Company Secretary is the Secretary, and the Executive Directors attend meetings as appropriate. See pages 80
to 82
for member biographies. The Committee met five times in 2025/26, with attendance set out on page 84 .
Committee performance review
In line with our structured review cycle, the annual review of Committee performance was an internal process for 2025/26
(see
page94 ), facilitated by Consello. This confirmed the Committee’s continued effective operation and actions for 2026/27.
Review
confirmed
– The Committee effectively managed a comprehensive Chief Executive succession process.
– Executive succession and leadership development has been prioritised, with GEC membership expanded to
align with SSE’s strategic needs.
– The Committee paid particular attention to the benefits of diversity for effective leadership.
– The Committee ensured a smooth transition and effective handover for the roles of SID and SSHEAC Chair.
Actions for
2026/27
– Continue to enhance executive succession and leadership development by overseeing actions to embed
andretain recent senior talent hires, supported by non-Executive Director engagement with the talent pool.
– Continue to focus on opportunities to support meaningful progress towards achieving diversity ambitions.
– Consider orderly succession plans for the EMRC and Remuneration Committee Chair positions.
– Continue to align routine Board succession planning to the strategic direction of SSE.
Governance
Ensuring effective leadership
Board composition
As the biographies and tables outlining the
Board’s composition and competencies
show (see pages 80 to 82 and 84
),
theSSEBoard is diverse in terms of skills,
experience, gender and ethnicity.
The Committee regularly assesses Board
composition against the criteria it believes is
needed to effectively lead SSE in agreeing
its strategy, setting and overseeing the
desired culture, and ensuring long-term
sustainable success. The Board’s skills
matrix sets out what these attributes are
(see page 84
) and this is used to guide
succession planning, as through regular
review it enables identification of any
potential gaps thereby helping to shape the
brief for prospective Board appointments.
The Board’s Inclusion and Diversity Policy,
planned departures, and the regulatory
landscape in which SSE operates also
inform this process.
The diagram below describes the steps
which typically guide appointments to the
Board. Details of how this process resulted
in the appointment of Hixonia Nyasulu as
SID and Martin Pibworth as Chief Executive
can be found in the Nomination Committee
Report2025.
Board changes
The Committee agreed a number of key
succession planning activities in 2024/25
that came into effect this year. At the
conclusion of the AGM 2025, both Alistair
Phillips-Davies and Helen Mahy did not seek
re-election and retired from the Board.
Martin Pibworth and Hixonia Nyasulu then
assumed the respective roles of Chief
Executive and SID. At this time, the
responsibilities of Chief Commercial Officer
were integrated with that of Chief Executive,
and leadership of the IT and Cyber Security,
and General Counsel and Company
Secretarial functions, transitioned to the
Chief Financial Officer.
The Committee did not undertake any new
Director recruitment in 2025/26, focusing
instead on the agreed transitions across
Board roles and future Board skills and
recruitment needs.
Board renewal
In 2025/26, the Committee recommended
that John Bason and Dame Angela Strank
be reappointed to the Board as non-
Executive Directors for a second and third
three-year term respectively. These
recommendations were supported by the
continued independence, experience and
contribution of each Director. No Director
took part in discussions or decisions relating
to their own reappointment.
Step 1
Confirming recruitment
objectives
The Committee and
Board agree the objective
of the process and the
role specification. This
isbased on reviews of
Board composition, skills,
experience, perspectives
and SSE’s strategic needs.
Potential gaps may be
identified as a result of
planned Board
departures.
Step 2
Engaging an external
recruitment firm
The Committee will
engage a search firm,
ensuring it is a signatory
to the voluntary code of
conduct for executive
search firms.
The search firm and
Committee will establish
a diverse longlist of
candidates, considering
fitwith the role
specification, interest,
bandwidth and potential
conflicts.
Step 3
Agree a shortlist and
interview
Once the Committee
hasreviewed the longlist
based on cultural and
technical fit, it will agree
ashortlist of candidates
to interview.
Following interviews, the
Committee will identify
one or more candidates
to meet with as many
members of the
Committee and Board
aspossible.
Step 4
Making a
recommendation
Considering all relevant
search criteria, an
individual’s independence
(for non-Executive
positions), and capacity
totake on the role,
theCommittee will
recommend the
appointment of the
preferred candidate to
theBoard.
Board appointment process
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Inducting new Directors
All Directors receive a comprehensive and
bespoke induction. This is designed with
theChair and Group General Counsel and
Company Secretary, considering each
Director’s expertise and potential Board or
Committee roles. It includes one-to-one
meetings with the Chair, Executive Directors,
Group General Counsel and Company
Secretary, members of the Group Executive
Committee, and other senior leaders.
Inductions familiarise Directors with SSE’s
operations, strategy, culture, governance,
and the regulatory environment in which
itoperates. They also generally include
meetings with external advisors and visits
tokey sites. Once appointed, Directors
aregiven access to SSE’s electronic Board
paper portal – this contains past Board and
Committee papers, key internal policies,
and information pertinent to the duties of
aDirector of a listed company.
Details of bespoke induction programmes
completed for Hixonia Nyasulu, Martin
Pibworth in his transition to Chief Executive,
and Dame Angela Strank in her transition
toSSHEAC Chair can be found in the
Nomination Committee Report 2025.
Company Secretary
Following notification from our Group
General Counsel and Company Secretary,
Liz Tanner, of her intention to retire in 2026,
a competitive recruitment process was run
to identify a recommended successor to her
role. The Board approved the appointment
of an external candidate, Tracey Wood, who
will join SSE from Balfour Beatty later in
2026. Tracey will continue in the joint
position of Group General Counsel and
Company Secretary and brings over
25years’ experience of leading legal and
corporate governance teams in the
construction and engineering sectors.
Capability and development
Group Executive Committee changes
As Martin Pibworth has transitioned into
therole of Chief Executive and SSE has
repositioned its strategic ambitions, the
Committee and Board have remained
updated on senior leadership changes to
expand the specialist knowledge within the
GEC. In August 2025, Nikki Flanders, ECS
Managing Director, was appointed as a
member. Rhian Kelly, Chief Sustainability
Officer and Thomas Brostrøm, Managing
Director, Business Development were
appointed upon joining SSE in November
2025 and April 2026 respectively.
Succession planning
The Committee works closely with Group
HR to support SSE’s continued ability to
recruit talent and develop the skills,
experience and knowledge needed at
Executive Director and below-Board level to
ensure the Company’s long-term success.
The internal pipeline of people with the
potential to move into key leadership and
functional roles, whether in the short or
long term, is regularly reviewed and
challenged. Recent hires and external talent
pools are also considered.
Building capability and capacity
SSE is committed to investing in its people
through targeted development initiatives to
build capability. External providers support
with some of these initiatives, which are
designed to create the education, exposure
and experience required to deliver
SSE’sstrategy.
To support this, the Committee regularly
reviews development activity and
overseestalent programme participation.
Members of this Committee also engage
with SSE’s emerging leaders through talent
sessions, Board-level presentations,
informal interactions, business-led sessions
and internal conferences, and opportunities
for coaching and mentorship.
Committee changes
When appointing Board Committee members
and considering key Board roles, the
Committee strives to:
– Ensure alignment between skills and
specific Committee and individual
responsibilities.
– Prevent undue reliance on any one
Director.
– Comply with recognised guidance,
including the UK Corporate Governance
Code 2024 (the Code).
A number of updates to Committee
membership were agreed in the year in
response to succession plans. After the
AGM 2025, the following changes took
effect. Dame Angela Strank became Chair
of the SSHEAC as Helen Mahy stepped
down from the Board. Hixonia Nyasulu
became a member of the Audit Committee
and SSHEAC. Upon becoming Chief
Executive, Martin Pibworth stepped down
from the SSHEAC and EMRC. Tony Cocker
stepped down from the SSHEAC to align
thenumber of his Board commitments
withthat of the other non-Executives.
External appointments
The Committee ensures Directors have
thetime to perform their agreed Board
andCommittee roles. Before a Director’s
appointment, their external commitments
and demands on time are assessed to
confirm capacity to take on the role.
Theamount of time expected of them is
specified in their Letter of Appointment.
Following appointment, a Director can
onlyaccept additional commitments with
approval from the Board. This is granted
following review of the individual’s
circumstances and provided the Board
issatisfied the Director can continue to
giveenough time to their SSE role.
In the period to 27 May 2026, approvals
were given for Lady Elish Angiolini, John
Bason, Melanie Smith and Maarten
Wetselaar. Key changes are reflected on
pages 80 to 82
. In each case, the Board
confirmed that the appointment would not
affect the Director’s time commitment to
SSE or create a conflict of interest.
Conflicts of interest and independence
The Committee reviews SSE’s Conflicts of
Interest Register and the independence of
Board members. This involves considering
the principles relating to independence in
the Code and taking into account each
Director’s character, objectivity and integrity.
After its review in 2025/26, the Committee
recommended that the conflicts or
potential conflicts of interest detailed in the
Register be authorised and that all non-
Executive Directors be seen as independent.
This was confirmed by the Board.
Nomination Committee Report continued
Coaching emerging talent
2025/26
Every year, members of the
Committee and wider Board meet
with an array of employees to
monitor, coach and develop our
talent. Below are some highlights
from the year:
– Before her retirement, Helen Mahy
sat on the judging panel for the
Graduate Sustainability Project in
June 2025. The event provides an
opportunity for graduates to tackle
real challenges with their own
innovative, sustainable solutions.
Helen gained valuable insight
anddirect access to talented
graduates, allowing her to provide
targeted, informal coaching.
– Hixonia Nyasulu, Tony Cocker,
Melanie Smith and Maarten
Wetselaar attended a dinner with
future talent in May 2025. The
evening provided a chance for
Committee members to interact
informally with our strong
leadership pipeline and converse
openly on the qualities needed
tobecome a leader.
– Dame Angela Strank, Lady Elish
Angiolini and Dame Debbie
Crosbie attended a dinner for
oursenior women leaders in
November 2025. The evening
offered a supportive environment
to hold candid conversations about
the meaningful and sustained
action needed to promote equality
of opportunity at the top.
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those with a disability. More detail on our
overarching inclusion and diversity strategy
and ambitions can be found on page 51
.
Senior leadership diversity
The Committee reviews inclusion and
diversity below Board level, including
strategy, plans and activities to create a more
inclusive and diverse environment. It works
with the Executive Directors and Group HR
to develop action plans that support SSE’s
senior leadership diversity ambitions and
monitors their progress.
Ethnicity. The Committee considered
ourposition against the previously
agreedambition of 6% ethnic minority
representation in senior leadership to be
achieved by December 2027, supporting the
Parker Review recommendation to agree an
appropriate target for this population. With
progress being made in the year to reach
alevel of 3.6%, it believes this ambition
remains a credible focus for the next year.
Group-wide diversity
Group-wide ambitions and supporting data
allow the Committee to track changes in
thecomposition of the overall employee
population. Despite the impact of the Group
Efficiency and Operating Model Review
across 2025/26, which resulted in decreased
hires and increased leavers, the Committee
was pleased to see the sustained progress
across inclusion and diversity measures
overrecent years, with small increases in
therepresentation of ethnic minorities and
Board Inclusion and Diversity Policy
How the policy links to strategy
People are at the heart of the transformational change needed to achieve a clean energy transition, and we believe innovative
solutions toclimate change require diverse views, experiences and skills. A diverse Board brings constructive challenge and fresh
perspectives to discussions. The principles of equality, fairness, inclusion and diversity must be at the centre of everything we do to
effectively deliver our strategic aims.
Policy principles
Leadership and composition
– Identify Board and Committee needs including the balance of
diversity characteristics.
See page 84
.
Culture and strategy
– Nurture an inclusive Board and Committee culture.
– Be aware of stakeholder expectations and challenge
targets inwider strategy.
See pages 90 and 101 .
Recruitment
– Adopt a formal and inclusive Board recruitment process.
– Engage executive search firms who have signed the enhanced
code of conduct and discuss ambitions for diverse candidate lists.
– Recruit based on an objective and shared understanding of merit.
See page 99
.
Succession
– Oversee work to develop a diverse talent pipeline.
See pages 100 to 101 .
Policy goals
– Goal. At least 40% of Board positions are held by women, with the
aim to stay as close to gender parity (50%) as possible on a rolling
basis.
45% women on the Board as at 27 May 2026. 43% rolling
three-year female representation as at 31March 2026.
– Goal. At least one woman in the roles of Chair, Senior
IndependentDirector, Chief Executive or Chief Financial Officer.
The role of Senior Independent Director is held by a woman.
– Goal. At least one Director from an ethnic minority
background.
Two Directors are from an ethnic minority background.
– Goal. At least one woman as a member of each of the
Board Committees.
At least two women sit on each of the Board’s
Committees.
Inclusion and diversity
Details of SSE’s Group-wide inclusion and
diversity strategy, along with examples of
initiatives underpinning it, are set out on
pages 50 to 52
.
Board and senior leadership diversity
ambitions and targets are set in line with the
FTSE Women Leaders Review, the UK Listing
Rules and the Parker Review. See the table
on page 141
for details of the gender
andethnic diversity on the Board and GEC.
Board diversity
The Board aims to set the right tone from
the top and foster a diverse organisation
that welcomes all views, perspectives and
experiences. To this end, it operates under
astandalone Inclusion and Diversity Policy
which aligns its membership with SSE’s
purpose, strategy and culture through
agreed principles and ambitions. The full
policy can be found on sse.com
.
The Committee reviews the policy annually
and from time to time recommends
changes that may enhance the diversity of
the Board and its Committees. This year,
aminor change was made to codify the
existing senior leadership ethnicity
ambition. Policy implementation is assessed
by reviewing the diversity of the Board and
Committees and evaluating progress
against set goals.
Gender – progressing female
representation
The Committee was pleased that we
met our ambition of attaining 40%
female representation across the
Group Executive Committee and
itsdirect reports by October 2025.
This now ongoing ambition aligned
with the recommendations of the
FTSE Women Leaders Review. It was
achieved following targeted action
with Group HR, including support for
colleagues returning from extended
leave, strengthened networking and
sponsorship opportunities, and
focused learning and development
programmes. Recognising that
progress at this level is not always
linear, as changes to the composition
of this relatively small group of people
can affect overall representation, the
Committee will maintain focus on
inclusive and accessible recruitment
and succession planning to build a
diverse leadership pipeline.
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The role of the Committee
The Audit Committee provides
independent oversight of the integrity
of SSE’s financial reporting, the
effectiveness of internal control and
risk management arrangements, and
the performance, independence and
quality of the internal and external
audit functions.
Further details on the Committee’s
role and responsibilities are set out in
its Terms of Reference, available on
sse.com
.
on established frameworks and
strengthened integrated assurance,
providing the Committee with confidence
that appropriate arrangements are in place
to support compliance with Provision 29
across 2026/27. Further detail is set out in
the Risk Management and Internal Control
section of this report on page 108 to 109
.
Non-financial reporting assurance
The role of non-financial reporting
continues to grow, driven by regulatory
developments and increased focus on
sustainability and governance disclosures.
During the year, we monitored progress
against the Group’s non-financial reporting
assurance framework and plan, which is
designed to strengthen the reliability of
keydisclosures through a proportionate,
risk-based approach. We recognise the
importance of this reporting to stakeholders
and believe that the enhanced assurance
processes implemented during the year will
provide greater confidence in the quality,
consistency and transparency of non-
financial disclosures, while focusing on
matters of greatest material importance.
Robust financial controls
During the year, we monitored the activities
of the recently established Financial
Controls Centre of Excellence and the
three-year roadmap to evolve our financial
control framework and embed a stronger
controls culture across the Group. We
recognise the importance of maintaining
robust financial controls to optimise
processes, enhance operational efficiency
and support effective financial reporting.
We were satisfied with progress delivered
during the year and will continue to track
delivery against the agreed roadmap.
Financial reporting
The Committee reviewed the Group’s
Annual Report and Interim Financial
Statements, paying particular attention
tothe clarity, accuracy and completeness
ofdisclosures, significant accounting
judgements and areas of estimation
uncertainty. Following challenge of
management and consideration of
theExternal Auditor’s findings, we
recommended that the Board approve
theFinancial Statements, the Going
Concern and Viability Statements, and
therelated letter of representation.
External audit and audit quality
We maintained close oversight of the
external audit process throughout the year.
The Committee was satisfied with the
quality and rigour of the audit, including
theapplication of appropriate professional
scepticism and robust challenge of
management’s key judgements. The
Committee also continued to monitor
theindependence and objectivity of the
External Auditor and were satisfied that
these were maintained.
Committee changes
Hixonia Nyasulu succeeded Helen Mahy as
a member of the Committee following the
AGM 2025. The Committee welcomed her
broad international experience in the energy
sector, which has further strengthened the
Committee’s deliberations.
We remain confident in SSE’s strong control
environment and hope this report gives
shareholders a clear insight into the
Committee’s work during the year.
John Bason
Chair of the Audit Committee
27 May 2026
I am pleased to present the Audit
Committee’s report for the financial year
2025/26, which outlines the Committee’s
principal areas of focus and how it has
supported the Board. Through focused
challenge and assurance, we supported
theBoard in maintaining robust financial
reporting, effective internal controls and
high standards of audit quality across
theGroup.
Governance reforms
Throughout the year, we received regular
updates on preparations for compliance
with the UK Corporate Governance Code
2024 (the Code), with particular focus on
Provision 29. While the requirement for a
formal Board declaration will apply from
the2026/27 financial year, we treated
2025/26 as a transitional year, supporting
management in developing and making
ready the robust approach to evidencing
the effectiveness of the Group’s systems
ofrisk management and internal control
inthe new financial year.
As part of this work, we reviewed the
Group’s approach to identifying, monitoring
and testing material controls, together
withthe governance processes supporting
effective oversight and transparent
disclosure of the risk management and
internal control framework. This work builds
Audit Committee
Report
“Through focused challenge and
assurance, the Committee supported
the Board in maintaining robust
financial reporting, effective internal
controls and high standards of audit
quality across the Group.”
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Financial reporting
The Committee’s primary responsibility is to
review and provide guidance to the Board
regarding the accuracy and clarity of the
Group’s financial statements, including
theAnnual Report and Interim Financial
Statements. It is committed to ensuring
these documents present SSE’s financial
position, performance, business model,
andstrategy in a clear and comprehensive
manner. In fulfilling this role, it examines:
– accounting policies and practices used
(see A1
Accompanying information to
the financial statements);
– accounting judgements and estimation
uncertainty (see note 1.2 , page 247 );
– significant financial judgements and
estimation uncertainties (see pages 104
to 106 );
– the independent auditors’ report on
approach to key audit matters (see
pages254 to 264 );
– Going Concern and Viability statements
(see page 76 );
– the fair, balanced and understandable
assessment (see page 103 );
– Internal Audit and Risk Management and
Internal Control (see pages 107 to 109 );
and
– compliance with accounting standards
and financial reporting requirements,
such as the UK Corporate Governance
Code and IFRS.
Following thorough Committee review,
itrecommended the Board approve the
Financial Statements, the Going Concern
Statement, and the letter of representation
to the External Auditor. This was made
aftercareful consideration of the clarity,
accuracy, and integrity of the disclosures,
aswell as the robustness of management’s
assessment of the Group’s financial position
and ongoing viability.
Viability and Going Concern
The Committee examined and challenged
management’s assessment of SSE’s
long-term viability and its ability to continue
as a Going Concern over the next 18 months.
The Committee was satisfied that the
viability assessment process was robust,
and that a four-year assessment period
remained appropriate. These considered
how SSE could withstand different scenarios
reflecting its current risk exposures. After
reviewing supporting information, the
Committee concluded that both the Group
and SSE plc as the parent company had
enough headroom to continue as a Going
Concern and that they had a reasonable
expectation that the Company would
continue to meet its financial liabilities over
the period to 2030. In the unlikely event of
not being able to refinance maturing debt,
the Group would be able to access the
revolving credit facility, defer uncommitted
capex, make further cost reductions,
anddelay or defer dividend payments.
The Financial Statements have been
prepared on a Going Concern basis (see
A6.3
Accompanying information to the
financial statements).
Ensuring a fair, balanced and
understandable Annual Report
The Committee supports the Board’s
assessment of whether the Annual Report
isfair, balanced and understandable,
andwhether it provides the information
necessary for shareholders to assess
SSE’sposition, performance, business
model and strategy. In doing so, the
Committee reviewed the assurance
processunderpinning the Annual Report,
which included:
– consideration of reports from the External
Auditor on material inconsistencies;
– review of the verification undertaken on
the factual content of the Annual Report;
– consideration of feedback received
during the drafting process from
Directors and senior management,
independent senior management and
SSE’s brokers, to ensure appropriate
balance, consistency and alignment with
performance, strategy and the financial
statements; and
– confirmation from senior management
that, based on the assurance activities
undertaken, the Annual Report was fair,
balanced and understandable.
On the basis of this work, the Committee
provided its advice to the Board to support
the Board’s final determination that the
Annual Report was fair, balanced and
understandable.
Non-financial and sustainability
reporting
The Committee closely monitored SSE’s
approach to non-financial reporting and
theunderlying governance, risk and control
environment that supports it, including
sustainability and regulatory disclosures
within the Annual Report.
As part of this oversight, the Committee
reviewed climate-related and sustainability
disclosures, considering the alignment
between narrative reporting, risk and
strategy, and the consistency between
financial and non-financial disclosures.
Thisincluded reporting aligned with the
Task Force on Climate-related Financial
Disclosures (TCFD) recommendations
andthe Group’s developing approach to
theupcoming UK Sustainability Reporting
Standards (SRS). The review covered
climate-related risks and opportunities,
supporting governance andprocesses,
andassociated assurance arrangements.
Membership and attendance
The Committee comprises five non-Executive Directors: John Bason and Debbie Crosbie, who bring financial expertise, as well as
Tony Cocker, Maarten Wetselaar, and Hixonia Nyasulu, who possess backgrounds in the energy sector. See
pages 80 to 82
for
member biographies. Committee meetings are regularly attended by the Board Chair, Chief Financial Officer and Director of Group
Risk and Audit, and External Auditor, with senior finance and business managers participating as required. To facilitate open and
transparent discussions, the Committee also meets privately at least twice a year with the Director of Group Risk and Audit and
External Auditor without management present.
The Committee met four times in 2025/26 with attendance set out on page 84
.
Committee performance review
In line with our structured review cycle, the annual review of Committee performance was an internal process for 2025/26, facilitated
by Consello (see page 94 ). This confirmed the Committee’s continued effective operation and actions for 2026/27. Good progress
was made during the year on the agreed actions ahead of 2026/27, including a review of the key activities set out in the Committee’s
Terms of Reference and the streamlining of Committee papers to promote clearer, more focused discussion.
Review confirmed
– The Committee operates efficiently, with members consistently demonstrating preparedness and
participating in open discussions.
– The Chair offers strong leadership that promotes an environment of transparency and collaboration.
Actions for 2026/27
– Ensure the Committee’s scope is appropriately balanced on its key risks, and monitor and manage any
potential overlap with other Board Committees to maintain clarity of remit and effective risk oversight.
Governance
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advisory work supporting sustainability
disclosures. No material errors were
identified. The Committee reviewed
management’s actions to address identified
areas for improvement and approved
therisk-based non-financial disclosure
assurance programme for 2026/27.
In fulfilling its responsibilities, the
Committee received updates on
developments in the external reporting
environment, including changes to the EU
Corporate Sustainability Directive (CSRD)
implementation timelines and the
UKCorporate Governance Code 2024.
TheCommittee also continued to
overseemanagement’s work to strengthen
the non-financial reporting control
environment in support of future
regulatoryreadiness.
Further information is set out in the
statement on non-financial and
sustainability information on page
75
.
Based on this work, and positive stakeholder
feedback, the Committee approved the
continued integration of climate-related
disclosures throughout the Annual Report
and recommended to the Board that the
disclosures were fair, balanced and
understandable.
The Committee also monitored the internal
assurance framework underpinning
non-financial information and received
updates during the year on targeted
assurance activity. This included reviews
ofinclusion and diversity metrics, safety
performance data, waste indicators and
Significant financial judgements and estimates for the year ended 31 March 2026
The Committee received comprehensive reports from both the Chief Financial Officer (CFO) and the External Auditor regarding aspects
of Financial Statements requiring significant judgements or estimation uncertainties as well as other matters brought to its attention. In
consultation with EY, SSE’s External Auditor, the Committee examined, monitored and challenged the appropriateness of those views, and
found them to be robust and justified.
Matters considered How these were addressed by the Committee Committee conclusions
Impairment testing and valuation of certain non-current assets (financial judgement and estimation uncertainty)
The Group reviews the carrying amounts of
itsgoodwill, other intangible assets, specific
property, plant and equipment and investment
assets to determine whether any impairments
or reversal of impairments to the carrying
value of those assets requires to be recorded.
Where an indicator of impairment or
impairment reversal exists, the recoverable
amount of those assets is reassessed by
reference to value in use calculations or fair
value less cost to sell assessments, if more
appropriate. As well as its goodwill balances,
the specific assets under review in the year
ended 31 March 2026 are intangible
development assets in Southern Europe and
Japan; specific property, plant and equipment
assets related to Gas Storage; specific onshore
Renewables assets; and the Group’s thermal
power station at Great Island in Ireland.
In addition, the Group performed impairment
reviews over the carrying value ofits equity
investments in the Dogger Bank Wind Farm
joint ventures (JVs); Neos Networks Limited;
and Triton Power Holdings Limited.
An annual impairment testing and valuation of
certain non-current assets exercise iscarried out
by SSE Finance, with management presenting
theoutcome of thisreview to the Committee.
In conducting its reviews, the Group makes
judgements and estimates determining both
thelevel of cash generating unit (CGU) at which
common assets such as goodwill are assessed
against, as well as the estimates and assumptions
behind the calculation of recoverable amount of
the respective assets orCGUs.
Changes to the estimates and assumptions
onfactors such as regulation and legislation
changes (including relevant climate change
related regulation), power, gas, carbon and other
commodity prices, volatility of gas prices, plant
running regimes andload factors, discount rates
and other inputs could impact the assessed
recoverable value of assets and CGUs and
consequently impact the Group’s income
statement and balance sheet.
Further detail of the calculation basis and key
assumptions used in the impairment reviews,
impairment test results, and the sensitivity of
these assessments to key assumptions is
disclosed at note15
. Detail on the accounting
policies applied is included in the Accompanying
Information at A1
.
The Committee reviewed and
challenged the assumptions and
projections and considered the
External Auditor’s reporting and
findings. Following this review, the
Committee supported the judgements
made to recommend the recognition
of exceptional impairment charges of
£155.8m in relation to the Aberarder
and Strathy South assets under
construction due to project delays
and the exceptional reversal of
impairment charges of £77.9m in
relation to the Gas Storage facilities
and Triton Power Holdings Limited.
The Committee also supported the
judgements made not to recognise
further impairment charges associated
with other assets including in relation
to the Group’s Southern Europe
platform’s goodwill and intangible
development assets and the Japanese
Pacifico Renewables development
platform.
Audit Committee Report continued
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Significant financial judgements and estimates for the year ended 31 March 2026
Matters considered How these were addressed by the Committee Committee conclusions
Retirement benefit obligations (estimation uncertainty)
The Group sets its assumptions in relation to
the cost of providing post-retirement benefits
after consultation with qualified actuaries.
While these assumptions are believed to be
appropriate, a change would impact both the
level of retirement benefit obligation recorded
and the cost to the Group of administering
theschemes.
The assets and liabilities of the Group’s defined
benefit retirement schemes are regularly
reviewed and advice is taken from independent
actuaries on the IAS 19 valuation of the schemes.
The Committee considered how the schemes
were valued and the External Auditor’s findings
on the scheme’s key assumptions relative to
market practice.
Following this review, the Committee
supported the judgements made.
See note 23
for details of
thecalculation basis and key
assumptions, resulting movements
inobligations, andthe sensitivity of
key assumptions to the obligation.
Revenue recognition – customers unbilled supply of energy (estimation uncertainty)
Revenue from the energy supply activities
undertaken by the Group’s Energy Customer
Solutions business includes an estimate of
thevalue of electricity or gas supplied to
customers between the date of the last meter
reading and the year end. Seenote 4.1 (iii)
fordetails of the estimation.
This unbilled estimation is subject to an internal
corroboration process. This compares calculated
unbilled volumes to a theoretical “perfect billing”
benchmark measure of unbilled volumes (in GWh
and millions of therms). It is derived from historical
consumption patterns and aggregated metering
data used in industry reconciliation processes.
Unbilled revenue is compared to billings in the
period between the balance sheet date and the
finalisation of the financial statements, which has
provided evidence of post report date billings
andhence support to the accrual recognised.
Given the requirement of senior management
toapplyjudgement, the estimated revenue
accrualremains a significant estimate when
preparing the financial statements. A change
intheassumptions underpinning the unbilled
calculation would havean impact on the amount
of revenue recognised in any given period.
The Committee reviewed the process, issues
andassumptions in determining the estimation
uncertainty and also considered the findings
oftheExternal Auditor.
The Committee considered senior
management’s judgements in respect
of theunbilled sales accrual based
onanalysis of the billing performance
in the year and other relevant
information.
The Committee supported the
estimate for revenue recognition from
energy supply activities. Note 18
details the sensitivity associated with
this judgement.
Impact of climate change and clean energy transition (financial judgement and estimation uncertainty)
Climate change and the clean energy transition
have been considered in the preparation of our
financial statements. The Group has a clearly
articulated strategy supported by an investment
plan and business activities, that aligns with the
UK’s clean energy transition. This strategy is
further supported by the Group’s Sustainability
Financing Framework, with nine green bonds
outstanding at 31 March 2026 and £2bn of
export credit agency-backed facilities in place,
treated as “Green Loans” when drawn (see
note21
).
The nature and timing of future climate-related
regulation, market developments and
technological change are inherently uncertain
and could have a material impact on the
carrying values of the Group’s assets and
liabilities. In preparing the financial statements,
senior management has considered the
potential impacts of climate change and the
clean energy transition in the application of
accounting judgements and estimates,
including the following areas:
– Valuation of property, plant and equipment,
and impairment of goodwill;
– Valuations of decommissioning provisions;
– Defined benefits scheme assets; and
– Going Concern and Viability Statement.
The Committee reviewed:
– The disclosures regarding the implications of
climate change and related significant
accounting judgements.
– The approach taken by the Group-level
Sustainability-related Financial Disclosures
Committee, which is responsible to steer and
govern sustainability-related disclosures.
– The Group’s climate-related financial
disclosures statement.
– Information from the External Auditor on the
associated audit requirements.
After a presentation on the proposed
disclosures and the External
Auditor’sreport on SSE’s approach,
the Committee approved the basis
ofreporting and related financial
judgement disclosures included in
theFinancial Statements for the year
ended 31 March 2026.
See note 4.1(v)
for details of the
sensitivity associated with this
judgement.
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External audit
The Committee oversees the relationship
with the External Auditor, undertaking an
annual assessment of its performance
andindependence, and providing
recommendations to the Board regarding
its reappointment or removal. EY has served
as SSE’s External Auditor since 2019 and was
reappointed by shareholders at the AGM
held in 2025. William Binns continues in his
role as lead Audit Partner for a second
consecutive year.
External audit plan
At the September 2025 meeting, the
Committee received a comprehensive
auditplan from EY. The plan included the
proposed audit approach and scope, key
audit matters (see the independent auditor’s
report on pages
254 to 264 ), and an
assessment of key areas of risk. The
Committee reviewed and challenged the
audit plan and the key risk assessment to
make sure underlying judgements were
robust. Throughout the year, the
Committee monitored progress against
theplan through updates from the
ExternalAuditor.
Independence and objectivity of the
External Auditor
The Committee is responsible for
safeguarding the independence and
objectivity of the External Auditor and
consider this to be fundamental to audit
quality. During the year, the Committee
undertook this review, which included
consideration of:
– formal independence confirmations and
assurances provided by EY, including the
effectiveness of safeguards in place;
– compliance with our Non-Audit Services
Policy and the nature and level of
non-audit fees incurred; and
– SSE’s policy on the employment of
former audit staff.
EY confirmed that all partners and staff
involved in the audit complied with its ethics
and independence policies and procedures,
and that no members of the audit team
heldshares in SSE plc. The Committee
wassatisfied that the non-audit services
provided during the year did not
compromise EY’s independence or
objectivity, and that all such services were
approved in accordance with our policy
andthe FRC Ethical Standard.
The Committee also considered EY’s
appointment as Sustainability Auditor for
the Group’s sustainability metrics for the
period 2024/25 to 2028/29, and concluded
that this additional assurance role does not
impair EY’s independence or objectivity.
Having considered the assurances received
from EY, the safeguards in place, and
compliance with our policies and the FRC
Ethical Standard, the Committee concluded
that EY remained independent and
objective throughout the year and that its
judgement was not compromised.
Audit quality and professional
scepticism
The Committee held detailed discussions
with EY on the conduct and quality of the
audit, with particular focus on the exercise
of professional scepticism. This included
how EY challenged management’s key
judgements and assumptions, the audit
approach adopted in areas of risk, and
theprocedures performed in response to
those risks, including controls testing and
substantive audit procedures, together
withsensitivity analysis and independent
corroboration in key judgemental areas.
The Committee also considered how EY
assessed the risk of management bias
andthe extent to which independent
corroborating evidence was obtained.
Following these discussions, the Committee
was satisfied that EY demonstrated an
appropriately robust and sceptical approach
and that audit quality was maintained at a
high standard.
External audit fees
The external audit fee proposal for the
yearending 31 March 2026 was reviewed
bytheCommittee in September 2025.
TheCommittee discussed the reasons
forthe increased fee with EY, which
werebased on: a broader audit scope –
particularly the growing complexity of the
Group’s structure which requires additional
specialist resources; evolving regulatory
requirements; and investment in
technology. The total external auditor
feefor the financial year 2026 was £6.9m
(2025: £6.3m), which included:
– Scope changes of £0.7m (2025: £0.8m)
related to the previous year’s audit.
– Audit-related assurance services of
£0.4m (2025: £0.3m), including fees
incurred related to regulatory
submissions and returns required by
Ofgem, comfort letters in connection
with funding and debt issuance,
andESGassurance.
– Non-audit services of £0.4m
(2025:£0.3m).
For details of fees paid to the External
Auditor, see note 6
.
Non-audit services
SSE’s Non-Audit Services Policy sets out the
framework governing when the External
Auditor may provide non-audit services.
Thepolicy is reviewed periodically to ensure
it remains aligned with evolving regulatory
requirements, professional standards and
best practice.
In accordance with the policy, the
Committee applies a cap of 70% on
non-audit fees payable to the External
Auditor, calculated by reference to the
average audit fees paid over the previous
three consecutive financial years. The
Committee approves all non-audit services
and associated fees in advance and receives
a report at each meeting detailing approved
services, enabling the monitoring of
compliance on an ongoing basis. During
theyear, the ratio of non-audit fees to audit
fees was approximately 0.06:1.
Significant financial judgements and estimates for the year ended 31 March 2026
Matters considered How these were addressed by the Committee Committee conclusions
Valuation of other receivables (financial judgement and estimation uncertainty)
The Group holds a £100m loan note due
fromOVO Group Limited (Ovo) following the
disposal of SSE Energy Services on 15 January
2020. The loan is repayable in full by
31December 2029, carries interest at 13.25%
and is presented cumulative of accrued interest
payments, discounted at 13.25%. At 31 March
2026, the carrying value (net of expected
creditloss provision of £2.0m (2025: £1.8m))
is£220.0m (2025: £193.5m) (see note 18
).
The Group has assessed recoverability of the
loan note receivable and has recognised a
provision for expected credit loss in accordance
with the requirements of IFRS 9.
The Committee considered senior
management’s actions to assess all available
information in respect of the recoverability of the
loan note. Procedures included reviewing recent
financial information of Ovo,and discussions
with its management. On 11 May 2026,
subsequent to the balance sheet date, E.On
announced the acquisition of Ovo’s Retail
business, subject to regulatory approval.
Completion of the acquisition would result in the
principal and accumulated interest becoming
repayable in full. The announcement of the
acquisition is considered a non-adjusting post
balance sheet event in terms of classification.
There is no impact to the measurement of the
loan note as a result of the announcement.
Following management’s assessment
of the recoverability of the loan note,
the Committee considered the
judgement to be appropriate and
nochanges to the recoverable value
were made following announcement
of the transaction.
While the carrying value is
consideredto be appropriate,
changes in economic conditions
could lead to achange in the
expected credit loss incurred by
theGroup in future periods.
Audit Committee Report continued
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Ensuring external audit effectiveness
The Committee oversees the Group’s relationship with EY to ensure the independence, quality, rigour and challenge of the external
audit process. The Committee’s review of external audit effectiveness involves the following key activities.
Key activities Key outputs
Audit Committee
– Monitored EY’s performance throughout the year.
– Assessed the audit strategy and independent auditors’
report.
– Considered the results of a survey of Audit Committee
members, regular attendees and Group Finance.
– Considered the quality of the External Auditor’s reporting
on key accounting and audit judgements and the skill
with which EY applied robust challenge and professional
scepticism when dealing with management.
– Met with EY twice during the year without the senior
management team.
– Held meetings with the audit engagement partner and
Committee Chair.
External Auditor
– Confirmed its policies and procedures for maintaining
independence.
– Provided confirmation that it operates in accordance
with the ethical standards required of audit firms.
Management
– Assessed the feedback from a management survey
ofpeople subject to the external audit process.
– Received assurance on the process for providing
information to the External Auditor.
Regulator
– Considered the FRC’s report on Audit Quality Inspections
which included a review of audits carried out by EY.
– Discussed FRC’s Audit Quality Review (AQR) team’s
inspection of EY’s audit of SSE plc for the financial year
ended 31 March 2025.
Results
The review confirmed that EY:
– Delivered a high-quality audit, with no significant
issuesraised.
– Focused on key financial risks and demonstrated good
understanding of the Group and its internal controls.
– Challenged management throughout the audit through
addressing key findings and properly engaging on
misstatements and materiality judgements.
The AQR inspection of EY’s audit of SSE plc for the year
ended 31 March 2025 concluded with no findings and was
awarded a “1” rating.
Outcome
The Committee concluded that EY:
– Effectively delivered the audit in line with the agreed
auditplan.
– Displayed strong expertise in complex areas and provided
constructive, independent and objective challenge to
management.
Debrief sessions were held between EY and Finance
management teams across SSE to consider how to enhance
the audit process and environment.
Reflecting on EY’s performance and the results of the AQR
inspection, the Committee recommended to the Board the
reappointment of EY as our External Auditor. Shareholder
approval will be sought at the AGM 2026 to reappoint EY for
the year ending 31 March 2027.
Reappointing the External Auditor
Having considered EY’s performance,
theeffectiveness of the audit and EY’s
relationship with SSE, the Committee
concluded that it is in the best interests of
SSE and its shareholders to continue with
EY as External Auditor. Accordingly, the
Committee recommended that the Board
seek shareholder approval to reappoint EY
for the financial year ending 31 March 2027.
In line with applicable regulatory
requirements, and to support audit quality,
independence and objectivity, SSE will
commence a competitive tender process
for the external audit no later than 2029.
The Committee confirms that SSE remains
compliant with the Statutory Audit Services
for Large Companies Market Investigation
(Mandatory Use of Competitive Tender
Processes and Audit Committee
Responsibilities) Order 2014.
Internal Audit
The Committee is responsible for
overseeing the work of Internal Audit,
whichprovides independent and objective
assurance to management, the Committee,
and the Board, regarding the effectiveness
of SSE’s risk management practices, internal
controls, and corporate governance. The
purpose, scope, and authority of Internal
Audit are established in its charter, which
isreviewed and approved annually by
theCommittee.
Internal Audit Plan
The programme of Internal Audit work is set
out in its annual plan which the Committee
reviews, challenges and endorses each year.
In February 2026, the Committee reviewed
and endorsed the 2026/27 Internal Audit
plan which was designed to align with
SSE’soperating model, risk profile, control
environment and assurance framework.
Theplan encompasses annual and cyclical
reviews, as well as targeted management-
requested audits. It covers a wide range of
thematic and functional areas, including
financial control, people and culture, cyber
security, resilience, and political and
regulatory change. Where specialist
knowledge is required, Internal Audit has
made provision to engage external expertise
in support of delivery.
Over the course of the year, the Committee
monitored delivery of the 2025/26 Internal
Audit plan. The Committee reviewed key
findings and recommendations, and
received confirmation from management
that agreed remedial actions were being
completed in a timely manner. The 2025/26
plan covered a broad range of Group-wide
and business-specific risk areas, including:
– Cyber security, technology resilience and
operational continuity;
– Financial controls and digital;
– Large capital projects and investment
governance;
– Climate change, sustainability and
non-financial reporting;
– People, culture and workforce capability;
and
– Regulatory change and external
obligations.
Overall, the Committee was satisfied with
the progress made under the 2025/26 plan.
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Complying with the UK Corporate Governance Code 2024
Summary
Following the publication of the UK Corporate
Governance Code 2024 (the Code), the
Committee conducted a thorough review
ofthe changes. The key updates related to
Provision 29, which requires the SSE Board
toinclude in the annual report:
– a description of how the Board has
monitored and reviewed the effectiveness
of the risk management and internal
control framework; and
– a declaration of effectiveness of the
material controls as at the balance
sheetdate.
This update will apply from SSE’s financial
yearended 31 March 2027. The Committee
view the changes introduced by the Code
asan opportunity to further enhance
governance, drive greater accountability,
andreinforce stakeholder confidence in
ourcontrol environment and risk
management framework.
Actions taken
In response to this requirement, the Board
and Committee have received regular updates
regarding the approach to Provision 29, to
ensure that the necessary procedures and
governance structures are in place to support
the Board in meeting its obligations for year
ended 31 March 2027:
– Monitoring and review processes.
Management has implemented and
operates processes for the ongoing
monitoring and review of: the effectiveness
of the risk management and internal
control framework, and oversight of all
assurance outcomes across three lines of
defence including the operation and testing
outcomes of material controls. These
measures are designed to provide
assurance that the effectiveness of internal
controls is being consistently evaluated and
maintained. The Board, supported by the
Committee, oversees and challenges
management’s approach through its own
monitoring and review of these integrated
assurance activities, to support the Board’s
annual report effectiveness declarations
asat the balance sheet date.
– Identification and testing of material
controls. Following review and agreement
by the Board, material controls
encompassing SSE’s Principal Risks,
financial reporting, and non-financial
reporting have been identified. The
approach to testing these controls, as well
as the plan for financial year 2026/27, has
been clearly outlined. The material controls
comprise both framework controls, which
establish overarching governance and
transparency, and transactional controls,
which support the day-to-day management
of key risks to SSE.
– Disclosure process.
Processes have been
established to ensure that disclosure
accurately describes how the Board
monitors and reviews the effectiveness of
the risk management and internal control
framework and material controls as at the
balance sheet date. Additionally, any
actions taken to address issues identified
during monitoring and testing are
communicated transparently, reinforcing
our commitment to strong governance.
Outcome
In preparation for full compliance with
Provision 29 of the Code, the 2025/26
financial year was treated as a “dry run”
toembed SSE’s refined governance
arrangements, and updated methodologies,
to ensure the effectiveness of our risk
management and internal control framework.
This review has strengthened control
documentation, risk mapping and assurance
processes. The Committee was satisfied that
the necessary frameworks were in place
tocomply with Provision 29 for the next
financial year.
Effectiveness of Internal Audit
In February 2026, the Committee carried
out its annual evaluation of the Internal
Audit function. This was informed by a
stakeholder survey covering members
ofthe Committee, the Group Executive
Committee, senior leaders from Corporate
and Business Unit functions, and the
External Auditor. The Committee also
reviewed delivery of the audit plan and
assessed the depth of skills and experience
within the Internal Audit team.
When reviewing the 2026/27 plan, the
Committee noted Internal Audit’s role in
supporting the Group Operating Model and
Efficiency Review, including its leadership to
establish an integrated assurance model
rationalising assurance effort and increasing
the focus on SSE’s most material risks.
Thefunction has maintained strong
alignment between audit activity and areas
of greatest strategic and operational risk.
Through constructive engagement with
management, Internal Audit has been able
to reprioritise its work where appropriate,
while preserving its independence and
continuing to deliver robust assurance.
Focus has remained appropriately directed
towards key Group risks.
Based on this assessment, the Committee
concluded that Internal Audit continues to
operate effectively, providing independent,
risk-based assurance across the Group’s
systems of risk management and
internalcontrol.
In line with the Institute of Internal Auditors’
guidance, which recommends external
quality assessments at least every five years,
and SSE’s policy of conducting such reviews
every three to four years, the next
independent assessment was initially
planned for 2027. The previous external
review, conducted by PwC in 2023,
confirmed that the function meets
professional standards and is operating
effectively. Following the appointment of
anew Head of Group Internal Audit in
January 2026, it has been agreed that the
next independent assessment will now be
undertaken in 2028.
Oversight of risk management and
internal control
The Committee oversees and evaluates the
effectiveness of SSE’s System of Internal
Control on behalf of the Board which
covers all material controls including
financial, reporting, operational and
compliance.
Risk management and internal control
The Group has established risk
management and internal control systems
designed to identify, assess and manage
risks to the achievement of its strategic
objectives.
The Committee receives regular reports
from the Director of Group Risk and Audit
on the operation and effectiveness of the
Group’s System of Internal Control (see
page 109
). Relevant matters are escalated
to the Board as appropriate.
Executive responsibility for risk
management rests with the CFO, supported
by the Director of Group Risk and Audit
andthe Group Executive Committee for
SSE’s overall risk profile. The Group Risk
Committee meets regularly to review
theeffectiveness of risk governance
arrangements, the performance of risk
management processes, and emerging risks
and themes across the Group. The output
informs the Audit Committee’s assurance
activities and supports the Board’s
assessment of principal risks and the
actionstaken to manage them.
For details on SSE’s approach to risk
management, seepages 56 to 63 .
The Energy Markets Risk Committee
oversees internal control and risk
management in relation to SSE’s energy
market-related exposures – see pages 110
to 111
for more.
Risk management and internal control
effectiveness
The Committee was satisfied that SSE’s
internal controls operated effectively
throughout the year. This conclusion
wasinformed following the results of an
evaluation conducted by stakeholders
within each framework of our System of
Internal Control. The CFO assessed these
evaluations and submitted a letter to the
Committee, summarising the work
completed during the year to enhance the
control environment and recommended
theoverall effectiveness of the system.
Audit Committee Report continued
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The work completed included letters of
assurance provided by the Managing
Directors of SSE’s Business Units and the
Directors of Corporate Functions. The
process considered each element of our
System of Internal Control from a Business
Unit and Corporate Function perspective
andincluded details of any planned
improvements. These improvements are
tracked, and our Group Risk Committee
receives regular updates.
Following its review of the CFO’s letter,
theCommittee recommended to the
Boardthat the System of Internal
Controlremained effective and aligned
withthe FRC Guidance on Risk
Management, Internal Control and related
Financial and Business Reporting. The
Board agreed and also confirmed that no
significant failings or weaknesses were
identified during the financial year, and that
robust processes are in place to ensure
necessary improvement actions are taken
and monitored where needed.
Review of key Group functions
andcontrols
As part of the Committee’s responsibilities
for risk management and internal control,
the Committee oversaw the performance of
key Group functions and related assurance
activities:
the Cyber Defence team set objectives
to strengthen SSE’s security position
this year. The Board has identified
thisarea asa Principal Risk for SSE.
Further information on developments
this year and key mitigations are
included in the Risk report on pages56
to 63 .
Outcome: The Committee supported
the Board in overseeing progress
across the Cyber Defence team’s
workstreams which focused on
infrastructure improvements,
strengthening of cyberrisk and crisis
management, and promoting a cyber
aware culture across the Group. The
Committee was satisfied with the
progress delivered during theyear.
Treasury. The Committee assessed
Treasury operations, funding strategies,
and policies to ensure robust controls
over liquidity, cash flow, funding, interest
rate risk, credit risk and credit ratings.
Outcome: Acting under authority
delegated by the Board, the Committee
approved a series of funding and
treasury transactions during the year.
Tax. The Committee reviewed the
Group’s tax strategy, focusing on the
adjusted underlying tax rate, potential
exposure areas, and authority audits
during the year. SSE’s low-risk HMRC
rating was maintained through
transparency.
Outcome: The Committee confirmed
satisfaction with the Group’s tax
approach, exposure management,
andcontrol measures.
Financial Controls Centre of
Excellence. Throughout the year, the
Committee continued to oversee the
development of the Financial Controls
Centre of Excellence within work on
reviewing financial reporting controls.
The Centre is designed to strengthen
oversight ofcontrols and drive
continuous improvement in controls
management across the Group.
Outcome: The Committee monitored
the activities of the Financial Controls
Centre of Excellence and progress
against the agreed three-year roadmap
to strengthen financial reporting controls
and embed a stronger controls culture
across the Group. The Committee was
satisfied with progress delivered during
the year and will continue to track
delivery against the roadmap,
supporting readiness for compliance
with Provision 29 of the Code.
Payment practices. The Committee
reviewed performance and reporting of
payment practices throughout the year.
Outcome: The review confirmed that
the Group continued to demonstrate
strong payment practices throughout
the year.
Group ethics and financial crime.
TheCommittee received an update on
group ethics and financial crime risks
aimed at promoting integrity and
compliance.
Outcome: Throughout the year, the
Committee received updates on
progress establishing this new function
and also the approach to implementing
the Economic Crime and Corporate
Transparency Act 2023 which became
enforceable in September 2025.
Governance framework
Ensures focus on the key
components of effective
decision making: clarity,
accountability,
transparency and
efficiency. For details,
see page 85
of the
Governance Report.
Strategic framework
Includes SSE’s purpose,
strategy, goals, values and
business model andis the
basis for all activity under
the RiskManagement
Framework. For details,
see
pages 1 to 7
of the
Strategic Report.
Risk management
framework
Supports Business Units in
managing risks andhelps
ensure the Board meets
itsobligations. It is
underpinned by the
principle that everyone
atSSE is responsible for
managing risk. See pages
56 to 63
for details.
Assurance framework
An integrated
programmeof audit and
assurance activity that’s
independent of the
day-to-day operations
ofthe Business Units
andCorporate Functions.
Standard andquality
framework
Sets out the expected
standards and guidelines
to be followed when
delivering the Group’s
purpose.
Board and Board
Committees
Strategic
objectives
Financial
objectives
Sustainability
goals
Group Risk Policy
External Audit
Internal Audit
Group Policies
Group Executive
Committee and
Executive sub-
Committees
Principal Risk Assessment
Risk Appetite Statement
Viability Assessment
Key Risk Indicators
Group Safety, Health
andEnvironment
Large Capital
ProjectsServices
Governance
manuals
Business Unit
Executive
Committees and
Corporate Support
Functions
Business Unit Principal
Risk Assessment
Assurance Evaluation
Risk Blueprint
Business
Assurance
Business Unit, policies,
procedures, processes
and systems
System of Internal Control
Cyber security. The Committee
received updates on cyber security risk
management and assurance activities
including a review of the Group’s
cybersecurity and resilience approach.
In light of the rising frequency and
intensity of cyber incidents in the UK,
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The role of the Committee
SSE operates in volatile commodity
markets, where prices, demand
patterns and regulatory frameworks
can shift quickly and influence
financial performance. A dedicated
committee ensures the Board has
appropriate oversight of these risks
byfocusing on market exposures,
trading activities and the related
controls. This helps safeguard the
Group’s risk appetite, supports
disciplined decision making and
ensures that hedging and
optimisation opportunities are
pursued in a way that protects
andenhances shareholder value.
For more details on the role and
responsibilities of the Committee, see
its Terms of Reference on sse.com
.
exposure to commodity price fluctuations
well ahead of delivery while maintaining the
flexibility needed to respond to externally
driven changes in energy markets. We
review SSE’s hedge positions to ensure
theyare aligned with risk appetite and the
factors shaping SSE’s portfolio exposures.
This year, we oversaw the approved
acceleration of SSE Renewables’ hedge
position, implemented to maximise value
inprevailing market conditions. We also
supported a targeted reduction in hedging
activity for SSE Thermal during certain time
periods where market conditions were
unfavourable. SSE’s latest hedging approach
statement is on page 236
.
Reviewing energy markets
We monitored the performance of SSE
Energy Markets as the Group’s primary
trading decision-maker through regular
updates on market developments, liquidity,
Group exposures, and the development of
its strategy.
We endorse a measured, risk-informed
approach to growth to support SSE’s
long-term competitive positioning.
Duringthe year, we reviewed progress of
participation in carefully selected European
and international power and gas markets,
and supported further geographic
expansion, recognising that broader reach
enhances strategic positioning, strengthens
market intelligence, and improves access to
liquidity. We also backed further investment
in trading technology and analytical
capability to enable faster, data-driven
execution and to help secure additional
value within a controlled risk environment.
We continue to challenge and support SSE
Energy Markets’ strategy, with a focus on
optimising SSE’s energy assets and creating
additional value through third-party
contracts and selective speculative trading.
To support key risk management and
optimisation activities, a limited amount
ofinformed position taking is undertaken.
Weemphasised the constructive and
proportionate use of the Group’s risk
appetite to enable value creation while
maintaining discipline. As such, we oversaw
the control environment for trading, credit
and collateral activities including strict
position limits and value-at-risk measures.
We also maintained oversight of how
SSEEnergy Markets responds to market
volatility, regulatory uncertainty, macro-
economics and geopolitical events,
ensuring resilience and adaptability in its
activities as conditions evolve. We reviewed
regular market outlook assessments and
scenario plans to ensure SSE is equipped
torespond effectively to a range of
marketconditions.
Year ahead
As we look to the year ahead, we will
continue to oversee energy market risk
exposures and promote resilience and
discipline across market-based activities.
We will also support the continued
development of SSE Energy Markets’
capability and strategic direction, ensuring
SSE remains well placed to navigate market
developments, manage exposures and
deliver value for SSE’s future success.
I’d like to thank the members of the
Committee for their dedication throughout
the year and their significant contributions
in supporting our work.
Tony Cocker
Chair of the Energy Markets Risk Committee
27 May 2026
Our work supports SSE’s management
ofenergy market risks by overseeing the
governance arrangements for managing
portfolio exposures, and by challenging
andsupporting the optimisation activities
used to add value across the Group. This
oversight remains essential in a year marked
by varied market volatility, shifting demand
patterns, supply chain pressures, and
geopolitical influences that continue to
impact price dynamics. The year was
characterised by contrasting conditions,
moving from relative stability to heightened
volatility towards year-end due to the
ongoing conflict in the Middle East.
Through ongoing monitoring and
challenge, we help the Board ensure that
the risk management and optimisation
approach and related controls, remain
aligned with SSE’s risk appetite and
responsive to evolving market conditions.
SSE’s hedging approach
We believe that SSE is well served by its
hedging approach, which aims to reduce
Energy Markets Risk
Committee Report
“Our work supports SSE’s management
ofenergy market risks by overseeing the
governance arrangements for managing
portfolio exposures, and bychallenging
and supporting the optimisation activities
used to add value across theGroup.”
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Membership
The Committee comprises five non-Executive Directors and the Chief Financial Officer. SSE’s Chief Executive and the Managing
Director, SSE Energy Markets also attend Committee meetings. See
pages 80 to 82
for member biographies. The Committee met
four times in 2025/26, with attendance set out on page 84 .
Committee performance review
The annual review of Committee performance was facilitated by Consello (see page 94 ) and the results considered by the Committee.
This confirmed the Committee’s continued effective operation and actions for 2026/27.
Review
confirmed
– The Committee operates well and provides crucial support to the Board.
– The Committee benefits from the leadership of an experienced and knowledgeable Chair.
Actions for
2026/27
– Ensure the Board’s orderly succession planning work considers the role of Committee Chair to ensure continuity
of expertise and Committee effectiveness when the incumbent reaches nine years’ non-Executive tenure.
monitor market developments and
conditions, and adjusts this approach in
response to changes in exposure profiles.
During the year, the Committee reviewed
reports on the latest hedge position,
assessing performance against SSE’s
hedging approach and considering the
impact of shifting market conditions.
TheCommittee endorsed the hedging
disclosure included in our Interim and
Full-year Results Statements and
recommended this to the Board.
Further details of SSE’s hedge approach
andposition are set out on page 236
.
Energy markets risks
During the year, the Committee considered
emerging issues across domestic and
international energy markets, informed by
scenario analysis and risk outlooks, to assess
how market conditions could influence
ouroperating environment. This included
consideration of:
– The future market outlook in Great
Britain and the island of Ireland,
including readiness for seasonal market
conditions and ongoing optimisation
opportunities.
– Regulatory changes including various
market reform and zonal pricing
scenarios as well as recent developments
in the UK carbon market.
– Key developments related to non-
commodity costs, in which the
Committee supported the importance
ofsustained engagement with
policymakers and industry bodies
tohelpshape a stable, long-term
energyframework.
– The ongoing conflict in the Middle East
and its impact on global commodity
prices.
Overall, the Committee was satisfied that
associated risks were being appropriately
monitored, addressed and managed.
As part of its oversight of energy market
risks, the Committee reviewed and
challenged SSE Energy Markets’ strategy
formanaging Group exposures, optimising
thecurrent portfolio and developing
Areas of focus for 2025/26
The below provides an overview of the work
and considerations of the Committee during
the year, aligned to its key areas of responsibility.
Overseeing SSE’s hedge approach
SSE’s hedge approach generally seeks to
reduce its broad exposure to commodity
price variation at least 12 months in advance
of delivery. The Committee continues to
Energy markets in action
During the year, the Chair of the
Committee, Tony Cocker, visited the
SSE Energy Markets office in Perth.
Tony observed how teams monitor
market conditions, execute
optimisation strategies, and apply
theGroup’s risk appetite.
The visit reinforced the value of the
systems and controls underpinning
SSE Energy Markets’ role as our
central trading and optimisation
function. It also underscored the
importance of continued investment
in capability, technology, and
expertise to ensure the business is
well placed to manage market-based
risks and support optimisation
opportunities.
Details of how SSE Energy Markets
supports our strategy is set out within
the review of business performance
on page 38
.
Reflecting on the visit, Tony said:
“Itwas invaluable to see the team
inaction and to discuss key
developments, such as the evolving
role of gas plants, enhanced data
analytics and growth into new
markets. Meeting colleagues across
trading, analytics and risk highlighted
the depth of our capabilities and the
strength of collaboration that is
helping position SSE for the future
through disciplined decision making.”
capabilities to support SSE’s future ambitions.
The Committee assessed:
– The approach to portfolio optimisation
and other market-related value-add
activities, including speculative trading,
third-party contracts and investment
intrading technology and analytics.
– The strategic rationale for expansion into
new markets, making recommendations
to the Board where appropriate, and
maintaining oversight of progress and
performance in those markets.
The Committee will continue to review SSE
Energy Markets’ strategy to ensure that it
remains aligned with, and makes appropriate
use of, the Group’s risk appetite.
Risk management and internal controls
The Committee evaluated the robustness of
internal controls for managing, monitoring,
andreporting energy market risks by reviewing:
– Controls relating to trading, credit and
collateral activities and related exposures.
– Thresholds set for value-at-risk and
stop-loss limits, approving any changes
asrequired within delegated authority
levels to reflect market conditions and
trading exposures.
– Quarterly Internal Audit reports relating to
SSE Energy Markets including progress on
audit actions which provide assurance on
the strength of the control framework.
– Minutes from the Group Energy Markets
Exposure Risk Committee, an executive-
level forum which allows SSE’s senior
management to review and consider
energy markets risks and exposures.
These reviews enabled the Committee to
form a view on the effectiveness of SSE’s
energy market risk management. The
Committee concluded that controls and
processes remain appropriate and effective
in the context of current market conditions.
The Committee’s evaluation of energy
market controls forms part of the Group’s
broader internal control framework. Further
detail on the Board’s approach to Provision
29 of the UK Corporate Governance Code
2024 is provided in the Audit Committee
Report on page 108
.
Governance
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The role of theCommittee
The Safety, Sustainability, Health and
Environment Advisory Committee
(SSHEAC) brings dedicated focus to
safety, sustainability, health and
environmental matters through:
– Reviewing and monitoring KPIs
and other reporting measures in
the Group.
– Assessing the effectiveness of
related strategy, initiatives, training
and targets.
– Overseeing the development
andimplementation of related
Group Policies.
– Monitoring the resources,
competence and commitment for
managing these issues to ensure
continuous improvement and
support a healthy culture.
The Committee’s Terms of Reference
areavailable on sse.com
.
As the Group navigated organisational
change and a drive for greater efficiency, we
continued to focus on ensuring employees
had the right wellbeing support. We were
updated on the tender process for new
occupational health and psychological
support providers, and endorsed those
selected for their ability to offer earlier
andmore accessible services. We also
recognised the important role played by
Mental Health First Aiders, Wellbeing
Champions, and stress support initiatives
inhelping colleagues through periods
ofchange.
We were pleased to meet a variety of
people in different locations during our
programme of site visits during the year.
This active engagement with colleagues
supports our oversight of SSE’s safety
culture by giving us a better understating of
day-to-day SHE challenges. It also provides
an opportunity to share feedback and agree
actions to enhance working environments.
Our environment and communities
As extreme weather events become more
common, we focused on understanding the
physical risks posed by climate change, and
ensuring that clear action plans are in place
to strengthen the resilience of the Group’s
assets, networks and operations. We
reviewed climate adaptation activity during
the year, including the impact of extreme
weather events and evolving regulatory
expectations. This led to our endorsement
of priorities to accelerate the development
of a Group-level climate adaptation
framework and to strengthen supporting
governance arrangements.
We also oversaw the Group’s approach to
biodiversity and environmental stewardship,
seeking assurance that environmental
considerations are embedded across planning,
delivery and asset management activities.
Through review of sustainability disclosures
and emerging reporting expectations,
weprovided oversight and challenge to
ensure that SSE’s sustainability priorities
andimpacts are clearly communicated to
investors and other stakeholders. We agreed
the approval plan for the publication of the
Sustainability Report 2026. And we also
reviewed SSE’s performance against key
ESG ratings and supported recommended
actions going forward.
Committee membership changes
After the AGM 2025, Hixonia Nyasulu joined
the Committee, and I succeeded Helen
Mahy as Chair. Martin Pibworth stepped
down as a member after his appointment
asChief Executive, but continues to attend
the SSHEAC in an advisory capacity. Tony
Cocker also stepped down, enabling him to
continue to dedicate sufficient time to his
other Board Committee responsibilities.
Following Rachel McEwen’s retirement from
SSE, Rhian Kelly took up the role of Chief
Sustainability Officer in November 2025 and
replaced Rachel as a Committee member.
We look forward to working closely
withRhian as we navigate the evolving
sustainability landscape. I would like to
thank Helen, Tony and Rachel for their
valuable contributions to the Committee
throughout their tenure.
On behalf of the Committee, I would like to
recognise the continued commitment of
our employees and partners to our culture,
SHE and our sustainability ambitions. I hope
this report provides a clear overview of our
work this year.
Dame Angela Strank DBE
Chair of the SSHEAC
27 May 2026
I am pleased to present my first report
asChair of the SSHEAC, covering the
Committee’s activities and site visits over
2025/26. This report shows how we have
worked with senior management to
developpolicies, targets and strategy
thatstrengthen safety, sustainability, health
and environmental performance at SSE.
Protecting our people
This year, our Committee continued to
oversee the delivery of the Group’s safety,
health and environment (SHE) strategy,
andreceived regular reports on SHE
performance, culture and risk management.
We reflected on safety results for the year,
including no life-changing injuries and
delivering against our Total Recordable Injury
Rate (TRIR) expectations for our employees
and contract partners. Our review of the
annual all-employee survey reflected
employees’ confidence in SSE’s safety
licence, which clearly states that “if it’s not
safe, we don’t do it”.
Safety, Sustainability, Health
and Environment Advisory
Committee Report
“Our review of the annual all-employee
survey reflected employees’ confidence
in SSE’s safety licence, which clearly
states that ‘if it’s not safe, we don’t do it.”
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Safety
During 2025/26, the Committee oversaw
delivery of our Group SHE strategy and
annual SHE plan. It engaged with senior
management and confirmed that Business
Unit plans aligned with our Group SHE
framework, and that planning and
governance arrangements continued
tosupport a consistent and positive SHE
culture across SSE.
The Committee also assessed and
shapedthe forward SHE strategy and
planfor 2026/27, providing feedback
tomanagement to ensure continued
alignment with our long-term Group
safetyambition to 2030. It oversaw key
priority areas, including the Safety Family
programme (which focuses on improving
our safety performance and behaviours
across all levels of SSE), risk, and assurance,
tosupport effective risk management and
sustained performance. The Committee
also reviewed the Group Safety and Health,
Environment, Climate Change, and Human
Rights Policies, recommending them for
approval by the Board on the basis they
continued to reinforce clear expectations
and consistent standards for all employees.
Monitoring performance
The safety of our people is our number
onepriority, and SSE’s safety, health and
wellbeing, environmental and sustainability
performance remains a standing focus
ofthe Committee. In assessing safety
performance, key indicators, including
SafeDays and TRIR provide a consistent
benchmark to appraise progress. Time was
spent reviewing the trends in recordable
and high potential incidents for our
employees and contract partners, and the
effectiveness of risk controls. Particular
attention was provided to recurring injury
types, including hand injuries, and the
impact of preventative interventions. The
Committee examined safety and process
safety incidents in detail to ensure root
causes were identified, supporting
investigations were robust, and learnings
were embedded consistently across SSE.
The Committee considered Business Unit
SHE milestones and performance metrics,
providing scrutiny and challenge on the
effectiveness of established processes
anddelivery plans. Through this review,
itgained assurance that metrics and
milestones appropriately reflected progress
against safety and environmental objectives,
including responsible consumption as a
common sustainability theme. The
Committee also discussed opportunities
forcross-business collaboration and
practical considerations affecting delivery.
The Committee also reviewed our Group-
wide SHE engagement strategy for 2025/26,
including targeted internal safety campaigns
to strengthen employee safety awareness,
and confidence in challenging unsafe
behaviours. It was encouraged to see
increased engagement on SHE matters
following these campaigns.
For details of SHE metrics for 2025/26,
seepages 49 and 55
.
Immersive safety training
The Committee received regular updates on
the progress, reach and impact delivered by
our immersive safety training programme.
Itwas pleased that participation had
continued to increase, with more than
14,000 colleagues, contingent workers and
contract partners attending since 2022.
Through careful design to ensure relevance
to the broad range of our operational
settings, the programme reinforces safety
leadership through real-life examples. It is
supported by a flexible self-booking model
and post-training resources in the form of
short films, questionnaires, toolbox talks,
and examples of how to use the models
taught on the day. Together, these contribute
to a stronger safety culture, enhanced
external reputation, and increased
participant confidence in SHE matters.
Supporting contract partner safety
Recognising the critical role our contract
partners play in delivering safe and
sustainable outcomes across SSE, the
Committee received regular updates
onpartner safety performance and
engagement levels. Our third annual
contract partner safety event was held in
March 2026, and was very well received.
Itwas attended by 130 partners from
across61 organisations, representing a
20%increase from the first event in 2023.
Inaddition to the conference, the
Committee was updated on the suite of
additional resources available for our
contract partners, including SSE-hosted
quarterly calls, safety campaign materials,
and lessons learned from incidents, all of
which are shared through a dedicated SHE
Portal to ensure continued collaboration
and improvement.
Process safety
The Committee continued to prioritise
oversight of process and asset safety,
focusing on the behaviours and practices
necessary to prevent or reduce the
consequences of process-related incidents,
which are a risk factor in major accidents.
Through regular reviews of performance
and maintenance programmes, the
Committee provided feedback to
management, with a consensus that our
focused Group strategy and enhanced
digital monitoring are increasing asset
visibility and enabling timely interventions.
Membership and attendance
The Committee comprises three non-Executive Directors, the Chair of the Board, the Chief Sustainability Officer, the Managing
Director, SSEN Distribution, and the SHE Director. The Chief Executive also attends meetings. See
pages 80 to 82
for Board
member biographies and page 83 for GEC member biographies. The Committee met four times in 2025/26, with an additional call
requested to review work in SSEN Distribution to address fatigue management in critical frontline roles. Meeting attendance is setout
on page 84 .
Committee performance review
The annual review of Committee performance was facilitated by Consello (see
page 94 ) and the results considered by the
Committee. This confirmed the SSHEAC’s continued effective operation and actions for 2026/27.
Review
confirmed
– The Committee is well established and operating effectively, providing appropriate support and advice to
the Board on the matters within its remit.
Actions for
2026/27
– A tailored induction was given to the new Committee Chair after her appointment in July 2025, and
ongoing support will be provided as she settles into the position.
– There is an opportunity to further refine agendas to ensure sufficient time is dedicated to the most material
safety and sustainability risks, opportunities and outcomes, reflecting the Committee’s broad remit.
– There is an opportunity to enhance Committee papers, with an emphasis on concise insights, clear
Board-level implications, and decision relevant information.
Governance
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Occupational health
This year, the Committee received an
update on the award of occupational health
services for the Group, with Health Partners
our new occupational health provider,
andOne Bright our psychological support
provider. Together, these service providers
improve continuity of care and broaden
access to specialist services, supported
byclear service standards and ongoing
performance monitoring.
Environment
Monitoring environmental performance
The Committee reviewed environmental
performance and permit breaches across
the Group. It looked at whether investigations
into these incidents were effective, assessed
if appropriate remedial actions had been
implemented, and considered the overall
environmental controls which were in
place. It also oversaw environmental risk
management and governance, informed by
audit and assurance results. And continued
to challenge management on progress in
improving environmental outcomes,
including resource use, waste management
and biodiversity, and environmental
stewardship.
Climate adaptation and resilience
The Committee received an annual climate
adaptation and resilience update, that
covered policy, planning and reporting
developments. Having considered the
update, the Committee advised the
development of climate risk assessments
and resilience activity across the Group,
should reflect the latest guidance and
evolving regulatory expectations,
includingOfgem’s strengthened focus
onnetwork resilience.
Recycling and diversion of waste
The Committee assessed performance and
annual improvements in recycling and
diversion of waste from landfill across the
Group. It noted recent regulatory changes
relating to waste separation and SSE’s
activities to deliver compliance. It also
noted plans to develop an SSE Circularity
Roadmap to define a Group-wide approach
to encourage reuse, resource efficiency and
innovation, taking account of upcoming
regulations in areas including the disposal
of biodegradable waste.
For more on SSE’s approach to the
environment, please see pages 54 to 55
of this report and SSE’s Sustainability
Report2026.
SHE risks and assurance
The Committee regularly reviewed
progressagainst assurance and audit plans
along with our SHE management system,
making sure that controls were working
well, actions were being implemented,
andimprovements were being made.
Italsodiscussed SHE audits findings
whichprovided a helpful benchmark for
Business Units, and the potential to share
Fatigue management
The Committee monitored the
effectiveness of fatigue management
processes in SSEN Distribution, to make
sure that fatigue-related risks are being
appropriately identified and managed,
andthat processes adequately protect
employees, customers and the
communities in which we operate. This
year, it spent additional time reviewing
progress against agreed fatigue
management risk controls, including
proposed working patterns, assurance
arrangements and engagement with
tradeunions.
Business Unit safety deep dives
During the year, the Committee held
dedicated sessions with our SSE
Renewables, SSEN Transmission and Energy
Customer Solutions (ECS) businesses to
rigorously review SHE performance,
reinforce accountability, and challenge
management on delivery. Strong and
consistent safety and health outcomes
werenoted in SSE Renewables, with TRIR
below target, a high level of workforce
engagement and continued reductions
inhigh-potential incidents. The business
had also responded proactively to
environmental incidents, with the events
largely isolated to certain areas of the
business and not widespread. WithinSSEN
Transmission, the Committee reviewed
thesuccessful outcome of a cumulative
riskvisibility pilot. It was noted this pilot
enhanced process safety, through improved
integration of major hazard risk assessment
with operational and asset data. The
Committee supported the roll-out of this
approach across critical assets within
SSE’sNetworks businesses. For ECS, the
Committee received progress updates and
considered its forward-looking SHE plan,
which focused on driving safety culture
through engagement, capability building,
and robust governance, to support safe,
sustainable and continued high-quality
delivery across ECS activities.
Health and wellbeing
Monitoring health performance
The Committee continued to focus on
making sure effective health and wellbeing
support is in place for our colleagues. This
isof particular importance during a year
where there was a period of organisational
change. It assessed the impact of wellbeing
initiatives and occupational health access
on workforce resilience and productivity,
and was pleased to see the breadth of
support available to employees.
The Committee reviews regular reports
onsickness and absence during the year.
These include trend analyses, giving
valuable insights into the overall health
andwellbeing of employees and the types
ofsupport that can be provided. It was
satisfied that we offer a comprehensive
range of support services that are well
usedby colleagues when needed.
good practice. The Committee also
reviewed anaggregated Group-wide view
of SHE risks, which enabled it to assess
trends in residual risk, across occupational
safety, health and wellbeing, environment,
process and asset safety, and marine
operations. This prompted the Committee
to discuss potential mitigations and to
identify areas that would benefit from
continued management focus.
Sustainability and ESG
ESG ratings
The Committee recognises that investor
ESG ratings play a key role in assessing
oursustainability performance, and are
strategically important to SSE and its
stakeholders. During the year, the
Committee reviewed the ESG ratings
scorecard for 2025 and the key trends
influencing SSE’s performance. The
Committee endorsed the priorities for
2026and the approach to the ratings.
Sustainability Report
During the reporting year, the Committee
reviewed the approach and content plan
forour Sustainability Report 2026, in the
context of the increasing complexity of
thesustainability disclosure landscape.
Itacknowledged the importance of our
Sustainability Report and the enhanced
disclosures within it, as a crucial
communication tool with investors and
other stakeholders. The Committee
continues to approve the report before
it’spublished.
For more information on sustainability
matters, please see pages 39 to 55
ofthis
report and SSE’s Sustainability Report2026.
Safety, Sustainability, Health and Environment Advisory Committee Report continued
114
SSE plc Annual Report 2026

Site visits
The Committee continued its programme
of site visits across a range of operating
environments, in line with an annual plan
developed by SSE’s SHE Director. Visits
areundertaken by different Committee
members, accompanied by senior
management, and are designed to provide
insight into how our safety culture is
embedded and applied in practice.
Feedback from visits in the year was
broadly positive, reflecting a strong
workforce commitment to safety,
environmental performance, and local
community impact. It also highlighted the
potential challenges presented by the rural
location of some of our operational sites.
The visits allowed Committee members
tohear directly from employees and gain
insight into workforce-led controls
supporting the management of SHE risks.
Each site provided a detailed safety briefing,
with a summary of the key observations
setout below.
Dogger Bank wind farm
This visit enabled members to observe
how our safety culture operates within
acomplex, multi-contract partner
environment. It provided assurance
overthe strength of operational safety
arrangements, including planning, vessel
management, emergency preparedness,
and incident learning, and highlighted the
importance of continuous safety training
and robust controls. Insight was gained
into how teams were adapting to new
technologies and challenging marine
conditions, and how workforce wellbeing
is supported in offshore settings.
Observations from the visit informed
theCommittee’s ongoing oversight
ofprocess safety, contract partner
management and incident learnings;
reinforcing future focus areas for
assurance activity.
SSEN Distribution Operations
Committee members met local
leadership and frontline teams on the Isle
of Wight, to observe live operational
activities. An overriding takeaway was the
strong planning and disciplined execution
required across tree cutting and HVDC
line maintenance activities which were
observed on the day. The visit provided
assurance surrounding safety culture, and
supervision and training, informing the
Committee’s ongoing oversight of safety
leadership and workforce capability.
Reflecting on the visit, the Committee
discussed how safety is prioritised in
practice through risk assessment, fatigue
management, environmental protection,
and incident learnings.
SSEN Transmission infrastructure
Committee members visited two new
substations in Argyll and engaged with
senior leadership and project teams on
the practical application of safety, health
and wellbeing priorities. The members
observed strong safety leadership,
collaborative working with contract
partners, and proactive use of reporting
and learning systems, alongside effective
management of environmental impacts
and community engagement. Feedback
from the visit provided assurance over
theapproach to risk management and
workforce wellbeing, and informed the
Committee’s ongoing oversight of
process safety, contract partner
collaboration and environmental
stewardship.
ECS solar farm development
During the visit, members reviewed how
safety, health and environmental
standards were being applied in practice.
The visit confirmed good alignment
between planning, site set up and
observed safe behaviours, providing
assurance over the management of
higher risk activities and the continued
embedding of a positive safety culture.
Members also identified a small number
of proportionate opportunities to further
enhance safety induction wording and
record keeping. Overall, feedback from
the visit supported the Committee’s
assurance that appropriate controls were
in place and operating as intended on site.
Peterhead power station
The visit highlighted strong management
presence supporting the clear
communication of safety expectations
across the site. Employees were engaged
and focused on the delivery of on-site
activities to maintain asset integrity.
Overall, the visit provided assurance
thatleadership arrangements were
supporting the safe and responsible
delivery of operations.
Dame Angela Strank observes progress with our upgrade to the grid in the north of Scotland
115
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The role of the Committee
The Remuneration Committee
determines and agrees SSE’s broad
policy for executive remuneration,
ensuring that it is appropriate,
enhances personal performance and
rewards individual contributions
towards the long-term sustainable
success of SSE.
For more details on the role and
responsibilities of the Committee, see
its Terms of Reference at sse.com
.
Policy principles
Our approach to pay is designed to support
the execution of SSE’s purpose to be
restless every day until we make electricity
clean, affordable and available for all. To do
this, we operate our Policy in line with the
following principles.
Balanced – we provide an appropriate
balance of fixed and variable pay, with a
clear emphasis on pay for performance.
Competitive – our approach to
remuneration at all levels is sufficiently
flexible to attract and retain world-class
talent.
Sustainable – our pay practices promote
long-term stewardship of SSE and support
our sustainable growth ambitions.
Strategically-aligned – pay is clearly
linked to our strategy of creating value
forshareholders and society in a
sustainableway.
Performance and strategy
Despite a challenging operating environment,
including geopolitical conflict and energy
market volatility, SSE met its financial
expectations and continued to deliver
nationally important energy infrastructure
that supports decarbonisation, energy
security and affordability.
During the year, we announced a £33bn
five-year investment plan founded on
aonce in a generation opportunity to
upgrade the UK electricity network,
enabling the transition to a cleaner, more
secure and affordable energy system. The
investment plan is fully funded, partially
through a share placing in November 2025
which was more than eight times over-
subscribed. This clearly demonstrated
shareholders’ confidence in the strategy.
The plan is expected to unlock wider
economic growth and support thousands
of jobs while creating sustainable,
long-term value for shareholders and
society (see page 86 and 87
).
We are well positioned for a period
ofsignificant growth, with the right
combination of businesses, assets and
people. Our Committee will closely monitor
progress as the strategy is executed to
ensure that the Policy remains fit for
purpose and continues to operate in line
with our principles.
Employee pay
We are proud of the continued contribution
of SEE’s wider team in the delivery of a clean
energy transition, now and in the years to
come. We actively promote the principles
offair pay throughout our workforce,
demonstrated through a longstanding
partnership with the Living Wage
Foundation (LWF). We hold all three LWF
accreditations – Living Wage, Living Hours
and Living Pensions.
Around half of our team are represented by
trade unions through a collective bargaining
process to determine annual base salary
increases. In 2025, salaries were increased
by a minimum of 5.1% which, at the time,
represented CPIH plus 1%. We are currently
in discussions with trade unions as we seek
to reach agreement on a 2026 pay deal that
reflects both cost of living and business
performance. Employees can receive
further increases during the year as part of
askills-based pay progression framework.
Annual Incentive Plan spend in 2026 is
expected to increase by around 18%,
recognising that financial expectations were
met and the Group’s progress on building
nationally important electricity assets. The
below-Board long-term incentive plan, the
Leadership Share Plan (LSP), awarded to our
I am pleased to present the Directors’
Remuneration Report for the year ended
31March 2026. It sets out our approach
todirectors’ remuneration within two
keysections:
– The Annual Report on Remuneration,
including this introductory letter,
whichexplains how we have applied
theDirectors’ Remuneration Policy
(thePolicy) during the year and how it
isintended to be implemented in the
forthcoming year.
– The Policy in summary format, which
was approved last year and explains
howwe intend to pay our executives.
I would like to thank shareholders for
theirsupport at the AGM in July 2025.
Wewere pleased to have received over 97%
ofvotes infavour of both our Directors’
Remuneration Policy and our Annual Report
on Remuneration. In last year’s report,
Idescribed how we engaged with
shareholders, and we are grateful for the
feedback they provided, which helped
shape the new Policy.
Remuneration
Committee Report
“As the Group grows, we will ensure
remuneration remains effective,
aligns with our purpose and
supports our strategic objectives.”
116
SSE plc Annual Report 2026

Membership and attendance
The membership of the Committee comprises four non-Executive Directors and the Chair of the Board. The Group General Counsel
and Company Secretary is Secretary, and the Group HR Director, and Director of Reward and Pensions provide advice to the
Committee. The Chief Executive may also attend the meetings but is not present for any discussion about his own remuneration
arrangements. The Committee met three times in 2025/26, with attendance set out on page 84
.
Committee performance review
In line with our structured review cycle, the annual review of Committee performance was an internal process for 2025/26, facilitated
by Consello. This confirmed the Committee’s continued effective operation and actions for 2026/27.
Review
confirmed
– The Committee continues to operate effectively, demonstrating strong governance, with issues
thoroughly debated and decisions reached by consensus.
– The Committee demonstrated careful oversight and diligence in managing compensation arrangements
during the leadership change.
Actions for
2026/27
– The Committee should continue to regularly review pay structures to ensure they remain competitive
and aligned with the Company’s strategic objectives, broader pay philosophy, and market practice.
senior leaders for the three-year period
from 2023 to 2026, had an outturn of 79%.
This reflected three years of strong
execution of our strategy.
From 2026, we agreed to move our
GroupExecutive Committee into the
samePerformance Share Plan (PSP) in
which ourExecutive Directors participate.
This emphasises the collective focus of
delivering the Group’s strategy.
We are pleased that employees benefited
from share price appreciation during the
year through participation in both of our
all-employee share plans. These plans
delivered a significant return on
employees’investments.
Executive base salary increases
On appointment as Chief Executive in July
2025, we agreed that Martin Pibworth’s
base salary would initially be £970,000 per
annum, increasing to £1,050,000 on 1 April
2026. This arrangement was explained in
last year’s Annual Report.
Martin’s salary remains below the market
level for the role. This reflects both the fact
that he was appointed on a lower base
salary while growing into the role, and the
significant increase in market capitalisation
over the financial year when SSE delivered a
total shareholder return of 68%. This means
that the peer group used for benchmarking
is now more conservative than when the
salary was originally set. The Committee
plans to keep this under review.
When Barry O’Regan was appointed as
Chief Financial Officer in November 2023,
we also set out a series of phased increases,
culminating in an increase to £700,000
from 1 April 2025. In last year’s report, we
indicated that we would review his base
salary position during the year once the
new structure had been agreed following
Martin’s appointment as Chief Executive.
Barry’s responsibilities have increased
sinceMartin’s appointment and he has
overseen a very successful equity placing in
the market. We agreed an increase of 6.5%
to reflect the expanded responsibilities,
andto recognise the greater scale and
complexity of the Company as it continues
to grow. At the same time, we applied a
further 3.5% in anticipation of the April 2026
annual increase, in line with the pay budget
for the wider employee population. His
salary from 1 September 2025 is £770,000.
No further increase is planned for the
forthcoming year.
We reviewed the new base salaries against
our main FTSE 50 (excluding Financial
Services) comparator group, where SSE’s
market capitalisation is close to the median.
The Chief Executive’s base salary is around
the lower quartile, and the Chief Financial
Officer’s base salary is closer to the median.
Total target remuneration remains at or
below the lower quartile for both. The
Committee plans to keep both Martin and
Barry’s salaries (and, indeed, packages more
generally, both in terms of quantum and
general developments in design) under
review to ensure that their pay appropriately
recognises the scale and complexity of
theroles.
Incentive plan targets
Following our successful equity raise
duringthe year, we have made technical
adjustments, consistent with good practice,
to the Adjusted Earnings Per Share (EPS)
targets under the 2025/26 Annual Incentive
Plan (AIP) and the in-flight Performance
Share Plans (PSP), as well as to the net debt
to EBITDA ratio under the AIP, that were set
before the equity raise. These adjustments
ensured that the targets remained aligned
with their original intent and did not
become easier or harder to achieve than
when first set. The adjusted targets are
shown in the scorecards on
pages 122
and125 .
In last year’s Annual Report, we advised that
we would delay setting detailed targets for
the strategy and sustainability measures
under the 2025-28 PSP in light of an
anticipated revision to SSE’s strategic
objectives as a result of the changing
macro-environment, delays to policy and
planning, and uncertainty over market
reform. These were set during the year as
planned, with strategy targets aligned to
‘Market leading Networks RAV growth’
and‘Selective and disciplined Renewables
growth’. Sustainability targets will continue
to be aligned to the 2030 Goals. Detailed
targets are shown on page127
.
Annual Incentive Plan outcomes
We assess AIP performance against a
broadrange of financial and non-financial
measures. These are adjusted EPS,
cashflow, operational performance,
personal objectives and sustainability
indices. They are collectively designed to
reflect business performance each year.
Weevaluate performance objectively,
takinginto account SSE’s performance in
the round, and use our discretion to adjust
any outcomes we consider inappropriate.
The Committee assessed underlying
adjusted Earnings Per Share at 151.5p,
excluding an accounting benefit related to
the Group’s share of losses in the Neos joint
venture. The outcome was above the
adjusted budget set at the start of the year
and reflected performance in line with
expectations.
The cashflow measure uses a ratio of net
debt to EBITDA to determine performance.
The ratio at 31March 2026 was 3.3x
adjusted for performance assessment
purposes to 4.0x. This adjustment was
appropriate to reflect the equity raise
otherwise it would have unfairly resulted
inmaximum performance against
thismeasure.
Governance
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Total Shareholder Return (TSR) accounts
for50% of the total award under PSP.
Thismeans that the PSP outcome for our
Executive Directors is clearly linked to the
creation of shareholder value. Following
strong share price growth towards the
endof the performance period, our
TSRperformance was around the 70th
percentile against both the FTSE 100 Index
and a European utilities peer group,
demonstrating good returns for our
shareholders.
Stretching targets were set under an
adjusted EPS growth measure at the
beginning of the performance period
andadjusted following the equity issue in
November 2025 (again to ensure that the
targets did not become easier or harder to
achieve as a result of the equity issue). The
Compound Annual Growth Rate (CAGR)
was over 12%, indicating sustainable
earnings growth and resulted in the
performance threshold being met.
Strategic performance measures were
aligned to the previous investment plan,
theNet Zero Acceleration Programme Plus,
and assessed delivery across four
implementation areas. Networks growth,
the most significant driver of strategic
delivery, performed particularly strongly
andexceeded Regulated Asset Value
growth targets by a considerable margin.
Sustainability performance was assessed
against the Group’s 2030 Goals aligned
tothe United Nations Sustainable
Development Goals. Despite a more
challenging external environment,
theGroup continued to make tangible
progress towards net zero. Renewable
generation capacity connected within
SSENTransmission’s network area increased
to10.8GW, exceeding the RIIO-T2 2026
target of 10GW, and SSE Distribution
facilitated growing demand forlow-carbon
technologies across its networks.
TheCommittee also noted the Group’s
continued leadership in supporting a just
transition, marked by a decade of Living
Wage and Fair Tax Mark accreditations.
The formulaic outturn for the 2023-26
PSPaward is 63% of the maximum
awardwhich, again, the Committee felt
appropriate and approved without the
exercise of any discretion.
The sustainability measure rewards
outperformance against two external
indices: Sustainalytics ESG Risk Rating
andS&P Global Corporate Sustainability
Assessment. The indices take into account
awide range of environmental, social and
governance factors. Our average score
compared to our industry peers was in the
87th percentile.
The Committee was satisfied with
operational performance during the year,
inparticular, safety performance remained
stable through a period of sharply
accelerating construction activity, with
fewer reportable and high potential injuries
recorded for SSE employees despite
increased hours worked. Capital delivery
was supported by the accelerated build-out
of economically regulated electricity
networks, resulting in Regulated Asset Value
growth above plan. Construction is well
under way on six of 11 major transmission
projects. Berwick Bank offshore wind farm
secured development consent and a
long-term, government backed contract
forits output. However, asstated on
page186
there were challenges with
delivery at Dogger Bank A wind farm.
Finally, the Executive Directors performed
well against their personal objectives set at
the beginning of the year. Barry had a
particularly strong year following the
success of the equity placing. Details are
shown on page123
.
The overall outturn of the AIP for 2025/26 is
85% of the maximum for Martin and Alistair.
An outturn of 86% was awarded to Barry
reflecting his excellent personal
performance during the year. We believe
these outcomes fairly reflect overall
performance and the SSE stakeholder
experience. Accordingly, the Committee
approved the outturn without exercising
discretion. In line with the Policy, 33% of the
award is deferred into shares for three years.
Performance Share Plan outcomes
PSP awards granted in 2023 are due to vest
at the end of the 2025/26 financial year.
Vesting is subject to value-creation,
financial and strategic performance
conditions measured over the three-year
performance period ended 31 March 2026.
Director changes
In July 2025, Alistair Phillips-Davies retired
after 28 years at the Group, including 12 as
Chief Executive. He continues to be the
Chair of SSEN’s Distribution Board and a
Director on the Board of Scottish Hydro
Electric Power Distribution and Southern
Electric Power Distribution, for which he
receives a fee. Iwant to thank him for his
dedication over many years.
As a retiree, Alistair received his normal
salary and benefits while in office, which
ceased on his retirement with no payments
in lieu of notice. His annual bonus was
pro-rated for the period worked. Deferred
bonus shares were released on his
retirement, and his PSP awards will remain
in force to normal maturity, (including the
application of the holding periods) subject
to pro-rating to reflect the period worked.
He will be required to keep a shareholding
for at least two years after his leaving date
inline with the policy.
To conclude
We plan to continue to be open about our
decision making, clear in our reporting
about remuneration, and fully mindful of
SSE’s stakeholder groups. I welcome all
feedback and comments on this Directors’
Remuneration Report or on remuneration
more generally and can be reached through
SSE’s Group General Counsel and Company
Secretary, Liz Tanner, at ir@sse.com .
I do hope that you will support the annual
vote on remuneration at the AGM.
Melanie Smith CBE
Chair of the Remuneration Committee
27 May 2026
Remuneration Committee Report continued
118
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How we pay our Executive Directors
What our Executive Directors were paid in 2025/26
79%
89%
90%
Martin Pibworth
Barry O’Regan
Alistair Phillips-Davies
0£000s 1,000 2,000 3,000 4,000
Base salary Benefits Pension AIP PSP
Martin Pibworth was promoted from Chief Commercial Officer to Chief Executive on 17 July 2025.
Barry O’Regan did not receive an award under the 2023-26 PSP as he was not a member of the Board at the time of grant.
Alistair Phillips-Davies stepped down as Chief Executive on 17 July 2025 and his remuneration has been pro-rated to reflect this.
How we intend to implement policy in 2026/27
Martin Pibworth Barry O’Regan
Base salary Increase to £1,050,000 from 1 April 2026 as part
ofaphased increase agreed on appointment as
ChiefExecutive (as set out in last year’s report).
No change following an in-year increase to £770,000
on1 September 2025 recognising his expanded
responsibilities following Board changes during the year.
Benefits No changes. No changes.
Pension Remains at 12% of base salary aligned to the wider
workforce.
Remains at 12% of base salary aligned to the wider
workforce.
Annual incentive
plan
The maximum opportunity will increase from 175% to
200% of base salary from 1 April 2026 in line with last
year’s policy review.
The maximum opportunity will increase from 155% to
180% of base salary from 1April 2026 in line with last
year’s policy review.
Performance
Share Plan
The maximum opportunity will increase from 275% to
300% of base salary for the 2026 PSP grant in line with
last year’s policy review.
The maximum opportunity will increase from 250% to
275% of base salary for the 2026 PSP grant in line with
last year’s policy review.
Share ownership
policy
The requirement will increase to 300% of base salary
in line with face value of the PSP award.
The requirement will increase to 275% of base salary in
line with the face value of the PSP award.
Changes to base salary, and AIP and PSP opportunities were described in detail in the Annual Report 2025.
Fixed pay Variable pay
Base
salary
Benefits Pension
Annual
Incentive
Plan
Performance
Share
Plan
Total
Remuneration
++++=
What our variable pay outcomes were in 2025/26
Annual Incentive Plan
80%
89%
90%
80%
100%
85%
Adjusted Earnings Per Share
A strategic KPI and measure
of value creation
Cashflow (ratio of net debt to EBITDA)
A measure of financial stability and the
ability to make future investment
Personal
Individual objectives set to support
strategic delivery
Operational
Safety, capital delivery and operational
performance
Sustainability
Ranking in external sustainability indices
relative to industry peers
Total
Actual Maximum
Barry O’Regan’s personal outcome was 100% giving him a total award of 86%.
Performance Share Plan
Actual Maximum
72%
76%
33%
67%
60%
63%
Total Shareholder Return (FTSE 100)
Share price performance relative
to FTSE 100 peers
Total Shareholder Return (Utilities)
Share price performance relative to
European utilities peers
Adjusted Earnings Per Share growth
Compound annual growth rate (CAGR)
over a three-year performance period
Strategy
Performance against the NZAP Plus
investment plan
Sustainability
Performance against our 2030 Goals
Total
119
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Financial StatementsGovernanceStrategic Report
Remuneration at a glance

This Annual Report on Remuneration explains what each of our Executive Directors was paid for the financial year ended 31 March 2026
and what they may be paid for the 2026/27 financial year. During the year the Remuneration Policy operated as intended with regard to
company performance and quantum.
Single total figure of remuneration
The table below shows the single total figure of remuneration for each Executive Director for the past two years. Alistair Phillips-Davies’s
pay for the year is pro-rated to reflect him stepping down from the Board on 17 July 2025. On the same date, Martin Pibworth was
promoted from Chief Commercial Officer to Chief Executive. Martin’s total pay for the year includes three and a half months as Chief
Commercial Officer.
Last year, the Remuneration Committee reviewed our Directors’ Remuneration Policy, which was subsequently approved at the AGM 2025.
As part of the Committee’s aim to strengthen the link between pay and performance, the Committee adjusted the balance between fixed
and variable remuneration. In line with this approach, Martin was appointed on a lower base salary and without the legacy defined benefit
pension arrangement that Alistair had received.
Overall variable pay has risen by 17% compared to last year. Although payouts from the Annual Incentive Plan remain largely consistent with
the previous year, the value of awards vesting under the longer-term Performance Share Plan has increased. This increase is mainlydue to
asubstantial increase in share price over the three-year performance period, which reflects the added value generated forshareholders.
Barry O’Regan was appointed to the Board as Chief Financial Officer in December 2023. On appointment, a phased plan to increase his
base salary to £700,000 per annum by 1 April 2025 was agreed. The Committee agreed a further increase to £770,000 per annum on
1September 2025 as the scope of Barry’s role increased following the Board changes and recognising the greater scale and complexity
ofthe Company as it continues to grow.
AUDITED
Fixed pay Variable pay
£000s Base salary Benefits Pension
Total
fixed pay AIP PSP
Total
variable pay Total
Martin Pibworth 2025/26 912 21 116 1,049 1,270 1,484 2,754 3,803
2024/25 750 19 113 882 790 995 1,785 2,667
Barry O’Regan 2025/26 741 21 89 851 943 – 943 1,794
2024/25 650 20 78 748 684 – 684 1,432
Alistair Phillips-Davies 2025/26 318 2 24 344 406 2,128 2,534 2,878
2024/25 1,044 11 154 1,209 1,269 1,605 2,874 4,083
Total 2025/26 1,971 44 229 2,244 2,619 3,612 6,231 8,475
2024/25
2,444 50 345 2,839 2,743 2,600 5,343 8,182
The following sections give more detail on each element of pay including any underlying assumptions, calculations and explanations of
thefigures.
Base salary
From 1 April 2025, base salaries for Alistair and Martin were increased by 3%. This was below the level of increase awarded to our wider
workforce. Barry’s base salary was increased by 8% on the same date. This was the final step in a phased plan agreed at the time of his
appointment to the Board in December 2023, as disclosed in previous Annual Reports.
On appointment as Chief Executive on 17 July 2025, Martin’s base salary was increased to £970,000 per annum. A further increase to
£1,050,000 per annum from 1 April 2026 was agreed as part of a phased plan. This was disclosed in the Annual Report 2025.
Our Committee also reviewed Barry’s base salary during the year, once the Board changes had taken effect following Martin’s appointment
to Chief Executive. His base salary was increased by 10% to £770,000 per annum with effect from 1 September 2025. This increase
comprised a 6.5% increase for the additional responsibilities and a further 3.5% increase in anticipation and reflective of the April 2026
salary review. This is consistent with the average increase for the wider workforce. No further increase is anticipated for 2026/27.
Alistair left the Board on 17 July 2025 and the figures below reflect salary paid to that date.
AUDITED
IMPLEMENTATION
£000s 2024/25 % increase 2025/26 % increase 2026/27
Martin Pibworth 750 21% 912 15% 1,050
Barry O’Regan 650 14% 741 4% 770
Alistair Phillips-Davies 1,044 (70%) 318 –n/a
Annual Report on Remuneration
Key:
AUDITED IMPLEMENTATION
Table content that sits under the
amberAudited rule has been
subject to audit.
Table content that sits under the
turquoise Implementation rule is
planned for implementation in 2026/27.
120
SSE plc Annual Report 2026

Benefits
Executive Directors are provided with appropriate benefits. These have been set considering market practice at similarly sized companies
and the level of benefits offered to our wider workforce. Our core benefits include a car allowance or company car, private medical
insurance, and health screening. Executive Directors can also participate in our all-employee share schemes on the same terms as our
other employees.
The values shown in the table below represent the cost to SSE of providing benefits to Executive Directors. No changes are proposed to
benefits in 2026/27.
AUDITED IMPLEMENTATION
£000s 2024/25 2025/26 2026/27
Martin Pibworth 19 21 In line with 2025/26
Barry O’Regan 20 21 In line with 2025/26
Alistair Phillips-Davies 11 2 n/a
Pension
Alistair was a member of the Southern Electric Pension Scheme (SEPS), and his membership predated his Board appointment. He participated
in the same defined benefit pension arrangements that were available to employees recruited prior to 1999. SEPS is a funded final salary
pension scheme, and the terms of the scheme apply equally to all members. His service contract provided for a possible maximum pension
of two-thirds of final salary from the age of 60. An approved pension is payable from SEPS, with the balance of the pension entitlement
met directly by SSE through an Unapproved Unfunded Retirement Benefits scheme (UURBS).
Alistair had the following pension provisions relating to leaving SSE:
– For retirement through ill-health, an unreduced pension based on service to expected retirement age is paid.
– If there is a reorganisation or redundancy, an unreduced accrued pension is paid to members who are 50 or older with at least five
years’ service.
– From the age of 55, a member is entitled to leave SSE and receive a pension, reduced for early payment, unless SSE gives consent and
funds this pension on an unreduced basis.
Alistair retired from employment with SSE on 30 November 2025 after stepping down from the Board on 17 July 2025.
His terms of employment provided for a pension of around £674,000, payable from age 60 based on his service to 30 November 2025.
This pension is provided by two schemes, SEPS (£128,000 from age 60) and an UURBS (£546,000 from age 60). He had the option to
request that the SEPS element of his pension be payable from the date he left employment, reduced for early payment. He requested that a
portion of his pension provided through the UURBS be commuted for a lump sum, with £83,000 being put into payment. As with previous
similar requests (including that of the former Finance Director in 2024), the Committee considered this and, in light of the financial health
of the Company and the circumstances surrounding his departure, agreed a commuted payment of £7.9m. In the Committee’s judgement,
and that of its actuaries, this was deemed to be cost neutral to SSE.
The pension value shown in the single total figure of remuneration table for Alistair represents the increase in capital value of pension
accrued over his period of employment during the year, times a multiple of 20 (net of CPI and Directors’ contributions of £15,000) in line
with statutory reporting requirements. The outcome of this calculation has been pro-rated for the period up to the point that he stepped
down from the Board.
The actual pension accrued by Alistair during the year is shown here:
£000s 2024/25 2025/26
Alistair Phillips-Davies 646 674
As Chief Commercial Officer, Martin received a cash allowance in lieu of pension contributions at 15% of base salary. On appointment as
Chief Executive, his cash allowance reduced to 12% of base salary.
Barry participates in the SSE Ireland Pension Scheme, which is a defined contribution arrangement. SSE makes employer’s contributions
equivalent to 12% of base salary.
Current pension arrangements for both Martin and Barry are aligned to the pension contribution available to all employees.
AUDITED IMPLEMENTATION
£000s 2024/25 2025/26 2026/27
Martin Pibworth 113 116 No change
Barry O’Regan 78 89 No change
Alistair Phillips-Davies 154 24 n/a
121
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Annual Incentive Plan
The Annual Incentive Plan (AIP) requires broad performance across a range of financial and strategic metrics. Each year, the Committee
follows this process.
Set performance
measures aligned
with strategy
Set stretching
performance
targets
Assess performance
against targets
Take account of the
wider environment
and stakeholders
Consider the use
ofdiscretion
The current AIP performance measures were set in 2022 and remain relevant. Against these measures, and consistent with normal practice,
updated targets were set at the beginning of the year. Performance was assessed over the 2025/26 financial year. Where possible, the
Committee made a formulaic assessment of performance against each target. However, some measures are qualitative and require the
Committee to use their collective judgement. A rating system with a range of one to five was used, where a rating of one was defined as
below threshold performance, and a rating of five was defined as all goals at or above target performance.
AIP performance measures and a summary assessment are shown in the AIP performance scorecard. The judgement-based assessments
of personal and operational measures are described on the following pages.
As part of the performance assessment, the Committee considered SSE’s performance in the round and against our pay principles.
Thisyear, it concluded that the outturn shown in the scorecard was appropriate and therefore chose not to exercise its discretion to make
any adjustments.
AUDITED
AIP performance scorecard
Measure Weighting Threshold Performance Maximum Outcome
Outturn (% of
total AIP)
Financial
(50%)
Adjusted Earnings Per Share (EPS)
Underlying measure of financial
performance and a strategic KPI
Formulaic assessment
30% 136.1p
(25% outturn)
162.3p
(100% outturn)
151.5p 24%
80%
Cashflow
Ratio of net debt to EBITDA
Formulaic assessment
20% 4.6x
(25% outturn)
3.9x
(100% outturn)
4.0x 18%
89%
42%
Strategic
(50%)
Personal
Assessment against a range of personal
objectives set at the beginning of the year
Judgement-based assessment (see page 123)
10% Rating 1
(zero outturn)
Rating 5
(100% outturn)
Rating 4+ 9%
90%
Operational
Operational goals relating to safety,
capital delivery and operational
performance
Judgement-based assessment (see page 123)
30% Rating 1
(zero outturn)
Rating 5
(100% outturn)
Rating 4 24%
80%
Sustainability
Performance independently assessed
relative to electric utilities peers against
the Sustainalytics ESG risk rating and the
S&P Global Corporate Sustainability
Assessment
Formulaic assessment
10% Median
ranking
(20% outturn)
Upper quintile
ranking
(100% outturn)
Average 87th
percentile
10%
100%
43%
Financial
measures
42%
+
Strategic
measures
43%
+/-
Committee
discretion
0%
=
Overall AIP
outturn
85%
Financial measures have been adjusted to take into account the equity issue in November 2025 (see pages 87 and 117).
Barry O’Regan’s personal outcome was 100% giving him a total award of 86%, reflecting excellent personal performance in the year.
Annual Report on Remuneration continued
122
SSE plc Annual Report 2026

Personal performance
Executive Directors have detailed personal objectives which are set and agreed by the Committee at the start of the year. They are assessed
at the end of the year based on judgement of performance. Strong individual performance during the year led to a four-plus rating,
resulting in a 90% outturn for Martin and Alistair. Barry received a five rating following excellent personal performance, resulting in a 100%
outturn for this measure. Some performance highlights are shown below.
Summary of performance highlights Weighting
Performance
outcome Outturn
Financial – Successful market update led to a positive share price reaction which endured to
year-end.
10% Rating 4+
90%
9%
Strategy – Strong momentum behind the £33bn Transformation for Growth plan with three
quarters of key Transmission consents received and a sixth major Transmission
project in construction.
Rating 5
100% for Barry
O’Regan
(10%)
Operations – SSEN Distribution outperformed competitors during major storms with all
customers back on the network faster.
Efficiency – Completed a Group Operating Model and Efficiency Review to ensure SSE has the
right structures, resourcing and accountabilities to maximise growth – with
efficiencies achieved.
People – Effective transition to new leadership and several key senior appointments made,
strengthening the wider team.
– Refreshed our corporate identity statements and introduced an internal
framework ofdefinitions of behaviours and strategic drivers, intended to foster
aperformance culture.
Operational performance
At the beginning of the year, the Committee set detailed operational targets for the year ahead. These fall under one of three distinct areas
worth 10% each: safety, capital delivery, and operational performance. Where possible, performance is assessed formulaically and adjusted
to take into account broader performance in each of these areas. In 2025/26, while there has been some challenges around some of the
Renewable projects, a substantial majority of operational goals were assessed as being at or above target, and this resulted in an overall
outcome of 80%.
Summary performance Weighting
Performance
outcome Outturn
Safety – Employee Total Recordable Injury Rate (TRIR) was less than the previous year.
– Contract partner TRIR was only slightly higher than the previous year despite
asignificant increase in hours worked.
– There were fewer reportable injuries and fewer high potential injuries during
theyear.
– Immersive safety training continues to be delivered at pace with 4,500 employee
and contract partner attendees during the year.
– For more information see page 112 .
10% 90% 9%
Capital
delivery
– Three quarters of key SSEN Transmission consents have been received and six
major projects are in construction.
– The SSEN Transmission asset base has grown to more than £9bn.
– There has been a significant increase in SSEN Distribution capital expenditure
to£852m.
– Despite challenges the turbine installation stage was completed at SSE Renewable’s
Dogger Bank A. Dogger Bank B installation is under way.
10% 83% 8%
Operational
performance
– SSEN Distribution outperformed against Distribution System Operations targets
andshowed strong connections delivery overall.
– SSEN Distribution incentive performance was negatively impacted by weather
resulting in higher than expected Interruptions Incentive Scheme impacts.
– SSEN Transmission’s overall network reliability as measured by the National Energy
System Operator (NESO) was >99.99%.
– SSE Renewables production volumes were within a target range, but availability
was impacted by unplanned grid outages, Wind Turbine Generator (WTG)
downtime, and cable and component issues.
– There was strong underlying performance across SSE Thermal despite extended
outages at Keadby 2 and Medway.
– For more information see pages 28 to 38
.
10% 65% 7%
Total 24%
123
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2025/26 AIP award payable
When Martin was appointed as Chief Executive on 17 July 2025, both his salary and his maximum incentive opportunity were increased.
Barry’s incentive opportunity was increased at the same time, and this was followed by a salary increase on 1 September 2025. Total awards
are made up of a 67% cash award with 33% deferred as shares for a period of three years.
Alistair stepped down from the Board on 17 July 2025 and, as reported last year, will receive a pro-rated award up to this date without
deferral. He will not receive any AIP payment in respect of the period between stepping down from the Board and his retirement in
November 2025.
The values of the 2025/26 AIP awards shown below reflect these changes.
AIP award for 2025/26
£000s
Number
of days
Base salary
(pro-rata)
Maximum
opportunity as
% of base salary
Outturn % of
maximum AIP cash
AIP deferred
as shares AIP total
Martin Pibworth 107 226 130% 85% 168 83 250
258 686 175% 85% 683 337 1,020
Total 365 851 419 1,270
Barry O’Regan 107 205 130% 86% 154 76 229
46 88 155% 86% 79 39 118
212 447 155% 86% 399 197 596
Total
365 632 311 943
Alistair Phillips-Davies 108 318 150% 85% 406 – 406
Total tal 108 406 – 406
IMPLEMENTATION
AIP – implementation for 2026/27
Martin’s AIP opportunity will increase from 175% to 200% of base salary from 1 April 2026. This increase was agreed as part of a phased
increase to maximum incentive opportunity agreed on appointment as Chief Executive. Barry’s AIP opportunity will also increase from
155% to 180% of base salary from 1 April 2026.
AIP measures in 2026/27 will be unchanged. Adjusted Earnings Per Share and cashflow remain key financial measures worth a combined
50% of the total award. Targets were set at the beginning of the year, aligned with strategy and taking into account wider market factors.
Due to commercial sensitivities, detailed targets will be disclosed retrospectively in next year’s report.
Measure Weighting
Financial
(50%)
Adjusted Earnings Per Share
Underlying measure of financial performance and a strategic KPI
30%
Cashflow
Ratio of net debt to EBITDA
20%
Strategic
(50%)
Personal
Assessment against a range of personal objectives set at the beginning of the year
10%
Operational
Goals relating to safety, capital delivery and operational performance
30%
Sustainability
Performance independently assessed relative topeer groups
10%
Performance Share Plan
The Performance Share Plan (PSP) is a long-term incentive plan where a grant of shares is made to Executive Directors before vesting three
years later. Vesting is subject to performance targets set in 2023 when the initial grant was made. The performance conditions are designed
to encourage sustainable value creation, effective stewardship and good long-term decision-making. The Committee uses the same
process described on page 122
for AIP to set and assess performance conditions under the PSP.
The current PSP was established in 2022 and remains relevant. Target ranges were set three years ago at the beginning of the performance
period and adjusted to ensure they operated as intended so that the 2025 equity raise did not unfairly impact the outcome. Performance
was assessed against these targets. Where possible, the Committee made a formulaic assessment of performance against each target.
However, some measures are qualitative and require the Committee to use their collective judgement. A rating system with a range of one
to five was used, where a rating of one was defined as below threshold performance, and a rating of five was defined as all goals at or
above target performance.
PSP performance measures and a summary assessment are shown in the PSP performance scorecard. The judgement-based assessments
of strategy and sustainability measures are described on the following pages.
As part of their performance assessment, the Committee considered SSE’s performance in the round and against our pay principles.
Thisyear, it concluded that the outturn shown in the scorecard was appropriate and therefore chose not to exercise its discretion to make
any adjustments.
Annual Report on Remuneration continued
124
SSE plc Annual Report 2026

AUDITED
PSP performance scorecard
Measure Weighting Threshold Performance Maximum Outcome
Outturn (% of
total award)
Value
creation
(50%)
Total Shareholder Return (FTSE 100)
Relative share price performance
against FTSE 100
Formulaic assessment
20%
Median
ranking
(20% outturn)
Upper quintile
ranking
(100% outturn)
Rank 30 of
97
70
th
percentile
14%
72%
Total Shareholder Return (Utilities)
Relative share price performance against
the MSCI European utilities index
Formulaic assessment
30%
Median
ranking
(20% outturn)
Upper quintile
ranking
(100% outturn)
Rank 8 of 26
72
nd
percentile
23%
76%
37%
Financial
(20%)
Adjusted Earnings Per Share growth
Compound annual growth rate (CAGR)
over the three-year performance period
Formulaic assessment
20%
147p
11.5% CAGR
(20% outturn)
175p
16.5% CAGR
(100% outturn)
151.5p
12.4% CAGR
7%
33%
7%
Strategic
(30%)
Strategy
Performance against the NZAP Plus
Judgement-based assessment (see below)
15%
Rating 1
(zero outturn)
Rating 5
(100% outturn)
Rating 3 10%
67%
Sustainability
Performance against SSE’s 2030 Goals
Judgement-based assessment (see page 126)
15%
Rating 1
(zero outturn)
Rating 5
(100% outturn)
Rating 3 9%
60%
19%
Value creation
measures
37%
+
Financial
measures
7%
+
Strategic
measures
19%
+/-
Committee
discretion
0%
=
Overall PSP
outturn
63%
Financial measures have been adjusted to take into account the equity issue in November 2025 (see pages 87 and 117).
Strategy performance
At the outset of the plan, measures were set based on the strategic investment plan at that time, the Net Zero Acceleration Plan (NZAP)
Plus. The measures focused on four key areas, which were similar to those set in the previous year with additional stretch targets
incorporated. These are shown below alongside the Committee’s performance assessment.
Summary of performance highlights Weighting
Performance
outcome Outturn
Renewables 8GW pipeline of net
installed capacity potential
and 0.5GW of international
under construction by FY26
– Net installed capacity is 5.3GW and international
projects under construction are 0.1GW.
– Macroeconomic shifts and planning delays have
resulted in challenging market conditions and a focus
on value over volume.
6.0% Rating 2
30%
1.8%
Networks
growth
Transmission and
Distribution to exceed RAV
growth targets of £7bn and
£6bn respectively
– RAV in Transmission is £6.7bn for SSE’s share, and
£6.6bn in Distribution by FY26.
– This strong growth reflected the connection of
several large renewables projects, including the
Shetland HVDC link.
7.5% Rating 5
100%
7.5%
Energy
businesses
Solar and battery installed
capacity to meet 1GW by
FY26
– Installed capacity by FY26 is 230MW.
– The target has not been met following a
reprioritisation of capital investment.
0.75% Rating 2
30%
0.2%
Customer On course to be a leading
PPA player in the market by
FY26
– SSE strengthened its position as a leading PPA
participant, expanding its route-to-market and
long-term PPA portfolio and reinforcing its role as a
partner of choice for renewable generators.
0.75% Rating 4
70%
0.5%
10%
125
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Sustainability performance
At the outset of the plan, measures were set based on our 2030 Goals, aligned to the United Nations Sustainable Development Goals
(SDGs). The measures focused on four key areas, which were similar to those set in the previous year with additional stretch targets
incorporated. These are shown below alongside the Committee’s performance assessment.
Summary of performance highlights Weighting
Performance
outcome Outturn
SDG 13
Climate action
Reduce scope 1 carbon
intensity by 80% by 2030,
compared to 2017/18 levels,
to 61g CO
2
e/kWh.
– Scope 1 carbon intensity decreased from to
205gCO
2
e/kWh to 194gCO
2
e/kWh, falling below
200gCO
2
e/kWh for the first time.
– Increased investment in networks, slower renewables
investment and delays to low-carbon flexible
generation mean the 2030 carbon intensity target
willbe challenging to achieve.
3.75% Rating 3
40%
1.5%
SDG 7
Affordable and
clean energy
Build a renewable energy
portfolio that generates at
least 50TWh of renewable
electricity a year by 2030.
– Renewables output increased by 30%, from 11.2TWh
in 2023/24 to 14.5TWh in 2025/26, driven by delivery
of Viking, Seagreen and Yellow River wind farms
andearly commissioning of Dogger Bank A wind
farm.
– Berwick Bank wind farm was granted consent and
CfD of Phase B of the project was secured.
– Due to macroeconomic shifts and planning delays,
the 50TWh renewable output target is unlikely to be
met by 2030.
3.75% Rating 2
30%
1.1%
SDG 9 Industry,
innovation and
infrastructure
Enable at least 20GW of
renewable generation and
facilitate around 2 million
EVs and 1 million heat
pumps on SSEN’s electricity
networks by 2030.
– SSEN Transmission’s connected renewable generation
capacity grew to 10.8GW, exceeding the RIIO-T2
2026 target of 10GW, this was achieved through the
connection of several large renewable projects
including the Shetland HVDC link.
– SSEN Distribution saw electric and plug-in hybrid
vehicle registrations rise to 589,000 in its areas.
3.75% Rating 4
70%
2.6%
SDG 8 Decent
work and
economic
growth
Be a global leader for the
just transition to net zero,
with a guarantee of fair
work and commitment to
paying fair tax and sharing
economic value.
– SSE has maintained its commitment to fair work
andfair tax, marking ten years of Living Wage and
Fair Tax Mark accreditations and earning Living
Pensions status.
– The company ranked in the 91st percentile for just
transition in the WBA Climate and Energy
benchmark out of 122 utilities.
– SSE also updated its Just Transition Strategy and
developed KPIs to track progress.
3.75% Rating 5
100%
3.8%
9%
2023 PSP award vesting
In 2023, Alistair and Martin received grants of 250% and 225% of base salary respectively. The estimated value of the award is based on the
average share price in the three months up to 31 March 2026 at £25.09. Share price appreciation over the period was 33%. Shares awarded
are subject to an additional two-year post-vesting holding period. Alistair’s award has been pro-rated at 32/36ths, reflecting his service until
he left SSE on 30 November 2025.
As the award will not vest until after this report is published, the actual value on vesting will be confirmed in next year’s report. The table
below provides details of the award.
Maximum
opportunity as
% of base salary
Share awards
available
Additional
awards
in respect of
accrued
dividends
Total number
of shares
vesting at 63%
Estimated value
of awards
vesting
£000s
Share price
appreciation
£000s
Martin Pibworth 225% 83,334 10,554 59,149 1,484 496
Barry O’Regan ––––– –
Alistair Phillips-Davies 250% 119,509 15,135 84,825
2,128 712
Barry received his first grant under the PSP in 2024, which will vest in 2027. In the interim, he continues to receive share awards which were
granted before he joined the Board under the below-Board long-term incentive plan, the Leadership Share Plan (LSP). As this award does
not relate to his Board service, it is not included in the single total figure of remuneration table. The number of shares vesting under the LSP
in 2026 will be 16,621.
Restatement of 2022 PSP award vesting
The 2022 PSP award vested during the year ended 31 March 2025. As the awards had not vested at the time of publication of the Annual
Report 2025, the values disclosed at that time were estimates. These estimates were calculated using the average share price over the three
months to 31 March 2025 of £15.46. The awards ultimately vested at a share price of £17.55. As the share price on vesting was lower than
the share price at grant, there was no share price appreciation.
Annual Report on Remuneration continued
126
SSE plc Annual Report 2026

The actual values on vesting are disclosed in the table below.
Maximum
opportunity as
% of base salary
Share awards
available
Additional
awards
in respect of
accrued
dividends
Total number
of shares
vesting at 59%
Estimated value
of awards
vesting
£000s
Share price
appreciation
£000s
Martin Pibworth 225% 83,928 12,174 56,697 995 –
Barry O’Regan – – – –
– –
Alistair Phillips-Davies 250% 135,407 19,644 91,476
1,605 –
IMPLEMENTATION
PSP – implementation of the 2026 to 2029 award
Martin’s PSP opportunity will increase to 300% of base salary and Barry’s PSP opportunity will increase to 275% for the 2026 grant.
Theseincreases in quantum were agreed as part of a phased plan to increase incentive levels following last year’s Policy review.
There are no changes proposed to the measures. The awards granted in 2026 will use the same measures as the previous four years.
Measure Description Weighting Threshold Maximum
TSR FTSE 100 Relative share price performance against FTSE 100. 20% 50th percentile
(20% outturn)
80th percentile
(100% outturn)
TSR MSCI Relative share price performance against the MSCI European
utilities index.
30% 50th percentile
(20% outturn)
80th percentile
(100% outturn)
Adjusted Earnings
Per Share
Growth targets over three years linked to SSE’s investment
plan.
20% 206p
(20% outturn)
231p
(100% outturn)
Strategic Performance in the main areas of the implementation of the
strategy.
15% Rating 2
(20% outturn)
Rating 5
(100% outturn)
Sustainability Performance linked to the 2030 Goals. 15% Rating 2
(20% outturn)
Rating 5
(100% outturn)
The target range for adjusted EPS of 206p to 231p aligns with the rebased target of 168p to 193p for FY27, and the FY30 guidance at 225p
to 250p, as described on page 18
.
The strategy targets have been updated and will now feature two distinct areas related to growth in Networks and Renewables. These will
apply to both the 2026 PSP targets and the 2025 targets which we delayed setting last year in light of the changing macro-environment,
delays to policy and planning, and uncertainty over market reform. In addition, a demand advocacy target will apply to the 2026 award.
Strategic area 2025 PSP targets 2026 PSP targets
Market leading Networks RAV growth
From £13bn gross RAV in FY25 to £40bn gross
RAV in FY30.
~£21bn RAV (on a net basis, for SSE’s 75%
share of SSEN Transmission) by FY28.
~£26bn RAV (On a net basis, for SSE’s 75%
share of SSEN Transmission) by FY29.
Selective and disciplined Renewables growth
From 5GW in FY25 to 9GW in FY30 (before asset
disposals / capital rotation).
~7GW installed capacity (before any asset
disposals / capital rotation) by FY28.
~8GW installed capacity (before any asset
disposals / capital rotation) by FY29.
Demand advocacy
Secure demonstrable advances in government
policy in SSE’s home markets that will drive
accelerated electrification of demand.
Not applicable to this award. Qualitative assessment of performance
related to securing demonstrable advances
in government policy in SSE’s home
markets that will drive accelerated
electrification of demand.
Sustainability targets will continue to be aligned to the 2030 Goals, linked to UN Sustainable Development Goals. This applies to both the
2026 PSP targets and the 2025 targets which we delayed setting last year.
Strategic area 2025 PSP targets 2026 PSP targets
SDG 13 Climate action
Reduce scope 1 carbon intensity by 80% by 2030,
compared to 2017/18 levels, to 61g CO
2
e/kWh.
Scope 1 carbon intensity tracked to FY28. Scope 1 carbon intensity tracked to FY29.
SDG 7 Affordable and Clean Energy
Build a renewable energy portfolio that generates
at least 50TWh of renewable electricity a year
by2030.
Renewables output TWh tracked to FY28. Renewables output TWh tracked to FY29.
SDG 9 Industry, Innovation and Infrastructure
Enable at least 20GW of renewable generation
and facilitate around 2 million EVs and 1 million
heat pumps on SSEN’s electricity networks
by2030.
GW renewable generation capacity
connected to SSEN’s electricity
transmission network by FY28.
Low-carbon technologies connected
to SSEN’s local electricity distribution
networks by FY28.
GW renewable generation capacity
connected to SSEN’s electricity transmission
network by FY29.
Low-carbon technologies connected
toSSEN’s local electricity distribution
networks by FY29.
SDG 8 Decent Work and Economic Growth
Be a global leader for the just transition to netzero,
with a guarantee of fair work and commitment to
paying fair tax and sharing economic value.
Achieve continued thought leadership on
just transition, as recognised in external
benchmarks.
Achieve continued thought leadership on
just transition, as recognised in external
benchmarks.
127
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The strategy and sustainability measures under the PSP, and the personal measures under the AIP, will be assessed against a five-point
rating scale on the same basis as the awards under assessment this year. The definitions of ratings and outturns are shown below.
TheRemuneration Committee may decide to award an outturn between levels if warranted.
Score Performance assessment Illustrative outturn as % of maximum
1 Below threshold zero
2Threshold performance 20%
3 Majority of goals at or above target 40%
4 Substantial majority of goals at or above target 70%
5 All goals at or above target 100%
AUDITED
Deferred bonus and PSP awards granted in 2025
The table below shows the deferred bonus and PSP awards granted to Executive Directors in 2025. Dividends will accrue during the
deferral, performance and holding periods.
Type of award Date of grant Director Shares granted
Market value on
date of award
Face value
(£000s)
Deferred bonus 18 July 2025 Martin Pibworth
Barry O’Regan
14,158
12,268
£18.41
£18.41
261
226
Total 487
PSP 18 July 2025 Martin Pibworth
Barry O’Regan
144,894
95,057
£18.41
£18.41
2,667
1,750
Total 4,417
The performance measures for the 2025 PSP award are Total Shareholder Return relative to the FTSE 100 (20%) and European utilities
(30%), adjusted Earnings Per Share growth (20%), strategy (15%) and sustainability (15%). These measures are set out in detail on page 147
ofSSE’s Annual Report 2025
and on the previous page. Threshold performance results in 20% of the awards vesting. The face value of
the 2025 PSP awards was 275% of salary for Martin, and 250% of salary for Barry. Alistair did not receive grants under the deferred bonus
orthe PSP in 2025 due to him stepping down from the Board early in the financial year.
Payments for loss of office and payments to past Directors
Alistair stepped down from the Board on 17 July 2025 and was treated as a good leaver for the purpose of outstanding share awards under
the PSP. This means that his awards will be pro-rated to reflect the time between the start of the performance period and when he left SSE
at the end of November 2025. This was disclosed in detail in the Annual Report 2025.
Under the 2023 PSP award, Alistair will receive an award of 84,825 shares as disclosed in detail on page 126
and in the single total figure
of remuneration table on page 120 . Vesting will take place in line with the normal vesting timetable and will be subject to the standard
two-year post-vesting holding period.
Share ownership policy
The table below shows the shareholding and share interests of the Executive Directors on 31 March 2026 (or on cessation in Alistair’s case).
Executive Directors are required to maintain a shareholding equivalent to the face value of the annual award of shares under the PSP.
For2025/26, Martin was required to maintain a shareholding equivalent to 275% of base salary, and Alistair and Barry were required to
maintain a shareholding equivalent to 250% of base salary. From 1 April 2026, Martin and Barry’s requirements increased to 300% and 275%
respectively, aligned with the increase to their PSP award levels. The shareholding requirement continues for two years post-cessation
ofemployment.
Martin and Alistair have exceeded the shareholding requirement, and Barry is building up a shareholding following his appointment to the
Board in 2023.
AUDITED
Number of shares Number of options
Shareholding as
a % of salary
Shares owned
outright at
31 March 2026*
Interests in
shares without
performance
conditions at
31 March 2026
(DBS Awards)
Interests in
shares subject
to performance
conditions at
31 March 2026
(PSP Awards)
Interests in
shares subject
to performance
conditions at
31 March 2026
(LSP Awards)
Interests in
share options
without
performance
conditions at
31 March 2026
(SAYE)
Interests in
share options
subject to
performance
conditions at
31 March 2026
Shares owned
outright at
31 March 2025*
Martin Pibworth 667% (met) 249,610 39,242 325,727 – 1,283 – 200,936
Barry O’Regan 200% (not met) 59,574 21,443 179,546 18,676 1,068 – 49,244
Alistair Phillips-Davies
1,333% (met) 552,594 42,026 285,255 – – – 491,164
* including holdings of any connected persons.
Annual Report on Remuneration continued
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Chair and non-Executive Directors’ fees
Non-Executive Directors’ fees – 2025/26
This table sets out what each non-Executive Director was paid for the financial year ended 31 March 2026 relative to the previous
financialyear.
Helen Mahy stepped down from the Board following the AGM on 17 July 2025. Hixonia Nyasulu joined the Board on 1 January 2025 and
assumed the position of Senior Independent Director upon Helen’s departure. On the same date, Dame Angela Strank was appointed Chair
of the Safety, Sustainability, Health and Environment Advisory Committee, a role previously held by Helen.
AUDITED
£000s 2024/25 2025/26
Lady Elish Angiolini 102 105
John Bason 107 110
Tony Cocker 102 105
Dame Debbie Crosbie 82 85
Helen Mahy 127 39
Sir John Manzoni 452 466
Hixonia Nyasulu 21 103
Melanie Smith 107 110
Dame Angela Strank 82 99
Maarten Wetselaar 82 85
Total 1,264 1,307
IMPLEMENTATION
Non-Executive Directors’ fees – 2026/27
Non-Executive Directors receive a base fee, a fee for chairing any committee, and a fee for the role of Non-Executive Director for
Employee Engagement. There is no additional fee paid for membership of a committee. The Chair fee is all-encompassing, and no other
fees are paid in addition.
Fees are typically reviewed each year taking into consideration any changes in time commitment or responsibilities. They are also
considered in the context of other companies of a similar size and complexity. In 2025/26, the Chair’s fee and base non-Executive Director
fees were increased by 3%, in line with the pay budget for the wider employee population.
Fee levels for 2026/27 are shown below and represent a 3.5% increase on the previous year, in line with the anticipated pay budget for the
wider employee population.
£000s 2025/26 2026/27
Chair fee 466 482
Base fee 85 88
Senior Independent Director 26 27
Audit Committee Chair 26 27
Remuneration Committee Chair 26 27
Energy Markets Risk Committee Chair 21 21
Safety, Sustainability, Health and Environment Advisory Committee Chair 21 21
Non-Executive Director for Employee Engagement 21 21
AUDITED
Non-Executive Directors’ share interests
This table shows the share interests and shareholdings of the non-Executive Directors on 31 March 2026. They are each expected to build
up a minimum holding of 2,000 SSE shares.
Shareholding
guideline
Shares owned
outright at
31 March 2026*
Lady Elish Angiolini Met 2,097
John Bason Met 2,565
Tony Cocker Met 5,000
Dame Debbie Crosbie Met 2,176
Helen Mahy Met 3,310
Sir John Manzoni Met 3,131
Hixonia Nyasulu Met 2,243
Melanie Smith Met 2,365
Dame Angela Strank Met 2,341
Maarten Wetselaar Met 4,352
* including holdings of any connected persons.
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Annual Report on Remuneration continued
130
SSE plc Annual Report 2026
Directors’ service contracts and letters of appointment
Executive Directors’ contracts are terminable by the Company immediately without notice upon breach by the individual, or by the
Company with 12 months’ notice, or by payment in lieu of salary only during that notice. Payment in lieu of notice may be staged and may
either reduce or stop completely when the departing Executive Director gains new employment. The Executive Director may terminate the
contract by giving the Company 12 months’ notice. Contracts for new Executive Directors will be limited to 12 months’ notice by both
parties (or payment in lieu of notice in respect of the Company). Service contracts are available to view at our registered office.
Effective date of service contract
Martin Pibworth 17 July 2025
Barry O’Regan 1 December 2023
Alistair Phillips-Davies 1 July 2013
Non-Executive Directors are appointed for fixed terms of three years, subject to retirement and re-appointment at AGMs. Non-Executive
Directors are not entitled to any payment in lieu of notice or any compensation for loss of office when they leave. Letters of appointment
are available to shareholders at sse.com
.
Malus and clawback
The circumstances in which malus and clawback provisions could be used are explained in detail in the Directors’ Remuneration Policy
published in full in last year’s report. As part of its annual review, the Committee considered these provisions at the end of the year and
determined that no adjustment was required to Executive Directors’ remuneration outcomes.
Executive remuneration in context
The following pages detail some of the factors the Remuneration Committee takes into account when setting pay for Executive Directors.
Workforce pay
Similar pay principles apply to all employees across SSE, and there are commonalities between executive pay and wider workforce pay.
While the Remuneration Committee’s responsibilities focus on pay arrangements for Executive Directors and the Group Executive
Committee (GEC), it is fully briefed on pay arrangements for the wider workforce and takes these into account in decision-making.
Thistable shows how pay is aligned across employee groups.
Executive Directors and GEC Wider workforce
Base salary Base salaries are reviewed each year, taking into account:
skills, experience and performance; salary levels at other
UK-listed companies of a similar size and complexity;
wider internal pay arrangements; and the overall policy
objective of setting competitive, but not excessive,
remuneration against benchmarks.
There are two main groups of employees. Around half are
subject to collective bargaining through our recognised trade
unions. Annual increases are based on the attainment of skills.
The remaining employees have salaries set with reference to
market requirements. Annual increases are based on a
performance pay matrix.
Benefits Voluntary benefits are provided in line with the wider
workforce, with the addition of contractual entitlements
to car and private medical benefits.
Some employees receive contractual car and private medical
benefits.
All employees have access to a comprehensive suite of
voluntary benefits, including private medical benefits, a salary
sacrifice car scheme, holiday purchase, financial wellbeing
benefits, and a range of family-friendly benefits.
Pension Pensions arrangements are aligned with the wider
workforce, and are capped at 12% for Executive
Directors.
New employees who join the GEC will also have pension
arrangements capped at 12%. Legacy arrangements may
exist for longer serving GEC members.
All employees are members of a defined contribution pension
scheme or one of our legacy defined benefit pension schemes,
unless they have opted out.
The arrangements are diverse, and employer costs typically
range from 3% to 32.5% of salary when both defined
contribution and defined benefit schemes are taken into
account. The potential pension contribution available to all
employees is 12%.
Annual
incentive
AIP for Executive Directors is linked directly to
performance and is structured around performance
measures that are 50% financial and 50% non-financial.
The award is normally delivered as 67% cash and 33%
deferred shares.
GEC members participate on the same basis as other
eligible employees.
Around half of the wider employee population is eligible for
AIP. Awards are linked to the performance of the Group, the
employee’s business or function, and the employee’s individual
performance rating. Employees in other leadership roles may
have a portion of their award deferred as shares.
Long-term
incentive
Executive Directors and, from 2026, GEC members
participate in thePSP which is a share award over three
years with performance linked to value creation, financial,
strategic and sustainability measures.
Other senior leaders are eligible for the Leadership Share Plan.
This is a share award over three years, linked to Group against
strategic delivery.
Share
ownership
policy
Executive Directors are required to maintain a minimum
shareholding of SSE shares linked to the level of annual
award under the PSP up to 300% of base salary.
Other GEC members are required to build up a
shareholding ofSSE shares linked to the level of annual
award under the PSP up to 200% of base salary.
All employees are encouraged to become SSE shareholders
through participation in the Share Incentive Plan (SIP) or
Sharesave.
Around 50% of employees participate in Sharesave, and 65%
of employees participate in SIP.

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Chief Executive pay ratio
The following table shows the Chief Executive to employee pay ratio over time based on methodology C of the Companies (Miscellaneous
Reporting) Regulations 2018. This uses Gender Pay Gap data as its basis, and includes other important components of pay at SSE, such as
overtime and employer’s contributions to pension. It excludes salary sacrifice arrangements.
For the purposes of the following tables, the Chief Executive’s pay is based on a blend of Alistair’s pay up to when he stepped down from
the Board and Martin’s pay from his appointment on 17 July 2025.
Year
Calculation
methodology
Ratio to employee pay
at 25th percentile
Ratio to employee pay
at median
Ratio to employee pay
at 75th percentile
2025/26 C 106:1 77:1 58:1
2024/25 C 97:1 69:1 52:1
2023/24 C 95:1 65:1 49:1
2022/23 C 136:1 100:1 73:1
2021/22 C 141:1 106:1 76:1
2020/21 C 95:1 73:1 52:1
2019/20 C 83:1 59:1 44:1
2018/19 C 57:1 42:1 30:1
As a large proportion of the Chief Executive’s pay is based on performance and the flow through to variable pay, the pay ratio can vary
significantly from year to year. Pay for employees typically has a high proportion of fixed pay and less variable pay. Total employee pay at
the median increased by 7%. The increase is mostly attributable to the base salary increases applied during the year which were in the
range of 3% to 6%.
As a result, the ratio of Chief Executive pay to employee pay at median has increased from 69:1 to 77:1. For more on employee pay,
including the Gender Pay Gap, see page 52
and at sse.com/inclusion .
This table sets out base salary and total pay for the Chief Executive and for UK employees at the 25th, 50th and 75th percentile. The total
pay figures have been used to determine the pay ratios in the previous table.
Chief Executive UK employees
25th percentile Median 75th percentile
£000s Base salary Total pay Base salary Total pay Base salary Total pay Base salary Total pay
2025/26 1,005 4,530 36 43 48 59 64 78
2024/25 1,044 4,083 33 40 45 57 60 75
2023/24 999 3,562 31 38 42 54 57 73
2022/23 952 4,776 29 35 37 48 51 65
2021/22 924 4,655 28 33 36 44 49 61
2020/21 915 3,045 28 32 35 42 48 59
2019/20 8902,418–29–41–55
2018/19 866 1,639 – 29 – 39 – 54
Change in remuneration of Directors and employees
The table below shows the percentage change in the annual remuneration of Directors and UK employees over the past five years, as
required by the reporting regulations. These changes reflect the information provided in the single total figure of remuneration table on
page 120
and the non-Executive Directors’ fees table on page 129 .
2021/22 v 2020/21 2022/23 v 2021/22 2023/24 v 2022/23 2024/25 v 2023/24 2025/26 v 2024/25
Director
Base
salary/fee Benefits Bonus
Base
salary/fee Benefits Bonus
Base
salary/fee Benefits Bonus
Base
salary/fee Benefits Bonus
Base
salary/fee Benefits Bonus
Non-Executive
Directors
Lady Elish Angiolini ––– –––28%–– 7%–– 3%––
John Bason ––– –––48%––16%–– 3%––
Tony Cocker 11%–– 3%––(1)%––(5)%–– 3%––
Dame Debbie Crosbie ––– ––– 5%–– 4%–– 3%––
Sir John Manzoni ––– 3%–– 5%–– 4%–– 3%––
Melanie Smith 1%–– 3%––32%–– 9%–– 3%––
Dame Angela Strank – – – 3% – – 5% – – 4% – – 21% – –
Maarten Wetselaar ––– ––– ––– ––– 3%––
Executive Directors
Martin Pibworth 11% 0% 32% 3% 1% 11% 5% 5% (18%) 9% (1%) 28% 21% 12% 61%
Barry O’Regan ––– ––– ––– –––14%(2)%38%
All employees 6% 3% 51% 22% 16% 6% 25% 11% 36% 19% 13% (11%) 4% 13% 18%

Board gender balance
Annual Report on Remuneration continued
132
SSE plc Annual Report 2026
Relative importance of the spend on pay
This table shows how the earnings of Executive Directors compare with SSE’s other financial distributions. For every £1 spent on Executive
Directors’ earnings by SSE in 2025/26, £50 was paid in tax, £127 was spent on employee costs and £417 was spent on capital and
investment expenditure. In addition, £86 was paid in dividend payments to shareholders.
2024/25
£m
2025/26
£m Change
Executive Directors’ earnings 8.1 8.5 5.1%
Dividends to shareholders 671.0
734.1 9.4%
Adjusted investment, capital and acquisition expenditure 2,910.4
3,546.5 21.9%
Total UK taxes paid (profits, property, environment and employment taxes) 592.1
424.9 (39.4)%
Staff costs 1,035.0 1,076.0 4.0%
Total Shareholder Return (TSR)
This graph shows SSE TSR performance over the past ten years relative to FTSE 100 performance. The FTSE 100 Index has been
chosen because SSE has been a constituent member throughout the period.
March
2016
March
2017
March
2018
March
2019
March
2020
March
2021
March
2022
Source: Datastream (a LSEG product)
March
2023
March
2024
March
2025
March
2026
SSE FTSE 100
TSR (rebased to 100)
80
100
120
140
160
180
200
220
240
260
280
300
320
The Chief Executive’s annual remuneration over the same period is in the table below. This represents a blend of Alistair’s pay up to when
he stepped down from the Board and Martin’s pay from his appointment on 17 July 2025.
Year
Single total figure
of remuneration
(£’000)
Annual variable
element award
(% of maximum)
Long-term
incentive vesting
(% of maximum) Application of discretion
2025/26 4,530 85 63
2024/25 4,083 81 59
2023/24 3,562 69 62
2022/23 4,776 88 76 Downward discretion applied to AIP
2021/22 4,655 83 66
2020/21 3,045 69 28 Downward discretion applied to AIP
2019/20 2,418 59 27
2018/19 1,639 0 26 Downward discretion applied to AIP
2017/18 2,693 78 30
2016/17 2,917 72 46 Downward discretion applied to AIP

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Governance
External appointments
Executive Directors can accept non-executive appointments outside of SSE with the consent of the Board, as this can enhance their
experience and value to SSE. Any fees received are kept by the Director. Details of all external appointments held by Executive Directors are
shown on pages 80 to 82
.
The former Chief Executive, Alistair Phillips-Davies, was a non-executive director of Anglian Water Services Limited, for which he received
an annual fee of £64,790 at the time of stepping down from the Board. Neither of the current Executive Directors hold any paid external
appointments.
Advice to the Remuneration Committee
The Chief Executive, Group HR Director, and Director of Reward and Pensions advised the Committee on certain remuneration matters for
Executive Directors and senior executives, although they were not present for any discussions related to their own remuneration.
The Group HR Director and Director of Reward and Pensions also advised on HR strategy and the application of HR policies across the
wider organisation.
FIT Remuneration Consultants LLP (FIT) provided a range of information to the Committee, including market data drawn from published
surveys, governance developments and their application to SSE, advice on remuneration disclosures and regulations, and comparator
group pay. FIT received £75,064 in relation to their work for the Committee, calculated on a time and materials basis. FIT is a founding
member of, and adheres to, the Remuneration Consultants’ Group Code of Conduct. This defines the roles of consultants, including the
requirement to have due regard to the organisation’s strategy, financial situation, pay philosophy, the Board’s statutory duties, and the views
of investors and other stakeholders. The Committee reviews performance annually to determine if it is satisfied with the quality, relevance,
objectivity and independence of the advice. FIT provides no other services and has no other connection to SSE or individual Directors.
Freshfields LLP also advised on legal matters, such as share plan rules, during the year.
Shareholder voting
On 17 July 2025, shareholders approved the current Directors’ Remuneration Policy and the Annual Report on Remuneration for the year
ended 31 March 2025.
Annual Report on Remuneration – shareholder
voting in2025
Directors’ Remuneration Policy – shareholder
voting in2025
For.................98.40%
Against ............1.60%
For..................97.22%
Against ............2.78%
Total votes cast: 796,524,905
Votes withheld: 391,485
Total votes cast: 796,517,385
Votes withheld: 398,210
Employee engagement
The Board actively seeks opportunities for two-way dialogue with SSE’s employees. Engagement activity is diverse and includes face-to-
face meetings, site visits, attendance at employee events and virtual meetings. During the year, the Remuneration Committee Chair met
with a group of employee representatives to discuss the pay arrangements for SSE’s executives and how they align to the wider employee
population. For more on ‘Listening to our employees’ see page 91
.
Remuneration Committee
A summary of the Committee’s role is on the first page of the Directors’ Remuneration Report. The Terms of Reference for the Committee
were reviewed during 2025/26 and no changes were made. These are available on sse.com .
The members of the Committee and the meetings attended are on page 84
. The focus of each of the meetings was as follows:
May 2025 Confirmed AIP, PSP and LSP performance outcomes for Executive Directors and the Group Executive Committee.
Agreed approach to setting AIP and PSP performance measures for the year ahead.
Reviewed below-Board pay arrangements.
November 2025 Received a market and governance update following AGM season.
Formally confirmed a salary increase for the Chief Financial Officer following an increase in responsibilities.
Reviewed how AIP and PSP measures were tracking against performance.
Agreed final pension arrangements for the former Chief Executive.
Reviewed Committee Terms of Reference.
March 2026
Reviewed how AIP and PSP measures were tracking against performance.
Agreed salary and fee increases for Executive Directors, the Chair and the Group Executive Committee.
Reviewed an update to the share plan rules.
Considered outcomes of annual Committee performance review.

Introduction
Our Directors’ Remuneration Policy was approved with over 97% of shareholders support at the AGM on 17 July 2025. It is intended that the
Policy will apply for a period of up to three years and will be re-approved at the 2028 AGM at the latest. No material changes have been
made to the Policy since its approval.
The full Policy is available in the Annual Report 2025
, and has been summarised below.
Policy table
Base salary
Purpose and link to strategy To support the retention and recruitment of Executive Directors of the calibre required to develop SSE’s
strategy, deliver efficient operations and investments, and engage effectively with key stakeholders.
Operation and maximum
opportunity
Base salary is normally reviewed annually with changes effective from 1 April.
Salary increases will normally be capped at the typical level of increases awarded to other employees in the
Company, although increases may be above this level in certain circumstances.
Performance measures Broad review of performance is included in the annual review process.
Benefits
Purpose and link to strategy To provide a market-competitive level of benefits for Executive Directors.
Operation and maximum
opportunity
Executive Directors’ core benefits currently include car allowance, private medical insurance and health
screening. They can also participate in SSE’s all-employee share plans on the same terms as UK colleagues.
Relocation assistance will be provided if required. Travel and business-related expenses will be reimbursed.
The cost will depend on the cost to SSE of providing individual items and the individual’s circumstances.
There is no maximum benefit level.
Performance measures Not applicable
Pension
Purpose and link to strategy Pension planning is an important part of SSE’s remuneration strategy as it’s consistent with the long-term
goals of the business.
Operation and maximum
opportunity
The Chief Executive receives a cash allowance in lieu of accruing future pension benefits. The Chief Financial
Officer participates in a defined contribution arrangement that SSE makes employer’s contributions to.
Employer’s pension contributions are capped at 12% of base salary in line with arrangements for the wider
SSE employee population.
Performance measures Not applicable
Annual Incentive Plan (AIP)
Purpose and link to strategy Rewards Executive Directors for the achievement of performance targets linked to SSE’s strategy and core
purpose. Compulsory deferral into SSE shares aligns Executive Directors’ interests with those of shareholders.
Operation and maximum
opportunity
The Remuneration Committee determines the level of incentive considering performance against targets,
the underlying performance of the business and Executive Directors’ individual performance.
Performance is typically assessed over a financial year. The award will normally be delivered as 67% in cash
and 33% in deferred shares.
The award is subject to malus and/or clawback provisions.
The maximum annual incentive opportunity is 200% of base salary.
Performance measures The annual incentive is normally based on a mix of financial, operational, strategic and stakeholder
measures reflecting the priorities of the business. A minimum of 50% of the annual incentive will be based
on financial performance.
Directors’ Remuneration Policy – a summary
134
SSE plc Annual Report 2026

Performance Share Plan (PSP)
Purpose and link to strategy Rewards Executive Directors for their part in delivering the sustained success of SSE over a three-year
performance period and further two-year holding period. It ensures that their interests are aligned with those
of SSE’s shareholders.
Operation and maximum
opportunity
Shares are awarded which normally vest based on performance over a period of three years with an
additional two-year post-vesting holding period during which time the Executive must retain the post-tax
number of shares vesting under the award.
The Remuneration Committee determines the extent to which shares vest. All shares vest if the maximum
performance standards are met or exceeded. No shares vest for below threshold performance.
Awards are subject to malus and/or claw back provisions.
Maximum annual value of an award that can be granted under the PSP is 300% of base salary.
Performance measures Awards vest based on a range of measures which may include value creation, financial, operational, strategic,
or stakeholder-based measures.
At least 70% of the award will be based on financial and value creation measures.
Share Ownership Policy
Purpose and link to strategy Aligns the interests of Executive Directors with those of SSE’s shareholders.
Operation and maximum
opportunity
Shareholding is normally built up by shares vesting through the PSP, as well as deferred shares from the AIP
and all employee share schemes. Executive Directors may also choose to buy shares.
The requirement to retain shares continues after employment and Executive Directors are required to hold
any shares (excluding those purchased from their own funds) to the value of the minimum requirement set
by the Policy (or the projected shareholding including in-flight PSP awards) for another two years following
cessation of employment.
The minimum shareholding is linked to the face value of the annual award of shares under the PSP (i.e. up to
a maximum of 300% of base salary), and should be built up over a reasonable time frame.
Performance measures Not applicable.
Chair and non-Executive Directors’ fees
Purpose and link to strategy Fees are set at a level which provides reward for undertaking their role. The fee levels are intended to attract
and retain individuals with the calibre and experience to contribute effectively at Board level.
Operation and maximum
opportunity
The fee structure may be made up of:
– a basic Board fee or Chair fee;
– an additional fee for any committee chairship or membership; and
– an additional fee for further responsibilities e.g. Senior Independent Director, Non-Executive Director for
Employee Engagement or periods of increased activity.
Fees are reviewed at appropriate intervals against companies of a similar size and complexity. Fees are set in
a way that is consistent with the wider remuneration policy.
Reasonable travelling and other expenses for costs incurred in the course of the non-Executive Directors
undertaking their duties are reimbursed (including any tax due on the expenses).
The aggregate level of non-Executive Director fees shall not exceed the maximum limit set out in the Articles
of Association.
It is also expected that all non-Executive Directors should build up a minimum of 2,000 shares in the Company.
Performance measures Not applicable.
The full Policy also includes further information on:
– Performance measures and targets
– Committee discretion
–Legacy commitments
– Directors’ service contracts
– Non-Executive Directors’ letters of appointment
– Loss of office policy
– Recovery provisions
–Recruitment policy
– Shareholders’ views
– Remuneration engagement across the Group
– Illustration of the Policy.
Melanie Smith CBE
Chair of the Remuneration Committee
27 May 2026
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Compliance with the UK Corporate Governance Code 2024
The Board keeps SSE’s corporate governance arrangements under review to ensure
our approach remains effective and proportionate.
andwritten commentary and dashboards
covering a range of financial and non-
financial key performance indicators.
The Board has a Schedule of Reserved
Matters and a wider Board Charter which
governs its own operations and relevant
Group-wide matters. The Schedule of
Reserved Matters ensures that areas
material to the delivery of SSE’s purpose and
strategy are safeguarded by the Board. It is
available on sse.com
, along with other
key SSE corporate governance documents.
See also:
– SSE’s Governance Framework on
page85
– Board composition on pages 80 to 82
and 84
– Board work in 2025/26 on pages 86
to93
– SSE’s stakeholders on pages 10 to 11
B. Purpose, culture and strategy
The Board sets SSE’s purpose and strategy
with a continued focus on developing the
energy infrastructure needed to support
security of supply and a just clean energy
transition. It reviews SSE’s strategic situation
across an annual programme of work and
monitors progress through structured
reporting from senior management. In
November 2025, the Board confirmed a
revised investment plan “Transformation for
Growth” which underpins strategic delivery
to 2030. It further approved a revision to
SSE’s purpose and description of strategy as
the challenges to delivering a clean energy
transition have become clearer. SSE’s
business model continues to show how
theGroup’s deliberate mix of businesses
creates lasting value within its complex
operating environment.
The Board sets SSE’s values and expected
behaviours to nurture the desired Group-
wide culture and deliver SSE’s purpose and
strategy. Work in the year saw refinement
ofSafety and Sustainability as SSE’s
foundational values, underpinning a suite of
behaviours to enable a performance culture
that encourages doing the right thing.
TheBoard leads by example, ensuring the
correct tone is instilled throughout the
Group by promoting a fair workplace and
ethical business practices. A combination
ofBoard’s employee engagement activities
assist its assessment of cultural health and
how expectations have been embedded
across SSE.
This year marks our first time reporting
against the FRC’s UK Corporate Governance
Code 2024 (the Code). A copy of the Code
can be found at www.frc.org.uk.
The Board and Board Committees continue
to uphold the spirit of the Code, and apply
its stated Principles, across their respective
areas of work. With reference to the Code’s
Provisions, the Board confirms compliance
with all matters for the year ended
31March2026.
This statement gives details of how Code
compliance has been achieved. Where
additional disclosures are located elsewhere
in the Annual Report, cross-references
areprovided.
Work has been completed in the year to
prepare for compliance with Provision 29,
which will apply to SSE plc from 1 April 2026.
1. Board leadership and company
purpose
A. Board’s role
The Board is responsible for leading SSE
andpromoting its long-term sustainable
success, while also generating value for
shareholders and wider stakeholders. In
doing so, it actively monitors internal and
external developments, provides effective
oversight and challenge, and makes
informed decisions. This is enabled by its
deliberate composition and balance of skills,
its annual workplan, and the Group-wide
strategic approach to stakeholder
engagement.
A set of operational and financial targets
and 2030 business goals support the
delivery of SSE’s strategy. The Board
monitors progress against these to make
sure agreed objectives are met. It sets key
parameters, including SSE’s financial and
investment strategy (such as annual
operating and capital expenditure budgets),
and the delegated authorities set out in
SSE’s Governance Framework. These
delegations support day-to-day operations
and the implementation of strategy –
matters which are overseen by the Group
Executive Committee.
The Board retains oversight of delegated
matters through verbal updates at Board
meetings and a range of written materials.
These include sub-Committee minutes,
standing reports such as the Chief
Executive’s Report and Finance Report,
See also:
– SSE’s purpose, strategy, values and
business model on page 7
– Board work on strategy on pages 86
to88
– Board focus on culture on page 90
C. Board decisions and their outcomes
– The Board oversees and drives the
delivery of SSE’s strategy through
focused decision-making and by
providing constructive guidance.
TheGovernance Report which ison
pages 77 to 142
has been prepared
inaccordance with Principle C. Itsets
out the key decisions taken by the Board
thisfinancial year, how these decisions
progressed SSE’s strategic objectives,
anddemonstrates relevant outcomes.
D. Stakeholder engagement
The Board agrees a framework of
stakeholder engagement, which defines:
who SSE’s key stakeholder groups are;
thepurpose of meaningful stakeholder
relations; and how stakeholder views
shouldbe considered at Business Unit
andGroup level.
Given the societal impact and scale of
SSE’sbusiness operations, stakeholder
engagement is necessary to make sure
decisions reflect an appropriate awareness
of stakeholder views and needs. SSE
engages in a range of ways through its
executive and business-led stakeholder
network. The Board regularly engages
directly with stakeholders and receives
reports on below-Board activity. This
approach allows emerging stakeholder
priorities to be promptly identified and
ensures senior leaders and Business Units
can take them into account when making
decisions and setting longer-term objectives.
The Board is committed to regular
engagement with employees through
anannual programme of activities.
ANon-Executive Director for Employee
Engagement, Lady Elish Angiolini, is the
Board lead for the employee voice
anddischarges her role through a
complementary agenda of work.
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Thisis supported by an annual authorisation
process, overseen by the Nomination
Committee, which informs the ongoing
assessment of each non-Executive
Director’s independence.
See also:
– Board composition on pages 80 to 82
and 84
– Board independence and conflicts on
page 100
H. Non-Executive Directors’ role and
time commitment
The expected time commitment of the
Chair and non-Executive Directors is
included in every Letter of Appointment.
The Letter of Appointment is issued after
confirming each person’s capacity to join
the Board and involves assessing existing
external commitments.
The Nomination Committee monitors
theongoing time commitments of
Boardmembers, and the annual Board
performance review considers the
performance and capacity of each Director
to discharge their role. Following initial
appointment to the Board, any new external
roles require prior Board approval.
To ensure non-Executive Directors have
appropriate oversight, and the ability to
challenge and review information which
ispresented to them, the Board has
unrestricted access to senior leadership,
their teams and specialist functions. People
from different levels across the organisation
are invited to present at Board meetings
andfacilitate deep dive sessions throughout
the year.
See also:
– Board external commitments on
pages80 to 82
– Assessing Board performance on
page94
– Time commitment on page 100
I. Company Secretary
The Group General Counsel and Company
Secretary makes sure Board procedures are
followed. This includes assisting the Chair,
in consultation with the Chief Executive,
indeveloping meeting agendas aligned to
the annual workplan, and ensuring agenda
items are allocated sufficient time for
effective and constructive discussion. The
annual workplan accounts for the status of
projects, strategic workstreams, and the
overarching operating context. Meeting
materials are shared using an electronic
portal, allowing timely review and
streamlined navigation of content.
Guidance on drafting papers and presenting
to the Board is available to everyone who
writes and presents Board materials.
The Board and any Director can ask for
more information to support their individual
duties or collective role as a Board. These
See also:
– SSE’s stakeholders on pages 10 to 11
– Stakeholders and Section 172 Statement
on pages 95 to 97
– Employee engagement on pages 91
to92
E. Workplace policies
SSE’s processes and procedures help to
embed a strong and consistent culture across
the Group. The Board approves key pillars
such as SSE’s values, a suite of performance
behaviours, SSE’s Group Policies, and an
employee guide, “Doing the right thing; SSE’s
guide to good business ethics”. These are
supported by mandatory training for all
employees and set clear expectations on
expected attitudes and conduct.
The Board recognises the importance of
making sure that everyone in SSE feels
empowered to speak up in relation to
wrongdoing. It reviews an assessment
ofthe ongoing effectiveness of SSE’s
whistleblowing arrangements bi-annually,
which considers performance, case trends
and employee confidence in speak-up
mechanisms and protections.
2. Division of responsibilities
F. Chair
The Chair is responsible for leading the
Board and nurturing a culture of informed
and transparent decision making. Clearly
defined Board roles support this, and the
Chair encourages constructive dialogue
both during and outside of meetings.
Private sessions are scheduled at to allow
non-Executive Directors to speak directly
with the Chair without Executive
Directorspresent.
Sir John Manzoni, the current Chair, was
considered independent on appointment.
His performance in the role is assessed each
year during the Board performance review.
For more, see Assessing Board performance
on page 94
.
G. Board composition, independence
and division of responsibilities
The Board comprises the Chair, eight
independent non-Executive Directors and
two Executive Directors. Excluding the
Chair, the eight non-Executive Directors
(over half of the Directors) are considered
independent. The Board’s Charter outlines
the clear division of responsibilities between
the Chair and Chief Executive. It also sets
out the responsibilities of the non-Executive
Directors, including the roles of the Senior
Independent Director and Non-Executive
Director for Employee Engagement.
Thedivision of responsibilities across the
Board can be found on sse.com
.
Each Director must disclose any actual
orpotential conflict of interest situations,
asdefined by law, for consideration
andapproval by the Board as required.
requests can come from Board discussions,
be raised as a development opportunity,
orbe an area of general interest relating to
SSE. Depending on the request, SSE may
support the learning internally or externally.
For more, see Deepening knowledge of AI
on page89
.
3. Composition, succession and
evaluation
J. Appointments and succession
planning
The Nomination Committee considers
Board and Executive appointments and
oversees SSE’s succession planning work.
To support this, it reviews the size, structure
and composition of the Board and its
Committees and makes recommendations
aligned to SSE’s needs. It also reviews
thetalent pipeline across the senior
management population.
Guided by the Board’s Inclusion and
Diversity Policy, the Nomination Committee
judges actions to create a diverse pipeline
for Board and senior leadership roles,
initiatives to develop internal capabilities,
and the status of the external market. The
Board engages in core talent programmes
and Directors meet with potential future
leaders through both structured and
informal activities.
The Board’s Policy ensures recruitment is
inclusive and promotes diversity and equal
opportunity. Appointments to the Board
follow an agreed process, starting with a
role specification and engaging an external
search firm if needed. The outcomes of
Board succession planning and recruitment
work are reported in the Annual Report
each year.
For more on the Nomination Committee’s
work, see pages 98 to 101
.
K. Skills, experience and knowledge
The Nomination Committee identifies the
skills, knowledge and experience needed
for effective leadership and SSE’s long-term
success. It considers the balance of
competencies through succession planning,
knowledge development and recruitment.
This work is supported by the Board’s skills
matrix and composition metrics to identify
where a potential gap exists.
All non-Executive Directors serve a fixed
term of three years and must be re-elected
yearly by shareholders. In line with best
practice, this fixed term can be renewed for
up to nine years. It cannot be extended
beyond nine years unless the Board decides
otherwise in exceptional circumstances.
The re-election of all Directors will be
considered at the AGM 2026.
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For more on the fair, balanced and
understandable assessment, see page 103
O. Risk management
SSE’s risk management and internal control
frameworks are designed to manage, rather
than eliminate risk, and provide reasonable
but not absolute assurance against material
misstatement or loss.
Each year the Board conducts a robust
assessment of the Principal Risks facing the
Group which have the potential to threaten
its business model, future performance,
solvency or liquidity. Emerging risks are
continuously considered in response to
theoperating environment and potential
impacts on SSE.
The Board and the Audit Committee
received regular updates regarding the
approach to Provision 29 to ensure
preparedness to comply from 1 April 2026.
See also:
– Group Principal Risks on pages 59
to 63
– Provision 29 of the Code on page 108
5. Remuneration
P. Remuneration policies and practices
The Remuneration Committee oversees
SSE’s policy for executive remuneration and
its ongoing appropriateness and relevance.
It’s the Remuneration Committee’s
responsibility to make sure remuneration
stays in line with SSE’s purpose and strategy,
while encouraging long-term stewardship
and rewarding individual contributions
towards the success of SSE.
SSE’s Directors’ Remuneration Policy was
approved with over 97% shareholders’
support, of votes cast, at the AGM on 17
July 2025. As the policy applies for up to
three years, shareholders will be asked to
approve the policy, including proposed
changes, again at the AGM 2028. The full
policy is provided in the Annual Report2025
and a summary is set out on pages 134
to135 .
For more on the work of the Remuneration
Committee, see pages 116 to 135
.
Q. Developing executive remuneration
policy
The Directors’ Remuneration Policy is
structured to ensure that SSE can attract
world-class talent, especially as it is
increasingly exposed to new markets and
technologies. Stakeholder views, including
from shareholders through dialogue with
investors, and from employees through
Board engagement activities, are
considered when setting pay policy
andpractice.
See also:
– Board composition on pages 80 to 82
– Nomination Committee considerations
on pages 98 to 101
L. Board performance
Each year, the Board reviews its own
performance, reflecting on the
effectiveness of its activities, the strength
ofits decisions, and the individual and
collective contributions made by each
Board member. This allows the Board
toscrutinise its own performance and
constructively discuss opportunities to
change, refine or improve. The Board
performance review is externally facilitated
at least every three years. With the last
external review completed in 2024, an
internal review of Board performance
wascompleted in 2025/26.
For more on assessing Board performance,
see page 94
.
4. Audit, risk and internal control
M. Internal and external audit
Internal Audit plays a crucial role in helping
SSE achieve its objectives by providing
independent and objective assurance
onthe effectiveness of the Group’s risk
management activities, internal controls
and SSE’s Governance Framework. The
Audit Committee oversees the Internal
Auditfunction and reviews its independence
and overall effectiveness. In doing so, it
makes sure the Group’s Internal Audit plan
isaligned to SSE’s operating model, risk
profile, control environment and assurance
arrangements, and receives regular updates
throughout the year.
The Audit Committee also oversees
SSE’srelationship with its External Auditor,
EY, to ensure independence, quality and
challenge during the external audit process.
In fulfilling its responsibilities, the Audit
Committee complies with FRC’s Audit
Committees and the External Audit:
Minimum Standard. As part of its work on
ensuring the overall integrity of the financial
and narrative statements prepared by SSE,
the Committee reviews significant
financialjudgements and estimates
madeby management and assesses
theappropriateness of the accounting
treatment which has been applied.
For more on the Audit Committee’s work,
see pages 102 to 109
.
N. Fair, balanced and understandable
assessment
On the recommendation of the Audit
Committee, the Board reviews the Annual
Report and Financial Statements to make
sure that, taken as a whole, it is fair,
balanced and understandable – and allows
shareholders to assess the Group’s overall
position, performance, business model and
strategy. This assessment is supported by
anassurance framework which the Board
and Audit Committee consider each year.
R. Remuneration outcomes and
independent judgement
The Remuneration Committee sets
stretching targets that reward outstanding
performance and has used its discretion in
recent years to reduce formulaic outcomes
where considered necessary.
The Chief Executive, Director of HR, and
Director of Reward and Pensions advise the
Committee on remuneration for Executive
Directors and senior executives on an
ongoing basis. To maintain independence,
no Director or senior executive joins
anydiscussions related to their own
remuneration. External remuneration
advisors also support the Committee and
adhere to the Remuneration Consultants’
Group Code ofConduct.
Compliance with the UK Corporate Governance Code 2024 continued
138
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Other statutory information
The Strategic Report is on pages 1 to 76 and the Governance Report, which is SSE’s Directors’ Report, is on pages 77 to 142 .
TheStrategic Report and Governance Report make up the management report as required under Rule 4.1.8R of the Disclosure Guidance
and Transparency Rules.
As permitted by section 414C(11) of Companies Act 2006, the below matters have been disclosed in the Strategic Report:
Page reference
An indication of likely future developments in the business of the Company pages 1 to 76
Particulars of important events affecting the Company since the financial year end page 141
Greenhouse gas emissions page 55
Energy consumption page 73
Energy efficiency action page 73
Employee engagement and involvement pages 91 to 92 and 96
Engagement with suppliers, customers and others in a business relationship with the Company pages 45 to 53 and 96 to 97
A summary of the Principal Risks facing the Company pages 59 to 63
Information required to be disclosed under UK Listing Rule 6.6.1R is contained on the pages listed below.
Page reference
Statement of interest capitalised by the Group during the financial year page 174
Details of any long-term incentive schemes page 119
Results and dividends
The Group’s results and performance highlights for the year are on pages 14 to 15 and 17 to 25 . An interim dividend of 21.4 pence per
Ordinary Share was paid on 30 January 2026. The Directors propose a final dividend of 47.3 pence per Ordinary Share. Subject to approval
at the AGM 2026, the final dividend will be paid on 17 September 2026 to shareholders on the Register of Members at close of business on
24July 2026.
Board of Directors
Director appointment and retirement
The Company Directors who served during the financial year ending 31 March 2026 are included in the attendance table on page 84
.
Thebiographies of the Directors on 27 May 2026 are on pages 80 to 82 . Details of Board changes are on page 82 .
The Company’s Articles of Association, the UK Corporate Governance Code, the Companies Act 2006 and other related legislation outline
the rules governing the appointment and retirement of Directors.
Indemnification of Directors and insurance
The Directors have the benefit of an indemnity provision contained in the Company’s Articles of Association. Qualifying third party
indemnity provisions have also been granted for Directors of the Company and its subsidiaries, as defined in the Companies Act 2006.
Theindemnity arrangements were in force throughout the year and remain so at the date of approval of this Directors’ Report. During the
financial year, the Company bought and maintained Directors’ and Officers’ liability insurance for itself and its Directors and Officers.
Political donations and expenditure
SSE operates on a politically neutral basis and does not make any donations to political parties, political organisations, or independent
election candidates. During the year, no political expenditure was incurred, and the Group made no political donations.
Accounting policies, financial instruments, risk and branches
Details of the Group’s accounting policies, financial instruments and risk are outlined in note 24 to the Financial Statements and
notesA6to A8 of the Accompanying Information. The Company has no branches and operates through subsidiaries and joint
arrangements, as outlined in note A3
of the Accompanying Information.
Research and development
SSE’s involvement in innovative projects and programmes designed to transform the energy system is described in the Strategic Report
onpages 1 to 76 .
Employing disabled people
SSE has a range of employment policies in place which clearly explain the standards, processes, expectations and responsibilities of its
people and the organisation. These policies are designed to ensure that every person, including those with existing or new disabilities
andfrom any background, is treated fairly and inclusively during recruitment and their career at SSE. This includes providing access to
appropriate training, development opportunities and job progression. For more on our approach see pages 49 to 52 .
Shares
Share capital
The Company has a single share class which is divided into Ordinary Shares of 50 pence each. The issued share capital as of 31March2026,
together with details of any changes during the year, is set out in note 22
to the Financial Statements. As of 31March2026, theissued
share capital consisted of 1,215,471,728 Ordinary Shares. This figure includes 3,291,658 Ordinary Shares held in treasury (representing
0.27% of the issued share capital). The voting and dividend rights of Treasury Shares are automatically suspended.
The Directors present their Annual Report and Accounts for SSE plc, together with the consolidated
Financial Statements of the SSE Group for the year ended 31 March 2026.
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Other statutory information continued
The Company was authorised at the AGM 2025 to allot shares or grant rights over shares up to an aggregate nominal amount equal to
£184,387,548 (representing 368,775,096 Ordinary Shares of 50 pence each excluding Treasury Shares). This represents one third of its
issued share capital. An increased authority to allot shares or grant rights over shares will be proposed at the AGM 2026 (representing
approximately two thirds of the Company’s issued share capital). The update is proposed to align with general market trends and is in
accordance with accepted best practice, including the Share Capital Management Guidelines issued by the Investment Association in
February 2023.
Variation of rights
Subject to the applicable statutory provisions, if at any time the capital of the Company is divided into different classes of shares, the rights
attached to any class of shares may be varied or abrogated. This can be done with the written consent of holders of three-quarters in
nominal value of the issued shares of that class (excluding any shares held as Treasury Shares), or by way of a special resolution passed
ataseparate general meeting of the holders of that class.
Transfer of Ordinary Shares
There are no restrictions on the transfer of Ordinary Shares in the Company other than certain restrictions which may from time to time
beimposed by law. The Company is not aware of any agreements between shareholders that could result in restrictions on the transfer
ofsecurities or voting rights.
Substantial shareholdings
At 27 May 2026 (being the last practical date prior to the publication of the Annual Report), the following percentage interests in the
Ordinary Share capital of SSE plc had been notified under Rule 5 of the Disclosure Guidance and Transparency Rules (DTR 5).
Shareholder
Date of receiving
notification
Voting rights
attached
to shares*
Voting rights
attached to
shares as %,
rounded to
2 decimal places
Voting rights
through
financial
instruments*
Voting rights
through
financial
instruments
as %, rounded
to2 decimal
places
Total of both
in %, rounded
to 2 decimal
places Nature of holding
BlackRock, Inc. 9 December
2025
83,606,404 6.92% 15,680,633 1.28% 8.20% Indirect, ADR,
Securities Lending, CFD
The Capital Group
Companies, Inc.
10 February
2026
61,468,100 5.07% – – 5.07% Indirect, Common Stock,
Depository Receipt
Invesco Limited 30 April 2014 45,775,918 4.69% – – 4.69% Indirect
Caisse de dépôt et
placement du
Québec
6 January 2021 41,492,159 3.98% – – 3.98% Direct
Barclays Bank Plc 28 July 2022 35,834,843 3.35% 19,978,657 1.87% 5.22% Indirect, ADR, Options,
Right to Recall (loan and
collateral), Portfolio Swap
Norges Bank 29 April 2026 36,468,666 3.01% 1,736,146 0.14% 3.15% Direct, Shares on loan
(right to recall)
Bank of America
Corporation
24 July 2025 24,364,329 2.20% 33,288,769 3.01% 5.21% Indirect, Right to Recall,
Physical Call Option, Call
Option, Swaps
The Goldman
Sachs Group, Inc.
23 December
2024
2,093,596 0.19% 126,764 0.01% 0.20% Indirect, Securities Lending,
Swap, Call Warrant
* At date of disclosure by relevant entity.
Authority to purchase shares
At the AGM 2025, the Company obtained shareholder approval to buy up to 110,632,528 of its own Ordinary Shares (representing 10% of its
issued share capital) up until the end of the AGM 2026 or, if earlier, the close of business on 30 September 2026.
The Company did not undertake any share repurchase programmes during the financial year ended 31 March 2026.
During the financial year ended 31 March 2026, the Company used 252,272 of the Treasury Shares acquired under prior share repurchase
programmes to satisfy the requirements of the UK all-employee Sharesave Scheme and the vesting of Performance Share Plan awards.
At the AGM 2026, the Directors will seek renewed authority to purchase the Company’s own shares in the market.
Voting
Each Ordinary Share of SSE plc carries one vote at the Company’s general meetings. Any Ordinary Shares held in treasury have no
votingrights.
A shareholder entitled to attend, speak and vote at a general meeting can exercise their right to vote by attending (either in person or
virtually where electronic facilities are provided), or by validly appointing a proxy or corporate representative in the case of corporate
members. To be valid, notification of the appointment of a proxy must be received at least 48 hours before the general meeting at which
the person named in the proxy notice proposes to vote. The Directors have the discretion to exclude non-working days when calculating
the 48-hour period.
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Employees who participate in the Share Incentive Plan, whose shares remain in the schemes’ trust, may direct the trustees to vote on
theirbehalf by completing a Form of Direction. SSE also has a Share Plan Account service with Computershare Investor Services PLC
(Computershare) which may be used by employees to hold shares arising from the exercise of matured options under SSE’s Sharesave
Scheme. Computershare provide a facility forparticipants to vote on their shares with voting deadlines communicated in advance of each
general meeting.
Annual General Meeting (AGM)
The AGM of the Company will be held on Thursday 16 July 2026 at 12.30pm at the Perth Concert Hall, Mill Street, Perth PH1 5HZ and
virtually, via a secure online platform. Shareholders joining online will be able to watch the meeting, ask questions and vote in real time.
Details of the arrangements for the AGM, resolutions to be proposed, and how to vote and ask questions are set out in the Notice of Annual
General Meeting 2026 which accompanies this report for shareholders receiving hard copy documents. This is also available at sse.com
for those receiving documents electronically.
Articles of Association changes
The Company’s Articles of Association were adopted at the AGM in 2021. Amendments to the Articles of Association can only be made by a
special resolution at a general meeting of SSE plc. The Articles of Association are available at sse.com .
Change of control
The Company is party to several agreements that take effect, alter or terminate upon a change of control of the Company following a
takeover. At 31 March 2026, change of control provisions were included in agreements for committed credit facilities, EIB debt, US private
placements, senior bonds and hybrid instruments. SSE plc is not aware of any other agreements with change of control provisions that
could significantly impact the business.
Disclosure of information to the auditor
Each Director who held office at the date of approval of this Directors’ Report confirms that, as far as they are aware, there is no relevant
audit information of which the Company’s Auditors are unaware. Each Director has taken all necessary steps required in their duty as a
Director to become aware of any relevant audit information and to make sure the Company’s Auditors are aware of such information.
Related party transactions
Related party transactions are set out in note A5 of the Accompanying Information.
Post-balance sheet events
There are no post-balance sheet events to report.
Compliance against FCA UK Listing Rule 6.6.6R(9)
As at the Company’s chosen reference date, 31 March 2026, SSE confirms it has met the targets set out under UKLR 6.6.6R(9). In line with
UKLR 6.6.6R(10) as at the reference date, the composition of the Board and Executive Management was as follows:
Gender (sex)
Number of
Board members
Percentage
of the Board
Number of senior
positions on the
Board (CEO, CFO,
SID and Chair)
Number in
Executive
Management
1
Percentage of
Executive
Management
1
Men 6 55% 3 9 75%
Women 5 45% 1 3 25%
Ethnic background
White British or other White (including minority-white groups) 9 81.8% 3 12 100%
Mixed/Multiple Ethnic Groups – – – – –
Asian/Asian British – – – – –
Black/African/Caribbean/Black British 1 9.1% 1 – –
Other ethnic group 1 9.1% – – –
Not specified/prefer not to say – – – – –
1 Executive Management within SSE is the Group Executive Committee including the Committee Secretary. As at 27 May 2026, representation of women on the GEC is 23.1%
following the appointment of Thomas Brostrøm as Managing Director, Business Development on 1 April 2026.
Gender information is captured from legal documentation provided by the employee and recorded in SSE’s HR data system, which maintains a 100% completion rate. This is what is
used when reporting the gender diversity of the Board and Executive Management. Ethnicity data is given voluntarily and can be recorded directly in SSE’s HR data system or via a
secure online form which feeds into the system. SSE has 100% voluntary completion of ethnicity data at Board and Executive Management level. All diversity data reporting is
completed securely and in a way that protects anonymity, so that no one person can be identifiable. All information is strictly confidential in accordance with SSE’s Privacy Notice in
line with the UK and ROI General Data Protection Regulations (UK GDPR and GDPR 2018 and DPA 2018).
The Directors’ Report set out on pages 77 to 142 was approved by the Board of Directors in accordance with the Companies Act2006.
By order of the Board
Liz Tanner
Group General Counsel and Company Secretary, SSE plc
27 May 2026
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Statement of Directors’ responsibilities in respect of the
Annual Report and the Financial Statements
The Directors are responsible for preparing the Annual Report and the Group and parent Company financial statements in accordance with
applicable law and regulations.
Company law requires the Directors to prepare Group and parent Company financial statements for each financial year. Under that law they
are required to prepare the Group financial statements in accordance with UK-adopted international accounting standards (“IFRS”), and have
elected to prepare the parent Company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice
(United Kingdom Accounting Standards and applicable law) including Financial Reporting Standard 101, “Reduced Disclosure Framework”.
Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the
state of affairs of the Group and parent Company and of their profit or loss for that period. In preparing each of the Group and parent Company
financial statements, the Directors are required to:
−
 select suitable accounting policies in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors and then
apply them consistently;
−
 make judgements and accounting estimates that are reasonable, relevant and reliable;
−
 present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
−
 provide additional disclosures when compliance with the specific requirements in IFRSs (and in respect of the parent Company financial
statements, FRS 101) is insufficient to enable users to understand the impact of particular transactions, other events and conditions on the
Group and parent Company financial position and financial performance;
−
 in respect of the Group financial statements, state whether UK-adopted international accounting standards have been followed, subject to
any material departures disclosed and explained in the financial statements;
−
 in respect of the parent Company financial statements, state whether applicable UK Accounting Standards, including FRS 101, have been
followed, subject to any material departures disclosed and explained in the financial statements;
−
 assess the Group and parent Company’s ability to continue as a Going Concern, disclosing, as applicable, matters related to Going Concern;
and
−
 use the Going Concern basis of accounting unless they either intend to liquidate the Group or the parent Company, or to cease operations,
or have no realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the parent Company’s
transactions and disclose with reasonable accuracy at any time the financial position of the parent Company and enable them to ensure that
its financial statements comply with the Companies Act 2006. They are responsible for such internal control as they determine is necessary
to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general
responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and
other irregularities.
Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report, Directors’ Report, Directors’
Remuneration Report and Corporate Governance Statement that complies with that law and those regulations.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website.
Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
Responsibility statement of the Directors in respect of the annual financial report
We confirm that to the best of our knowledge:
−
 the financial statements, prepared in accordance with UK-adopted international accounting standards, give a true and fair view of the assets,
liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole; and
−
 the Annual Report, including the Strategic Report, includes a fair review of the development and performance of the business and the
position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks
and uncertainties that they face.
We consider the Annual Report and Accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for
shareholders to assess the Group’s position and performance, business model and strategy.
Martin Pibworth Barry O’Regan
Chief Executive Chief Financial Officer
27 May 2026
142
SSE plc Annual Report 2026

Alternative Performance Measures 144
Consolidated income statement 151
Consolidated statement of comprehensive income 152
Consolidated balance sheet 153
Consolidated statement of changes in equity 154
Consolidated cash flow statement 155
Notes to the consolidated financial statements 156
Accompanying information 210
Company balance sheet 244
Company statement of changes in equity 245
Notes to the Company financial statements 246
Independent Auditor’s Report 254
Glossary 265
Shareholder information 266
Financial
Statements
People Powering SSE
Fergus Wilson, Graduate Engineer,
SSEN, Inverness, Scotland
“As a Graduate Engineer, I’m able to
earn as I learn while also contributing
to major grid projects that support
achieving the clean energy transition.
Best of all, after finishing university,
I’ve been able to confidently return
tolive and work in the place where
Igrew up thanks to SSEN’s investment
in the Highlands.”
SSE
Engineer,
d
n
gineer, I
’
m able to
hil
e a
l
so contr
ib
ut
i
ng
oj
ects that su
pp
ort
e
an ener
gy
transition.
fi
nishing university,
confident
ly
return
i
n the place where
to SSEN’s investment
.”
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report
143

Alternative Performance Measures
When assessing, discussing, measuring and reporting the Group’s financial performance, management refer to measures used for internal
performance management. These measures are not defined or specified under International Financial Reporting Standards (“IFRS”) and as such
are considered to be Alternative Performance Measures (“APMs”).
By their nature, APMs are not uniformly applied by all preparers including other participants in the Group’s industry. Accordingly, APMs used by
the Group may not be comparable to other companies within the Group’s industry.
Purpose
APMs are used by management to aid comparison and assess historical performance against internal performance benchmarks and across
reporting periods. These measures provide an ongoing and consistent basis to assess performance by excluding items that are materially non-
recurring, uncontrollable or exceptional. These measures can be classified in terms of their key financial characteristics:
– Profit measures allow management to assess and benchmark underlying business performance during the year. They are primarily used
by operational management to measure operating profit contribution and by the Board to monitor performance against business plan.
The Group has six profit measures, of which Adjusted Operating Profit and Adjusted Profit Before Tax are the main focus of management
through the financial year and Adjusted Earnings Per Share is the main focus of management on an annual basis. In order to derive Adjusted
Earnings Per Share, the Group has defined Adjusted Operating Profit, Adjusted Net Finance Costs, and Adjusted Current Tax Charge as
components of the Adjusted Earnings Per Share calculation. Adjusted EBITDA is used by management as a proxy for cash derived from
ordinary operations of the Group.
– Capital measures allow management to track and assess the progress of the Group’s significant capital investments and projects against
their approved investment cases, including the expected timing of their operational deployment and to provide a measure of progress
against the Group’s strategic objectives.
– Debt measures allow management to record and monitor both operating cash generation and the Group’s ongoing financing and
liquidity position.
During the year, the Group refined its Adjusted Net Debt and Hybrid Capital measure by removing a proportionate share of SSE plc’sexternal
debt invested in subsidiaries with a non-controlling interest, along with any related net finance costs from its Adjusted Net Finance Costs,
Adjusted Profit Before Tax and Adjusted Earnings Per Share measures. There have been no other changes to the way the Group calculates its
APMs in the current year.
The following section explains the key APMs applied by the Group and referred to in these statements:
Profit measures
Group APM Purpose
Closest equivalent
IFRS measure Adjustments to reconcile to primary financial statements
Adjusted EBITDA
(earnings before
interest, tax,
depreciation and
amortisation)
Measure which
acts as proxy for
cash generated
from operating
activities
Operating profit

Movement on operating and joint venture operating derivatives
(“certain re-measurements”)

Exceptional items

Adjustments to Gas Production decommissioning provision

Share of joint ventures and associates’ interest and tax

Depreciation and amortisation before exceptional charges (including
depreciation expense on fair value uplifts)

Share of joint ventures and associates’ depreciation and amortisation

Operating profit attributable to non-controlling interest holders

Depreciation and amortisation attributable to non-controlling
interest holders

Release of deferred income
Adjusted
Operating Profit
Measure of the
underlying
business
performance
excluding material
non-recurring and
exceptional items
Operating profit

Movement on operating and joint venture operating derivatives
(“certain re-measurements”)

Exceptional items

Adjustments to Gas Production decommissioning provision

Depreciation expense on fair value uplifts

Share of joint ventures and associates’ interest and tax

Operating profit attributable to non-controlling interest holders
Adjusted Profit
Before Tax
Measure of the
underlying
business
performance
excluding material
non-recurring and
exceptional items,
before tax
Profit before tax

Movement on operating and financing derivatives
(“certain re-measurements”)

Exceptional items

Adjustments to Gas Production decommissioning provision

Profit before tax attributable to non-controlling interest holders

Depreciation expense on fair value uplifts

Share of joint ventures and associates’ tax
Adjusted Net
Finance Costs
Used to monitor
the underlying
cost of Group
financing
Net finance costs

Exceptional items

Movement on financing derivatives

Share of joint ventures and associates’ interest

Net financing costs attributable to non-controlling interest holders
144
SSE plc Annual Report 2026

Group APM Purpose
Closest equivalent
IFRS measure Adjustments to reconcile to primary financial statements
Adjusted Current
Tax Charge
Measure of the
current year tax
charge excluding
deferred and
exceptional
elements
Tax charge

Share of joint ventures and associates’ tax

Non-controlling share of current tax including tax on net finance costs
attributable to non-controlling interest holders

Deferred tax including share of joint ventures, associates and non-
controlling interests

Tax on exceptional items and “certain re-measurements"
Adjusted Earnings
Per Share
Measure of
earnings available
to ordinary
shareholders on an
adjusted basis
Earnings per share

Exceptional items

Adjustments to Gas Production decommissioning provision

Movements on operating and financing derivatives
(“certain re-measurements”)

Depreciation expense on fair value uplifts

Deferred tax including share of joint ventures, associates and non-
controlling interests

Net finance costs attributable to non-controlling interest holders
Rationale for adjustments to profit measures
1 Movement on operating and financing derivatives (“certain re-measurements”)
This adjustment can be designated between operating and financing derivatives.
Operating derivatives
The Group’s SSE Energy Markets function enters forward commitments or options to buy or sell power, gas and other commodities.
These contracts are used to:
– meet the future demand requirements of Energy Customer Solutions, or
– optimise the value of generation from SSE Renewables and SSE Thermal generation assets; or
– conduct trading activities within the value at risk limits set out by the Energy Markets Risk Committee.
Certain of these contracts (predominantly purchase contracts) are determined to be derivative financial instruments under IFRS 9 and as such
are required to be recorded at their fair value. Changes in the fair value of those commodity contracts designated as IFRS 9 financial instruments
are recognised in the income statement (as part of “certain re-measurements”).
The Group presents these fair value movements separately, as they introduce volatility that does not reflect the underlying performance of its
operating segments. The underlying value of these contracts is recognised as the relevant commodity is delivered, typically within the
subsequent 12 to 24 months.
Conversely, commodity contracts that do not meet the definition of a financial instrument under IFRS 9 (predominately sales contracts) are
accounted for as “own use” contracts and are consequently not recorded until the commodity is delivered and the contract is settled.
Additionally, gas inventory purchased by the Group’s Gas Storage business for secondary trading opportunities is also held at fair value with
gains and losses on re-measurement recognised as part of “certain re-measurements” in the income statement.
Finally, the mark-to-market valuation movements on SSE Renewables’ contracts for difference (“CfDs”) that are not designated as government
grants and are measured as Level 3 fair value financial instruments are also included within “certain re-measurements".
Financing derivatives
Financing derivatives include all fair value and cash flow interest rate hedges, non-hedge accounted (mark-to-market) interest rate derivatives,
cash flow foreign exchange hedges and non-hedge accounted foreign exchange contracts entered to manage the Group’s banking, liquidity
and risk management exposures relating to interest rate and foreign exchange.
Changes in the fair value of the non-hedge account financing derivatives are recognised in the income statement (within “certain re-
measurements"). These forward contracts are presented separately as this mark-to-market movement does not reflect the underlying
performance of the Group’s operations.
Presentation
The re-measurements arising from both operating and financing derivatives, together with their associated tax effects, are disclosed separately
to aid transparency and provide a clearer understanding of the Group’s underlying performance.
2 Exceptional items
Exceptional charges or credits, and the tax effects thereof, are considered unusual by nature or scale and of such significance that separate
disclosure is required for the underlying performance of the Group to be properly understood. Further explanation for the classification of an
item as exceptional is included in note 3.2
.
3 Adjustments to Gas Production decommissioning provision
The Group retains an obligation for 60% of the decommissioning liabilities of its former Gas Production business which was disposed in
October 2021. The revaluation adjustments relating to these decommissioning liabilities are accounted for through the Group’s consolidated
income statement and are removed from the Group’s adjusted profit measures as the revaluation of the provision is not considered to be part
of the Group’s core continuing operations.
145
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Financial StatementsGovernanceStrategic Report

Alternative Performance Measures continued
4 Share of joint ventures and associates’ interest and tax
The Group’s reported operating profit includes its share of post-tax results from equity-accounted joint ventures and associates. For internal
performance management and for consistency, SSE excludes its share of associated interest and tax from its Adjusted Operating Profit. On
adoption of IFRS 18 the Group’s share of joint venture interest and tax will no longer be reported within operating profit. It is expected that the
Group’s APM reconciliations will be amended to maintain consistent reporting of Adjusted Profit Measures.
5 Share of joint ventures and associates’ depreciation and amortisation
For management purposes, the Group considers Adjusted EBITDA (“earnings before interest, tax, depreciation and amortisation”) based on a
sum-of-the-parts derived metric which includes a share of the EBITDA from equity accounted investments. While this is not equal to adjusted
cash generated from operating activities, it is considered useful by management in assessing a proxy for such a measure, given the complexity
of the Group structure and the range of investment structures utilised. For the purpose of calculating the Net Debt to EBITDA metric referred at
page 23
, Adjusted EBITDA is further refined to remove the proportion of adjusted EBITDA from equity-accounted joint ventures relating
to off-balance sheet debt.
6 Depreciation expense on fair value uplifts
When SSE reduces its ownership interest in a subsidiary through a part-disposal that results in the loss of control, the retained interest is initially
re-measured at fair value. This can give rise to fair value uplifts on the underlying assets. These uplifts are recognised as non-cash exceptional
gains in the year of the transaction. The associated depreciation or amortisation arising from these one-off uplifts is excluded from the Group’s
Adjusted Profit Measures, as it does not reflect the ongoing underlying performance of the business.
7 Release of deferred income
The Group deducts the release of deferred income in the year from its Adjusted EBITDA metric as it principally relates to customer contributions
against depreciating assets. As the metric adds back depreciation, the income release is also deducted.
8 Deferred tax
The Group adjusts for deferred tax when arriving at adjusted profit after tax, Adjusted Earnings Per Share and its adjusted effective rate of tax.
Deferred tax arises as a result of differences in accounting and tax bases that give rise to potential future accounting credits or charges. As the
Group remains committed to its ongoing capital programme, the liabilities associated are not expected to reverse and accordingly the Group
excludes these from its Adjusted Profit Measures.
9 Results attributable to non-controlling interest holders
Certain Group subsidiaries, including SSEN Transmission, are controlled but not wholly owned by the Group. The share of profit, depreciation,
amortisation, net finance costs, and tax attributable to non-controlling interests is excluded from Adjusted Profit Measures to reflect only the
results attributable to the Group’s ordinary shareholders. For consistency with the refinement to the Group’s adjusted debt measure, a
proportionate share of net finance costs relating to non-controlling interests is removed, to better represent the Group’s underlying economic
interest. This refinement represents a change to the derivation of the Adjusted Net Finance Costs measure reported in the 31 March 2026
financial statements. The impact of this change applied in the year ended 31 March 2026 has been to decrease Adjusted Net Finance Costs
from £219.8m to £211.8m (2025: £281.0m to £274.7m); increase Adjusted Profit Before Tax from £2,016.8m to £2,024.8m (2025: £2,138.2m to
£2,144.5m); and increase Adjusted Earnings per Share from 153.0p to 153.5p (2025: 160.9p to 161.3p).
146
SSE plc Annual Report 2026

March 2026
Reported
£m
Movement on
derivatives
£m
Exceptional
items
£m
Reported before
exceptional items
and certain
re-measurements
£m
Adjustments to
Gas Production
decommissioning
provision
£m
Joint
venture
interest
and tax
£m
Depreciation
expense
on FV uplifts
£m
Deferred
tax
£m
Results
attributable
to non-
controlling
interests
£m
Adjusted
£m
Operating profit 1,888.9 157.7 162.6 2,209.2 (12.6) 206.9 20.3 – (187.2) 2,236.6
Net finance
(costs)/income (51.6) (17.9) – (69.5) – (155.7) – – 13.4 (211.8)
Profit before taxation 1,837.3 139.8 162.6 2,139.7 (12.6) 51.2 20.3 – (173.8) 2,024.8
Taxation (425.7) (16.9) (39.6) (482.2) – (51.2) – 354.2 (14.2) (193.4)
Profit after taxation 1,411.6 122.9 123.0 1,657.5 (12.6) – 20.3 354.2 (188.0) 1,831.4
Attributable to other
equity holders (202.9) 1.9 – (201.0) – – – (64.5) 192.6 (72.9)
Profit attributable
to ordinary
shareholders 1,208.7 124.8 123.0 1,456.5 (12.6)
–20.3289.74.61,758.5
Number of shares
for EPS 1,145.4 1,145.4
Earnings per share
(pence) 105.5 153.5
EBITDA
Adjusted
operating profit
£m
Share of joint
ventures and
associates’
depreciation
and
amortisation
£m
Depreciation
expense
on FV uplifts
£m
Release of
deferred
income
£m
Depreciation,
impairment and
amortisation
before
exceptional
charges
£m
Depreciation,
impairment and
amortisation
(before
exceptional items)
attributable to
non-controlling
interests
£m
Adjusted
EBITDA
£m
Adjusted operating profit 2,236.6 173.0 (20.3) (13.1) 879.3 (47.6) 3,207.9
March 2025
(restated*)
Reported
£m
Movement on
derivatives
£m
Exceptional
items
£m
Reported before
exceptional items
and certain
re-measurements
£m
Adjustments to
Gas Production
decommissioning
provision
£m
Joint
venture
interest
and tax
£m
Depreciation
expense
on FV uplifts
£m
Deferred
tax
£m
Results
attributable
to non-
controlling
interests
£m
Adjusted
£m
Operating profit 1,962.2 78.5 309.7 2,350.4 (17.9) 173.3 20.1 – (106.7) 2,419.2
Net finance
(costs)/income (111.3) (12.8) (0.3) (124.4) – (164.3) – – 14.0 (274.7)
Profit before taxation 1,850.9 65.7 309.4 2,226.0 (17.9) 9.0 20.1 – (92.7) 2,144.5
Taxation (518.0) (4.0) (29.7) (551.7) – (9.0) – 276.6 (13.8) (297.9)
Profit after taxation 1,332.9 61.7 279.7 1,674.3 (17.9) – 20.1 276.6 (106.5) 1,846.6
Attributable to other
equity holders (143.5) – – (143.5) – – – (41.5) 111.3 (73.7)
Profit attributable
to ordinary
shareholders 1,189.4 61.7 279.7 1,530.8 (17.9) – 20.1 235.1 4.8 1,772.9
Number of shares
for EPS 1,099.2 1,099.2
Earnings per share
(pence) 108.2 161.3
* The comparative has been restated. See note 1.2.
EBITDA
Adjusted
operating profit
£m
Share of joint
ventures and
associates’
depreciation
and
amortisation
£m
Depreciation
expense
on FV uplifts
£m
Release of
deferred
income
£m
Depreciation,
impairment and
amortisation
before
exceptional
charges
£m
Depreciation,
impairment and
amortisation
(before exceptional
items) attributable
to non-controlling
interests
£m
Adjusted
EBITDA
£m
Adjusted operating profit 2,419.2 226.0 (20.1) (14.1) 776.1 (37.8) 3,349.3
147
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Alternative Performance Measures continued
Debt measure
Group APM Purpose
Closest equivalent
IFRS measure Adjustments to reconcile to primary financial statements
Adjusted Net Debt
and Hybrid Capital
Measure of the capital
owed to investors and
lenders
Unadjusted net debt

Cash held and posted as collateral and other deposits

Lease obligations

Borrowings and cash attributable to non-controlling interest holders

Hybrid equity
Rationale for adjustments to debt measure
10 Cash held and posted as collateral and other deposits
Cash held and posted as collateral refers to cash balances received from and deposited with counterparties including trading exchanges.
Collateral balances mostly represent initial and variation margin, required as part of the management of the Group’s exposures on commodity
contracts, that will be received on maturity of the related trades. Deposits with a maturity of more than three months are also included in this
adjustment. The Group includes this adjustment to better reflect the cash resources to which it has access, which in turn better reflects the
Group’s funding position.
11 Lease obligations
SSE’s reported loans and borrowings include lease obligations recognised under IFRS 16 “Leases”. The Group excludes these liabilities from
Adjusted Net Debt and Hybrid Capital to better reflect the Group’s underlying funding position with its primary sources of capital.
12 Borrowings and cash attributable to non-controlling interest holders
Certain Group subsidiaries, including SSEN Transmission, are controlled but not wholly owned by the Group. The share of external debt and
cash attributable to non-controlling interests is excluded from Adjusted Net Debt and Hybrid Capital so that the debt metric reflects only
amounts proportionately attributable to the Group’s ordinary shareholders.
Additionally, where external funding is raised by SSE plc and used to fund investment in subsidiaries whose non-controlling interest holders do
not contribute capital on a proportionate basis, such as SSEN Transmission, the Group has removed a proportionate share of external debt and
related net finance costs to better represent the Group’s underlying economic interest. This refinement represents a change to the Group’s
Adjusted Net Debt and Hybrid Capital measure presented in the 31 March 2026 financial statements. The impact of the change has been to
decrease the Group’s Adjusted Net Debt and Hybrid Capital measure from £10,345.0m to £10,095.0m (2025: £10,186.7m to £10,066.7m).
13 Hybrid equity
The characteristics of certain hybrid capital securities mean that they qualify for recognition as equity rather than debt under applicable
accounting standards. Consequently, their coupon payments are presented within equity rather than within finance costs and are not included
in SSE’s Adjusted Profit Before Tax measure. To present total funding provided from sources other than ordinary shareholders, SSE presents its
adjusted net debt measure inclusive of hybrid capital to better reflect the Group’s funding position.
March 2026
£m
March 2025
£m
(restated*)
Unadjusted net debt (8,578.3) (9,513.9)
Cash (held) and posted as collateral and other deposits (246.0) (63.3)
Lease obligations 456.7 455.0
Borrowings and cash attributable to non-controlling interest holders 1,258.4 937.9
Adjusted Net Debt (7,109.2) (8,184.3)
Hybrid equity (2,985.8) (1,882.4)
A
A
d
d
j
j
u
u
s
s
t
t
e
e
d
d
N
N
e
e
t
t
D
D
e
e
b
b
t
t
a
a
n
n
d
d
H
H
y
y
b
b
r
r
i
i
d
d
C
C
a
a
p
p
i
i
t
t
a
a
l
l
(10,095.0) (10,066.7)
* The comparative has been restated. See note 1.2.
148
SSE plc Annual Report 2026

Capital measures
Group APM Purpose
Closest equivalent
IFRS measure Adjustments to reconcile to primary financial statements
Adjusted Investment
and Capital
Expenditure
Measures the
Group’s underlying
investment in capital
assets, excluding
non-cash or third-
party funded
additions
Capital additions
to intangible assets
and property, plant
and equipment

Joint ventures and associates’ additions funding

Allowances and certificates

Customer or third party funded additions

Lease asset additions

Capital expenditure attributable to non-controlling interests

Additions acquired through business combinations
Adjusted Investment,
Capital and
Acquisition
Expenditure
Expands the above
measure to include
acquisition related
cash consideration,
providing a broader
v
iew of total
investment growth
Capital additions
to intangible assets
and property, plant
and equipment

Joint ventures and associates’ additions funding

Allowances and certificates

Customer or third party funded additions

Lease asset additions

Capital expenditure attributable to non-controlling interests

Additions acquired through business combinations

Acquisition cash consideration
Rationale for adjustments to capital measures
14 Joint ventures and associates’ additions funding
Joint ventures and associates’ additions included in the Group’s capital measures represent the direct loan or equity funding provided by the
Group to joint venture and associate arrangements in relation to capital expenditure projects. This has been included to better reflect the
Group’s use of directly funded equity accounted vehicles to grow the Group’s asset base. Asset additions funded by project finance raised
within the Group’s joint ventures and associates are not included in this adjustment.
15 Allowances and certificates
Allowances and certificates consist of purchased carbon emissions allowances and generated or purchased renewable source of generation
certificates such as renewable obligations certificates (“ROCs”). Additions of allowances and certificates in the year are not included in the
Group’s “capital expenditure and investment” APM to better reflect the Group’s investment in enduring operational assets.
16 Customer or third party funded additions
Customer or third party funded additions represents additions to the Group’s electricity and other networks that are financed by cash provided
by third parties. Given these are directly funded by customers or third parties, these additions have been excluded to better reflect the Group’s
underlying investment position.
17 Lease asset additions
Additions of right of use assets under the Group’s IFRS 16 compliant policies for lease contracts are excluded from the Group’s adjusted
capital measures as they do not represent directly funded capital investment. This is consistent with the treatment of lease obligations explained
at 11, above.
18 Capital expenditure attributable to non-controlling interests
The Group’s structure includes controlled but non-wholly owned subsidiaries which are consolidated within the financial statements under
relevant IFRS. The Group has removed the share of capital additions attributable to these equity holders from its Adjusted Investment and
Capital Expenditure and Adjusted Investment, Capital and Acquisition Expenditure measures. This is consistent with the adjustments noted
elsewhere related to these non-controlling interests.
19 Additions through business combinations
Where the Group acquires an early-stage development company, which is classified as the acquisition of an asset, or group of assets and
not the acquisition of a business, the acquisition is treated as an addition to intangible assets or property, plant and equipment and is included
within Adjusted Investment and Capital Expenditure. Where the Group acquires an established business or interest in an equity-accounted
joint venture requiring a fair value assessment in line with the principles of IFRS 3 “Business Combinations”, the fair value of acquired
consolidated tangible or intangible assets is excluded from the Group’s Adjusted Investment and Capital Expenditure, as they are not direct
capital expenditure by the Group. However, the fair valuation of consideration paid for the business or investment is included in the Group’s
Adjusted Investment, Capital and Acquisition Expenditure measure.
During the current and prior year there were no significant acquisitions.
149
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Alternative Performance Measures continued
20 Cash consideration in relation to business combinations
The Group has outlined a significant investment programme which will partly be achieved through the acquisition of businesses with
development opportunities for the Group. The cash consideration paid for these entities is included within the Group’s Adjusted Investment,
Capital and Acquisition Expenditure measure as it provides stakeholders an accurate basis of cash investment into the Group’s total
development pipeline and is consistent with the reporting of the Group’s projected capital investment expectations.
During the current and prior year there were no significant acquisitions.
March 2026
£m
March 2025
£m
Capital additions to intangible assets 797.2 1,045.5
Capital additions to property, plant and equipment 3,983.5 2,791.5
Capital additions to intangible assets and property, plant and equipment 4,780.7 3,837.0
Joint ventures and associates’ additions 189.0 288.0
Allowances and certificates (500.6) (603.7)
Customer or third party funded additions (215.7) (163.4)
Lease asset additions (93.3) (126.7)
Capital expenditure attributable to non-controlling interests (574.5) (320.8)
Adjusted Investment and Capital Expenditure 3,585.6 2,910.4
Adjusted Investment, Capital and Acquisition Expenditure 3,585.6 2,910.4
150
SSE plc Annual Report 2026

Consolidated income statement
for the year ended 31 March 2026
Note
2026
2025
Revenue
5
10,186.5
–
10,186.5
10,131.9
–
10,131.9
Cost of sales
(6,2 70.7)
(141.6)
(6 ,412.3)
(6,210.9)
(57.4)
(6,268.3)
Gross profit/(loss)
3,915.8
(141.6)
3,7 74.2
3,921.0
(57. 4)
3,8 63.6
Operating costs
6
(1,818 .6)
(162.6)
(1,981.2)
(1,742.0)
(309.7)
(2,051. 7)
Debt impairment charges
A6.2
(29.4)
–
(29.4)
(47.1)
–
(47.1)
Other operating income
37.3
–
37.3
107.5
–
107.5
and associates
2,105.1
(304.2)
1,800.9
2,239.4
(367.1)
1,872.3
Share of operating profit
311.0
–
31 1.0
284.3
–
284.3
Share of interest
(155.7)
–
(155.7)
(164.3)
–
(164.3)
Share of movement in derivatives
–
(21 .4)
(21.4)
–
(28.1)
(28.1)
Share of tax
(51. 2)
5.3
(45.9)
(9.0)
7.0
(2.0)
and associates
16
104.1
(16.1)
88.0
111.0
(21.1)
89.9
Operating profit/(loss)
5
2,209.2
(320.3)
1,888.9
2,350. 4
(388.2)
1,962. 2
Finance income
9
240.9
17.9
258 .8
194.8
13.1
207.9
Finance costs
9
(310.4)
–
(310.4)
(319.2)
–
(319.2)
Profit/(loss) before taxation
2,139.7
(302.4)
1,837.3
2,226.0
(375.1)
1,850.9
Taxation
10
(48 2.2)
56.5
(425.7)
(551.7)
33.7
(518.0)
Profit/(loss) for the year
1,657.5
(245.9)
1,411.6
1,674 .3
(341.4)
1,332.9
Ordinary shareholders of the parent
11
1,45 6.5
(247.8)
1,20 8.7
1,530. 8
(341. 4)
1,189.4
Non-controlling interests
128.1
1.9
130.0
69.8
–
69.8
Other equity holders
72 .9
–
72.9
73.7
–
73.7
Basic (pence)
11
105.5
108.2
Diluted (pence)
11
105.4
108.1
The accompanying notes are an integral part of these financial statements.
151
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Consolidated statement of comprehensive income
for the year ended 31 March 2026
Profit for the year
1,411.6
1,332.9
Net (losses)/gains on cash flow hedges
(14.2)
48.1
Transferred to assets and liabilities on cash flow hedges
3.2
10.0
Taxation on cashflow hedges
3.8
(11.3)
(7.2)
46. 8
Share of other comprehensive loss of joint ventures and associates, net of taxation
(35.0)
(16.7)
Exchange difference on translation of foreign operations
64.4
(42.9)
(Loss)/gain on net investment hedge
(87.5)
36.0
(65.3)
23.2
Actuarial (loss)/gain on retirement benefit schemes, net of taxation
(60.6)
39.6
Share of other comprehensive (loss)/income of joint ventures and associates, net of taxation
(15.8)
15.8
Gains/(losses) on revaluation of investments in equity instruments, net of taxation
0.1
(0.3)
(76.3)
55. 1
Other comprehensive (loss)/gain, net of taxation
(141.6)
78.3
Total comprehensive income for the year
1,270.0
1,411. 2
Ordinary shareholders of the parent
1,074.3
1,2 63.6
Non-controlling interests
122.8
73.9
Other equity holders
72.9
73.7
1,270.0
1,411. 2
The accompanying notes are an integral part of these financial statements.
152
SSE plc Annual Report 2026

Consolidated balance sheet
as at 31 March 2026
Property, plant and equipment
14
22,022.3
18,824.1
Goodwill and other intangible assets
13
2,249 .1
2,170.5
Equity investments in joint ventures and associates
16
1,945.1
1,987.3
Loans to joint ventures and associates
16
1,621.2
1,510. 3
Other investments
16
7.6
8.8
Other non-current assets
18
604.0
447.7
Derivative financial assets
24
193.9
63.5
Retirement benefit assets
23
459.8
501.8
Non-current assets
29,103.0
25 ,514.0
Intangible assets
13
527.3
392.7
Inventories
17
434.2
462.9
Trade and other receivables
18
3,030 .3
2, 695.4
Current tax asset
10
18.2
29.7
Cash and cash equivalents
21
1,542.9
1,090.5
Derivative financial assets
24
651.4
178.4
Assets held for sale
12
46.3
–
Current assets
6,250.6
4,849.6
Total assets
35,353.6
30,363.6
Loans and other borrowings
21
1,204.4
1,964.0
Trade and other payables
19
3,286.9
2,708.2
Current tax liabilities
10
17.8
–
Financial guarantee liabilities
24
2.4
2.4
Provisions
20
59.6
80.5
Derivative financial liabilities
24
641.1
126.3
Liabilities directly associated with the assets held for sale
12
3.0
–
Current liabilities
5,215.2
4,88 1.4
Loans and other borrowings
21
8,91 6.8
8,640.4
Deferred tax liabilities
10
2,14 1.5
1,844.5
Trade and other payables
19
1, 658.7
1,437.6
Financial guarantee liabilities
24
19.0
23.1
Provisions
20
711.9
676.1
Derivative financial liabilities
24
289.2
167.7
Non-current liabilities
13,737.1
12,789.4
Total liabilities
18,952.3
17,67 0.8
Net assets
16,401.3
12,692.8
Share capital
22
607.7
555.6
Share premium
2,738.9
812.6
Capital redemption reserve
52.6
52.6
Hedge reserve
397.0
432.7
Translation reserve
(31.0)
(8.6)
Retained earnings
8,898.7
8,336.7
Equity attributable to ordinary shareholders of the parent
12,663.9
10,181.6
Hybrid equity
22
2, 985.8
1,882.4
Attributable to non-controlling interests
22
751.6
628.8
Total equity
16 ,401.3
12,692.8
* The comparative has been restated. See note 1.2.
The accompanying notes are an integral part of the financial statements.
These financial statements were approved by the Board of Directors on 27 May 2026 and signed on their behalf by:
Barry O’Regan, Sir John Manzoni,
C
Chie
f
f Financia
l
l Office
r
r Chairma
n
n
SSE plc
Registered No: SC117119
153
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Consolidated statement of changes in equity
for the year ended 31 March 2026
At 1 April 2025
555.6
812.6
52.6
432.7
(8.6)
8,336.7
10,181.6
1,882.4
12,064.0
628.8
12,692.8
Profit for the year
–
–
–
–
–
1,20 8.7
1,20 8.7
72.9
1,281 .6
130.0
1,411.6
Other comprehensive loss
–
–
–
(35.7)
(22.4)
(76.3)
(134.4)
–
(134.4)
(7.2)
(141.6)
Total comprehensive
income for the year
–
–
–
(35.7)
(22.4)
1,132.4
1,074.3
72.9
1,147.2
122.8
1,270. 0
Dividends to shareholders
–
–
–
–
–
(734.1)
(734.1)
–
(734.1)
–
(734.1)
share issue
3.2
(3.2)
–
–
–
133. 0
133.0
–
133.0
–
133.0
Issue of shares net of costs
48.9
1,929.5
–
–
–
–
1,978.4
–
1,978.4
–
1,978.4
Issue of treasury shares
–
–
–
–
–
17.4
17. 4
–
17.4
–
17.4
equity holders
–
–
–
–
–
–
–
(72.9)
(72.9)
–
(72.9)
Issue of Hybrid equity
–
–
–
–
–
–
–
1,103.4
1,10 3.4
–
1,103.4
Credit in respect of
employee share awards
–
–
–
–
–
38.7
38.7
–
38.7
–
38.7
Investment in own shares
–
–
–
–
–
(25.4)
(25.4)
–
(25.4)
–
(25.4)
At 31 March 2026
607. 7
2, 738.9
52. 6
397 .0
(31.0)
8,898 .7
12,663. 9
2,985.8
15,649.7
751.6
16,401.3
for the year ended 31 March 2025
At 1 April 2024
548.1
820.1
52. 6
407.6
(2.6)
7,540.0
9,365.8
1,882.4
11,248. 2
554.9
11, 803.1
Profit for the year
–
–
–
–
–
1,189.4
1,189. 4
73.7
1,263.1
69.8
1,33 2.9
Other comprehensive
income/(loss)
–
–
–
25.1
(6.0)
55.1
74.2
–
74.2
4.1
78.3
Total comprehensive
income for the year
–
–
–
25.1
(6.0)
1,244.5
1,263.6
73.7
1,337.3
73.9
1,411. 2
Dividends to shareholders
–
–
–
–
–
(671.0)
(671.0)
–
(671.0)
–
(671.0)
share issue
7.5
(7.5)
–
–
–
268.9
268.9
–
268.9
–
268.9
Issue of treasury shares
–
–
–
–
–
17.8
17.8
–
17.8
–
17.8
equity holders
–
–
–
–
–
–
–
(73.7)
(73.7)
–
(73.7)
Share buyback (note 22.1)
–
–
–
–
–
(71.7)
(71.7)
–
(71.7)
–
(71.7)
Credit in respect of
employee share awards
–
–
–
–
–
22.3
22.3
–
22.3
–
22.3
Investment in own shares
–
–
–
–
–
(14.1)
–
(14.1)
–
(14.1)
At 31 March 2025
555.6
812.6
52.6
432.7
(8.6)
8,33 6.7
10,181 .6
1,882.4
12,064. 0
628.8
12,69 2.8
154
SSE plc Annual Report 2026

Consolidated cash flow statement
for the year ended 31 March 2026
Operating profit
1,888.9
1,962.2
Less share of profit of joint ventures and associates
(88.0)
(89.9)
Operating profit before jointly controlled entities and associates
1,800. 9
1,872 .3
Pension service charges less contributions paid
23
(9.3)
(6.7)
Movement on operating derivatives
24
149.8
60.1
Depreciation, amortisation, write downs and impairments
979.0
1,057.1
Charge in respect of employee share awards
29.6
22.3
Profit on disposal of assets and businesses
(7.3)
(47. 9)
(Credit)/charge in respect of provisions
20
(8.8)
6.4
Credit in respect of financial guarantees
(1.7)
(1.9)
Release of deferred income
6
(13.1)
(14.1)
Cash generated from operations before working capital movements
2,919.1
2,94 7.6
Decrease/(increase) in inventories
17.9
(109. 5)
(Increase)/decrease in receivables
(0.1)
2.6
Increase/(decrease) in payables
474.8
(196.0)
Decrease in provisions
(36. 8)
(23.7)
Cash generated from operations
3,374.9
2,621 .0
Dividends received from investments
16
184.1
200.6
Interest paid
(243.3)
(260.1)
Interest received
180.8
155.9
Taxes paid
(61.3)
(240.6)
Net cash from operating activities
3,435.2
2,476.8
Purchase of property, plant and equipment
5
(4,147.0)
(2,689.2)
Purchase of intangible assets
5
(2 96.6)
(441.8)
Receipt of government grant income
5
41.7
55.7
Deferred income received
0.3
20.2
Proceeds from disposals
7.8
25.2
Purchases of businesses, joint ventures and subsidiaries
16
(22.7)
–
Loans and equity provided to joint ventures and associates
(288.3)
(408.3)
Loans and equity repaid by joint ventures
79.4
121.7
Decrease/(increase) in other investments
16
1.3
(1.9)
Net cash used in investing activities
(4,624.1)
(3,318.4)
Proceeds from issue of share capital, net of costs
22
1,995 .8
17.8
Dividends paid to company’s equity holders
11
(60 1.1)
(402.1)
Share buybacks
22
–
(71.7)
Hybrid equity dividend payments
22
(72.9)
(73.7)
Employee share awards share purchase
22
(25.4)
(14.1)
Issue of Hybrid instruments
22
1,10 3.4
–
New borrowings
21
1,5 95.3
2,592.2
Repayment of borrowings
(2,357.0)
(1,162.2)
Settlement of cashflow hedges
3.2
10.0
Net cash from financing activities
1,641.3
896.2
Net increase in cash and cash equivalents
452.4
54. 6
Cash and cash equivalents at the start of year
21
1,0 90.5
1,035.9
Net increase in cash and cash equivalents
452.4
54. 6
Cash and cash equivalents at the end of year
21
1,542.9
1,090.5
* The prior year cash flow statement has been restated. See note 1.2.
The accompanying notes are an integral part of these financial statements.
155
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Notes to the consolidated financial statements
for the year ended 31 March 2026
1. General Information
and basis of preparation
1.1. General information
SSE plc (the “Company”) is a company domiciled in Scotland.
The address of the registered office is given on the back cover.
The Group’s operations and its principal activities are set out in
the Strategic Report. The consolidated financial statements for the
year ended 31 March 2026 comprise those of the Company and
its subsidiaries (together referred to as the Group). The Company
financial statements present information about the Company as
a separate entity and not about the Group, these can be seen on
pages 244 to 253
.
1.2. Basis of preparation
Statement of compliance
The financial statements were authorised for issue by the Directors
on 27 May 2026. The financial statements have been prepared in
accordance with UK-adopted International Accounting Standards
(“IAS”).
Going Concern
The Directors consider that the Group has adequate resources to
continue in operational existence for the period to 31 December
2027. The financial statements are therefore prepared on a Going
Concern basis.
In addition, further details of the Group’s liquidity position and Going
Concern review are provided at note 21
and in A6 .
Accompanying Information to the Financial Statements.
Basis of measurement
The financial statements of the Group are prepared on the historical
cost basis except for certain gas inventory, derivative financial
instruments, financial instruments designated at fair value through
profit or loss or other comprehensive income on initial recognition,
assets of the Group pension schemes, all of which are measured at
their fair value, and liabilities of the Group’s pension schemes which
are measured using the projected unit credit method. The directors
believe the financial statements present a true and fair view. The
financial statements of the Group are presented in pounds Sterling,
and all values are rounded to the nearest million to one decimal place
(£m), unless otherwise stated. The basis for including operations and
transactions conducted in currencies other than pounds Sterling is
provided in A1
. Accompanying Information to the Financial
Statements on page 210
.
Use of estimates and judgements
The preparation of financial statements conforming with adopted
IFRS requires the use of certain accounting estimates. It also requires
management to exercise judgement in the process of applying the
accounting policies. The areas involving a higher level of judgement
or estimation are summarised at pages 159 to 160
.
Share-based payments
The Group previously assessed that, on the basis of materiality,
the disclosures required under IFRS 2 “Share-based Payment”
should be removed. The Group has assessed that at 31 March 2026
these disclosures continue to be immaterial to the Group’s financial
statements.
Changes to presentation and prior year adjustments
The prior year comparatives at 31 March 2025 have been restated
as follows:
Segments
In accordance with the requirements of IFRS 8 “Operating Segments”
the Group aligns its segmental disclosures with its internal reporting
to the Group Executive Committee (the Chief Operating Decision
Maker). The reporting of these operating segments is used to
assess operating performance and to make decisions on how to
allocate capital.
Segments continued
During the year to 31 March 2026, reporting to the Group Executive
Committee was amended so that SSE Thermal includes Gas Storage;
Energy Customer Solutions includes SSE Business Energy and SSE
Airtricity; and Corporate unallocated includes the loss on the Group’s
joint venture investment in Neos Networks Limited (note 16
). The
segmental results reported within these financial statements have
been restated from 1 April 2024 (note 5
), which had no impact on
the consolidated results of the Group in all periods presented.
Capital prepayments
Due to the long-term nature of capital projects within the Group,
a greater proportion of prepayments to suppliers to secure materials
and production capacity in advance are extending beyond 12 months.
Under the Group’s previous accounting policy, all capital prepayments
were shown as current assets. However, the Group has elected to
amend its accounting policy for disclosure of capital prepayments
to split prepayments between current and non-current maturity.
In accordance with IAS 8 “Accounting Policies, Changes in
Accounting Estimates and Errors” the balance sheet for the year
ended 31 March 2025 has been restated to present £247.8m of
capital prepayments as non-current assets (2026 equivalent:
£372.0m). This change in policy had no impact on net assets, the
income statement, statement of cashflows or Alternative Performance
Measures of the Group at any reporting date.
Deferred income
A prior period adjustment has been made to restate deferred income
split between current and non-current maturity following incorrect
classification at 31 March 2025. Deferred income due after more
than one year has increased from £1,247.9m to £1,437.6m (2026
equivalent: from £1,468.6m to £1,658.7m) within non-current “Trade
and other payables”; and current “Trade and other payables” has
decreased from £2,897.9m to £2,708.2m at 31 March 2025 (2026
equivalent: £3,477.0m to £3,286.9m). This adjustment has no impact
on retained earnings, net assets or the consolidated Alternative
Performance Measures of the Group, at any reporting date.
Alternative Performance Measures – adjustment for net debt and
cash attributable to non-controlling interests and related net
finance costs
Where external funding is raised by SSE plc and used to fund
investment in subsidiaries whose non-controlling interest holders
do not contribute capital on a proportionate basis, such as SSEN
Transmission, the Group has removed a proportionate share of
external debt and related net finance costs to better represent
the Group’s underlying economic interest. This refinement
represents a change to the derivation of the adjusted debt measure
applied in the 31 March 2026 financial statements and comparatives
at 31 March 2025 have been restated accordingly. This adjustment
has no impact on reported net assets, income statement or statement
of cashflows of the Group, at any reporting date. The restatement
results in a decrease of
Adjusted Net Debt and Hybrid Capital by
£120.0m from £10,186.7m to £10,066.7m, a decrease in Adjusted Net
Finance Costs from £281.0m to £274.7m, an increase in Adjusted
Profit Before Tax from £2,138.2m to £2,144.5m and an increase in
Adjusted Earnings per Share by 0.4 pence from 160.9 pence to
161.3 pence. There have been no other changes to the Group’s APMs
in the current year.
Cash flow statement
A prior year restatement has been made to present interest paid
of £260.1m (2026 equivalent: £243.3m) and interest received of
£155.9m (2026 equivalent: £180.8m) gross (previously presented net)
in the cash flow statement in accordance with the requirements of
IAS 7 “Statement of Cash Flows”. This restatement had no impact on
net cash from operating activities in the cash flow statement, retained
earnings, net assets or the consolidated Alternative Performance
Measures of the Group, at any reporting date.
156
SSE plc Annual Report 2026

2. New accounting policies and reporting
changes
The principal accounting policies applied in the preparation of these
financial statements are set out below and in the A1 Accompanying
Information to the Financial Statements on pages 210 to 218
.
2.1. New standards, amendments and interpretations
effective or adopted by the Group
During the year ended 31 March 2026, the Group adopted the Lack
of Exchangeability amendments to IAS 21 “The Effects of Changes in
Foreign Exchange Rates”. Adoption of the amendment had no impact
on the financial statements.
There were no other standards, amendments to standards or
interpretations relevant to the Group’s operations which were
adopted during the year.
2.2. New standards, amendments and interpretations
issued, but not yet adopted by the Group
Following adoption of IFRS 9 on 1 April 2019, the Group elected to
continue to apply IAS 39 for hedge accounting. From 1 April 2026,
the Group will adopt the hedge accounting requirements of IFRS 9
to align its hedge accounting more closely with the Group’s risk
management objectives. In the period to 31 March 2026, the Group
assessed its existing IAS 39 hedging relationships and concluded that
those relationships continue to meet the IFRS 9 hedge accounting
criteria. These hedging relationships will be designated as continuing
hedges upon adoption of IFRS 9.
The Group will apply the prospective basis of adoption as permitted
by IFRS 9, whereby comparative information is not restated. The
impact on the income statement is immaterial.
The Group has elected to apply the cost of hedging approach, under
which certain elements of the fair value of hedging instruments (such
as forward points and currency basis spread) are recognised in other
comprehensive income rather than profit or loss. These amounts will
be accumulated in a cost of hedge equity reserve within equity and
subsequently reclassified to profit or loss in the period the hedged
item affects profit or loss. On adoption, the cost of hedge reserve
will be £23.5m. There is no impact on total equity as a result of
this reclassification.
IFRS 18 “Presentation and Disclosure in Financial Statements” was
issued in April 2024 and will be effective for accounting periods
beginning on or after 1 January 2027 (1 April 2027 for the Group).
The standard replaces IAS 1 “Presentation of Financial Statements”.
The new standard does not amend the principles of recognition
and measurement and so will not impact the financial results of the
Group. However, it will impact the presentation of the consolidated
financial statements, in particular the consolidated income statement.
The Group is continuing to assess the full impact of adoption of the
standard. However, it is expected that the consolidated income
statement will be amended to include the new subtotals prescribed
in the standard, and the share of profit recognised from equity
accounted investments will be classified within investing activities
instead of operating activities. It is expected that certain notes to the
consolidated financial statements will also be amended to comply
with aggregation and disaggregation principles.
Amendments to IFRS 9 “Financial Instruments” and IFRS 7 “Financial
Instruments: Disclosures” in relation to the classification and
measurement of financial instruments have been issued. An additional
amendment has also been made to both standards in relation
to contracts referencing nature-dependent electricity. These
amendments will be effective from 1 January 2026 (1 April 2026 for
the Group). The amendments will not have a material impact on the
Group’s consolidated financial statements.
3. Adjusted accounting measures
The Group applies the use of adjusted accounting measures or
Alternative Performance Measures (“APMs”) throughout the Annual
Report and Financial Statements. These measures enable the
Directors to present the underlying performance of the Group and
its segments to the users of the statements in a consistent and
meaningful manner. The adjustments applied and certain terms such
as Adjusted Operating Profit; Adjusted Earnings Per Share; Adjusted
EBITDA; Adjusted Investment and Capital Expenditure; Adjusted
Investment, Capital and Acquisition Expenditure; and Adjusted Net
Debt and Hybrid Capital are not defined under IFRS and are explained
in more detail below. In addition, the section Alternative Performance
Measures at page 144
provides further context and explanation of
these terms.
3.1 Adjusted measures
The Directors assess the performance of the Group and its reportable
segments based on adjusted measures. These measures are used
for internal performance management and are believed to be
appropriate for explaining underlying performance to users of the
accounts. These measures are also deemed to be the most useful for
ordinary shareholders of the Company and for other stakeholders.
The performance of the reportable segments is reported based on
adjusted profit before interest and tax (Adjusted Operating Profit).
This is reconciled to reported profit before interest and tax by adding
back exceptional items and certain re-measurements (see note 3.2
below), depreciation expense on fair value uplifts, the share of
operating profit attributable to non-controlling interests, adjustments
to the Gas Production decommissioning provision and after the
removal of interest and taxation on profits from equity-accounted
joint ventures and associates.
The performance of the Group is reported based on Adjusted Profit
Before Tax which excludes exceptional items and certain re-
measurements (see note 3.2 below), depreciation expense on
fair value uplifts, the share of profit before tax attributable to non-
controlling interests, adjustments to the Gas Production
decommissioning provision and taxation on profits from equity-
accounted joint ventures and associates.
The Group also uses adjusted earnings before interest, taxation,
depreciation and amortisation (“Adjusted EBITDA”) as an alternative
operating performance measure which acts as a management proxy
for cash generated from operating activities. This does not take into
account the rights and obligations that SSE has in relation to its
equity-accounted joint ventures and associates. This measure
excludes exceptional items and certain re-measurements (see
note 3.2
below), the depreciation charged on fair value uplifts, the
share of EBITDA attributable to non-controlling interests, adjustments
to the Gas Production decommissioning provision, depreciation and
amortisation from equity-accounted joint ventures and associates
and interest and taxation on profits from equity-accounted joint
ventures and associates. For the purpose of calculating the Net Debt
to EBITDA metric referred at page 23
, Adjusted EBITDA is further
adjusted to remove the proportion of adjusted EBITDA from equity-
accounted joint ventures relating to off-balance sheet debt (see
note 5.1(v))
.
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3. Adjusted accounting measures continued
3.1 Adjusted measures continued
The Group’s key performance measure is Adjusted Earnings Per Share
(“Adjusted EPS”), which is based on basic earnings per share before
exceptional items and certain re-measurements (see note 3.2
below), depreciation on fair value uplifts, adjustments to the Gas
Production decommissioning provision, the removal of the interest
on external debt invested in subsidiaries with a non-controlling
interest and after the removal of deferred taxation and certain other
taxation items. Deferred taxation is excluded from the Group’s
Adjusted EPS because of the Group’s significant ongoing capital
investment programme, which means that the deferred tax is unlikely
to reverse. Adjusted profit after tax is presented on a basis consistent
with Adjusted EPS except for the non-inclusion of payments to
holders of hybrid equity.
The financial statements also include an Adjusted Net Debt and
Hybrid Capital measure. This presents financing information on the
basis used for internal liquidity risk management. This measure
excludes obligations due under lease arrangements, the share of net
debt attributable to non-controlling interests (including debt held at
SSE plc level, which is a change in the current year), and includes
cash held and posted as collateral on commodity trading exchanges,
and other deposits with a maturity of more than three months. The
measure represents the capital owed to investors, lenders and equity
holders other than the ordinary shareholders. As with Adjusted
Earnings Per Share, this measure is considered to be of relevance to
the ordinary shareholders of the Group as well as other stakeholders
and interested parties. The impact of the change to the definition of
debt attributable to non-controlling interest holders has been to
increase the adjustment for these items at 31 March 2025 from
£817.9m to £937.9m and therefore reduce the Adjusted Net Debt
and Hybrid Capital by £120.0m from £10,186.7m to £10,066.7m.
Finally, the financial statements include an Adjusted Investment
and Capital Expenditure and an Adjusted Investment, Capital and
Acquisition Expenditure measure. These metrics represent the capital
invested by the Group in projects that are anticipated to provide a
return on investment over future years, or which otherwise support
Group operations and are consistent with internally applied metrics.
They therefore include capital additions to property, plant and
equipment and intangible assets and the Group’s direct funding
of joint venture and associates’ capital projects. The Group has
considered it appropriate to report these values both internally
and externally in this manner due to its use of equity-accounted
investment vehicles to grow the Group’s asset base and to highlight
where the Group is providing funding to the vehicle through either
loans or equity. The Group does not include project funded capital
additions in these metrics, nor does it include other capital invested
in joint ventures and associates. In addition, the Group excludes
additions to its property, plant and equipment funded by customer
contributions, lease additions and additions to intangible
assets associated with allowances and certificates. The Group
also excludes the share of investment and capital expenditure
attributable to non-controlling interests in controlled but not wholly
owned subsidiaries. The Adjusted Investment, Capital and Acquisition
Expenditure measure also includes cash consideration paid by the
Group for business combinations which contribute to growth of the
Group’s capital asset base and are considered to be relevant to the
Group’s strategic objectives. As with Adjusted Earnings Per Share,
these measures are considered to be of relevance to management
and to the ordinary shareholders of the Group as well as to other
stakeholders and interested parties.
Reconciliations from reported measures to adjusted measures along
with further description of the rationale for those adjustments are
included in the Alternative Performance Measures section at
pages 144 to 150
.
Where the Group has referred to an adjusted performance measure
in the financial statements the following sign is presented to denote
this APM.
3.2 Exceptional items and certain re-measurements
Exceptional items are those charges or credits that are considered
unusual by nature and/or scale and of such significance that separate
disclosure is required for the financial statements to be properly
understood. The trigger points for recognition of items as exceptional
items will tend to be non-recurring, although exceptional charges
(or credits) may impact the same asset class or segment over time.
Examples of items that may be considered exceptional include
material asset, investment or business impairment charges; reversals
of historic exceptional impairments; business restructuring and
reorganisation costs relating to strategic change initiatives; significant
realised gains or losses on disposal; unrealised fair value adjustments
on acquisition or disposals; and provisions in relation to significant
disputes and claims.
The Group operates a policy framework for establishing whether
items should be considered exceptional. This framework, which
is reviewed annually, is based on the materiality of the item, by
reference to the Group’s key performance measure of Adjusted
Earnings Per Share. This framework estimates that any qualifying item
greater than £40.0m (2025: £40.0m) will be considered exceptional,
with the exception of any strategic restructuring or transformational
activities or discontinued operations, which will be considered on a
case-by-case basis. The only further exception to this threshold is for
gains or losses on disposal, or divestment of early-stage international
or offshore wind farm development projects within SSE Renewables,
which are considered non-exceptional in line with the Group’s
strategy to generate recurring gains from developer divestments.
Where a qualifying gain arises on a non-cash transaction, the gain
is still treated as exceptional.
Certain re-measurements are re-measurements arising on certain
commodity, interest rate and currency contracts which are
accounted for as held for trading or as fair value hedges in
accordance with the Group’s policy for such financial instruments;
re-measurements on stocks of commodities held at the balance
sheet date; or movements in fair valuation of contracts for difference
not designated as government grants. The amount recorded in the
adjusted results for these contracts is the amount settled in the year
as disclosed in note 24.1
.
This excludes commodity contracts not treated as financial
instruments under IFRS 9 where the contracts are held for the
Group’s own use requirements. The fair value of these contracts
is not recorded and the value associated with the contract is not
recognised until the underlying commodity is delivered.
The impact of changes in corporation tax rates on deferred tax
balances is also included within certain re-measurements.
3.3 Other additional disclosures
As permitted by IAS 1 “Presentation of Financial Statements”, the
Group’s income statement discloses additional information in respect
of joint ventures and associates, exceptional items and certain re-
measurements to aid understanding of the Group’s financial
performance and to present results clearly and consistently.
Notes to the consolidated financial statements continued
for the year ended 31 March 2026
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4. Accounting judgements and
estimation uncertainty
In the process of applying the Group’s accounting policies,
management is required to make judgements and estimates that will
have a significant effect on the amounts recognised in the financial
statements. Changes in the assumptions underlying the estimates
could result in a significant impact to the financial statements. The
Group’s key accounting judgement and estimation areas are noted
below, with the most significant and material financial judgement
areas that are specifically considered by the Audit Committee
highlighted separately.
The Group has made no changes to its material accounting
judgements and identified no new areas of estimation uncertainty
during the year.
4.1 Significant financial judgements and estimation
uncertainties
The preparation of these financial statements has specifically
considered the following significant financial judgements, some
of which are also areas of estimation uncertainty as noted below.
i. Impairment testing and valuation of certain non-current assets
– financial judgement and estimation uncertainty
The Group reviews the carrying amounts of its goodwill, other
intangible assets, specific property, plant and equipment and
investment assets to determine whether any impairments or reversal
of impairments to the carrying value of those assets requires to be
recorded. Where an indicator of impairment or impairment reversal
exists, the recoverable amount of those assets is reassessed by
reference to either value in use or fair value less cost to sell
assessments. As well as its goodwill balances, the specific assets
under review in the year ended 31 March 2026 are intangible
development assets in Southern Europe and Japan; specific property,
plant and equipment assets related to Gas Storage; specific onshore
Renewables assets; and the Group’s thermal power station at Great
Island in Ireland. In addition, the Group performed impairment
reviews over the carrying value of its equity investments in the
Dogger Bank Wind Farm joint ventures; Neos Networks Limited;
and Triton Power Holdings Limited.
In conducting its reviews, the Group makes judgements and
estimates determining both the level of cash generating unit (“CGU”)
at which common assets such as goodwill are assessed against, as
well as the estimates and assumptions behind the calculation of
recoverable amount of the respective assets or CGUs.
Changes to the estimates and assumptions on factors such as
regulation and legislation changes (including relevant climate change
related regulation), power, gas, carbon and other commodity prices,
volatility of gas prices, plant running regimes and load factors,
discount rates and other inputs could impact the assessed
recoverable value of assets and CGUs and consequently impact
the Group’s income statement and balance sheet.
Further detail of the calculation basis and key assumptions used in
the impairment reviews, impairment test results and the sensitivity
of these assessments to key assumptions is disclosed at note 15
.
Detail on the accounting policies applied is included in the
Accompanying Information section A1
.
ii. Retirement benefit obligations – estimation uncertainty
The Group sets its assumptions in relation to the cost of providing
post-retirement benefits after consultation with qualified actuaries.
While these assumptions are believed to be appropriate, a change in
these assumptions would impact the level of the retirement benefit
obligation recorded and the cost to the Group of administering
the schemes.
Further detail of the calculation basis and key assumptions used,
the resulting movements in obligations, and the sensitivity of key
assumptions to the obligation is disclosed at note 23
.
iii. Revenue recognition – Customers unbilled supply of energy –
estimation uncertainty
Revenue from energy supply activities undertaken by the Group’s
Energy Customer Solutions businesses includes an estimate of the
value of electricity or gas supplied to customers between the date of
the last meter reading and the year end. This estimation comprises
both billed revenue and unbilled revenue and is calculated based on
applying the tariffs and contract rates applicable to customers against
aggregated estimated customer consumption, taking account of
various factors including tariffs, consumption patterns, customer mix,
metering data, operational issues relating to the billings process and
externally notified aggregated volumes supplied to customers from
national settlements bodies.
This unbilled estimation is subject to an internal corroboration
process which compares calculated unbilled volumes to a theoretical
“perfect billing” benchmark measure of unbilled volumes (in GWh and
millions of therms) derived from historical consumption patterns and
aggregated metering data used in industry reconciliation processes.
Unbilled revenue is compared to billings in the period between the
balance sheet date and the finalisation of the financial statements
which has provided evidence of post report date billings and hence
support to the accrual recognised.
Given the requirement of management to apply judgement, the
estimated revenue accrual remains a significant estimate made by
management in preparing the financial statements. A change in the
assumptions underpinning the unbilled calculation would have an
impact on the amount of revenue recognised in any given period.
The sensitivity associated with this judgement factor is disclosed at
note 18
.
iv. Valuation of other receivables – financial judgement and
estimation uncertainty
The Group holds a £100m loan note due from OVO Group Limited
(“Ovo”) following the disposal of SSE Energy Services on 15 January
2020. The loan is repayable in full by 31 December 2029, carries
interest at 13.25% and is presented cumulative of accrued interest
payments, discounted at 13.25%. At 31 March 2026, the carrying value
(net of expected credit loss provision of £2.0m (2025: £1.8m)) is
£220.0m (2025: £193.5m) (see note 18
).
The Group has assessed recoverability of the loan note receivable
and has recognised a provision for expected credit loss in accordance
with the requirements of IFRS 9. The Group has taken appropriate
steps to assess all available information in respect of the recoverability
of the loan note. Procedures included reviewing recent financial
information of Ovo and discussions with Ovo management. While the
carrying value is considered to be appropriate, changes in economic
conditions could lead to a change in the expected credit loss incurred
by the Group in future periods. On 11 May 2026, subsequent to the
balance sheet date, E.On announced the acquisition of Ovo’s Retail
business, subject to regulatory approval. Completion of the
acquisition would result in the principal and accumulated interest
becoming repayable in full. While considered a non-adjusting post
balance sheet event in terms of classification, the Group has
considered the transaction as part of its recoverability assessment.
No changes to the recoverable value were made following
announcement of the transaction.
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
4. Accounting judgements and
estimation uncertainty continued
4.1 Significant financial judgements and estimation
uncertainties continued
v. Impact of climate change and the transition to net zero –
financial judgement and estimation uncertainty
Climate change and the transition to net zero have been considered
in the preparation of these financial statements. Where relevant,
assumptions have been applied that are consistent to a Paris-aligned
1.5°C net zero pathway by 2050. The Group has a clearly articulated
strategy to lead the UK’s transition to clean power and aligns its
investment plans and business activities to that strategy. These plans
continue to be supported by the Group’s Sustainability Financing
Framework, with ten green bonds outstanding at 31 March 2026
and £2bn of export credit agency-backed facilities in place, which
are classified as “Green Loans” when drawn (see note 21
).
The nature and timing of future climate-related regulation, market
developments and technological change are inherently uncertain and
could have a material impact on the carrying values of the Group’s
assets and liabilities. In preparing these financial statements, the
Group has considered the potential impacts of climate change and
the transition to net zero in the application of accounting judgements
and estimates, including the following areas:
Valuation of property, plant and equipment, and impairment
assessment of goodwill
The Group’s view is that flexible generation capacity, including the
Group’s fleet of CCGT power stations, will continue to play an
essential role in maintaining the security of supply during the
transition to clean power, supporting a system with increasing levels
of intermittent renewable generation. Accordingly, the Group has not
shortened the useful economic lives of its gas-fired-CCGTs fleet,
reflecting their expected role as flexible back-up capacity over the
transition period.
A significant increase in renewable generation capacity in the Group’s
core markets in the UK and Ireland could, in the longer term, result in
periods of oversupply of electricity, potentially placing downward
pressure on achievable power prices for renewable generation assets.
The Group has not assessed that this constitutes an indicator of
impairment at 31 March 2026, as the Group’s baseline investment
case models assume a centrally approved volume of new build
capacity consistent with system requirements and policy objectives
over the lives of the Group’s existing assets. In accordance with
IAS 36 “Impairment of Assets”, the Group performs an annual
impairment test of the goodwill balances associated with its wind
generation portfolio (see note 15.1)
. As part of this, sensitivities to
key assumptions, including power prices, have been considered.
A sensitivity analysis assuming a 10% reduction in power prices,
which could arise in a market with significant new build renewable
capacity, indicated that significant headroom remains relative to the
carrying value of the Group’s wind generating assets.
Valuation of decommissioning provisions
The Group recognises decommissioning provisions in respect of its
Renewable and Thermal generation assets and retained 60% share
of the decommissioning obligations relating to its disposed Gas
Production business. The Group considered the impacts of climate
change and the transition to clean power in estimating these
provisions. Given the essential back-up role thermal generation assets
are expected to play during the transition period, no change to
accelerate decommissioning timelines has been assumed at 31 March
2026. Similarly, the Group does not expect changes in weather
patterns or increased levels of new wind generation capacity to bring
forward the decommissioning of the Group’s wind farm portfolio.
The discounted share of the Gas Production provision is £191.1m
(2025: £201.6m). At 31 March 2026, the impact of discounting of this
retained provision is £106.5m (2025: £80.8m), which is expected
to be recognised across the period to 31 March 2044. If the
decommissioning activity was accelerated due to changes in
legislation, the costs of unwinding the discounting of the provision
would be recognised earlier.
Defined benefit scheme assets
The Group holds defined benefit pension scheme assets at 31 March
2026 which could be impacted by climate-related risks. The trustees
of the schemes have a long-term investment strategy that seeks to
reduce investment risk as and when appropriate and takes into
consideration the impact of climate-related risk.
Going Concern and viability statement
The implications of near-term climate-related risks have been
considered in the Group’s Going Concern assessment and viability
statement assessment.
4.2 Accounting judgements and estimation uncertainties
– changes from prior year
There were no changes to accounting judgements and estimation
uncertainties during the year.
4.3 Other areas of estimation uncertainty
Decommissioning costs
The calculation of the Group’s decommissioning provisions involves
the estimation of quantum and timing of cash flows to settle the
obligation. The Group engages independent valuation experts to
estimate the cost of decommissioning its Renewable, Thermal and
Gas Storage assets every three years based on current technology
and prices. The last independent assessment for the majority of the
Group’s Renewable and Thermal generation assets was performed in
the prior year to 31 March 2025. The last formal assessment for Gas
Storage assets was performed in the year to 31 March 2026. Retained
decommissioning costs in relation to the disposed Gas Production
business are periodically agreed with the field operators and reflect
the latest expected economic production lives of the fields.
The dates for settlement of future decommissioning costs are
uncertain, particularly for the disposed Gas Production business
where reassessment of gas and liquids reserves and fluctuations
in commodity prices can lengthen or shorten the field life.
Further detail on the assumptions applied, including expected
decommissioning dates, and movement in decommissioning costs
during the year are disclosed at note 20
.
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5. Segmental information
IFRS 8 requires operating segments to be identified based on the Group’s internal reporting to its Chief Operating Decision Maker to assess
operating performance and to make decisions on how to allocate capital. The Group’s Chief Operating Decision Maker has been identified as
the Group Executive Committee. The changes to the Group’s segments in the year are explained in note 1.2
and reflect how operating
performance is reported to the Group Executive Committee for SSE Thermal (previously reported as SSE Thermal and Gas Storage) and Energy
Customer Solutions (previously reported as SSE Business Energy and SSE Airtricity). Comparative information has been re-presented to reflect
the change to these segments. The Group’s Corporate unallocated segment is the Group’s residual corporate central costs which are not
allocated to individual segments and includes the contribution from its Enerveo business and the Group’s joint venture investment in Neos
Networks Limited – neither of which are reported separately to the Group Executive Committee.
The types of products and services from which each reportable segment derives its revenues are:
Segments
Description
SSE Thermal
The generation of electricity from flexible generation plants including CCGTs in the UK and Ireland and the
Following the change in segmental reporting noted at note 1.2
, SSE Thermal comprises the Group’s Thermal
Following the change in segmental reporting noted at note 1.2
, Energy Customer Solutions comprises the
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
5. Segmental information continued
As referred to in note 3 , the internal measure of profit reported to the Group Executive Committee is Adjusted Profit Before Interest and Tax
or Adjusted Operating Profit which is arrived at before exceptional items, the impact of financial instruments measured under IFRS 9, share of
profits attributable to non-controlling interests, adjustments to the Gas Production decommissioning provision, the impact of depreciation on
fair value uplifts and after the removal of taxation and interest on profits from joint ventures and associates.
Analysis of revenue, operating profit, capital expenditure and earnings before interest, taxation, depreciation and amortisation (“EBITDA”) by
segment is provided on the following pages. Revenue and profit before taxation arise primarily from operations within the UK and Ireland.
5.1 Segmental information disclosure
(i) Revenue by segment
(restated
(ii)
)
revenue
(i)
revenue
(i)
SSEN Transmission
1,210.3
–
1,210.3
807.0
–
807.0
SSEN Distribution
1,116.5
38.6
1,155.1
1,513.6
66.9
1,580.5
SSE Renewables
412.0
1,167.6
1,579.6
354.9
1,243.8
1,598.7
SSE Thermal
(ii)
669.8
4,417.9
5,087.7
650.6
4,556.7
5,207.3
Energy Customer Solutions
(ii)
4,704.7
196.5
4,901.2
4,601.5
239.3
4,840.8
Gross trading
18,732.1
5,729.1
24,461.2
16,542.4
6,074.6
22,617.0
Optimisation trades
(16,797.0)
(192.8)
(16,989.8)
(14,547.0)
36.8
(14,510.2)
SSE Energy Markets
1,935.1
5,536.3
7,471.4
1,995.4
6,111.4
8,106.8
Corporate unallocated
138.1
347.4
485.5
208.9
294.5
503.4
Total SSE Group
10,186.5
11,704.3
21,890.8
10,131.9
12,512.6
22,644.5
(i) Significant inter-segment revenue is derived from the sale of power and stored gas from SSE Renewables and SSE Thermal to SSE Energy Markets; use of system income received by SSEN
Distribution from Energy Customer Solutions; Energy Customer Solutions provides internal heat and light power supplies to other Group companies; SSE Energy Markets provides power,
gas and other commodities to Energy Customer Solutions; and Corporate unallocated provides corporate and infrastructure services to all segments as well as third parties. All are provided
at arm’s length.
(ii) The comparative segment revenue has been restated to combine Gas Storage (2025: £17.6m) and SSE Thermal (2025: £633.0m) into SSE Thermal (2025: £650.6m) and SSE Business Energy
(2025: £2,692.4m) and SSE Airtricity (2025: £1,909.1m) into Energy Customer Solutions (2025: £4,601.5m).
Disaggregation of revenue
Revenue from contracts with customers can be disaggregated by reported segment, by major service lines and by timing of revenue
recognition as follows:
SSEN Transmission
1,184.9
–
–
21.3
–
4.1
–
1,210.3
–
1,210.3
SSEN Distribution
1,040.6
–
–
18.3
–
32.4
–
1,091.3
25.2
1,116.5
SSE Renewables
–
126.3
–
103.4
179.7
2.6
–
412.0
–
412.0
SSE Thermal
22.7
604.8
2.8
6.2
–
16.1
15.6
668.2
1.6
669.8
Energy Customer Solutions
2.9
4,626.0
–
–
–
75.6
–
4,704.5
0.2
4,704.7
SSE Energy Markets
–
–
–
–
1,624.3
310.8
–
1,935.1
–
1,935.1
Corporate unallocated
–
–
–
122.5
–
14.4
–
136.9
1.2
138.1
Total SSE Group
2,251.1
5,357.1
2.8
271.7
1,804.0
456.0
15.6
10,158.3
28.2
10,186.5
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(restated
(i)
)
SSEN Transmission
783.0
–
–
21.4
–
–
2.6
807.0
–
807.0
SSEN Distribution
1,423.0
–
–
15.4
–
–
21.7
1,460.1
53.5
1,513.6
SSE Renewables
–
97.1
–
121.1
134.4
–
2.3
354.9
–
354.9
SSE Thermal
(i)
21.1
583.3
2.8
5.6
–
17.6
11.6
642.0
8.6
650.6
Energy Customer Solutions
(i)
1.8
4,550.6
0.4
–
–
–
37.4
4,590.2
11.3
4,601.5
SSE Energy Markets
–
–
–
–
1,815.1
–
180.3
1,995.4
–
1,995.4
Corporate unallocated
–
–
–
187.1
–
–
21.8
208.9
–
208.9
Total SSE Group
2,228.9
5,231.0
3.2
350.6
1,949.5
17.6
277.7
10,058.5
73.4
10,131.9
(i) The comparative has been restated to combine disaggregation of revenue of Gas Storage (2025: £17.6m) and SSE Thermal (2025: £633.0m) into SSE Thermal (2025: £650.6m) and SSE
Business Energy (2025: £2,692.4m) and SSE Airtricity (2025: £1,909.1m) into Energy Customer Solutions (2025: £4,601.5m).
Included within trade and other receivables (note 18 ) is £547.2m (2025: £521.1m) of unbilled energy income. Included within trade and other
payables (note 19
) is £345.0m (2025: £292.2m) of contract related liabilities. Contract related assets reflect the Group’s right to consideration
in exchange for goods or services that have transferred to the customer, and contract related liabilities reflect the Group’s obligation to transfer
future goods or services for which the Group has already received consideration.
The Group has not disclosed information related to the transaction price allocated to remaining performance obligations on the basis that the
Group’s contracts either have an original expected duration of less than one year, or permit the Group to recognise revenue as invoiced.
Revenue by geographical location is as follows:
UK
7,942.9
8,490.3
Ireland
2,237.8
1,641.6
Southern Europe
5.8
–
10,186.5
10,131.9
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
5. Segmental information continued
5.1 Segmental information disclosure continued
(ii) Operating profit/(loss) by segment
SSEN Transmission
562.6
–
–
–
187.5
750.1
–
750.1
SSEN Distribution
335.3
–
–
–
–
335.3
(38.4)
296.9
SSE Renewables
1,076.4
(19.6)
(187.9)
–
(0.3)
868.6
(143.3)
725.3
SSE Thermal
195.4
(0.7)
(19.2)
–
–
175.5
67.5
243.0
Energy Customer Solutions
136.9
–
0.7
–
–
137.6
(1.4)
136.2
SSE Energy Markets
43.2
–
–
–
–
43.2
(189.0)
(145.8)
Corporate unallocated
(113.2)
–
(0.5)
12.6
–
(101.1)
(15.7)
(116.8)
Total SSE Group
2,236.6
(20.3)
(206.9)
12.6
187.2
2,209.2
(320.3)
1,888.9
The Adjusted Operating Profit of the Group is reported after removal of the Group’s share of interest, fair value movements on operating
derivatives, the depreciation charged on fair value uplifts and tax from joint ventures and associates, adjustments to the Gas Production
decommissioning provision, operating profit from non-controlling interests and after adjusting for exceptional items and certain re-
measurements (note 7
).
The Group’s share of operating profit from joint ventures and associates has been recognised in the SSE Renewables, SSE Thermal, Energy
Customer Solutions and Corporate segments.
2025 (restated
(i)
)
SSEN Transmission
322.5
–
–
–
107.5
430.0
–
430.0
SSEN Distribution
736.0
–
–
–
–
736.0
–
736.0
SSE Renewables
1,038.8
(19.7)
(155.3)
–
(0.8)
863.0
(245.4)
617.6
SSE Thermal
(i)
211.4
(0.4)
(6.0)
–
–
205.0
(9.7)
195.3
Solutions
(i)
192.1
–
(0.9)
–
–
191.2
(2.0)
189.2
SSE Energy Markets
30.0
–
–
–
–
30.0
(72.9)
(42.9)
Corporate unallocated
(i)
(111.6)
–
(11.1)
17.9
–
(104.8)
(58.2)
(163.0)
Total SSE Group
2,419.2
(20.1)
(173.3)
17.9
106.7
2,350.4
(388.2)
1,962.2
(i) The comparative operating profit/(loss) by segment information has been restated to aggregate the adjusted operating result of Gas Storage (2025: £37.1m loss) and SSE Thermal
(2025: £248.5m) into SSE Thermal (2025: £211.4m), SSE Business Energy (2025: £32.7m) and SSE Airtricity (2025: £159.4m) into Energy Customer Solutions (2025: £192.1m) and Neos
Networks (2025: £22.2m loss) into Corporate unallocated. The reported operating profit by segment has been similarly restated to aggregate Gas Storage (2025: £45.5m loss) and SSE
Thermal (2025: £240.8m) into SSE Thermal (2025: £195.3m), SSE Business Energy (2025: £32.2m) and SSE Airtricity (2025: £157.0m) into Energy Customer Solutions (2025: £189.2m)
and Neos Networks (2025: £33.3m loss) into Corporate unallocated.
164
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(iii) Capital and investment expenditure by segment
(restated
(i)
)
(restated
(i)
)
SSEN Transmission
31.1
2,272.9
20.3
1,253.8
SSEN Distribution
39.8
1,012.3
35.8
743.9
SSE Renewables
165.0
408.0
291.3
545.8
SSE Thermal
(i)
43.7
186.0
56.9
139.3
Energy Customer Solutions
(i)
27.9
11.5
36.0
33.5
SSE Energy Markets
484.5
–
585.1
–
Corporate unallocated
5.2
92.8
20.1
75.2
Total SSE Group
797.2
3,983.5
1,045.5
2,791.5
Increase in prepayments related to capital expenditure
–
4 6 8 . 1
–
2 5 4 . 9
Government funded additions
–
4 1 . 7
–
55.7
Decrease/(increase) in trade payables related to capital expenditure
–
3 . 8
–
(122.8)
Customer or third party funded additions
–
(215.7)
–
( 1 6 3 . 4 )
Lease asset additions
–
( 9 3 . 3 )
–
(126.7)
Allowances and certificates
(235.9)
–
(335.7)
–
Property, plant and equipment
–
( 4 1 . 1 )
–
–
Net cash outflow
561.3
4,147.0
709.8
2,689.2
(i)
The comparatives have been restated to aggregate capital additions to intangible assets of SSE Business Energy (2025: £28.9m) and SSE Airtricity (2025: £7.1m) into Energy Customer
Solutions (2025: £36.0m) and capital additions to property, plant and equipment of Gas Storage (2025: £0.7m) and SSE Thermal (2025: £138.6m) into SSE Thermal (2025: £139.3m).
Capital additions do not include assets acquired in acquisitions, assets acquired under leases or assets constructed that the Group were
reimbursed by way of a government grant. During the year the Group received reimbursements totalling £41.7m (2025: £55.7m) from
government bodies relating to construction of a temporary generation plant at the Group’s Tarbert site, which have been presented separately
on the cashflow statement. Capital additions to intangible assets includes the cash purchase of emissions allowances and certificates (2026:
£264.7m; 2025: £268.0m). These purchases are presented in the cash flow statement within operating activities as they relate to the obligation
to surrender the allowances and certificates in line with operating volumes of emissions. Other non-cash additions comprise self-generated
renewable obligation certificates and asset additions from the acquisition of a further 50% equity interest in Lenalea Wind Farm DAC, since the
acquisition is shown separately in the cashflow statement.
No segmental analysis of assets is required to be disclosed as this information is not presented to the Group Executive Committee.
165
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Financial StatementsGovernanceStrategic Report

Notes to the consolidated financial statements continued
for the year ended 31 March 2026
5. Segmental information continued
5.1 Segmental information disclosure continued
(iii) Capital and investment expenditure by segment continued
associates
(i)
certificates
(ii)
additions
(iii)
additions
(iv)
interests
(v)
SSEN Transmission
31.1
2,272.9
–
–
–
(13.9)
(572.5)
1,717.6
SSEN Distribution
39.8
1,012.3
–
–
(199.9)
(0.4)
–
851.8
SSE Renewables
165.0
408.0
183.5
–
–
(15.5)
(2.0)
739.0
SSE Thermal
43.7
186.0
–
(16.7)
(15.3)
(0.2)
–
197.5
Energy Customer Solutions
27.9
11.5
5.5
(9.6)
(0.5)
–
–
34.8
SSE Energy Markets
484.5
–
–
(474.3)
–
–
–
10.2
Corporate unallocated
5.2
92.8
–
–
–
(63.3)
–
34.7
Total SSE Group
797.2
3,983.5
189.0
(500.6)
(215.7)
(93.3)
(574.5)
3,585.6
(i) Represents equity or debt funding provided to joint ventures or associates in relation to capital expenditure projects.
(ii) Allowances and certificates consist of purchased carbon emissions allowances and generated or purchased renewable obligations certificates and are not included in the Group’s Capital
Expenditure and Investment alternative performance measure.
(iii) Represents removal of additions to electricity and other networks funded by customer or third party contributions.
(iv) Represents removal of additions in respect of right of use assets recognised on the commencement date of a lease arrangement.
(v) Represents the share of capital additions attributable to non-controlling interests.
(restated
(i)
)
SSEN Transmission
20.3
1,253.8
–
–
–
(2.8)
(317.8)
953.5
SSEN Distribution
35.8
743.9
–
–
(143.3)
(0.6)
–
635.8
SSE Renewables
291.3
545.8
227.8
–
–
(60.1)
(3.0)
1,001.8
SSE Thermal
(i)
56.9
139.3
31.3
(27.3)
(16.2)
(0.2)
–
183.8
Solutions
(i)
36.0
33.5
15.1
–
(3.9)
(0.7)
–
80.0
SSE Energy Markets
585.1
–
–
(576.4)
–
–
–
8.7
Corporate unallocated
20.1
75.2
13.8
–
–
(62.3)
–
46.8
Total SSE Group
1,045.5
2,791.5
288.0
(603.7)
(163.4)
(126.7)
(320.8)
2,910.4
(i)
The comparatives have been restated, as noted above for the capital additions to intangible assets and capital additions to property plant and equipment.
166
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(iv) Items included in operating profit/(loss) by segment
plant and equipment
Amortisation/impairment of intangible assets
SSEN Transmission
178.6
–
178.6
11.7
–
11.7
SSEN Distribution
220.4
–
220.4
15.7
–
15.7
SSE Renewables
199.7
155.8
355.5
16.4
–
16.4
SSE Thermal
86.2
(48.5)
37.7
2.8
4.2
7.0
Energy Customer Solutions
2.8
–
2.8
36.3
–
36.3
SSE Energy Markets
–
–
–
9.2
–
9.2
Corporate unallocated
68.7
–
68.7
30.8
–
30.8
Total SSE Group
756.4
107.3
863.7
122.9
4.2
127.1
(restated
(i)
)
plant and equipment
Amortisation/impairment of intangible assets
SSEN Transmission
142.8
–
142.8
8.3
–
8.3
SSEN Distribution
199.3
–
199.3
14.9
–
14.9
SSE Renewables
184.1
–
184.1
18.6
249.5
268.1
SSE Thermal
(i)
88.4
–
88.4
2.0
–
2.0
Energy Customer Solutions
(i)
3.1
0.5
3.6
29.1
–
29.1
SSE Energy Markets
–
–
–
6.8
–
6.8
Corporate unallocated
49.6
6.7
56.3
29.1
24.3
53.4
Total SSE Group
667.3
7.2
674.5
108.8
273.8
382.6
(i)
The comparatives have been restated to combine Gas Storage and SSE Thermal into SSE Thermal and SSE Airtricity and SSE Business Energy into Energy Customer Solutions .
167
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
5. Segmental information continued
5.1 Segmental information disclosure continued
(v) Earnings before interest, taxation, depreciation and amortisation (“EBITDA”)
SSEN Transmission
562.6
–
190.3
–
(2.4)
(47.6)
702.9
SSEN Distribution
335.3
–
236.1
–
(9.3)
–
562.1
SSE Renewables
1,076.4
(19.6)
216.1
137.0
(0.1)
–
1,409.8
SSE Thermal
195.4
(0.7)
89.0
34.8
–
–
318.5
Energy Customer Solutions
136.9
–
39.1
1.2
(0.8)
–
176.4
SSE Energy Markets
43.2
–
9.2
–
–
–
52.4
Corporate unallocated
(113.2)
–
99.5
–
(0.5)
–
(14.2)
Total SSE Group
2,236.6
(20.3)
879.3
173.0
(13.1)
(47.6)
3,207.9
Note that the Group’s Net Debt to EBITDA metric is derived after removing the proportionate EBITDA from Beatrice, Seagreen and Dogger Bank
A debt-financed joint ventures. This adjustment is £157.4m (2025: £153.3m) resulting in EBITDA for inclusion in the Net Debt to EBITDA metric
of £3,050.5m (2025: £3,196.0m).
For 31 March 2026 the £879.3m (2025: £776.1m) combined depreciation, impairment and amortisation charges included non-exceptional
impairments net of reversals totalling £12.7m (2025: £20.7m).
(restated
(i)
)
SSEN Transmission
322.5
–
151.1
–
(2.3)
(37.8)
433.5
SSEN Distribution
736.0
–
214.2
–
(10.8)
–
939.4
SSE Renewables
1,038.8
(19.7)
202.7
132.5
–
–
1,354.3
SSE Thermal
(i)
211.4
(0.4)
90.4
42.9
–
–
344.3
Energy Customer Solutions
(i)
192.1
–
32.2
1.3
(0.5)
–
225.1
SSE Energy Markets
30.0
–
6.8
–
–
–
36.8
Corporate unallocated
(i)
(111.6)
–
78.7
49.3
(0.5)
–
15.9
Total SSE Group
2,419.2
(20.1)
776.1
226.0
(14.1)
(37.8)
3,349.3
(i)
The comparatives have been restated to combine the adjusted EBITDA of Gas Storage (2025: £36.3m loss) and SSE Thermal (2025: £380.6m) into SSE Thermal (2025: £344.3m); SSE
Business Energy (2025: £58.2m) and SSE Airtricity (2025: £166.9m) into Energy Customers Solutions (2025: £225.1m); and Neos Networks (2025: £27.1m) and Corporate unallocated
(2025: £11.2m (loss)) into Corporate unallocated (2025: £15.9m).
168
SSE plc Annual Report 2026

6. Other operating income and cost
Group operating profit is stated after charging/(crediting) the following items:
Depreciation of property, plant and equipment
(i)
(note 14)
753.0
665.6
Exceptional charges (note 7)
162.6
309.7
Research costs
17.7
17.2
Lease charges
(ii)
14.0
14.3
Release of deferred income in relation to capital grants and historic customer contributions
(13.1)
(14.1)
Government grant income
(iii)
–
(59.3)
Gain on disposals (non-exceptional)
(iv)
(7.3)
(47.9)
(i) Does not include exceptional impairment charges.
(ii) Represents the expense of leases with a duration of twelve months or less and leases for assets which are deemed “low value” under the principles of IFRS 16. In addition, variable lease
payments, which are not included within the measurement of lease liabilities as they do not depend on an index or rate, of £17.8m (2025: £9.8m) were charged in the current year.
(iii) During the prior year the Group received £59.3m of income from government funded customer support schemes. All amounts received were passed to the Group’s energy customers in the
UK and Republic of Ireland. Amounts received were classed as other operating income in line with the Group’s accounting policies for government grants.
(iv) There were no significant gains recognised on disposals in the current year (2025: £47.9m gain relating to £38.8m from the sale of land at Ferrybridge, £7.4m from the sale of the gas
metering business and £1.7m from investments in associates).
Auditor’s remuneration
Audit of these financial statements
0.4
0.4
Audit of financial statements of subsidiaries of the Company
5.7
5.3
Audit related assurance services
0.4
0.3
Other services fees
0.4
0.3
6.5
5.9
Total remuneration paid to auditor
6.9
6.3
Audit fees incurred in the current year include scope changes for non-recurring items and overruns of £0.7m (2025: £0.8m) related to the prior
year audit. Assurance and other service fees incurred in the year were £0.8m (2025: £0.6m). Audit related assurance services include fees
incurred in relation to regulatory accounts and returns required by Ofgem, comfort letters in connection with funding and debt issuance and
ESG assurance. A description of the work of the Audit Committee is set out on pages 102 to 109
and includes an explanation of how auditor
objectivity and independence is safeguarded when non-audit services are provided by the auditors.
169
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
7. Exceptional items and certain re-measurements
Asset impairments and reversals
(99.7)
(293.6)
Provisions for restructuring and other liabilities
(62.9)
(16.1)
Net gains on disposals of businesses and other assets
–
0.3
Total exceptional items
(162.6)
(309.4)
Movement on operating derivatives (note 24)
(152.0)
(49.0)
Movement in fair value of commodity stocks
10.4
(8.4)
Movement on financing derivatives (note 24)
17.9
12.8
Share of movement on derivatives in jointly controlled entities (net of tax)
(16.1)
(21.1)
Total certain re-measurements
(139.8)
(65.7)
Exceptional items and certain re-measurements before taxation
(302.4)
(375.1)
Taxation on other exceptional items
39.6
29.7
Taxation on certain re-measurements
16.9
4.0
Total taxation on exceptional items and certain re-measurements
56.5
33.7
Total exceptional items and certain re-measurements after taxation
(245.9)
(341.4)
Exceptional items and certain re-measurements are disclosed across the following categories within the income statement:
Movement on operating derivatives (note 24)
(152.0)
(49.0)
Movement in fair value of commodity stocks
10.4
(8.4)
(141.6)
(57.4)
Asset impairments and reversals
(99.7)
(293.6)
Exceptional restructuring provisions and other liabilities
(62.9)
(16.1)
(162.6)
(309.7)
Share of movement on derivatives in jointly controlled entities (net of tax)
(16.1)
(21.1)
Operating loss
(320.3)
(388.2)
Movement on financing derivatives (note 24)
17.9
12.8
Interest income on deferred consideration receipt
–
0.3
17.9
13.1
Loss before tax
(302.4)
(375.1)
170
SSE plc Annual Report 2026

7.1 Exceptional items
Exceptional items in the year ended 31 March 2026
In the year to 31 March 2026, the Group recognised a pre-tax exceptional charge of £162.6m (2025: £309.4m), which is primarily due to
exceptional pre-tax impairment charges totalling £155.8m relating the Group’s onshore wind farms at Strathy South (£96.0m) and Aberarder
(£59.8m); and exceptional Group restructuring costs of £84.7m (including £21.8m of asset impairments). These exceptional costs are partially
offset by exceptional pre-tax impairment reversals totalling £77.9m relating to the Group’s gas storage assets (£48.5m) and joint venture
investment in Triton Power Holdings Limited (“Triton”) (£29.4m).
The net exceptional (charges)/credits recognised can be summarised as follows:
Renewables – impairment charges (i)
–
(155.8)
–
(155.8)
Gas Storage – impairment reversal (ii)
–
48.5
–
–
48.5
Triton Power 50% joint venture – investment impairment reversal (iii)
–
–
29.4
–
29.4
Restructuring costs (iv)
(4.2)
–
(17.6)
(62.9)
(84.7)
Total exceptional items
(4.2)
(107.3)
11.8
(62.9)
(162.6)
i) Renewables – impairment charges
The Group performed formal impairment reviews over the carrying value of its mid-construction onshore wind farm developments at Strathy
South and Aberarder (see note 15.2
) following grid connection delays notified during the year. As a result of these assessments, the Group
recognised exceptional impairment charges of £96.0m to Strathy South and £59.8m to the carrying value of Aberarder.
ii) Gas Storage – impairment reversal
At 31 March 2026, the Group performed a formal impairment review of the carrying value of its operational Gas Storage assets due to global
commodity market volatility in the period prior to the Group’s balance sheet date (see note 15.2
). As a result of the assessment, the Group
recognised an exceptional impairment reversal of £48.5m to the carrying value of the Group’s Gas Storage assets.
iii) Triton Power 50% joint venture – investment impairment reversal
The Group recognised an impairment reversal of £29.4m against the carrying value of the Group’s investment in Triton Power Holdings Limited,
following updates to projected running schedules and future market price assumptions (see note 15.2
).
iv) Restructuring costs
During the year the Group continued its Group Operating Model and Efficiency Review and related restructuring programmes, resulting in
the recognition of exceptional restructuring costs totalling £84.7m. Costs recognised during the year included the impairment of £21.8m of
standalone hydrogen production development projects and joint venture investments in SSE Thermal; consultancy fees of £22.0m; £20.9m of
IT customisation and integration charges; and £20.0m of redundancy costs. While the wider Group Operating Model and Efficiency Review is
now largely complete, the Group will continue to incur exceptional restructuring costs related to the ongoing transformation of SSEN
Distribution, which is expected to continue into the 31 March 2028 financial year.
Exceptional items in the year ended 31 March 2025
i) Southern Europe goodwill and development assets – impairment charge
The Group recognised a pre-tax impairment charge of £249.5m against the carrying value of its Southern Europe goodwill and intangible
assets, offset by the release of a deferred tax liability of £23.2m.
ii) Restructuring costs
Costs of £46.7m in relation to the Group Operating Model and Efficiency Review were recognised during the year ended 31 March 2025.
The costs included the impairment of £19.8m of goodwill associated with The Energy Solutions Group Limited; the impairment of £11.1m of
stranded IT assets; and £13.8m of redundancy costs.
In addition, the Group recognised further exceptional charges of £13.5m in relation to the ongoing disposal of its non-core Enerveo subsidiary.
iii) Other credits
The Group recognised a final exceptional credit of £0.3m relating to the unwind of discounting on deferred consideration recognised on the
part disposal of SSE Slough Multifuel Limited in the year ending 31 March 2021.
Taxation
The Group has separately recognised the tax effect of the exceptional items summarised above.
171
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Financial StatementsGovernanceStrategic Report

Notes to the consolidated financial statements continued
for the year ended 31 March 2026
7. Exceptional items and certain re-measurements continued
7.2 Certain re-measurements
The Group, through its SSE Energy Markets business, enters into forward commodity purchase (and sales) contracts to
– meet the future demand requirements of its Energy Customer Solutions businesses,
– optimise the value of its SSE Renewables and SSE Thermal power generation assets, or
– conduct trading subject to the value at risk limits set out by the Energy Markets Risk Committee.
Certain of these contracts (predominately power, gas and other commodity purchase contracts) are determined to be derivative financial
instruments under IFRS 9 “Financial Instruments” and therefore are required to be recorded at their fair value. Conversely, commodity contracts
that are not financial instruments under IFRS 9 (predominately electricity sales contracts) are accounted for as “own use” contracts and are not
recorded at fair value. Inventory held by the SSE Thermal business for optimisation and trading purposes is measured at fair value, with changes
in value recognised within “certain re-measurements”. In addition, the mark-to-market valuation movements on the Group’s CfDs entered into
by SSE Renewables that are not designated as government grants, and which are measured as Level 3 fair value financial instruments, are also
included within “certain re-measurements”.
Changes in the fair value of those commodity contracts designated as financial instruments and trading inventory are therefore reflected in the
income statement. The Group recognises the change in the fair value of these forward contracts and trading inventory separately as “certain re-
measurements”, as the Group does not believe this mark-to-market movement is relevant to the underlying performance of its businesses.
At 31 March 2026, changes in commodity prices and in SSE’s contractual positions have resulted in a net mark-to-market re-measurement
on commodity contracts designated as financial instruments, contracts for difference contracts and trading inventory of £141.6m (loss)
(2025: £57.4m (loss)). The net IFRS 9 position on operating derivatives at 31 March 2026 is a liability of £158.9m (2025: £3.9m liability).
The mark-to-market loss in the year has resulted in a deferred tax credit of £18.5m (2025: £9.3m credit), which has been reported separately as
part of certain re-measurements. In addition, the Group has recognised gains of £17.9m (2025: £12.8m gain) on the re-measurement of certain
interest rate and foreign exchange contracts through the income statement.
The following mark-to-market losses/gains were recorded in the statement of other comprehensive income:
– £14.2m of losses (2025: £48.1m gain) on the re-measurement of cash flow hedge accounted contracts, and
– £35.0m of losses (2025: £16.7m loss) on the equity share of the re-measurement of cash flow hedge accounted contracts in joint ventures
The re-measurements arising from IFRS 9 together with the associated deferred tax are disclosed separately to aid understanding of the
underlying performance of the Group.
8. Directors and employees
8.1 Staff costs
Wages and salaries
802.2
799.6
Social security costs
111.7
92.4
Share-based remuneration
29.6
24.5
Pension costs (note 23)
132.5
118.5
1,076.0
1,035.0
Less: capitalised as property, plant and equipment or intangible assets
(353.3)
(299.1)
722.7
735.9
8.2 Employee numbers
Numbers employed at 31 March
(i)
15,197
15,824
15,197
15,824
(i) The number of employees at 31 March 2026 includes 475 employees of Enerveo (2025: 944).
172
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The average number of people employed by the Group (including Executive Directors) during the year was:
SSEN Transmission
2,619
2,082
SSEN Distribution
4,873
4,818
SSE Renewables
1,909
2,142
SSE Thermal
824
815
Energy Customer Solutions
2,695
2,978
SSE Energy Markets
368
349
Corporate Services
(i)
2,250
2,443
Total SSE Group
15,538
15,627
* The comparative has been restated to reallocate 97 average employees from Gas Storage to SSE Thermal and combine 1,977 and 981 average employees in SSE Business Energy and SSE
Airtricity respectively in Energy Customers Solutions.
(i) Enerveo employees of 846 (2025: 1,011) continue to be reported within Corporate Services.
8.3 Remuneration of key management personnel
The remuneration of the key management personnel of the Group (excluding amounts equivalent to pension value increases as set out in the
Remuneration Report), is set out below in aggregate.
2026
2025
Salaries and short-term employee benefits
5.7
4.6
10.3
5.1
5.4
10.5
Social security costs
1.2
1.0
2.2
1.0
1.0
2.0
Post-employment benefits
0.6
0.2
0.8
0.6
0.3
0.9
Share-based benefits
2.8
3.8
6.6
2.7
3.4
6.1
10.3
9.6
19.9
9.4
10.1
19.5
Key management personnel are responsible for planning, directing and controlling the operations of the Group and are designated Persons
Discharging Management Responsibilities (“PDMRs”) in line with the market abuse regulation definition. The Group has two (2025: three)
Executive Directors. Executive committee members included in the table above at 31 March 2026 are the Managing Director of SSEN
Distribution; the Managing Director of SSEN Transmission; the Managing Director of SSE Renewables; the Managing Director of Thermal; the
Managing Director of Energy Customer Solutions; the Managing Director of Corporate Affairs, Regulation and Strategy; the Director of Human
Resources; the Group’s General Counsel, and the Group’s Chief Sustainability Officer.
Further information about the remuneration of individual Directors is provided in the audited part of the Remuneration Report.
Information regarding transactions with post-retirement benefit plans is included in note 23
.
Non-Executive Directors were paid fees of £1.5m during the current year (2025: £1.4m).
173
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
9. Finance income and costs
Recognised in income statement
2026
2025
Interest income from short term deposits
46.9
–
46.9
24.8
–
24.8
Interest on pension scheme assets
(i)
29.4
–
29.4
20.7
–
20.7
Joint ventures and associates
119.4
–
119.4
118.8
–
118.8
Other receivable
45.2
–
45.2
30.5
0.3
30.8
164.6
–
164.6
149.3
0.3
149.6
Total finance income
240.9
–
240.9
194.8
0.3
195.1
Bank loans and overdrafts
(69.7)
–
(69.7)
(61.1)
–
(61.1)
Other loans and charges
(362.7)
–
(362.7)
(309.9)
–
(309.9)
Notional interest arising on discounted provisions
(34.3)
–
(34.3)
(27.2)
–
(27.2)
and liabilities
(4.4)
–
( 4 . 4 )
(0.2)
–
(0.2)
Lease charges
(24.1)
–
(24.1)
(26.9)
–
(26.9)
Less: interest capitalised
(ii)
184.8
–
184.8
106.1
–
106.1
Total finance costs
(310.4)
–
(310.4)
(319.2)
–
(319.2)
Changes in fair value of financing derivative assets or
liabilities at fair value through profit or loss
–
17.9
17.9
–
12.8
12.8
Net finance costs
(69.5)
17.9
(51.6)
(124.4)
13.1
(111.3)
Finance income
240.9
17.9
258.8
194.8
13.1
207.9
Finance costs
(310.4)
–
(310.4)
(319.2)
–
(319.2)
Net finance costs
(69.5)
17.9
(51.6)
(124.4)
13.1
(111.3)
(i) The interest income on net pension assets for the year ended 31 March 2026 of £29.4m (2025: £20.7m) represents the interest earned on the Group’s net retirement benefits assets.
(ii) The capitalisation rate applied in determining the amount of borrowing costs to capitalise in the year was 4.29% (2025: 4.12%).
Adjusted Net Finance Costs are arrived at after the following adjustments:
Net finance costs
(51.6)
(111.3)
Share of interest from joint ventures and associates
(155.7)
(164.3)
Movement on financing derivatives (note 24)
(17.9)
(12.8)
Exceptional item
–
(0.3)
Share of net finance cost attributable to non-controlling interests
13.4
14.0
Adjusted Net Finance Costs APM
(211.8)
(274.7)
Notional interest arising on discounted provisions
34.3
27.2
Lease charges
24.1
26.9
Hybrid coupon payment (note 22.5(iii))
(72.9)
(73.7)
Finance costs incurred by non-controlled interests on debt instruments provided by SSE plc
(8.0)
(6.3)
Adjusted Net Finance Costs for interest cover calculations APM
(234.3)
(300.6)
* The comparatives have been restated. See note 1.2.
Recognised in other comprehensive income
(Loss)/gain on effective portion of cash flow hedges (before tax)
(14.2)
48.1
Share of joint venture and associate loss on effective portion of cash flow hedges (before tax)
(46.7)
(22.3)
Total recognised in other comprehensive income
(60.9)
25.8
174
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10. Taxation
10.1 Analysis of charge recognised in the income statement
2026
2025
Corporation tax
141.8
(33.2)
108.6
247.3
(5.3)
242.0
Adjustments in respect of previous years
(11.2)
–
(11.2)
(8.3)
–
(8.3)
Total current tax
130.6
(33.2)
97.4
239.0
(5.3)
233.7
Current year
345.3
(23.3)
322.0
293.6
(28.4)
265.2
Adjustments in respect of previous years
6.3
–
6.3
19.1
–
19.1
Total deferred tax
351.6
(23.3)
328.3
312.7
(28.4)
284.3
Total taxation charge/(credit)
482.2
(56.5)
425.7
551.7
(33.7)
518.0
The Group has separately recognised the tax effect of the exceptional items and certain re-measurements summarised above.
SSE continues to be accredited with the Fair Tax Mark. As a result, these financial statements include several areas of enhanced disclosure which
have been provided in order to develop stakeholder understanding of the tax the Group pays and the reported total taxation charge along with
additional commentary on the main reconciling items.
These can be seen at section A2
.
The majority of the Group’s profits are earned in the UK, with the standard rate of UK corporation tax being 25% for the year to 31 March 2026
(2025: 25%). Profits earned by the Group in the Republic of Ireland are taxable at either 12.5% or 25%, depending upon the nature of the income.
While the Group has activities in other jurisdictions outside of the UK and Republic of Ireland, tax paid on those development activities is
currently immaterial.
Change in UK corporation tax rates
There are no announced or enacted changes in corporation tax rates in the year ended 31 March 2026.
Finance Act (No.2) 2023 introduced legislation in respect of Multinational Top-up Tax in line with OECD BEPS Pillar Two principles. Similar draft
legislation has been introduced in the Republic of Ireland and other EU jurisdictions. The Group has carried out a group wide tax rate review,
in line with the BEPS Pillar Two Legislation and guidance, and has found there is no material impact as tax rates in the countries in which the
Group operates exceed 15%. The Group has applied the exemption from recognising and disclosing information about deferred tax assets
and liabilities related to Pillar Two income taxes as required by the amendments to IAS 12 “International Tax Reform – Pillar Two Model Rules”,
which were issued in May 2023.
The Adjusted Current Tax Charge and the adjusted effective rate of tax, which are presented in order to best represent underlying performance
by making similar adjustments to the adjusted profit before tax measure, are arrived at after the following adjustments:
Group tax charge and effective rate
425.7
24.3
518.0
29.4
Add: reported deferred tax charge and effective rate
(328.3)
(18.8)
(284.3)
(16.1)
Reported current tax charge and effective rate
97.4
5.5
233.7
13.3
Effect of adjusting items
(0.7)
(2.4)
Reported current tax charge and effective rate on adjusted basis
97.4
4.8
233.7
10.9
Share of current tax from joint ventures and associates
48.6
2.5
45.1
2.2
Current tax credit on exceptional items
33.2
1.6
5.3
0.2
Share of current tax attributable to non-controlling interests
14.2
0.7
13.8
0.6
Adjusted Current Tax Charge and effective rate APM
193.4
9.6
297.9
13.9
* The comparatives have been restated. See note 1.2.
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
10. Taxation continued
10.1 Analysis of charge recognised in the income statement continued
Tax (credit)/charge recognised in other comprehensive income:
Pension scheme actuarial movements
(20.1)
13.2
Cash flow and net investment hedge movements
(3.8)
11.3
(23.9)
24.5
All tax recognised through other comprehensive income is deferred tax.
See further Taxation disclosures at A2
.
10.2 Deferred taxation
The following are the deferred tax liabilities and assets recognised by the Group and movements thereon during the current and prior
reporting periods:
At 31 March 2024
1,479.3
33.5
105.4
(79.5)
(1.9)
1,536.8
Charge/(credit) to income statement
306.0
(5.0)
8.0
3.7
(28.4)
284.3
Transfer of deferred tax on derivatives
–
(18.3)
–
–
18.3
–
under IAS 12
–
–
–
(17.2)
17.2
–
Charge to other comprehensive income
–
11.3
13.2
–
–
24.5
Charge to equity
–
–
–
–
2.2
2.2
Exchange adjustment
(3.3)
–
–
–
–
(3.3)
At 31 March 2025
1,782.0
21.5
126.6
(93.0)
7.4
1,844.5
Charge/(credit) to income statement
347.5
(14.0)
10.0
(9.4)
(5.8)
328.3
Credit to other comprehensive income
–
(3.8)
(20.1)
–
–
(23.9)
Charge to equity
–
–
–
–
(9.1)
(9.1)
Exchange adjustment
1.5
–
–
–
0.2
1.7
At 31 March 2026
2,131.0
3.7
116.5
(102.4)
(7.3)
2,141.5
Certain deferred tax assets and liabilities have been offset, including the asset balances analysed in the tables above. The following is an analysis
of the deferred tax balances (after offset) for financial reporting purposes:
Deferred tax liabilities
2,303.6
2,000.9
Deferred tax assets
(162.1)
(156.4)
Net deferred tax liabilities
2,141.5
1,844.5
In total there are £62.0m (2025: £20.6m) of unrecognised deferred tax assets. The Group has not recognised a deferred tax asset of £5.6m
(2025: £2.9m) on trading losses of £45.1m (2025: £23.7m) in the Republic of Ireland. The Group has not recognised deferred tax assets
of £56.4m (2025: £17.7m) in respect of losses of £233.3m (2025: £74.6m) primarily in Spain and Japan. These assets have not been recognised
as the Group is uncertain that there will be sufficient future profits against which to utilise the assets. There are no impending time limits for
expiry of the losses or allowances to which they relate.
No deferred tax is recognised on the unremitted earnings of overseas subsidiaries, associates and joint ventures. As the earnings are continually
reinvested by the Group, no tax is expected to be payable on them in the foreseeable future. Total unremitted earnings at 31 March 2026 were
£1,167.8m (2025: £971.1m).
176
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11. Dividends and earnings per share
11.1 Ordinary dividends
2026
Total
2025
Total
Interim – year ended 31 March 2026
258.3
107.7
21.4
–
–
–
Final – year ended 31 March 2025
475.8
25.3
43.0
–
–
–
Interim – year ended 31 March 2025
–
–
–
233.7
43.4
21.2
Final – year ended 31 March 2024
–
–
–
437.3
225.5
40.0
734.1
133.0
671.0
268.9
The final dividend of 43.0p per ordinary share declared in respect of the financial year ended 31 March 2025 (2024: 40.0p) was approved at the
Annual General Meeting on 17 July 2025 and was paid to shareholders on 18 September 2025. Shareholders were able to elect to receive
ordinary shares credited as fully paid instead of the cash dividend under the terms of the Company’s scrip dividend scheme.
The scrip dividend scheme allows investors the option to receive ordinary shares for every cash dividend entitlement where offered. Where the
scrip take-up exceeds 25% of the full year dividend in any given year, the Group's policy is to repurchase shares to reduce the dilutive effects to
a maximum of 25%. This policy is expected to be extended for the years to 31 March 2030 subject to shareholder approval at the Group’s 2026
Annual General Meeting. The scrip dividend take-up for the prior financial year was 9.7%, which was below the 25.0% required by the share
buyback programme, therefore no share buybacks occurred during the current year. In the year ended 31 March 2025 3.8m shares were
repurchased for total consideration of £71.7m (including stamp duty and commission).
An interim dividend of 21.4p per ordinary share (2025: 21.2p) was declared and paid on 30 January 2026 to those shareholders on the SSE plc
share register on 5 December 2025. Shareholders were able to elect to receive ordinary shares credited as fully paid instead of the interim cash
dividend under the terms of the Company’s scrip dividend scheme.
The proposed final dividend of 47 .3p per ordinary share based on the number of issued ordinary shares at 31 March 2026 is subject to approval
by shareholders at the Annual General Meeting and has not been included as a liability in these financial statements. Based on shares in issue at
31 March 2026, this would equate to a final dividend of £574.9m.
11.2 Basic and Adjusted Earnings Per Share
The calculation of basic earnings per ordinary share at 31 March 2026 is based on the net profit attributable to ordinary shareholders and a
weighted average number of ordinary shares outstanding during the year ended 31 March 2026.
Adjusted Earnings Per Share has been calculated by excluding the charge for deferred tax, retained Gas Production decommissioning costs, the
depreciation charged on fair value uplifts, the share of profit attributable to non-controlling interests and the impact of exceptional items and
certain re-measurements (note 7
).
2026
2026
2025
2025
EPS
1,208.7
105.5
1,189.4
108.2
shareholders
247.8
21.6
341.4
31.1
Basic excluding exceptional items and certain re-measurements
1,456.5
127.1
1,530.8
139.3
Decommissioning Gas Production
(12.6)
(1.1)
(17.9)
(1.6)
Depreciation charge on fair value uplifts
20.3
1.8
20.1
1.8
Deferred tax (note 10.1)
351.6
30.7
312.7
28.4
Deferred tax from share of joint ventures and associates
2.6
0.2
(36.1)
(3.2)
Deferred tax on non-controlling interest
(64.5)
(5.7)
(41.5)
(3.8)
Interest attributable to non-controlling interest holders, net of tax
4.6
0.5
4.8
0.4
Adjusted APM
1,758.5
153.5
1,772.9
161.3
* The comparatives have been restated. See note 1.2.
Reported earnings per share
2026
2026
2025
2025
Basic
1,208.7
105.5
1,189.4
108.2
Dilutive effect of outstanding share options
–
( 0 . 1 )
–
( 0 . 1 )
Diluted
1,208.7
105.4
1,189.4
108.1
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
11. Dividends and earnings per share continued
11.2 Basic and Adjusted Earnings Per Share continued
The weighted average number of shares used in each calculation is as follows:
For basic and Adjusted Earnings Per Share
1,145.4
1,099.2
Effect of exercise of share options
1.8
1.1
For diluted earnings per share
1,147.2
1,100.3
11.3 Dividend cover
The Group’s adjusted dividend cover metric is calculated by comparing Adjusted Earnings Per Share to the projected dividend per share payable
to ordinary shareholders.
Reported earnings per share
105.5
68.7
1.54
108.2
64.2
1.69
Adjusted Earnings Per Share APM (restated*)
153.5
68.7
2.23
161.3
64.2
2.51
* The comparatives have been restated. See note 1.2.
12. Acquisitions and disposals
12.1 Acquisitions
Current year acquisitions
There have been no significant acquisitions in the current year.
Prior year acquisitions
During the year ended 31 March 2025, the Group made small asset acquisitions (of special purpose vehicles as opposed to businesses) for cash
consideration of £17.1m.
12.2 Disposals
Current and prior year disposals
There have been no significant disposals in the current and prior year.
12.3 Held for sale assets and liabilities
During the year ended 31 March 2026, the Group commenced a process to divest its renewable platform in France and a solar development
asset in Greece. The Group has assessed that these divestments meet the held for sale IFRS 5 definition and accordingly the below associated
assets and liabilities are presented as held for sale:
Property, plant and equipment
34.1
Intangible assets
8.3
Inventories
0.4
Trade and other receivables
3.5
Total assets
46.3
Trade and other payables
(0.2)
Provisions
(1.3)
Loans and other borrowings
(1.5)
Total liabilities
(3.0)
Net assets
43.3
The aggregate pre-tax profit contribution of the held for sale businesses in the year to 31 March 2026 was a profit of £1.0m. There are no
accumulated gains or losses recognised in other comprehensive income related to assets and liabilities held for sale.
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13. Intangible assets
At 31 March 2024
1,130.6
982.2
990.6
1,370.1
4,473.5
Additions
–
603.7
307.1
134.7
1,045.5
Transfer (to)/from property plant and equipment (note 14)
–
–
(170.0)
3.1
(166.9)
Disposals/utilised
(0.5)
(965.6)
(22.1)
(25.6)
(1,013.8)
Exchange adjustments
(13.9)
(0.1)
(8.8)
2.2
(20.6)
At 31 March 2025
1,116.2
620.2
1,096.8
1,484.5
4,317.7
Additions
–
500.6
178.3
118.3
797.2
Transfer to property plant and equipment (note 14)
–
–
(59.6)
(8.9)
(68.5)
Disposals/utilised
–
(366.0)
(22.7)
(12.2)
(400.9)
Transfer to asset held for sale (note 12)
–
–
(10.2)
–
(10.2)
Exchange adjustments
11.2
–
6.9
1.6
19.7
At 31 March 2026
1,127.4
754.8
1,189.5
1,583.3
4,655.0
At 31 March 2024
(192.9)
(227.5)
(171.4)
(802.4)
(1,394.2)
Charge for the year
–
–
–
(89.8)
(89.8)
Disposals/utilised
–
–
–
21.3
21.3
Exceptional impairment charge
(195.2)
–
(74.8)
(3.8)
(273.8)
Non-exceptional impairment charge
–
–
(10.9)
(8.1)
(19.0)
Exchange adjustments
(0.4)
–
(0.3)
1.7
1.0
At 31 March 2025
(388.5)
(227.5)
(257.4)
(881.1)
(1,754.5)
Charge for the year
–
–
–
(113.6)
(113.6)
Disposals/utilised
–
–
–
1.9
1.9
Exceptional impairment charge
(i)
–
–
(4.2)
–
(4.2)
Non-exceptional impairment charge
(ii)
–
–
(6.3)
(3.0)
(9.3)
Transfer to asset held for sale (note 12)
–
–
1.9
–
1.9
Exchange adjustments
(0.8)
–
–
–
(0.8)
At 31 March 2026
(389.3)
(227.5)
(266.0)
(995.8)
(1,878.6)
At 31 March 2026
738.1
527.3
923.5
587.5
2,776.4
At 31 March 2025
727.7
392.7
839.4
603.4
2,563.2
At 1 April 2024
937.7
754.7
819.2
567.7
3,079.3
(i) The exceptional impairment charge recognised during the current year primarily relates to the impairment of assets associated with standalone hydrogen production development projects
in SSE Thermal.
(ii) The non-exceptional impairments in both years relate to assets where future development became uncertain or untenable in the year. The impairment of these items does not meet the
Group’s definition of an exceptional item, therefore they are included in the adjusted and reported results of the Group.
Intangible assets have been analysed as current and non-current as follows:
Current
527.3
392.7
Non-current
2,249.1
2,170.5
2,776.4
2,563.2
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
13. Intangible assets continued
(i) Goodwill
At inception, goodwill arising from business combinations is allocated to cash-generating units (CGUs) or groups of CGUs for impairment
testing purposes. Certain goodwill valuations have changed in the current year following retranslation. Commentary on the impairment testing
of the related CGUs, with the exception of two historic balances totalling £20.1m, is included in note 15
.
A summary of the goodwill allocated to CGUs and the Group’s operating segments is presented below:
CGU group
Operating Segment
Great Britain and Ireland wind farms
SSE Renewables
291.8
287.0
SSE Pacifico
1
SSE Renewables
182.9
187.3
SSE Southern Europe
2
SSE Renewables
243.3
233.3
Energy Solutions
3
Energy Customer Solutions
11.9
11.9
Ireland Supply
4
Energy Customer Solutions
8.2
8.2
738.1
727.7
1 Relates to the acquisition on 29 October 2021 of an 80% equity interest in the Group’s Japanese offshore wind development platform.
2 The SSE Southern Europe CGU relates to the acquisition on 1 September 2022 of the Group’s renewable platform in Spain, France, Greece and Italy.
3 Energy Solutions is the remaining goodwill that arose on the acquisition of The Energy Solutions Group Limited.
4 The value associated with the Ireland supply goodwill represents the difference between the fair value attributed to the Northern Ireland based Phoenix Energy business acquired in 2012 and
the book value of those assets.
(ii) Allowances and certificates
Allowances and certificates consist of purchased carbon emissions allowances and generated or purchased renewable obligations certificates
(“ROCs”). These allowances and certificates will be utilised in settlement of environmental obligations incurred by the Group’s SSE Thermal and
Energy Customer Solutions supply business and are therefore distinct from allowances and certificates held in excess of the Group’s
environmental obligations which are recorded within inventories.
(iii) Development assets
Development costs primarily relate to the design, construction and testing of Thermal, Renewable and Solar and Battery assets, which the
Group believes will generate probable future economic benefits. Costs capitalised as development intangibles include options over land rights,
planning application costs, environmental impact studies and other costs incurred in bringing wind farms and other development projects to
the consented stage. These may be costs incurred directly or at a cost as part of the fair value attribution on acquisition.
At the point the development reaches the consent stage and is approved for construction, the carrying value is transferred to property, plant
and equipment (note 14
). At the point a project is no longer expected to reach the consented stage, the carrying amount of the project is
impaired. During the year the Group has recognised exceptional impairment charges of £4.2m (2025: £74.8m) in relation to standalone
hydrogen production development projects in SSE Thermal (note 7
) and £6.3m (2025: £10.9m) of non-exceptional impairment charges
relating to projects that are not expected to reach the construction phase.
(iv) Software assets
Software assets include application software license fees, software development work, software upgrades and purchased PC software
packages. The Group also has a number of contracts for Software as a Service (“SaaS”) and Platform as a Service (“PaaS”) Cloud Computing
Arrangements which permit access to vendor-hosted software and platform services over the term of the arrangement. Where the Group does
not control the underlying assets in these arrangements, costs are expensed as incurred. The Group also incurs implementation costs in respect
of these contracts. Implementation costs are capitalised as intangible assets where costs meet the definition and recognition criteria of an
intangible asset under IAS 38 by being separable and controlled by the Group.
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14. Property, plant and equipment
assets
(i)
assets
(i)
At 31 March 2024
3,633.9
4,673.1
10,563.9
6,417.0
629.1
1,263.9
1,428.3
28,609.2
Additions
33.9
20.5
103.3
1.7
77.2
2,503.1
51.8
2,791.5
Adjustment to decommissioning asset
(12.8)
(2.5)
–
–
–
–
(3.6)
(18.9)
(note 13)
(ii)
–
–
–
–
–
1 7 0 . 0
( 3 . 1 )
1 6 6 . 9
Transfer from assets under
construction
(15.8)
103.2
579.9
1,243.7
16.6
(1,991.3)
63.7
–
Disposals
(iv)
(0.1)
–
(2.0)
–
(10.6)
(17.7)
(10.4)
(40.8)
Exchange rate adjustments
(10.5)
(18.4)
–
–
(1.6)
(6.3)
(0.3)
(37.1)
At 31 March 2025
3,628.6
4,775.9
11,245.1
7,662.4
710.7
1,921.7
1,526.4
31,470.8
Additions
6.0
3.0
–
–
33.7
3,877.2
63.6
3,983.5
Adjustment to decommissioning asset
3.4
7.5
–
–
–
–
13.0
23.9
(note 13)
(ii)
0.4
0.8
–
–
–
58.2
9.1
68.5
Transfer from assets under
construction
70.0
1,115.5
888.0
2,236.4
4.4
(4,381.4)
67.1
–
Transfer between categories
(39.3)
–
–
–
39.3
–
–
–
Disposals
(iv)
(4.4)
(2.3)
(0.5)
–
(11.9)
(2.8)
(36.9)
(58.8)
(note 12)
–
(33.6)
–
–
(1.5)
–
(1.3)
(36.4)
Exchange rate adjustments
23.0
37.5
–
–
1.6
13.5
–
75.6
At 31 March 2026
3,687.7
5,904.3
12,132.6
9,898.8
776.3
1,486.4
1,641.0
35,527.1
At 31 March 2024
(2,591.9)
(2,229.4)
(4,704.8)
(985.5)
(253.9)
(10.9)
(1,221.3)
(11,997.7)
Charge for the year
(85.0)
(175.6)
(188.3)
(135.3)
(18.0)
–
(63.4)
(665.6)
Transfer between categories
–
–
–
–
(0.2)
–
0.2
–
Exceptional impairment charges
(iii)
–
–
–
–
–
–
( 7 . 2 )
( 7 . 2 )
Non-exceptional impairment charges
–
–
–
–
(0.1)
(0.4)
(1.2)
(1.7)
Disposals
–
–
0.2
–
0.5
–
9.0
9.7
Exchange rate adjustments
3.9
10.6
0.1
–
(0.2)
–
1.4
15.8
At 31 March 2025
(2,673.0)
(2,394.4)
(4,892.8)
(1,120.8)
(271.9)
(11.3)
(1,282.5)
(12,646.7)
Charge for the year
(77.6)
(191.4)
(210.5)
(168.5)
(24.5)
–
(80.5)
(753.0)
Exceptional impairment charges and
reversals
(iii)
–
–
–
–
–
( 1 5 5 . 8 )
4 8 . 5
( 1 0 7 . 3 )
Non-exceptional impairment charges
(3.4)
–
–
–
1.5
(1.8)
0.3
(3.4)
Disposals
(iv)
4.4
1.2
–
–
5.5
2.8
21.5
35.4
(note 12)
–
1.6
–
–
–
–
0.7
2.3
Exchange rate adjustments
(11.0)
(20.3)
–
–
(0.4)
–
(0.4)
(32.1)
At 31 March 2026
(2,760.6)
(2,603.3)
(5,103.3)
(1,289.3)
(289.8)
(166.1)
(1,292.4)
(13,504.8)
At 31 March 2026
927.1
3,301.0
7,029.3
8,609.5
486.5
1,320.3
348.6
22,022.3
At 31 March 2025
955.6
2,381.5
6,352.3
6,541.6
438.8
1,910.4
243.9
18,824.1
At 1 April 2024
1,042.0
2,443.7
5,859.1
5,431.5
375.2
1,253.0
207.0
16,611.5
(i) Renewable and Thermal power generation assets includes plant and machinery and related land and buildings and decommissioning costs with a net book value of £139.2m and £59.2m
(2025: £137.3m and £58.7m) respectively. Additionally, Other assets includes £62.5m in relation to decommissioning costs for Gas Storage assets (2025: £49.5m).
(ii) Represents the carrying value of development assets transferred from intangible assets (note 13) which have reached the consent stage and have been approved for construction and the
reclassification of certain software assets to intangible assets.
(iii) Exceptional impairment charges of £107.3m relate to Strathy South (£96.0m) and Aberarder (£59.8m), offset by an impairment reversal of £48.5m relating to the Group’s Gas Storage assets
(note 15).
(iv) Disposals in the current year primarily relate to surplus buildings and vehicles.
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
14. Property, plant and equipment continued
Included within property, plant and equipment are the following right of use assets for leased assets:
At 31 March 2024
369.6
282.4
151.4
803.4
Additions
–
76.8
49.9
126.7
Disposals
–
(11.6)
(9.2)
(20.8)
Exchange rate adjustments
–
(0.8)
(0.5)
(1.3)
At 31 March 2025
369.6
346.8
191.6
908.0
Additions
–
3 3 . 3
6 0 . 0
9 3 . 3
–
(3.5)
(40.4)
(43.9)
–
(1.5)
–
(1.5)
–
1 . 7
–
1 . 7
369.6
376.8
211.2
957.6
At 31 March 2024
(264.0)
(54.0)
(63.2)
(381.2)
Charge for the year
(18.4)
(16.1)
(31.2)
(65.7)
Disposals
–
0.8
7.1
7.9
At 31 March 2025
(282.4)
(69.3)
(87.3)
(439.0)
(18.6)
(20.3)
(43.7)
(82.6)
–
1.7
27.8
29.5
(301.0)
(87.9)
(103.2)
(492.1)
68.6
288.9
108.0
465.5
At 31 March 2025
87.2
277.5
104.3
469.0
At 1 April 2024
105.6
228.4
88.2
422.2
15. Impairment testing
Goodwill and intangible assets that are not amortised are reviewed at least annually for impairment. Property, plant and equipment, investments
and other intangibles are assessed annually for triggers of impairment (or impairment reversal).
The Group’s accounting policies for impairment testing are described at Accompanying Information sections A1.2
.
The key operating and valuation assumptions, specific considerations and outcome of tests for all impairment reviews are noted in the
following sections. The discount rates used are pre-tax real, except where noted, and reflect specific risks attributable to the relevant
assets subject to impairment review. The recoverable amounts derived from the value in use (‘VIU’) or fair value less costs to sell (‘FVLCS’)
calculations are compared to the carrying amount of each asset or cash generating unit (‘CGU’) to determine whether an impairment charge
(or reversal) is required to be recognised. The reviews carried out for the 2026 financial statements were carried out in the fourth quarter of the
year, which is consistent with previous reviews. Note that the actual outcomes may differ from the assumptions included in the assessments at
the balance sheet date.
15.1 Goodwill impairment reviews – CGUs testing
The Group has three goodwill balances within its SSE Renewables business (GB and Ireland, SSE Southern Europe and SSE Pacifico) that
are subject to annual goodwill impairment reviews. Legacy goodwill balances within the Energy Customers Solutions segment are also subject
to annual impairment review but are not included in the disclosure on the basis of materiality. The recoverable amounts of the CGUs supporting
the goodwill balances are determined by reference to either VIU or FVLCS calculations, as noted below. The VIU calculations use, as a starting
point, pre-tax cash flow projections based on the Group’s ten-year Corporate Model as approved by the Board. The Group’s Corporate Model
is based on past experience and reflects the Group’s forward view of markets, prices, risks and its strategic objectives. Commodity prices used
are based on observable market data and, where this is not available, internal estimates. The FVLCS methodology also uses a present value
technique, unless there is a quoted price in an active market for that asset. The methodology is based on the post-tax cash flows arising from
the specific assets, underlying assets or CGUs, and discounted using a post-tax discount rate determined in the same manner as the rates used
in the VIU calculations, adjusted for the relevant taxation rate.
182
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assumption
Operating and other valuation assumptions
Commentary and impairment conclusions
Impairment conclusion
The recoverable value of the Southern Europe
wind farm CGU has been calculated at £469.0m
(2025: £351.2m), which is greater than the carrying
value of the goodwill and intangible development
£169.4m of tangible generation and intangible assets, therefore no impairment charge has been
development assets (2025: £192.7m). The FVLCS
assessment is based on the discounted post-tax
cash flows, which are presented on a similar
basis to the acquisition model updated to reflect
changes to specific project circumstances and
wider market developments.
In the prior year the Group recognised an
exceptional impairment of £249.5m on its Southern
Europe development portfolio between goodwill
(£174.7m) and development assets (£74.8m).
During the current financial year, the Group has
progressed development and construction of a
number of projects, primarily in Spain and Italy.
While development has continued in Spain, the
prospects of the specific development projects
impaired in the prior year have not significantly
improved in the current year and have not been
reversed. The impairment of goodwill recognised
in the prior year is ineligible for reversal.
The Group has assessed that its French portfolio
and the Mesouvouni solar asset in Greece have
met the relevant criteria to be classified as held for
sale as at 31 March 2026 (see note 12.3
). The
assets have been written down to the lower of cost
or net realisable value, which has resulted in a non-
exceptional impairment of £1.9m to Mesouvouni.
The Southern Europe CGU model includes
cashflows for two operational wind farms and
over 50 early-stage development assets, being
headroom would increase to £95.2m. A 5
% decrease
individual wind farm and co-located solar projects
been assigned a probability of success. While there
across Spain, France, Italy and Greece that have
are other projects in the portfolio, these have not
been assigned a probability of success and have
been excluded from the valuation.
Cashflows for the CGU are based on the expected
average annual generation output for each project,
valued using forward power price projections. These
factors are subject to management review on an
annual basis. The prices applied to projected outputs
are based on observable market information during
the period, or management projections for available
contracts in the PPA market. Assumptions have
also been made on government support for the
development of wind projects and expected
governmental support under CFD subsidies.
Cash outflows are based on planned and expected
maintenance profiles and other capital or
replacement costs.
The cash flow projections are based on European
power prices between €23 – €272 per MWh (2025:
€35 – €173 per MWh) and have been discounted
applying a post-tax nominal discount rate between
7.2% and 8.1% (2025: post-tax nominal discount
rate between 7.1% and 8.0%) based on technology
and market risks.
183
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
15. Impairment testing continued
15.1 Goodwill impairment reviews – CGUs testing continued
assumption
Operating and other valuation assumptions
Commentary and impairment conclusions
price; generation volumes; operating cost estimates;
184
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assumption
Operating and other valuation assumptions
Commentary and impairment conclusions
185
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
15. Impairment testing continued
15.2 Property, plant and equipment, other intangibles and investment impairment reviews – asset testing
Where an indicator of impairment exists, the recoverable amounts of the Group’s property, plant and equipment, other intangible assets and
interests in joint ventures and associates are determined by reference to VIU or, where appropriate, FVLCS calculations. The calculations use,
as their starting point, pre-tax cash flow projections based on the Group’s ten-year Corporate Model as approved by the Board. The Group’s
Corporate Model is based on experience and reflects the Group’s forward view of markets, prices, risks and its strategic objectives. Commodity
prices used are based on observable market data and, where this is not available, on internal estimates. FVLCS valuations are derived from
market analysis for similar transactions, adjusted to specific circumstances of the Group’s investment to reflect the amount the Group believes
will be recoverable in a sale transaction. Note that the Group will expense any individual asset, investment or development asset, should it
clearly be damaged, obsolete or economically impaired, as part of its normal course of business.
Assets identified for review
The specific assets and investments identified for impairment reviews in the prior year (being the Great Island CCGT; Gas Storage facilities at
Aldbrough and Atwick; 50% joint venture investment in Triton Power; and 50% joint venture investment in Neos Networks) all remained subject
to impairment testing at 31 March 2026 as they displayed indicators of impairment, or impairment reversal, as set out below. In addition, Strathy
South and Aberarder wind farms and the Group’s investments in the Dogger Bank joint venture were identified as displaying indicators of
impairment and have been tested for impairment in the current year.
While the Group’s GB CCGTs were tested for impairment in the prior year, all historic impairments related to these assets are fully reversed and
significant headroom existed on all assets in the prior year impairment test. No further indicators of impairment were identified in the current
year, therefore no detailed impairment test was performed for these assets.
assumption
Operating and other valuation assumptions
Commentary and impairment conclusions
Bank wind farms is production volumes
projected by
186
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assumption
Operating and other valuation assumptions
Commentary and impairment conclusions
187
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
15. Impairment testing continued
15.2 Property, plant and equipment, other intangibles and investment impairment reviews – asset testing continued
assumption
Operating and other valuation assumptions
Commentary and impairment conclusions
188
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assumption
Operating and other valuation assumptions
Commentary and impairment conclusions
losses arising from the investment (see note 16
).
189
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
16. Investments
16.1 Joint Ventures and associates
2026
2025
At 1 April
1,987.3
1,510.3
3,497.6
1,963.2
1,352.9
3,316.1
Additions
60.8
243.6
304.4
153.4
280.0
433.4
Repayment of shareholder loans
–
(94.5)
(94.5)
–
(121.7)
(121.7)
Dividends received
(184.1)
–
(184.1)
(200.6)
–
(200.6)
Share of profit after tax
(i)
88.0
–
88.0
91.6
–
91.6
Share of other comprehensive income
(50.8)
–
(50.8)
(0.9)
–
(0.9)
Disposals
(4.6)
–
(4.6)
–
–
–
Transfer – loans to equity
25.5
(25.5)
–
–
–
–
Transfers – other investments
–
–
–
(4.6)
–
(4.6)
Impairments
(ii)
21.3
(15.6)
5.7
–
–
–
guarantees
(iii)
(2.3)
–
(2.3)
(12.1)
–
(12.1)
Exchange rate adjustments
4.0
2.9
6.9
(2.7)
(0.9)
(3.6)
At 31 March
1,945.1
1,621.2
3,566.3
1,987.3
1,510.3
3,497.6
(i) The Group recognised losses of £1.3m from its joint venture investment Neos Networks Limited in the year ended 31 March 2026. While the Group’s total share of losses totalled £30.9m for
the 12 months ended 31 March 2026, only £1.3m was recognised as this reduced the equity investment to £nil. For 31 March 2025 of the £91.6m share of profit, only £89.9m was recognised
through the income statement, as £1.7m related to profits earning from SSE Group companies where the cost were capitalised and the related profit eliminated on consolidation.
(ii) The net impairment credit for the year ended 31 March 2026 of £5.7m is comprised of an exceptional impairment reversal of £29.4m relating to Triton Power Holdings Limited (see note
15.2), offset by an exceptional impairment charge of £17.6m relating to the Group’s joint venture investments in hydrogen development projects (see note 7.1) and non-exceptional expected
credit loss impairment charges of £6.1m.
(iii) The investment decrease in respect of financial guarantees relates to £3.1m (2025: £12.5m) of unwind and expiry of guarantee contracts, less £0.8m (2025: £0.4m) for the fair value of fees
receivable on guarantees granted to joint venture investments during the year.
16.2 Additions and disposals of equity in the current year
Additions and disposals in the year
During the year the Group provided equity and loans to its existing joint venture investments of £60.8m and £243.6m respectively, primarily in
relation to Seagreen Holdco 1 Limited and Doggerbank Offshore Wind Farm Project 1 Holdco Limited.
During the year ended 31 March 2026 the Group completed the acquisition of a further 50% equity interest in Lenalea Wind Farm DAC
(“Lenalea”) from FuturEnergy Ireland Development Holdings DAC for cash consideration of €26.0m, therefore recognising Lenalea as a
100% subsidiary and disposing of its joint venture investment.
16.3 Additions and disposals of equity in the previous year
Additions in the previous year
On 10 September 2024 the Group sold a 50% equity share in SSE DE EV Hold Co Limited to form the 50:50 Source EV joint venture with
TotalEnergies Marketing UK Limited for cash consideration of £16.5m. Following the completion of the transaction, both shareholders provided
the joint venture with £5.1m of shareholder loans and £10.0m of equity funding.
During the year ended 31 March 2025 the Group provided equity and loans to its existing joint venture investments of £129.4m and £274.9m
respectively, primarily in relation to Seagreen Holdco 1 Limited and Doggerbank Offshore Wind Farm Project 1 Holdco Limited.
There were no significant disposals in the previous year.
190
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16.4 Principal joint ventures and associates
Under IFRS 12 “Disclosure of Interests in Other Entities”, the Group has evaluated the key joint ventures and associates it holds with the purpose
of disclosing any which are materially significant in order to identify the impact on the Group’s financial position, performance and cash flows,
whilst identifying the nature of the risks associated with these interests. A full listing of the Group’s incorporated joint ventures, joint operations,
associates and investments are included in the Accompanying Information (A3
).
Share of results of joint ventures and associates
2026
2026
2026
2026
2025
Other
(i)
Revenue
456.9
392.3
25.3
874.5
940.9
Other income
108.7
–
–
108.7
109.7
Depreciation and amortisation
(137.0)
(34.8)
(1.2)
(173.0)
(226.0)
Other operating costs
(149.3)
(321.4)
(28.5)
(499.2)
(540.3)
Operating profit
279.3
36.1
(4.4)
311.0
284.3
Interest expense
(143.5)
(10.9)
(1.3)
(155.7)
(164.3)
Changes in fair value of derivatives
(23.6)
2.1
0.1
(21.4)
(28.1)
Corporation tax
(38.3)
(8.8)
1.2
(45.9)
(2.0)
Share of post taxation results
73.9
18.5
(4.4)
88.0
89.9
Cashflow hedges
(46.7)
–
–
(46.7)
(22.3)
Taxation
11.7
–
–
11.7
5.6
Other
–
–
(15.8)
(15.8)
15.8
Total comprehensive income
38.9
18.5
(20.2)
37.2
89.0
Share of joint ventures and associates’ assets and liabilities
2026
2026
2026
2026
2025
Other
(i)
Non-current assets
6,413.5
456.6
313.9
7,184.0
7,263.9
Current assets
731.4
127.0
18.0
876.4
297.9
Cash and cash equivalents
210.2
51.3
12.6
274.1
329.2
Current liabilities
(521.1)
(113.3)
(73.3)
(707.7)
(389.2)
Non-current liabilities
(5,738.8)
(229.6)
(201.3)
(6,169.7)
(6,007.5)
1,095.2
292.0
69.9
1,457.1
1,494.3
Other adjustments
456.1
31.6
0.3
488.0
493.0
Share of net assets of joint ventures and associates
1,551.3
323.6
70.2
1,945.1
1,987.3
Shareholder loans
1,351.0
172.5
97.7
1,621.2
1,510.3
Interest in joint venture and associate
2,902.3
496.1
167.9
3,566.3
3,497.6
(i) Other comprises the investments the Group holds in Neos Networks Limited, Source EV Limited, Corran Environmental LP and Marron Activ8 Energies Limited.
Information on Group’s investments in joint ventures and associates is provided at A3, A4 and A5 .
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
16. Investments continued
16.5 Joint operations
Listed are the incorporated joint operations that have a material impact on the financial position and financial results of the Group.
Greater Gabbard Offshore Winds Limited
Offshore Wind farm
UK
Ordinary
50.0
50.0
31 March
Eastern Green Link 2 Limited
Power Transmission
UK
Ordinary
50.0
37.5
31 March
The Group’s interest in Greater Gabbard Offshore Winds Limited is that of a joint operation designed to provide output to the parties sharing
control. The liabilities of the arrangement are principally met by the parties through the contracts for the output of the wind farm.
Eastern Green Link 2 Limited is a joint operation between Scottish Hydro Electric Transmission plc and National Grid Electricity Transmission plc
to install a 2GW subsea high-voltage connection.
The Group also has an unincorporated arrangement with Equinor under which it accounts for its 66.7% share of the Aldbrough gas storage
facility owned by SSE Hornsea Limited.
16.6 Other investments held at fair value through other comprehensive income
At 1 April
8.8
3.2
Additions in year
0.1
1.9
Disposals in year
(1.4)
(0.1)
Transfers from investments in joint ventures and associates
–
4.6
Fair value adjustment through other comprehensive income
0.1
(0.8)
At 31 March
7.6
8.8
17. Inventories
Fuel and consumables
168.6
170.9
Certificates and allowances
277.2
268.1
Gas held in storage
23.4
57.6
Less: provisions held
(35.0)
(33.7)
434.2
462.9
Where ROCs and Renewable Energy Guarantees of Origin (“REGOs”) certificates are self-generated or purchased to fulfil the Group’s
environmental obligations, they are recorded within intangible assets. The value of ROCs and REGOs held in excess of the Group’s
environmental obligations are recorded within inventories.
The Group has expensed inventories of £415.9m within cost of sales in the year (2025: £571.9m).
192
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18. Trade and other receivables
Loan note receivable and other non-current assets
232.0
199.9
Other prepayments and accrued income
372.0
247.8
604.0
447.7
Trade receivables
1,370.2
1,480.2
Unbilled energy income
547.2
521.1
Other receivables
148.1
56.2
Cash posted as collateral and other deposits
25.3
19.2
Other prepayments and accrued income
939.5
618.7
3,030.3
2,695.4
Total trade and other receivables
3,634.3
3,143.1
* The comparatives have been restated. See note 1.2.
The non-current loan note receivable and other non-current assets primarily consists of a £220.0m (2025: £193.5m) loan note payable by Ovo
Group Limited by 2029. The loan note carries interest of 13.25% and is presented cumulative of accrued interest repayments, discounted at
13.25%. On 11 May 2026, subsequent to the balance sheet date, E.On announced the acquisition of Ovo’s Retail business, subject to regulatory
approval. Completion of the acquisition would result in the principal and accumulated interest becoming repayable in full. While considered a
non-adjusting post balance sheet event in terms of classification, the Group has considered the transaction as part of its recoverability
assessment. No changes to the recoverable value were made following announcement of the transaction.
Unbilled energy income represents an estimate of the value of electricity or gas supplied to customers between the date of the last meter
reading and the year end. Detail of the calculation applied to estimate this balance is included at note 4.1(iii)
. A 5% sensitivity on the unbilled
energy accrual would equate to an increase or decrease in the receivable balance of £13.1m (2025: £14.6m).
Cash posted as collateral includes amounts deposited on commodity trading exchanges of £13.0m (2025: £9.6m).
Trade receivables and other financial assets are part of the Group’s financial exposure to credit risk as explained in accompanying information
note A6
.
19. Trade and other payables
Trade payables
898.7
710.7
Contract related liabilities
(i)
158.0
127.9
Cash held as collateral
271.3
82.5
Other creditors
398.8
441.6
Deferred income and other accruals
(ii)
1,560.1
1,345.5
3,286.9
2,708.2
Contract related liabilities
(i)
187.0
164.3
Deferred income, other creditors and accruals
(ii)
1,471.7
1,273.3
1,658.7
1,437.6
Total trade and other payables
4,945.6
4,145.8
* The comparatives have been restated. See note 1.2.
(i) Current contract related liabilities includes customer contributions of £19.3m (2025: £15.1m) and non-current contract related liabilities includes customer contributions of £187.0m
(2025: £164.3m).
(ii) Non-current other accruals includes government grants of £6.1m (2025: £5.6m).
Cash held as collateral relates to amounts received from commodity trading exchanges of £271.3m (2025: £82.5m).
193
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Financial StatementsGovernanceStrategic Report

Notes to the consolidated financial statements continued
for the year ended 31 March 2026
20. Provisions
At 31 March 2024
735.7
0.4
12.8
16.2
765.1
Charged in the year
–
2.4
6.5
10.9
19.8
Decrease in decommissioning provision
(25.5)
–
–
–
(25.5)
Unwind of discount
27.2
–
–
–
27.2
Released during the year
–
–
(3.5)
–
(3.5)
Utilised during the year
(17.6)
(0.4)
(0.4)
(5.3)
(23.7)
Exchange rate adjustments
(2.8)
–
–
–
(2.8)
At 31 March 2025
717.0
2.4
15.4
21.8
756.6
Charged in the year
–
2.6
1.0
19.2
22.8
Decrease in decommissioning provision
(3.9)
–
–
–
(3.9)
Unwind of discount
34.3
–
–
–
34.3
Released during the year
–
(2.4)
(0.4)
(1.0)
(3.8)
Utilised during the year
(14.6)
–
(12.6)
(9.6)
(36.8)
Transfer to assets held for sale (note 12)
(1.3)
–
–
–
(1.3)
Transfers
–
–
(1.5)
1.5
–
Exchange rate adjustments
3.6
–
–
–
3.6
At 31 March 2026
735.1
2.6
1.9
31.9
771.5
Non-current
690.8
–
1.7
19.4
711.9
Current
44.3
2.6
0.2
12.5
59.6
735.1
2.6
1.9
31.9
771.5
Non-current
656.3
–
8.9
10.9
676.1
Current
60.7
2.4
6.5
10.9
80.5
717.0
2.4
15.4
21.8
756.6
Decommissioning provisions
Provision has been made for the estimated net present value of decommissioning the Group’s Thermal and Renewable power generation
assets, Gas Storage facilities and the 60% share of decommissioning liabilities of the Group’s former Gas Production business. Cost estimates
are based on forecast remediation or clean-up costs based on current technology and prices for Renewable, Thermal and Gas Storage assets
and are reviewed by independent valuation experts every three years. In the intervening years, management update cost estimates based on
factors arising since the last formal valuation date. Retained decommissioning costs in relation to the disposed Gas Production business are
periodically agreed with the field operators. The cost estimates include a risk adjustment and are inflated to the projected decommissioning
date using a market observable inflation rate. This projection is discounted using a risk-free discount rate based on UK gilt rates with maturity
date similar to the expected decommissioning date.
There is a wide range of assumed decommissioning dates across the obligation due to the number of assets and their varying ages, which is
summarised in the table below. Decommissioning dates are based on the useful economic lives of the individual assets based on technology
and price forecasts at the balance sheet date. It is possible that the forecast decommissioning dates will change due to technology advances or
decisions to repower wind farms when the current turbines reach the end of their respective lives. The date of decommissioning of the Gas
Production business can vary based on hydrocarbon reserve estimates and market commodity prices, which can shorten or lengthen the
economic life of the field.
Renewables
256.3
58
2026-2064
236.3
58
2026 – 2064
Thermal
158.9
19
2026-2050
165.0
17
2025 – 2050
Gas Storage
128.8
18
1
2026-2049
114.1
18
1
Gas Production
191.1
4
2
2026-2044
201.6
4
2
Total
735.1
717.0
1 The Group has two Gas Storage assets at Aldbrough and Atwick. In total there are 18 caverns with varying economic lives, therefore the number of sites has been disclosed to more
accurately reflect the scale and expected timing of decommissioning activities.
2 The Group has retained a 60% share of the decommissioning obligation for four Gas Production fields, though each field has multiple wells and shared infrastructure that the Group retains
an obligation to remediate.
194
SSE plc Annual Report 2026

The Group’s total decommissioning provision has increased during the year from £717.0m to £735.1m. This movement primarily reflects the
unwinding of the discount on the provision, which increases the carrying value over time as expected cash outflows move closer to settlement.
This increase was partially offset by utilisation of the provision during the year as decommissioning activities were undertaken. In addition,
updated assumptions on the expected scope and cost of future decommissioning activities impacted the provision. Risk free discount rates
increased during the year 4.9%-5.5% (2025: 4.7%-5.2%) resulting in a reduction in the present value of the provision. In addition, the long term
inflation rate increased to 3.4% (2025: 3.2%), increasing the estimated nominal future cash flows.
Impact of climate change on the Group’s decommissioning provisions
The Group has assessed the impact of climate change on its decommissioning provisions. There is a physical risk that due to changes in
weather patterns, the projected costs in relation to decommissioning could increase. The decommissioning provision included in the table
above for these assets is based on a best estimate of the costs to be incurred at the balance sheet date. In the sensitivity analysis below, a
scenario has been included assuming costs will increase and this takes account of the physical climate change risk.
Sensitivity analysis
Sensitivity analysis reflecting reasonably probable fluctuations to the main assumptions used in the calculation of the decommissioning
provisions is set out below:
Increasing the projected cost estimate by 10%
808.5
775.3
Increasing the inflation rate by 1.0%
817.2
774.2
Decreasing the discount rate by 0.5%
772.5
736.4
Employee related provisions
Employee related provisions include the Group’s employer financed retirement benefit provision for certain directors and former directors and
employees, which is valued in accordance with IAS 19 using assumptions consistent with the Scottish Hydro Electric Pension Scheme (see
note 23
for assumptions applied).
The Group Operating Model and Efficiency Review is now largely complete with £4.7m of the provisions utilised in relation to redundancy costs.
Other provisions
Other provisions include onerous contract provisions, mutualisation obligations and other contractual obligations and are calculated based on a
best estimate basis. The timing of settlement of these provisions varies by obligation between 2026 and 2035.
21. Sources of finance
21.1 Capital management
The Group’s objective is to maintain a strong balance sheet and credit rating to support continued access to capital markets and fund its
investment programme, underpinning delivery of the Group’s strategy and long term value creation. The Group monitors its capital structure
using key financial metrics including, Adjusted Net Debt and Hybrid Capital together with credit metrics consistent with those used by external
rating agencies.
At 31 March 2026, the Group’s long term credit rating was BBB+ stable outlook for Standard and Poor’s; Baa1 stable outlook for Moody’s; and
BBB+ stable outlook with Fitch, which is now provided on a solicited basis.
The maintenance of a medium-term corporate model is a key control in monitoring the development of the Group’s capital structure and
enables detailed scenario and sensitivity analysis. Key ratios derived from this analysis underpin regular reporting to the Board and include the
ratios used by the rating agencies in assessing the Group’s credit ratings.
The Group’s debt requirements are principally met through bond issuances in Sterling and Euros, private placements and medium-term bank
loans. Details of debt issued by the Group and maturity profile are included in note 21.3
. The Group’s capital structure is supported by a range
of financial instruments, including bonds, private placements, hybrid capital, equity issuances and short-term funding through its commercial
paper programme. Under SSE plc’s articles of association, the borrowings of the Company are limited so as to ensure that the aggregate
amount of all borrowings by the Group outstanding at any time is not more than three times the capital and reserves of the Group. SSE’s
Adjusted Net Debt and Hybrid Capital remained stable at £10.1bn at 31 March 2026 (2025: £10.1bn (restated – see note 1.2
)).
The Group seeks to balance returns to shareholders through dividends and long-term capital investment for growth, while maintaining a
disciplined approach to capital management within the prevailing economic environment.
On 14 November 2025 the Group issued 97.9m ordinary shares at a placement price of £20.50 per share, resulting in net proceeds of £1,978.4m
(see note 22.1
).
195
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Financial StatementsGovernanceStrategic Report

Notes to the consolidated financial statements continued
for the year ended 31 March 2026
21. Sources of finance continued
21.1 Capital management continued
At 31 March, the Group’s capital is comprised of:
Total borrowings (excluding lease obligations)
9,664.5
10,149.4
Less: Cash and cash equivalents
(1,542.9)
(1,090.5)
Net debt (excluding Hybrid equity)
8,121.6
9,058.9
Hybrid equity
2,985.8
1,882.4
Borrowings and cash attributable to non-controlling interests
(1,258.4)
(937.9)
Cash held and posted as collateral and other deposits
(i)
246.0
63.3
Adjusted Net Debt and Hybrid Capital APM
10,095.0
10,066.7
Equity attributable to shareholders of the parent
12,663.9
10,181.6
Total capital excluding lease obligations
22,758.9
20,248.3
* The comparatives have been restated. See note 1.2.
(i) At 31 March 2026 collateral and other deposits were a net liability of £246.0m (2025: £63.3m net liability) consisting of net collateral liabilities of £258.3m (2025: £72.9m net liability) and
other deposits with a maturity of more than three months of £12.3m (2025: £9.6m). The collateral movement in the current year is due to cash withdrawals from trading exchanges
following increases in the variation margin on “in the money” positions.
Adjusted Net Debt and Hybrid Capital is stated after removing lease obligations, external net debt attributable to non-controlling interests and
cash held and posted as collateral and other deposits with a maturity of more than three months in line with the Group’s presentation basis
which is explained at note 3.1
. The adjustment related to the non-controlling interest share of Scottish Hydro Electric Transmission plc
external net debt and related SSE plc external debt is £1,258.4m at 31 March 2026 (2025: £937.9m restated) and relates to 25% of external loans
of £5,073.7m (2025: £3,758.8m restated) net of cash and cash equivalents of £40.2m (2025: £7.3m). This adjustment was increased from
£817.9m to £937.9m at 31 March 2025, reflecting the change of definition referred to at note 3.1
.
21.2 Loans and other borrowings
Short term loans
1,124.6
1,895.5
Lease obligations
79.8
68.5
1,204.4
1,964.0
Loans
8,539.9
8,253.9
Lease obligations
376.9
386.5
8,916.8
8,640.4
Total loans and borrowings
10,121.2
10,604.4
Cash and cash equivalents
(1,542.9)
(1,090.5)
Unadjusted net debt
8,578.3
9,513.9
Hybrid equity
2,985.8
1,882.4
Borrowings and cash attributable to non-controlling interest holders
(1,258.4)
(937.9)
Lease obligations
(456.7)
(455.0)
Cash held and (posted) as collateral and other deposits
246.0
63.3
Adjusted Net Debt and Hybrid Capital APM
10,095.0
10,066.7
* The comparatives have been restated. See note 1.2.
196
SSE plc Annual Report 2026

21.3 Borrowing facilities
The Group maintains a diversified portfolio of funding sources, including committed bank facilities, bond issuances, a €1.5bn commercial paper
programme and private placements to support its liquidity requirements and investment programme. At 31 March 2026, £501.2m of the Group’s
€1.5bn commercial paper programme was outstanding (2025: £890.5m).
At 31 March 2026, the Group had access to a total of £5.0bn of committed facilities (2025: £3.0bn), comprising revolving credit facilities and
other committed arrangements. During the year, Scottish Hydro Electric Transmission plc agreed £2.0bn of new ECA and National Wealth Fund
guaranteed facilities. As at 31 March 2026 there were no drawings on the revolving credit facilities (2025: Scottish Hydro Electric Transmission
plc utilisation £340m and SSE plc utilisation £nil) or the new ECA and National Wealth Fund facilities.
The committed facilities are in place to ensure the Group has sufficient liquidity headroom when making significant capital investment. The
£1.5bn revolving credit facility for SSE plc is in place to provide back-up to the commercial paper programme and support the Group’s capital
expenditure plans. The £3.5bn Scottish Hydro Electric Transmission plc facilities are in place to support the capital expenditure and working
capital during a period of significant capital growth for the business.
On 31 March 2026, SSE plc signed an additional commitment letter which allows SSE plc to enter a £1.5bn committed facility between 31 March
2026 and 30 June 2026.
The revolving credit facilities include sustainability-linked features which may or may not adjust the interest margin applicable. The rate of
interest is calculated annually, subject to fulfilling certain ESG KPIs and applied prospectively. At 31 March 2026, these features had no impact on
the carrying value of the borrowings.
Under the terms of its revolving credit and private placement borrowing facilities, the Group is subject to the following financial covenants:
– Interest Cover Ratio: The Group shall procure that the ratio of Operating Profit to Net Interest Payable for any relevant period is not less than
2.5 to 1.
– Net debt to Regulatory Asset Value: Scottish Hydro Electric Transmission plc shall procure that the consolidated net debt to Regulatory
Asset Value does not at any time exceed 0.80 to 1.00 as assessed by their financial statements.
The Group and Scottish Hydro Electric Transmission plc complied with all covenants throughout the year.
During the year to 31 March 2026, SSE plc issued a total of £1.6bn of new borrowings, including £1.1bn of dual-tranche equity accounted hybrid
bonds (see note 22.5
) and £0.5bn of commercial paper rolled at maturity. Scottish Hydro Electric Transmission plc issued a total of £1.1bn of
new external debt instruments across four issuances. A total of £2.2bn of instruments matured in the period, including £1.0bn of SSE plc
Eurobonds, £0.9bn of SSE plc commercial paper and £0.3bn of Scottish Hydro Electric Transmission plc debt instruments.
On 7 April 2026, subsequent to the balance sheet date, SSE plc issued a €400m (£346m) two-year floating rate note.
197
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Notes to the consolidated financial statements continued
for the year ended 31 March 2026
21. Sources of finance continued
21.3 Borrowing facilities continued
Analysis of borrowings
2026
2026
2026
2026
2025
2025
2025
2025
rate
(iv)
rate
(iv)
Bank loans – non amortising
(i)
2.2%
300.0
296.6
300.0
–
–
–
–
Other Short term loans – non amortising
(ii)
2.4%
502.2
503.7
501.2
5.0%
901.7
906.6
890.5
1.250% Eurobond repayable 16 April 2025
–
–
–
–
1.3%
531.4
531.2
531.4
0.875% €600m Eurobond repayable 8 September 2025
(v)
–
–
–
–
0.9%
502.6
499.2
502.4
US Private Placement 8 June 2026
3.1%
64.0
64.4
64.0
–
–
–
–
US Private Placement 6 September 2026
3.2%
247.1
259.0
246.9
–
–
–
–
Within one year
1,113.3
1,123.7
1,112.1
1,935.7
1,937.0
1,924.3
Fair value adjustment
(iii)
12.5
(28.8)
Total current borrowings
1,113.3
1,123.7
1,124.6
1,935.7
1,937.0
1,895.5
Bank loans – non amortising
(i)
4.6%
450.0
460.0
450.0
3.5%
500.0
493.1
500.0
Other loans – non amortising
(ii)
–
–
–
–
4.8%
340.0
340.0
340.0
US Private Placement 8 June 2026
–
–
–
–
3.1%
64.0
63.0
63.8
US Private Placement 6 September 2026
–
–
–
–
3.2%
247.1
258.9
246.2
US Private Placement 6 September 2027
3.2%
35.0
34.0
34.9
3.2%
35.0
33.3
34.8
1.375% €650m Eurobond repayable 4 September 2027
(v) (vi)
1.4%
591.4
576.0
591.1
1.4%
591.4
573.7
590.9
1.50% Eurobond repayable 24 March 2028
(v)
1.5%
250.0
234.0
249.7
1.5%
250.0
227.5
249.5
8.375% Eurobond repayable on 20 November 2028
8.4%
500.0
538.7
498.9
8.4%
500.0
554.3
498.5
2.875% Eurobond repayable 1 August 2029
(v)
2.9%
567.6
560.0
566.8
2.9%
544.5
539.3
543.3
1.750% Eurobond repayable 16 April 2030
(v)
1.8%
442.9
413.9
442.9
–
–
–
–
Between two and five years
2,836.9
2,816.6
2,834.3
3,072.0
3,083.1
3,067.0
1.750% Eurobond repayable 16 April 2030
(vii)
–
–
–
–
1.8%
442.9
413.9
442.9
5.50% Eurobond repayable on 7 June 2032
5.5%
350.0
351.8
350.1
5.5%
350.0
353.1
350.1
Private Placement 30 June 2032
3.1%
175.0
154.6
175.0
3.1%
175.0
152.1
175.0
2.25% Eurobond repayable 27 September 2035
(v)
2.3%
350.0
262.1
348.0
2.3%
350.0
252.4
347.8
2.125% Eurobond repayable 24 March 2036
(v)
2.1%
250.0
180.2
248.8
2.1%
250.0
175.4
248.7
4.625% Eurobond repayable on 20 February 2037
4.6%
325.0
289.6
324.4
4.6%
325.0
288.5
324.3
Private Placement 30 June 2037
3.2%
175.0
136.7
175.0
3.2%
175.0
135.5
175.0
6.25% Eurobond repayable on 27 August 2038
6.3%
350.0
350.5
348.0
6.3%
350.0
350.7
347.9
4.454% Index linked loan repayable on 27 February 2044
4.5%
159.6
180.5
159.3
4.5%
164.7
186.4
164.3
1.429% Index linked bond repayable on 20 October 2056
1.4%
204.7
132.8
204.7
1.4%
195.5
134.3
195.5
4.00% €750m Eurobond repayable 5 September 2031
(v) (viii)
4.0%
655.0
664.5
653.7
4.0%
628.2
646.5
626.8
5.50% £500m Eurobond maturing 15 January 2044
(v)
5.5%
500.0
442.6
493.3
5.5%
500.0
448.3
493.0
3.375% €950m Eurobond repayable 4 September 2032
(v)(ix)
3.4%
802.0
782.7
800.5
3.4%
715.3
702.7
713.6
Private Placement 26 June 2034
4.7%
111.3
106.2
111.3
4.7%
111.3
107.8
111.3
Private Placement 19 July 2039
5.6%
30.0
28.4
30.0
5.6%
30.0
28.4
30.0
3.50% €600m Eurobond repayable 18 March 2032
(v)(x)
3.5%
524.0
516.2
521.4
3.5%
503.5
501.3
500.5
3.375% €750m Eurobond maturing 2 November 2033
(v)(xi)
3.4%
647.7
627.9
646.2
–
–
–
–
Private Placement 11 February 2036
5.0%
112.7
109.4
112.7
–
–
–
–
Over five years
5,722.0
5,316.7
5,702.4
5,266.4
4,877.3
5,246.7
Fair value adjustment
(iii)
3.2
(59.8)
Total non-current borrowings
8,558.9
8,133.3
8,539.9
8,338.4
7,960.4
8,253.9
Total borrowings
9,672.2
9,257.0
9,664.5
10,274.1
9,897.4
10,149.4
Note: The Sterling-equivalent fair value reflects the fair value of non-Sterling denominated borrowings, post the impact of the hedges noted below.
(i) Balances include term loans and EIB debt and is a mixture of fixed and floating rate debt.
(ii) Balances include Commercial Paper and facility advances (£501.2m of Commercial Paper). At 31 March 2026, Scottish Hydro Electric Transmission plc had no drawings under its £1.5bn
revolving credit facility (2025: £340.0m). The £340.0m drawn at 31 March 2025 was classified as non-current within debt maturing in two to five years in accordance with IAS 1 paragraph
75A. The debt was repaid in April 2025, subsequent to the balance sheet date.
(iii) The fair value adjustment relates to the change in the carrying amount of the borrowings as a result of fair value hedges that are in place. The movement in the fair value adjustment is
recognised in the income statement with a corresponding movement on the hedging instrument also being recognised in the income statement.
(iv) The weighted average interest rates (including the effect of interest rate swaps) for the year ended 31 March 2026 was 3.79% (2025: 3.85%).
(v) Bonds have been issued under the Group’s Sustainability Financing Framework (previously the Group’s Green Bond Framework).
(vi) The 1.375% €650m Eurobond maturing 4 September 2027 has been swapped to Sterling giving an effective interest rate of 2.56%.
(vii) The 1.750% €500m Eurobond maturing 16 April 2030 has been swapped to Sterling giving an effective interest rate of 2.89%.
(viii) The 4.0% €750m Eurobond maturing 5 September 2031 has been left in Euros as a net investment hedge for the Group’s Euro denominated subsidiaries.
(ix) The 3.375% €950m Eurobond maturing 4 September 2032 has been swapped to Sterling giving an effective interest rate of 4.91%.
(x) The 3.50% €600m Eurobond maturing 18 March 2032 has predominantly been left in Euros as a net investment hedge for the Group’s Euro denominated subsidiaries.
(xi) The 3.375% €750m Eurobond maturin
g
2 November 2033 has been swapped to Sterlin
g
g
ivin
g
an effective interest rate of 5.20%.
198
SSE plc Annual Report 2026

Lease liabilities
Amounts charged under lease arrangements are detailed within note 6
, and right of use assets recognised under lease arrangements are
detailed within note 14
.
At 1 April
455.0
407.5
Additions during the year
74.9
139.8
Disposals during the year
(8.9)
(12.3)
Unwind of discount
24.1
26.9
Repayment in the year
(86.9)
(106.9)
Transferred to liabilities held for sale
(1.5)
–
At 31 March
456.7
455.0
The weighted average incremental borrowing rate applied to lease liabilities during the year was 5.12% (2025: 4.95%). Incremental borrowing
rates applied to individual lease additions in the year ranged between 3.75% to 7.34% (2025: 3.85% to 7.46%). The Group has additional
committed payments under short term and low value leases at 31 March 2026 of £14.0m (2025: £14.3m).
The maturity of future lease liabilities are as follows:
Within one year
86.8
75.2
Between one and five years
223.2
233.5
After five years
390.1
403.2
700.1
711.9
Less: future finance charge
(243.4)
(256.9)
Present value of lease obligations
456.7
455.0
21.4 Reconciliation of net increase in cash and cash equivalents to movement in Adjusted Net Debt and Hybrid Capital
Increase in cash and cash equivalents
452.4
54.6
New borrowing proceeds
(1,595.3)
(2,592.2)
New Hybrid equity proceeds
(1,103.4)
–
Repayment of borrowings
2,294.2
1,055.3
Non-cash movement on borrowings
(214.0)
113.7
Increase in borrowings and cash attributable to non-controlling interest holders
320.5
252.7
(Increase)/decrease in cash held and posted as collateral and other deposits
(182.7)
289.9
Increase in Adjusted Net Debt and Hybrid Capital APM
(28.3)
(826.0)
* The comparatives have been restated. See note 1.2.
Cash held and posted as collateral refers to amounts received and deposited on commodity trading exchanges which are reported within
“Trade and other payables” and “Trade and other receivables” respectively on the face of the balance sheet, as well as other deposits with a
maturity of more than 3 months.
199
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Financial StatementsGovernanceStrategic Report

Notes to the consolidated financial statements continued
for the year ended 31 March 2026
21. Sources of finance continued
21.5 Reconciliation of movements in financing liabilities
Financing cash flows
Non-cash movements
Bank loans
500.0
250.0
–
–
–
–
–
(300.0)
–
450.0
Private placement
852.2
112.7
–
–
(9.5)
–
–
(310.0)
0.1
645.5
Fixed rate Eurobonds
6,201.9
734.4
–
–
72.5
70.3
–
–
1.4
7,080.5
Index linked loans
359.8
–
(11.2)
–
–
–
–
–
15.3
363.9
amortising
340.0
–
(340.0)
–
–
–
–
–
–
–
Total long term borrowings
8,253.9
1,097.1
(351.2)
–
63.0
70.3
–
(610.0)
16.8
8,539.9
Bank loans
–
–
–
–
–
–
–
300.0
–
300.0
Fixed rate Eurobonds
1,005.0
–
(1,052.5)
–
28.8
18.6
–
–
0.1
–
non amortising
890.5
498.2
(890.5)
–
–
3.0
–
–
–
501.2
US private placement
–
–
–
–
12.5
–
–
310.0
0.9
323.4
Total short term borrowings
1,895.5
498.2
(1,943.0)
–
41.3
21.6
–
610.0
1.0
1,124.6
10,149.4
1,595.3
(2,294.2)
–
104.3
91.9
–
–
17.8
9,664.5
Lease liabilities
455.0
–
–
(86.9)
–
–
88.6
–
–
456.7
Total loans and borrowings
10,604.4
1,595.3
(2,294.2)
(86.9)
104.3
91.9
88.6
–
17.8
10,121.2
term borrowings
48.2
–
–
–
(122.1)
–
–
–
–
(73.9)
10,652.6
1,595.3
(2,294.2)
(86.9)
(17.8)
91.9
88.6
–
17.8
10,047.3
Financing cash flows
Non-cash movements
Bank loans
499.9
–
–
–
–
–
–
–
0.1
500.0
Private placement
770.2
141.3
–
–
(60.2)
–
–
–
0.9
852.2
Fixed rate Eurobonds
6,059.7
1,220.4
–
–
(4.8)
(25.7)
–
(1,043.6)
(4.1)
6,201.9
Index linked loans
357.8
–
(10.8)
–
–
–
–
–
12.8
359.8
Other loans – non amortising
–
340.0
–
–
–
–
–
–
–
340.0
Total long term borrowings
7,687.6
1,701.7
(10.8)
–
(65.0)
(25.7)
–
(1,043.6)
9.7
8,253.9
Fixed rate Eurobonds
–
–
–
–
(30.4)
(10.4)
–
1,043.6
2.2
1,005.0
amortising
840.4
890.5
(840.4)
–
–
–
–
–
–
890.5
US private placement
198.2
–
(204.1)
–
5.9
–
–
–
–
–
Total short term borrowings
1,038.6
890.5
(1,044.5)
–
(24.5)
(10.4)
–
1,043.6
2.2
1,895.5
8,726.2
2,592.2
(1,055.3)
–
(89.5)
(36.1)
–
–
11.9
10,149.4
Lease liabilities
407.5
–
–
(106.9)
–
–
154.4
–
–
455.0
Total loans and borrowings
9,133.7
2,592.2
(1,055.3)
(106.9)
(89.5)
(36.1)
154.4
–
11.9
10,604.4
term borrowings
18.5
–
–
–
29.7
–
–
–
–
48.2
9,152.2
2,592.2
(1,055.3)
(106.9)
(59.8)
(36.1)
154.4
–
11.9
10,652.6
200
SSE plc Annual Report 2026

22. Equity
22.1 Share capital
2026
2025
(millions)
£m
At 1 April
1,111.2
555.6
1,096.2
548.1
Issue of shares
104.3
52.1
15.0
7.5
At 31 March
1,215.5
607.7
1,111.2
555.6
The Company has one class of ordinary share which carries no right to fixed income. The holders of ordinary shares are entitled to receive
dividends as declared and are entitled to one vote per share at meetings of the Company.
On 14 November 2025 the Group issued 97.9m ordinary shares at a placement price of £20.50 per share, resulting in gross proceeds of
£2,007.3m. Transaction costs, which were directly attributable to the issuance, have been deducted from share premium in line with IAS 32 and
therefore the Group recognised net proceeds of £1,978.4m from this share issuance.
Shareholders were able to elect to receive ordinary shares in place of the final dividend of 43.0p per ordinary share (in relation to year ended
31 March 2025) and the interim dividend of 21.4p (in relation to the current year) under the terms of the Company’s scrip dividend scheme. This
resulted in the issue of 1.4m and 5.0m new fully paid ordinary shares respectively (2025: 12.2m and 2.8m). In addition, the Company issued 1.4m
(2025: 1.7m) shares during the year to satisfy awards to employees under certain employee share schemes (all of which were settled by shares
held in Treasury) for a consideration of £17.4m (2025: £17.8m).
The scrip dividend take-up for the prior financial year was 9.7%, which was below the 25.0% required by the share buyback programme,
therefore no share buybacks occurred during the current year. In the year ended 31 March 2025 3.8m shares were repurchased for total
consideration of £71.7m (including stamp duty and commission).
Of the 1,215.5m shares in issue, 3.3m are held as treasury shares. These shares will be held by SSE plc and used to satisfy awards to employees
under certain employee share schemes.
During the year, on behalf of the Company, the employee share trust purchased 1.0m shares for a total consideration of £25.4m (2025: 0.8m
shares, consideration of £14.1m) to be held in trust for the benefit of employee share schemes. At 31 March 2026, the trust held 6.1m shares
(2025: 6.7m) which had a market value of £159.5m (2025: £107.1m).
22.2 Capital redemption reserve
The capital redemption reserve comprises the value of shares redeemed or purchased and cancelled by the Company from distributable profits.
22.3 Hedge reserve
The hedge reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedge derivative instruments
related to hedged transactions that have not yet occurred.
22.4 Translation reserve
Comprises exchange translation differences on foreign currency net investments offset by exchange translation differences on borrowings and
derivatives classified as net investment hedges under IAS 39.
22.5 Hybrid Equity
GBP 600m 3.74% perpetual subordinated capital securities
(i)
598.0
598.0
EUR 500m 3.125% perpetual subordinated capital securities
(i)
453.0
453.0
EUR 1,000m 4.00% perpetual subordinated capital securities
(ii)
831.4
831.4
EUR 800m 4.00% perpetual subordinated capital securities
(iii)
678.9
–
EUR 500m 4.50% perpetual subordinated capital securities
(iii)
424.5
–
2,985.8
1,882.4
(i) 2 July 2020 £600m and €500m Hybrid Capital Bonds
The hybrid capital bonds issued in July 2020 have no fixed redemption date, but the Company may, at its sole discretion, redeem all but not
part of the capital securities at their principal amount. The date for the first potential discretionary redemption of the £600m hybrid bond is
14 April 2026 and then every 5 years thereafter. The date for the first potential discretionary redemption of the €500m hybrid capital bond is
14 July 2027 and then every 5 years thereafter. For the £600m hybrid the discretionary coupon payments are made annually on 14 April and for
the €500m hybrid the coupon payments are made annually on 14 July.
(ii) 12 April 2022 €1,000m Hybrid Capital Bonds
The hybrid capital bond issued in April 2022 has no fixed redemption date, but the Company may, at its sole discretion, redeem all but not part
of the capital securities at their principal amount. The date for the first potential discretionary redemption is 21 April 2028 and then every 5 years
thereafter. The discretionary hybrid coupon payments are made annually on 22 April.
201
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
22. Equity continued
22.5 Hybrid Equity continued
(iii) 12 June 2025 €800m and €500m Hybrid Capital Bonds
The hybrid capital bonds issued in June 2025 have no fixed redemption dates, but the Company may, at its sole discretion, redeem all but
not part of the capital securities at their principal amount. The date for the first potential redemption for the €800m hybrid capital bond is
19 September 2030, and for the €500m bond is 19 June 2033, then every five years thereafter. The discretionary hybrid coupon payments
are made annually on 19 September and 19 June respectively.
Coupon payments
In relation to the £600m hybrid equity bond a discretionary coupon payment of £22.4m (2025: £22.4m) was made on 14 April 2025, for the
€500m hybrid equity bond a discretionary coupon payment of £16.5m (2025: £16.5m) was made on 14 July 2025 and for the €1bn hybrid
equity bond a discretionary payment of £34.0m was paid on 22 April 2025 (2025: £34.8m). The first discretionary coupon payment on the new
hybrid equity bonds will occur on 19 June 2026 for the €500m hybrid equity bond and 19 September 2026 for the €800m hybrid equity bond.
The coupon payments in the year to 31 March 2026 consequently totalled £72.9m (2025: £73.7m).
The Company has the option to defer coupon payments on the bonds on any relevant payment date, as long as a dividend on the ordinary
shares has not been declared. Deferred coupons shall be satisfied only on redemption; or on a dividend payment on ordinary shares, both of
which occur at the sole option of the Company. Interest will accrue on any deferred coupon.
22.6 Equity attributable to non-controlling interests
This relates to equity attributable to non-wholly owned but controlled subsidiaries which are consolidated within the financial statements of the
Group. At 31 March 2026 the amount attributable to non-controlling interests is £751.6m (2025: £628.8m), which relates to Scottish Hydro
Electric Transmission of £713.4m (2025: £589.6m) and SSE Pacifico £38.2m (2025: £39.2m). The profit attributable to non-controlling interests
for the year ended 31 March 2026 is £130.0m (2025: £69.8m), which relates to Scottish Hydro Electric Transmission £130.3m (2025: £70.6m)
and SSE Pacifico £0.3m loss (2025: £0.8m loss).
Details regarding Scottish Hydro Electric Transmission’s principal activity and country of incorporation are included in A3
.
Scottish Hydro Electric Transmission’s summary financial information is as follows:
Non-current assets
9,052.1
6,936.2
Current assets
636.0
210.0
Current liabilities
(1,737.3)
(399.8)
Non-current liabilities
(5,129.3)
(4,424.2)
2,821.5
2,322.2
Revenue
1,210.3
807.0
Operating profit
770.3
435.5
Net finance costs
(47.0)
(60.3)
Profit before taxation
723.3
375.2
Taxation
(201.1)
(110.8)
Profit for the year after taxation
522.2
264.4
The summary financial information provided above is presented without Group eliminations, including £1.0bn (2025: £480.0m) of internal loans,
consolidation and re-measurement adjustments, and deferred taxation, which have been eliminated to calculate the non-controlling interest
for adjusted profit.
Profit for the year after taxation
522.2
264.4
Consolidation adjustments
(19.5)
(0.8)
Re-measurement movement on financing derivatives
(7.4)
–
Deferred taxation
258.0
165.4
753.3
429.0
Adjusted net profit attributable to 25% non-controlling interest
188.3
107.3
In addition to the net profit after tax attributable to the Scottish Hydro Electric Transmission non-controlling interest holders of £188.3m (2025:
£107.3m) shown above, the Group’s APM also reflects £0.3m of a loss (2025: £0.8m loss) attributable to the SSE Pacifico non-controlling
interest holders.
* The comparatives have been restated. See note 1.2.
202
SSE plc Annual Report 2026

23. Retirement benefit obligations
The Group has two funded final salary pension schemes which provide defined benefits based on final pensionable pay. The schemes are
subject to independent valuations at least every three years. The future benefit obligations are valued by actuarial methods based on an
appropriate assessment of the relevant parameters.
The Group provides pension benefits to most UK colleagues through SSE Pensions+, a defined contribution master trust agreement with Aviva.
The Group generally matches employee contributions up to 6%, and provides additional contributions of 3% after two years and a further 3%
after ten years continuous Group service. The Group also operates other pension arrangements, including a defined contribution master trust
agreement with Zurich in the Republic of Ireland and an Unfunded Unapproved Retirement Benefit Scheme.
The Group presents its pension scheme valuations under two different measurement bases, a formal actuarial valuation and an IAS 19 valuation
as required by accounting standards. The IAS 19 valuation is used to determine the assets and obligations recognised in the Group’s consolidated
balance sheet and is calculated annually by scheme actuaries, whereas the formal actuarial valuation is used to determine the contributions the
Group makes to each scheme. The actuarial valuation is recalculated for each scheme every three years.
Actuarial valuations
The individual pension scheme details based on the latest formal actuarial valuations are as follows:
Scottish Hydro Electric
SSE Southern
Latest formal actuarial valuation
31 March 2024
31 March 2025
Valuation carried out by
Hymans Robertson
Aon
Value of assets based on valuation
£1,376.3m
£1,525.4m
Value of liabilities based on valuation
£1,146.1m
£1,524.3m
Valuation method adopted
Projected Unit
Projected Unit
Average salary increase
RPI+0.25%
RPI+0.25%
Average pension increase
RPI
RPI
Value of fund assets/accrued benefits
120.1%
100.1%
Future contributions
Scottish Hydro Electric Pension Scheme
The last triennial actuarial valuation of the scheme was carried out at 31 March 2024 and showed a surplus of £230.2m on a projected unit
basis. Following this valuation, the Group agreed to a new schedule of contributions which does not require contributions to be paid to the
scheme, unless there is a sustained deficit for two successive quarters on the trustees’ long term funding basis. Consequently, the Group has
not made contributions to the scheme in the year ending 31 March 2026 and does not expect to make any contributions during the year ended
31 March 2027. The next triennial funding valuation will be carried out as at 31 March 2027.
SSE Southern Group of the Electricity Supply Pension Scheme
The last triennial actuarial valuation of the scheme was carried out at 31 March 2025 and showed a surplus of £1.1m on a projected unit basis.
Following this valuation, the Group agreed to a new schedule of contributions which provides for contributions to be paid in respect of current
accrual and expenses only. The next funding valuation will be carried out as at 31 March 2028. Total contributions of approximately £7.7m are
expected to be paid by the Group during the year ending on 31 March 2027, which includes the final deficit payment made under the previous
recovery plan of £1.3m in April 2026.
During the year ending 31 March 2026, the Group paid deficit contributions of £16.0m (2025: £15.5m).
Pension summary as measured under IAS 19:
of comprehensive income
Net pension asset
Scottish Hydro Electric
Defined benefit
(2.1)
7.7
364.3
353.7
SSE Southern
Defined benefit
(78.6)
45.1
95.5
148.1
(80.7)
52.8
459.8
501.8
203
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Financial StatementsGovernanceStrategic Report

Notes to the consolidated financial statements continued
for the year ended 31 March 2026
23. Retirement benefit obligations continued
IFRIC 14 surplus restrictions
As a result of the Group and the trustees to the Scottish Hydro Electric Pension Scheme agreeing in 2016/17 to an amendment to the scheme
rules to clarify that the Company has a clear right to any surplus upon final winding up of the scheme, there are no restrictions on recognition
of the scheme surplus. The net pension asset of the Scottish Hydro Electric Scheme at 31 March 2026 was £364.3m (2025: £353.7m).
At 31 March 2026, the SSE Southern Pension Scheme has a net surplus of £95.5m (2025: £148.1m), and unrecognised future contributions of
£7.7m (2025: £32.0m). The Group has assessed that it has the right to recognise the current and any future surpluses on the scheme, therefore
has not recognised a liability for future unrecoverable contributions.
Other matters
In July 2024 the Court of Appeal upheld the 16 June 2023 High Court ruling in respect of Virgin Media v NTL Pension Trustees II Limited (and
others) calling into question the validity of rule amendments made to defined benefit pension schemes contracted-out on a Reference Scheme
Test basis between 6 April 1997 and 5 April 2016. Relevant amendments to these pension schemes over this time required confirmation from
the Scheme Actuary that the Reference Scheme Test would continue to be met. In the absence of such a confirmation, the Rule amendment
would be void.
In May 2026, the UK Government introduced legislation as part of the Pension Schemes Act 2026 to enable pension schemes to retrospectively
obtain written actuarial confirmation that historic benefit changes met the necessary standards. Any subsequent developments are being
monitored by the Group and the pension scheme trustees. The defined benefit obligation for the Group’s schemes has been calculated on the
basis of the pension benefits currently being administered.
23.1 Pension scheme assumptions
Both schemes have been updated to 31 March 2026 by qualified independent actuaries. The valuations have been prepared for the purposes of
meeting the requirements of IAS 19. The major assumptions used by the actuaries in both schemes were:
Rate of increase in pensionable salaries
3.5%
3.3%
Rate of increase in pension payments
3.3%
3.0%
Discount rate
6.2%
5.8%
Inflation rate
3.3%
3.0%
The assumptions relating to longevity underlying the pension liabilities at 31 March 2026 are based on standard actuarial mortality tables, and
include an allowance for future improvements in longevity. The assumptions, equivalent to future longevity for members in normal health at
age 65, are as follows:
Scottish Hydro Electric
At 31 March 2026
At 31 March 2025
Male
Female
Male
Female
Currently aged 65
22
24
22
24
Currently aged 45
23
26
24
26
SSE Southern
At 31 March 2026
At 31 March 2025
Male
Female
Male
Female
Currently aged 65
23
25
22
25
Currently aged 45
24
26
24
25
204
SSE plc Annual Report 2026

23.2 Sensitivity analysis
The impact on the schemes’ liabilities of changing certain of the major assumptions is as follows:
Scottish Hydro Electric
At 31 March 2026
At 31 March 2025
Rate of increase in pensionable salaries
0.1%
+/– 0.1%
0.1%
+/– 0.1%
Rate of increase in pension payments
0.1%
+/– 0.6%
0.1%
+/– 0.6%
Discount rate
0.1%
+/– 0.6%
0.1%
+/– 0.6%
Longevity
1 year
+/– 1.9%
1 year
+/– 1.9%
SSE Southern
At 31 March 2026
At 31 March 2025
Rate of increase in pensionable salaries
0.1%
+/– 0.1%
0.1%
+/– 0.1%
Rate of increase in pension payments
0.1%
+/– 1.1%
0.1%
+/– 1.2%
Discount rate
0.1%
+/– 1.1%
0.1%
+/– 1.2%
Longevity
1 year
+/– 3.2%
1 year
+/– 3.0%
23.3 Valuation of combined pension schemes
Equities
148.7
–
148.7
173.2
–
173.2
Government bonds
998.3
–
998.3
1,180.6
–
1,180.6
Insurance contracts
(i)
–
4 3 2 . 4
4 3 2 . 4
–
454.4
454.4
Other investments
1,138.5
–
1,138.5
942.1
–
942.1
Total fair value of plan assets
2,285.5
432.4
2,717.9
2,295.9
454.4
2,750.3
Present value of defined benefit obligation
(2,258.1)
(2,248.5)
Surplus in the schemes
459.8
501.8
Deferred tax thereon
(ii)
(115.0)
(125.5)
Net pension asset
344.8
376.3
(i) See details of valuations of insurance contracts in note 23.7(ii).
(ii) Deferred tax rate of 25% (2025: 25%) applied to net pension surplus position.
205
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
23. Retirement benefit obligations continued
23.4 Movements in the combined defined benefit assets and obligations during the year
2026
2025
At 1 April
2,750.3
(2,248.5)
501.8
3,015.2
(2,593.6)
421.6
Current service cost
–
(14.4)
(14.4)
–
(15.0)
(15.0)
Past service cost
–
(1.4)
(1.4)
–
( 4 . 7 )
( 4 . 7 )
Interest income/(cost)
154.0
(124.6)
29.4
141.3
(120.6)
20.7
154.0
(140.4)
13.6
141.3
(140.3)
1.0
Demographic assumptions
–
(11.2)
(11.2)
–
20.9
20.9
Financial assumptions
–
46.5
46.5
–
288.5
288.5
Experience assumptions
–
(82.2)
(82.2)
–
1 . 9
1 . 9
Return on plan assets excluding interest income
(33.8)
–
(33.8)
(258.5)
–
(258.5)
(33.8)
(46.9)
(80.7)
(258.5)
311.3
52.8
Other
Contributions paid by the employer
26.5
–
26.5
26.4
–
26.4
Scheme participant’s contributions
0.1
(0.1)
–
0.1
(0.1)
–
Benefits paid
(179.2)
177.8
(1.4)
(174.2)
174.2
–
(152.6)
177.7
25.1
(147.7)
174.1
26.4
Balance at 31 March
2,717.9
(2,258.1)
459.8
2,750.3
(2,248.5)
501.8
23.5 Pension scheme contributions and costs
Charges/(credits) recognised:
Service costs (charged to operating profit)
15.8
19.7
Interest from pension scheme assets
(154.0)
(141.3)
Interest on pension scheme liabilities
124.6
120.6
(29.4)
(20.7)
The return on pension scheme assets is as follows:
Return/(loss) on pension scheme assets
120.2
(117.2)
Defined contribution scheme
The total contribution paid by the Group to defined contribution pension schemes was £116.7m (2025: £98.8m).
Unfunded Unapproved Retirement Benefit Scheme (“UURBS”) pension costs
The decrease during the year ended 31 March 2026 in relation to UURBS was £7.2m (2025: decrease of £3.6m). This is included in Employee
related provisions (note 20
).
Staff costs analysis
The pension costs in note 8
can be analysed as follows:
Service costs
15.8
19.7
Defined contribution scheme payments
116.7
98.8
132.5
118.5
206
SSE plc Annual Report 2026

23.6 Pension scheme risk assessment and mitigation
Risks to which the Pension Schemes exposes the Group
The nature of the Group’s defined benefit pension schemes expose the Group to the risk of paying unanticipated additional contributions to the
schemes in times of adverse experience. The most financially significant risks are likely to be:
(i) Asset volatility
The liabilities are calculated using a discount rate set with reference to corporate bond yields; if assets underperform this yield, this will create a
deficit. The schemes hold a proportion of growth assets (equities and property) which, though expected to outperform corporate bonds in the
long term, create volatility and risk in the short term. The allocation to growth assets is monitored to ensure it remains appropriate given the
schemes’ long term objectives. The Scottish Hydro Electric Pension Scheme has a much lower proportion of growth assets than the SSE
Southern Pension Scheme reflecting the maturity of each scheme.
(ii) Changes in bond yields
A decrease in corporate bond yields will increase the value placed on the schemes’ liabilities for accounting purposes. However, this will be
partially offset by an increase in the value of the schemes’ bond holdings and its interest rate hedging in both schemes.
(iii) Inflation risk
The majority of the schemes’ benefit obligations are linked to inflation, and higher inflation will lead to higher liabilities (although, in most cases,
caps on the level of inflationary increases are in place to protect against extreme inflation). However, this will be substantially offset by the
inflation hedging in both schemes.
(iv) Life expectancy
The majority of the schemes’ obligations are to provide benefits for the life of the members, so an increase in the life expectancy will result in an
increase in the liabilities. The sensitivity analysis disclosed is intended to provide an indication of the impact on the value of the schemes’
liabilities of the risks highlighted.
(v) Liability versus asset risk
The risk that movement in the value of the schemes’ liabilities are not met by corresponding movements in the value of the schemes’ assets will
expose the Group to movements in the overall funding surplus.
23.7 Risk mitigation
(i) De-risking
The trustees have taken a number of steps to control the level of investment risk including reducing the Schemes’ exposures to higher risk
assets and increasing the level of protection against adverse movements in interest rates and inflation. The trustees of both schemes continue
to review the risk exposures in light of the longer term objectives of the respective schemes, including consideration of the impact of climate-
related risk. Detailed below are further details on the hedging of pensioner longevity risk.
(ii) Asset buy-in
The Scottish Hydro Electric Pension Scheme entered into two asset buy-in insurance policies in 2018 and 2019 which covered all pensions in
payment prior to 1 October 2019. These asset buy-ins are valued under the accounting principles of IFRS 13 and are considered a Level 3
instrument in the fair value hierarchy. The Group has now insured against volatility in obligations related to all pensioners who retired before
1 October 2019 to third parties (insurer PIC) and is now only exposed to valuation fluctuations related to active and deferred members and any
members who retired after 1 October 2019.
(iii) Asset-liability matching strategies used by the Scheme
The Group and trustees of the schemes have agreed a long term investment strategy that seeks to reduce investment risk as and when
appropriate. The asset-liability matching strategy is part of this approach which aims to reduce the volatility of the funding level of the pension
schemes by investing in assets which perform in line with the liabilities of the schemes so as to protect against inflation being higher than
expected. This has been adopted for a proportion of the schemes’ assets, which is designed to provide partial protection against adverse
movements in interest rates and inflation. The trustees of the respective schemes review the schemes’ asset allocation on an ongoing basis in
light of changes in the funding position and market opportunities.
23.8 Risk assessment
(i) Maturity profile of the defined benefit obligations
The weighted average duration of the defined benefit obligation is 11 years (2025: 12 years) for the Scottish Hydro Electric Pension Scheme and
12 years (2025: 12 years) for the SSE Southern Pension Scheme.
(ii) Information about the defined benefit obligations
Status of members is weighted by the liabilities of each scheme
Active members
17
11
Deferred members
12
7
Pensioners
71
82
100
100
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Notes to the consolidated financial statements continued
for the year ended 31 March 2026
23. Retirement benefit obligations continued
23.9 Pension scheme policies
(i) Recognition of gains and losses
The Group recognises actuarial gains and losses in the statement of other comprehensive income following the re-measurement of the net
defined benefit liabilities of the schemes.
(ii) Methods and assumptions used in preparing the sensitivity analyses
The sensitivities disclosed are calculated using approximate methods taking into account the duration of the schemes’ liabilities. While these
have been calculated consistently with the previous financial year, the method applied may change over time with financial conditions and
assumptions.
(iii) Asset recognition
The Group has recognised net pension assets in relation to the Scottish Hydro Electric and SSE Southern pension schemes due to a surplus
existing under IAS 19 accounting. The Group will only recognise a surplus should it have rights to that surplus under the rules of the pension
scheme. The Group no longer applies the “asset ceiling” restriction mandated by IFRIC 14. Details on this key accounting consideration are
provided above.
(iv) Fair value assessment of scheme assets
The Group seeks to assess whether there is a quotable market value (referenced as “quotable” above) in relation to pension scheme assets held.
This assessment is based on regular reviews conducted in conjunction with the trustees of the schemes. For assets where no quotable market
value exists, these assets will be valued based on a set methodology agreed by trustees and scheme advisors and then regularly assessed.
Currently only one unquotable value exists within the two pension schemes of the Group, this being qualifying insurance contracts (or “buy-in”)
held by the Scottish Hydro Electric Pension Scheme. These assets are currently valued consistently with the scheme’s liabilities with the
expected return on these assets being set equal to the discount rate.
24. Financial instruments
For financial reporting purposes, the Group has classified derivative financial instruments into two categories, operating derivatives and
financing derivatives. Operating derivatives include all qualifying commodity contracts including those for power, gas, and carbon and the post-
day 1 fair value movements on non-government backed contracts for difference in SSE Renewables. Financing derivatives include all fair value
and cash flow interest rate hedges, non-hedge accounted (mark-to-market) interest rate derivatives, cash flow foreign exchange hedges and
non-hedge accounted foreign exchange contracts. Non-hedge accounted contracts are treated as held for trading.
The Group provides guarantees in respect of certain activities of former subsidiaries and to certain current joint venture investments.
As permitted by IFRS 17 “Insurance Contracts”, the Group elected to apply the valuation principles of IFRS 9 to these contracts.
24.1 Financial instruments – income statement
Total result on operating derivatives
(i)
(24.5)
92.9
Less: amounts settled
(ii)
(127.5)
(141.9)
Movement in unrealised derivatives
(152.0)
(49.0)
Total result on financing derivatives
(i)
(113.2)
63.6
Less: amounts settled
(ii)
131.1
(50.8)
Movement in unrealised derivatives
17.9
12.8
Total result on financial guarantee liabilities
(iii)
1.7
1.9
Net income statement impact
(132.4)
(34.3)
(i) Total result on derivatives in the income statement represents the total amounts credited (or charged) to the income statement in respect of operating and financial derivatives, and is shown
as certain re-measurements in note 7.
(ii) Amounts settled in the year represent the result on derivatives transacted which have matured or been delivered and have been included within the total result on derivatives, and is shown
as certain re-measurements in note 7.
(iii) Total result on financial guarantee liabilities in the income statement represents the total amounts credited or (charged) to the income statement in respect of the unwind of the financial
liabilities and recognition of new or expiring contracts.
The movement in unrealised operating derivative excludes a £2.2m gain (2025: £11.1m loss) on proprietary trades, which has been recognised in
the underlying profit of the Group.
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24.2 Financial instruments – balance sheet
The derivative financial assets/(liabilities) are represented as follows:
Non-current
193.9
63.5
Current
651.4
178.4
Total derivative assets
845.3
241.9
Non-current
(289.2)
(167.7)
Current
(641.1)
(126.3)
Total derivative liabilities
(930.3)
(294.0)
Net derivative liability
(85.0)
(52.1)
The financial guarantee liabilities are represented as follows:
Non-current
(19.0)
(23.1)
Current
(2.4)
(2.4)
Total guarantee liabilities
(21.4)
(25.5)
Information on the Group’s financial risk management and the fair value of financial instruments is available at A6 and A7 .
25. Commitments and contingencies
25.1 Capital commitments
Contracted for but not provided
7,627.5
4,438.3
Contracted for but not provided capital commitments include the fixed contracted costs of the Group’s major capital projects. In practice
contractual variations may arise on the final settlement of these contractual costs. The increase from the prior year relates primarily to
Transmission projects.
25.2 Contingent liabilities
Contingent liabilities for the Group solely relate to SSE plc, and have been disclosed within note 13 to the Company financial statements.
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Accompanying information
A1. Basis of consolidation and material
accounting policies
A1.1 Basis of consolidation
The financial statements consolidate the results of the Company and
its subsidiaries together with the Group’s share of the results and net
assets of its interests in joint arrangements and associates. Where
necessary to ensure consistency, the accounting policies of the
subsidiaries, joint arrangements or associates have been adjusted to
align to the accounting policies of the Group. Intra-Group balances
and any unrealised gains and losses or income and expenses arising
from Intra-Group transactions are eliminated in preparing the
consolidated financial statements. Unrealised gains and losses
arising from transactions with joint arrangements and associates are
eliminated to the extent of the Group’s interest in the entity. Non-
controlling interests represent the equity in subsidiaries that is not
attributable, either directly or indirectly, to SSE plc shareholders.
Subsidiaries (Accompanying Information A3)
Subsidiaries are those entities controlled by the Group or the
Company. Control exists when the Group has the power, directly or
indirectly, to govern the financial and operating policies of an entity in
order to obtain variable returns from its activities. In assessing control,
potential voting rights that are currently exercisable or convertible are
taken into account. The financial statements of subsidiaries acquired
are consolidated in the financial statements of the Group from the
date that control commences until the date control ceases.
Transactions with non-controlling interests that relate to their
ownership interests and do not result in a loss of control are
accounted for as equity transactions.
Interests in joint arrangements and associates (note 16 and
Accompanying Information A3)
Joint arrangements, as defined by IFRS 11 “Joint Arrangements”,
are those arrangements that convey to two or more parties “joint
control”. Joint control exists when decisions about the “relevant
activities”, being the financial, operational or strategic policies of the
arrangement, are made with the unanimous consent of the parties
sharing control. Whilst this assessment is principally focused on
any “reserved matters”, being the material activities that typically
require all significant shareholders to approve, other contractual
agreements such as Power Purchase Agreements and Management
Services Agreements are also considered. The Group’s investments
in joint arrangements are classified as either joint operations or joint
ventures depending on the investee’s legal form and the investor’s
contractual rights and obligations over the assets and liabilities of
the investee.
Associates are those investments over which the Group has
significant influence but neither control nor joint control.
The Group’s interests in its joint operations are accounted for by
recognising its share of the assets, liabilities, revenue and expenses of
the operation. The Group’s share of revenue from Greater Gabbard is
eliminated on consolidation due to the offtake agreement where the
Group purchases its share of the output from the arrangement.
The Group’s joint ventures and associates are accounted for using the
equity method of accounting where the joint venture and associate
net investments (comprising both equity and long term loans) are
carried at historical cost plus the Group’s share of post-acquisition
results, less any impairment in value. Where an impairment is
recognised against the carrying value of an investment, it is
recognised within the operating costs line of the consolidated
financial statements. For those investments that were formerly
subsidiaries of the Group, this will also include any fair value uplift
arising from loss of control. The Group recognises its share of the
results of these equity-accounted operations after tax and interest in
the income statement.
Foreign currencies
The consolidated financial statements are presented in pounds
Sterling, which is the functional currency of the parent. Each entity in
the Group determines its own functional currency and items included
in the financial statements of each entity are measured accordingly.
Transactions in foreign currencies are recorded at the rate ruling
at the date of the transaction. Monetary assets and liabilities
denominated in foreign currencies are translated at the rate of
exchange ruling at the balance sheet date. Any gain or loss arising on
the restatement of such items is taken to the income statement as a
finance cost, with the exception of exchange gains or losses on
foreign currency borrowings that provide a hedge against a net
investment in a foreign entity or exchange gains or losses incurred as
part of a qualifying cash flow hedge. These exchange gains or losses
are transferred to the translation reserve to the extent the hedge is
effective. Non-monetary assets that are measured in terms of
historical cost in a foreign currency are translated at the historic rate
at the date of transaction.
For the purpose of presenting the consolidated financial statements,
the assets and liabilities of the Group’s foreign operations are
translated into pounds Sterling at the balance sheet closing rate. The
results of these operations are translated at the average rate in the
relevant period. Exchange differences on retranslation of the opening
net assets and the results of foreign operations are transferred to the
translation reserve and are reported in the consolidated statement of
comprehensive income.
The average and spot rates for the principal functional currencies that
the Group’s foreign operations are denominated in are shown in the
table below.
2026
2025
Change
EUR v GBP
Year end
1.1451
1.1938
(4.1)%
1.1544
1.1946
(3.4)%
US$ v GBP
Year end
1.3216
1.2907
2.4%
1.3346
1.2915
3.3%
JPY v GBP
Year end
210.0740
193.4770
8.6%
211.7950
192.5154
10.0%
A1.2 Material accounting policies
Revenue (note 5)
Revenue from contracts with customers is recognised to the
extent that it reflects the expected consideration for goods or
services provided to the customer under contract, over the
performance obligations they are being provided. For each separable
performance obligation identified, the Group determines whether it is
satisfied at a “point in time” or “over time” based upon an evaluation
of the receipt and consumption of benefits, control of assets and
enforceable payment rights associated with that obligation. If the
criteria required for “over time” recognition are not met, the
performance obligation is deemed to be satisfied at a “point in time”.
Revenue principally arises as a result of the Group’s activities in
energy production, storage, transmission, distribution, supply and
related services in the energy markets in Great Britain and Ireland.
Where the Group earns income from an asset during the
commissioning period, the income is recognised in the income
statement as revenue in accordance with the relevant asset
accounting policy set out below. Once in operation, depreciation
will be charged over the expected useful life of the asset.
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The key policies applied by each Business Unit are as follows:
Transmission
Use of electricity transmission networks
Revenue from use of electricity transmission networks is derived from
the allowed revenue as defined by the parameters in the relevant
electricity transmission licence, which informs the tariffs set.
Electricity transmission revenue is determined in accordance with the
regulatory licence, based on an Ofgem approved revenue model and
is recognised “over time” as charged to National Grid. Where this
revenue differs from the allowed revenue, there may be an over- or
under-recovery of revenue which will be reflected in future financial
years’ allowed revenue as set out in the regulatory licence. No
accounting adjustments are made for over- or under-recoveries in
the year that they arise as they are contingent on future events (being
the transmission of electricity in a future period). The over or under
recovery adjustment is recognised in the subsequent period when
included within the tariffs that form allowed revenue under the
regulatory agreement.
Transmission network contracted services
Where the Group has an ongoing obligation to provide contracted
services (transmission network connections), revenues are recognised
“over time” consistent with the customer receiving and consuming
the benefits of that service across the expected contractual service
period. Any assets constructed in order to deliver the service are
capitalised and depreciated over their useful life. Payments are
typically received from customers in advance of providing the
contracted service and are deferred on balance sheet. No extended
warranty periods are offered.
Distribution
Use of electricity distribution networks
Revenue from use of electricity distribution networks is derived from
the allowed revenue as defined by the parameters in the relevant
electricity distribution licence, which informs the tariffs set.
Electricity distribution revenue is recognised based on the volume
of electricity distributed “over time”, as use of distribution service is
determined by the customer, and the set customer tariff. As with
electricity transmission revenue, any over- or under-recovery of
revenue is reflected in future financial years’ allowed revenue as set
out in the regulatory licence. No accounting adjustments are made
for over- or under-recoveries in the year that they arise as they are
contingent on future events (being the distribution of electricity in a
future period). The over or under recovery adjustment is recognised
in the subsequent period when included within the tariffs that form
allowed revenue under the regulatory agreement.
Distribution network contracted services
Where the Group has an ongoing obligation to provide contracted
services (such as for distribution network connections), revenues are
recognised “over time” consistent with the customer receiving and
consuming the benefits of that service across the expected
contractual service period. Any assets constructed in order to deliver
the service are capitalised and depreciated over their useful life.
Payments are typically received from customers in advance of
providing the contracted service and are deferred on balance sheet.
The release of deferred income on customer or third party funded
additions is removed from the Group’s Adjusted EBITDA measure.
No extended warranty periods are offered.
Renewables
Electricity generation
Revenue from the physical generation of electricity is recognised “point
in time” as generated and supplied to the national settlements body.
Revenue is measured at either the spot price at the time of delivery,
or trade price where that trade is eligible for “own use” designation.
Renewables contracted services
Revenue from national support schemes, such as Renewable
Obligation Certificates, is recognised at the point the performance
obligation has been met. This is typically considered to be either
at the point electricity has been physically generated or over the
contractual period, depending on the underlying performance
obligation. Revenue is measured either at the market rate at the point
of generation, or at the fixed contractual consideration, depending on
the individual scheme mechanic.
Revenue from other ancillary generation services is recognised “over
time” consistent with the customer receiving and consuming the
benefits of those services across the expected contractual service
period, and at the contracted consideration.
Thermal
Electricity generation
Revenue from the physical generation of electricity is recognised “point
in time” as generated and supplied to the national settlements body.
Revenue is measured at either the spot price at the time of delivery,
or trade price where that trade is eligible for “own use” designation.
Gas storage
Revenue from gas storage trading activities is recognised “point in
time” as injected back into the gas network. Revenue is measured at
the spot price at the time of delivery.
Thermal Generation contracted services
Revenue from national support schemes, such as the Capacity Market
mechanism, is recognised at the point the performance obligation
has been met. This is typically considered to be either at the point
electricity has been physically generated or over the contractual
period, depending on the underlying performance obligation.
Revenue is measured either at the market rate at the point of
generation, or at the fixed contractual consideration, depending on
the individual scheme mechanic.
Revenue from other ancillary generation services is recognised “over
time” consistent with the customer receiving and consuming the
benefits of those services across the expected contractual service
period, and at the contracted consideration.
Customers
Supply of energy
Revenue on the supply of energy comprises sales to domestic (in
Ireland) and business end-user customers (in GB and Ireland) is based
on actual energy consumption including an estimate of the value of
electricity and gas supplied to customers between the date of the last
meter reading and the year end. Revenue is recognised “over time”
consistent with the delivery of energy to the customer as the receipt
and consumption of the benefits of the energy is considered to be
simultaneous. Revenue is measured based on the applicable customer
tariff rate and after deduction of any applicable contractual discounts.
Details of the judgements involved in the estimation process for the
value of electricity and gas supplied to GB Business customers is
given within note 4.1(iii)
.
Payments from customers may be received in advance of providing
the contracted service and are deferred on balance sheet. Amounts
received from customers in relation to energy management services
provided by Third Party Intermediaries (“TPIs”) are offset against
payments to those TPIs, reflecting the responsibility for providing the
energy management service.
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Accompanying information continued
A1. Basis of consolidation and material
accounting policies continued
A1.2 Material accounting policies continued
Energy related services
Where the Group has an ongoing obligation to provide contracted
energy related services, such as energy optimisation or maintenance
services, revenues are recognised “over time” consistent with the
customer receiving and consuming the benefits of that service across
the expected contractual service period at the fixed contracted rate.
Where the Group has an obligation to perform a specific service,
revenues are recognised “point in time”, following performance of the
service at the fixed contracted consideration. No extended warranty
periods are offered.
SSE Energy Markets
Commodity optimisation and other services
Income from sales commodity optimisation trading occurring in any
business unit is presented net in cost of sales alongside purchase
commodity optimisation trades. Revenue on physical power and gas
supplied is recognised “point in time” as delivered to the national
settlements body or third parties. Revenue is measured at either the
spot price at the time of delivery, or trade price where that trade is
eligible for “own use” designation.
Revenue arising on commodities purchased in excess of the Group’s
requirements and recorded as inventory assets, such as Renewables
Obligation Certificates, REGOs or carbon allowances, is recognised
“point in time” on disposal of these inventory assets to third parties.
Revenue from other ancillary services is recognised “over time”
consistent with the customer receiving and consuming the benefits
of those services across the expected contractual service period, and
at the contracted consideration.
Aside from where specifically noted above, consideration is due
when the performance obligation has been satisfied. As the period
between satisfaction of the performance obligation and receipt of
consideration from the customer is expected to be less than a year,
the Group has applied the practical expedient not to adjust revenue
for the effect of any financing components.
Revenue from sources other than the Group’s contracts with
customers principally comprise meter rental income included within
Corporate unallocated, and Contract for Difference income.
Income on meter rental agreements, which are classified as operating
leases, are presented as revenue where they relate to the core
operating activities of that business. Lease payments are recognised
as income on a straight-line basis over the lease term.
Other operating income – Government Grants (note 6)
Contracts for Difference (“CfD”) are agreements between a low
carbon electricity generator and the Low Carbon Contracts Company
(“LCCC”), a UK Government owned entity responsible for delivering
support mechanisms for low-carbon electricity generation. These
agreements are not considered to be contracts with a customer, as
the LCCC does not receive any goods or services from the generator.
These arrangements are instead considered to be Government
Grants, with income arising from these grants recognised in the
income statement in the period in which generation takes place. In
the year, the Group recognised no income or expense (2025: none)
related to Contracts for Difference with the LCCC within its wholly
owned subsidiaries. The Group’s joint venture investment, Beatrice
Offshore Windfarm Limited, has a CfD with the LCCC which resulted
in payments from the LCCC of £250.7m in the year with SSE’s share
of £100.3m recognised within share of profit (2025: £245.7m, with
SSE’s share of £98.3m recognised within share of profit). The Group’s
wholly owned operational Viking wind farm and joint venture
investments Seagreen Wind Energy Limited, and Doggerbank A & B
also have a CfD arrangement in place with the LCCC. The LCCC
government agreements for Viking, Seagreen and Doggerbank are
not yet effective and as such no income or cost was recognised
during the year.
Where the CfD strike price falls below the spot price of generation
and payments are made to the LCCC, these payments are expensed
as incurred within operating costs. See “financial instruments” below
for the Group’s policy in relation to commercial Contracts
for Difference.
Presentation of grants related to assets
Income received from Government towards the capital cost of
an asset are deducted from the carrying value presented in the
financial statements.
Cost of sales (note 6)
Cost of sales includes fuel and energy purchases, direct employee
benefits, and depreciation of electricity generation property, plant
and equipment.
The net result from sales and purchases of commodity optimisation
trades – comprising both realised and unrealised gains and losses
arising from optimisation trading activities – is also presented within
cost of sales, reflecting the underlying economic purpose of this
trading activity.
Finance income and costs (note 9)
Interest income and costs are recognised in the income statement
as they accrue, on an effective interest method. The issue costs
and interest payable on bonds and all other interest payable and
receivable is reflected in the income statement on the same basis.
Interest on the funding attributable to major capital projects is
capitalised during the period of construction and depreciated as part
of the total cost over the useful life of the asset.
The accounting policy for foreign exchange translation of monetary
assets and liabilities is described on page 210
and for lease liability
charges on page 215
.
Taxation (note 10)
Taxation on the profit for the year comprises current and deferred tax.
Taxation is recognised in the income statement unless it relates to
items recognised directly in equity, in which case it is recognised in
other comprehensive income.
Current tax is the expected tax payable on the taxable income for
the year, using tax rates enacted or substantively enacted at the
balance sheet date, and any adjustment to tax payable in respect
of previous years.
Deferred tax is calculated using the balance sheet liability method,
providing for temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the amounts
used for taxation purposes. The following temporary differences are
not provided for: goodwill not deductible for tax purposes, the initial
recognition of assets or liabilities other than in business combinations
that affect neither accounting nor taxable profit, and differences
relating to investments in subsidiaries to the extent that they will
probably not reverse in the foreseeable future. The amount of
deferred tax provided is based on the expected manner of realisation
or settlement of the carrying amount of assets and liabilities, using tax
rates enacted or substantively enacted at the balance sheet date.
Deferred tax assets and liabilities are offset where there is a legally
enforceable right of offset within the same tax authority and where
the Group intends to either settle them on a net basis, or to realise
the asset and settle the liability simultaneously. A deferred tax asset is
recognised only to the extent that it is probable that future taxable
profits will be available against which the asset can be utilised.
Deferred tax assets are reduced to the extent that it is no longer
probable that the related tax benefit will be realised.
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The Electricity Generator Levy (“EGL”) is effective for periods from
1 January 2023 to 31 March 2028, and the Group has assessed that
the EGL has the characteristics of a levy rather than an income tax.
The Group therefore recognises the costs associated with the levy for
within cost of sales.
Business Combinations (note 12)
The acquisition of subsidiaries, and joint operations that meet the
definition of a business, is accounted for under the acquisition method
as defined by IFRS 3 “Business Combinations”.
The cost of acquisition is measured as being the aggregate fair value
of consideration to be transferred at the date control is obtained.
Goodwill is measured at the acquisition date as the fair value of
consideration transferred, plus non-controlling interests, less the net
recognised amount (which is generally fair value) of the identifiable
assets and liabilities assumed. Goodwill is subject to an annual review
for impairment (or more frequently if necessary) in accordance with
the Group’s impairment accounting policy.
Contingent consideration is classified as a liability and subsequently
re-measured through the income statement. Acquisition costs are
expensed as incurred.
Changes in ownership that do not result in a change of control are
accounted for as equity transactions.
Held for sale assets and liabilities and discontinued operations
Non-current assets are classified as held for sale if their recoverable
value is likely to be recovered via a sale or distribution as opposed to
continued use by the Group. In order to be classified as assets held
for sale, assets must meet all of the following conditions: the sale is
highly probable; it is available for immediate sale; it is being actively
marketed; and the sale is likely to occur within one year.
Assets that qualify as held for sale and related liabilities are disclosed
separately from other assets and liabilities in the balance sheet
prospectively from the date of classification. Non-current assets
determined as held for sale are measured at the lower of carrying
value and fair value less costs to sell, no depreciation is charged in
respect of these assets after classification as held for sale.
Assets or groups of assets and related liabilities that qualify as held for
sale are classified as discontinued operations when they represent a
separate major line of business or geographical area, are part of a
single plan to dispose of a separate major line of business or
geographical area or are acquired exclusively with a view to resale.
Income and expenses relating to these discontinued operations are
disclosed in a single net amount after taxes in the income statement,
with comparative amounts re-presented accordingly.
Intra-Group balances and any unrealised gains and losses or
income and expenses arising from trading between continuing
and discontinued operations continue to be eliminated in preparing
the consolidated financial statements.
Intangible assets (note 13)
Goodwill and impairment testing
Goodwill arising on a business combination represents the excess of
the cost of acquisition over the Group’s interest in the fair value of the
identifiable assets, liabilities and contingent liabilities of a subsidiary,
associate or joint venture at the date of acquisition. Following initial
recognition, goodwill is measured at cost less any accumulated
impairment losses. Goodwill is reviewed for impairment at least on an
annual basis.
For the purpose of impairment testing, goodwill is allocated on initial
recognition to the cash-generating units or groups of CGUs expected
to benefit from the combination’s synergies. The CGUs (or groups of
CGUs) used for goodwill impairment testing purposes will represent
how goodwill was attributed but may not represent reportable
business segments.
Goodwill may also arise upon investments in joint arrangements and
associates. Goodwill arising on a joint operation is recorded as a
separate asset and any impairment loss is recognised in the income
statement. Goodwill arising on a joint venture or associate is recorded
within the carrying amount of the Group’s investment and any
impairment loss is included within the share of result from joint
ventures and associates. On disposal or closure of a previously
acquired investment or business, any attributed goodwill will be
included in determining the profit or loss on disposal.
Allowances and certificates
Allowances and certificates consist of purchased carbon emissions
allowances and generated or purchased obligations certificates.
Carbon emissions allowances are held to settle environmental
obligations incurred by the Group’s SSE Thermal and Energy
Customer Solutions businesses under regulated emissions trading
schemes. The Group’s UK generation assets operate under the UK
Emissions Trading Scheme (“UK ETS”), while the Group retains an EU
Emissions Trading Scheme (“EU ETS”) obligation in respect of its Irish
Thermal generation assets. Carbon allowances purchased and held to
settle emissions obligations are recognised at cost as intangible assets.
Forward carbon contracts are treated as financial instruments and
measured at fair value with gains or losses arising on re-measurement
being recognised in the income statement. A liability is recognised
based on the level of emissions recorded. Up to the level of
allowances held, including forward carbon contracts, the liability is
measured at the cost of purchase. When the carbon emission liability
exceeds the carbon allowances held, the difference is measured at
market value of carbon allowances. Subsequent movements in
market value are prospectively recognised in operating profit.
The carbon allowance intangible asset is surrendered at the end
of the compliance period to the extent requested reflecting the
consumption of the economic benefit and is recorded as being
utilised. As a result, no amortisation is booked but an impairment
charge may be recognised should the carrying value of allowances
exceed prevailing market price.
Under the Renewable Obligations Certificates (“ROCs”) scheme,
certificates obtained from own generation are awarded by a third
party, Ofgem. ROCs can be traded with third parties and are used
by suppliers to demonstrate to Ofgem that they have met their
obligation to source a set proportion of supplied electricity from
renewable sources. The value of a ROC to a supplier comprises two
elements: the “buy-out” price which is set annually in advance of the
compliance period by Ofgem; and the “recycle” price which is
determined after the compliance period by Ofgem. The recycle price
element is estimated at the balance sheet date based on assumptions
around likely levels of renewable generation and supply over the
remaining compliance period and is therefore subject to possible
future variation.
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Accompanying information continued
A1. Basis of consolidation and material
accounting policies continued
A1.2 Material accounting policies continued
Allowances and certificates continued
Where ROCs are self-generated or purchased to fulfil the Group’s
liability under the renewable obligation, they are recorded at market
value at the point of generation or purchased cost within intangible
assets. The Group can hold ROCs in excess of its obligation, which,
due to limited evidence of liquidity or net settlement for ROC trades,
are recorded at the lower of cost or net realisable value within
inventories. Similarly, the fair value of any forward contracts entered
into at the balance sheet date for the purchase or sale of ROCs in
future periods are not recognised, as there is insufficient liquidity for
net settlement. The Group’s liability under the renewable obligation is
recognised based on electricity supplied to customers, the obligation
level set by Ofgem and the prevailing market price.
The Group’s Energy Customer Solutions segment holds Renewable
Energy Guarantees of Origin certificates (“REGOs”) to meet
contractual customer supply requirements relating to renewable
electricity origin. REGOs are procured from third parties or generated
by the Group’s Renewable accredited assets and retained for
surrender under the scheme. REGO certificates that are held to be
surrendered are recorded as intangible assets at the prevailing market
rate in line with the external obligation. Excess REGO certificates held
by the Group are held in inventories at the lower of cost or net
realisable value.
The ROC and REGO intangible assets are surrendered at the end of
the compliance period reflecting the consumption of economic
benefit and release of the associated liability. As a result, no
amortisation is recorded during the period.
Research and development
Expenditure on research activities is charged to the income statement
as incurred.
Expenditure on development activities is capitalised as intangible
assets if the project or process is considered to be technically and
commercially feasible and the Group intends to complete the project
or process for use or for sale. Development projects include wind
farm developments, battery storage and solar developments, thermal
generation projects and other developments relating to proven
technologies. Costs incurred in bringing these projects to the consent
stage include options over land rights, planning application costs and
environmental impact studies and may be costs incurred directly or
part of the fair value exercise on acquisition of an interest in a project.
At the point that the project reaches the consent stage and is
approved by the Board, the carrying value of the project is transferred
to property, plant and equipment as assets under construction.
Revenue and costs incurred through pre-commissioning testing
activities are reflected in the income statement. Once in operation,
depreciation will be charged over the expected useful life of the asset.
The asset is derecognised on disposal, or when no future economic
benefits are expected to arise.
Software assets
Software assets that have been acquired separately by the Group are
stated at cost less accumulated amortisation and impairment losses.
Expenditure on internally developed software assets and application
software licences includes contractors’ fees and directly attributable
labour and overheads. Amortisation is charged to the income
statement on a straight-line basis over the estimated useful life of
these assets. The amortisation periods utilised are as follows:
software licences
3–15
The useful lives of all the intangible assets are reviewed annually and
amended, as required, on a prospective basis. Intangible assets are
derecognised on disposal, or when no future economic benefits are
expected from their use.
Cloud computing arrangements
The Group has contracts for Software as a Service (“SaaS”) and
Platform as a Service (“PaaS”) Cloud Computing Arrangements.
Where the Group does not control the underlying assets in these
arrangements, costs are expensed as incurred. Implementation costs
in respect of these contracts are capitalised when the definition and
recognition criteria of an intangible asset under IAS 38 are met.
Property, plant and equipment (note 14)
Owned assets
Items of property, plant and equipment are stated at cost less
accumulated depreciation and impairments. The cost of self-
constructed assets includes the cost of materials, direct labour and
other directly attributable costs. Where the asset is a qualifying asset,
for which a considerable period of time is required to prepare the
asset for use or sale, borrowing costs will be capitalised as part of
the asset’s cost. Where an item of property, plant and equipment
comprises major components having different useful lives, the
components are accounted for as separate items of property, plant
and equipment, and depreciated accordingly. An item of property,
plant and equipment is derecognised on disposal or when no future
economic benefits are expected to arise from the continued use of
the asset.
Right of use assets
Right of use assets are measured at cost, less any accumulated
depreciation and impairment losses, and adjusted for any
re-measurement of lease liabilities. The cost of right of use assets
includes the amount of lease liabilities recognised, initial direct costs
incurred, and lease payments made at or before the commencement
date less any lease incentives received. Where a modification to a
lease agreement decreases the scope of the lease, the carrying
amount of the right of use asset is adjusted and a gain or loss is
recognised in proportion to the decrease in scope of the lease.
All other modifications to lease agreements are accounted for as a
reassessment of the lease liability with a corresponding adjustment to
the right of use asset.
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Hydro civil assets
The Group is obliged under the Reservoirs Act 1975 to maintain its
hydro infrastructure network, including its dams, tunnels and other
hydro civil engineering structures (hydro civil assets). All items of
property, plant and equipment within hydro civil assets, with the
exception of land, are subject to depreciation.
In accordance with the transition provisions of IFRS 1 “First-time
Adoption of IFRS”, the Group identified the carrying value of these
assets at privatisation and has treated this value as deemed cost.
Following this assessment, the assets, and all subsequent
enhancement and replacement expenditure, has been subject
to depreciation over a useful economic life of between 75 and
100 years. All subsequent maintenance expenditure is chargeable
directly to the income statement.
Depreciation
Depreciation is charged to the income statement to write off cost,
less residual values, on a straight line basis over their estimated useful
lives. Heritable and freehold land is not depreciated. Depreciation
policy, useful lives and residual values are reviewed at least annually,
for all asset classes to ensure that the current method is the most
appropriate. Depreciation commences following the asset
commissioning period and when the asset is available for commercial
operation. The estimated useful lives for assets depreciated on a
straight line basis are as follows:
generation assets)
75 to 100
power generation assets)
20 to 60
power generation assets)
20 to 25
power generation assets)
23 to 30
power generation assets)
12 to 15
Gas storage facilities (classified within Other assets)
25 to 50
Overhead lines, underground and subsea cables and
other network assets (classified within Distribution or
Transmission network assets)
5 to 80
Office buildings (classified within Land and buildings)
30 to 40
within Other assets)
3 to 15
Assets held under leases are depreciated over their expected useful
lives on the same basis as owned assets or, where shorter, over the
term of the relevant lease agreement.
It is the Group policy to capitalise qualifying replacement expenditure
and depreciate it over the expected useful life of the replaced asset.
Replaced assets are derecognised at this point and the costs recorded
as costs of disposal. Where an item of property, plant and equipment
is replaced and it is not practicable to determine the carrying amount
of the replaced part, the cost of the replacement part adjusted for
inflation and depreciation will be used as an approximation.
Expenditure incurred to replace a component of an item of property,
plant and equipment that is accounted for separately is capitalised.
Other subsequent expenditure is capitalised only when it increases
the future economic benefits of the item of property, plant and
equipment to which it relates. Maintenance and repair costs are
expensed as incurred.
Derecognition
An item of property, plant or equipment is derecognised upon
disposal or when no future economic benefits are expected to arise
from the continued use of the asset. Gains and losses on disposals
are determined by comparing the proceeds received with the
carrying amount of the asset and are included in the income
statement. Any gain or loss on derecognition of the asset is
included in the income statement in the period of derecognition.
Lease arrangements (note 21)
Lease arrangements are separately distinguished from service
contracts based on whether the contract conveys the right to control
the use of an identified asset for a period of time in exchange for
consideration. If the Group is deemed to control the use of an
identified asset, a right of use asset and a corresponding lease liability
are recognised on the balance sheet.
Right of use assets are capitalised and held as part of property,
plant and equipment. The accounting policy for such arrangements is
described above.
Lease liabilities are initially measured at the present value of the future
lease payments discounted using the rate implicit in the lease if that
can be readily determined. If the interest rate implicit in the lease
cannot be readily determined the incremental borrowing rate is used.
Where the interest rate implicit in the lease is not readily determinable,
the Group has applied the intercompany borrowing rate which is
based on the Group’s external medium-term borrowing rates with
premia adjustments for any subsidiary specific risk factors.
In determining whether any break and/or extension clauses should be
included within the lease term, the Group has considered that where
an internal decision has been made to break or extend the lease
agreement, that decision shall be applied in determining the
appropriate lease term. Where an internal decision has not been
made, and where the non-cancellable element of the lease term has
longer than five years remaining, it is considered that any clauses will
not be triggered as any decision beyond that date is not reasonably
certain. For all leases with less than five years remaining, an
assessment is made at each reporting period on a lease-by-lease
basis on whether the clause is reasonably certain to be triggered.
Reassessment of break and/or extension judgements made in prior
periods could result in recalculation of the lease liability and
adjustments to associated balances.
The lease liability is subsequently adjusted for the unwind of
discounting, repayments and other modifications to the
underlying agreement. Lease modifications are accounted for
as a separate lease where the scope of the lease increases
through the right to use one or more underlying assets and where the
consideration of the lease increases by an amount that is equivalent
to the standalone price of the increase in scope. Where a
modification decreases the scope of the lease, the carrying amount
of the right of use asset is adjusted and a gain or loss is recognised
in proportion to the decrease in scope of the lease. All other
modifications are accounted for as a reassessment of the lease
liability with a corresponding adjustment to the right of use asset.
Leases with a duration of 12 months or less and leases for assets
which are deemed “low value” are expensed to the income statement
on a straight-line basis over the lease term.
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Accompanying information continued
A1. Basis of consolidation and material
accounting policies continued
A1.2 Material accounting policies continued
Impairment review (note 15)
The carrying amounts of the Group’s property, plant and equipment
and other intangible assets and the Group’s investments in joint
ventures and associates, are reviewed for impairment whenever
events or changes in circumstances indicate that the carrying amount
may not be recoverable, or where there are indications that a
previously recognised impairment loss has reduced. For property,
plant and equipment assets that have previously been identified as
exhibiting indications of impairment, the review of impairment will be
performed annually until there is sufficient evidence to confirm that
any potential impairment loss has been appropriately recognised, or
until previously recognised impairment losses have been fully written
back. For goodwill and other intangible assets with an indefinite life or
which are not yet ready for use, the test for impairment is carried out
annually. In addition, financial assets measured at amortised cost are
also reviewed for impairment annually.
For assets subject to impairment testing, the asset’s carrying value
is compared to the asset’s (or cash-generating unit’s, in the case
of goodwill), recoverable amount. The recoverable amount is
determined to be the higher of the fair value less costs to sell
(“FVLCS”) and the value-in-use (“VIU”) of the asset or cash-generating
unit (“CGU”). For financial assets measured at amortised cost the
impairment is measured as the difference between the asset’s
carrying amount and the present value of estimated future cash flows
discounted at the financial asset’s original effective interest rate.
If the carrying amount of the asset or CGU exceeds its recoverable
amount, an impairment charge will be recognised immediately in
the income statement. Reversals of previous impairment charges
are recognised if the recoverable amount of the asset or CGU
significantly exceeds the carrying amount. Previous impairments
of goodwill are not reversed.
VIU calculations require the estimation of future cash flows to be
derived from the respective assets (or CGUs) and the selection of
an appropriate discount rate in order to calculate their present value.
The VIU methodology is consistent with the approach taken by
management to evaluate economic value and is deemed to be the
most appropriate for reviews of property, plant and equipment assets
and the Group’s identified goodwill-related CGUs. The methodology
is based on the pre-tax cash flows arising from the specific assets,
underlying assets or CGUs, and discounted using a pre-tax discount
rate based on the Group’s cost of funding and adjusted for any
specific risks. The estimation of the timing and value of underlying
projected cash flows and the selection of appropriate discount rates
involves management judgement. Subsequent changes to these
estimates or judgements may impact the carrying value of the assets.
The fair value less costs to sell methodology also uses a present value
technique, unless there is a quoted price in an active market for that
asset. The methodology is based on the post-tax cash flows arising
from the specific assets, underlying assets or CGUs, and discounted
using a post-tax discount rate determined in the same manner as the
rates used in the VIU calculations, adjusted for the relevant taxation rate.
Any impairment charge identified will initially be adjusted against the
goodwill allocated to the cash-generating unit. Any excess charge will
be allocated against the remaining assets of the cash-generating unit.
Reversals of previous impairment charges are allocated against the
carrying value of assets previously subject to an impairment charge.
Inventories (note 17)
Inventories – aside from gas inventory purchased for trading activities
– are valued at the lower of cost and net realisable value. Net
realisable value is the estimated selling price in the ordinary course of
business, less the estimated costs of completion and selling expenses.
Gas inventory purchased for trading activities is held at fair value with
reference to the forward month market price. Gains and losses on re-
measurement at fair value are recognised within the income
statement, as a “certain re-measurement” item.
Provisions (note 20)
A provision is recognised in the balance sheet when the Group has
a present legal or constructive obligation as a result of a past event,
it can be measured reliably, and it is probable that an outflow of
economic benefits will be required to settle the obligation.
If the effect is material, provisions are determined by discounting the
expected future cash flows at a pre-tax rate that reflects current
market assessments of the time value of money and, where
appropriate, the risks specific to the liability.
Decommissioning
The Group engages independent experts to estimate the cost to
decommission its Renewable (Wind, Solar and Battery assets),
Thermal and Gas Storage assets every three years. In the intervening
years, management updates the external valuation based on factors
arising since the last formal valuation date. Provision is made for the
net present value of the estimated cost of decommissioning gas
storage facilities, wind farms, power stations and battery storage
assets at the end of the useful life of the facilities. This includes
development assets, where if a present obligation exists, a provision
is recognised during construction and prior to commencement of
operations from the site. The estimates are based on technology and
prices at the balance sheet date and exclude any salvage value related
to those assets. A corresponding decommissioning asset is
recognised and is included within property, plant and equipment
when it gives access to future economic benefits, and is depreciated
on a straight-line basis over the expected useful life of the asset.
Changes in these provisions are recognised prospectively. The
unwind of discounting of the provision is included in finance costs.
The Group retained a decommissioning obligation following the
disposal of its Gas Production business. The decommissioning
cost estimates are updated periodically by field operators based
on current technology and prices. Field operators also provide
estimated end of field life dates for each field, which can change
based on market commodity prices.
Retirement benefit obligations (note 23)
Defined benefit pension schemes
The Group operates two defined benefit pension schemes, one of
which is operated by the Company. Pension scheme assets are
measured using bid market values. Pension scheme liabilities are
measured using the projected unit credit actuarial method and are
discounted at the current rate of return on a high-quality corporate
bond of equivalent term and currency to the liability.
Any increase in the present value of liabilities within the Group’s
defined benefit pension schemes expected to arise from employee
service in the year is charged as service costs to operating profit.
Net interest costs are based on net scheme assets or liabilities.
Actuarial gains and losses are recognised in full in the consolidated
statement of comprehensive income. Pension scheme surpluses,
to the extent that they are considered recoverable, or deficits are
recognised in full and presented on the face of the balance sheet.
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Defined contribution pension schemes
The Group also operates a number of defined contribution pension
schemes. The assets of the schemes are held separately from those
of the Group in independently administered funds. The amounts
charged represent the contributions payable to the schemes in the
year and are charged directly to the income statement.
Equity and equity-related compensation benefits
The Group operates a number of employee share schemes as
described in the Remuneration Report. These schemes enable Group
employees to acquire shares of the Company.
The exercise prices of the sharesave scheme are set at a discount to
market price at the date of the grant. The fair value of the sharesave
scheme option granted is measured at the grant date by use of a
Black-Scholes model. The fair value of the options granted is
recognised as an expense on a straight-line basis over the period that
the scheme vests. Estimates are updated for non-market conditions
at each balance sheet date with any adjustment in respect of the
current and prior years being recognised in the income statement.
The costs associated with the other main employee schemes are
recognised over the period to which they relate. The charge related
to the equity shares in the Company awarded under the share
schemes is treated as an increase in the cost of investment held by
the Company in the subsidiary companies of the Group. The
disclosures on equity and equity-related compensation benefits have
been removed on the grounds of materiality in relation to the Group.
Financial instruments (note 24)
The Group uses a range of financial instruments to manage
exposures to financial risks, such as interest rate, foreign exchange
and energy price fluctuations in its normal course of business. Hedge
accounting is applied where the relevant qualifying criteria are met
and is aligned to the Group’s risk management objectives and
policies, which are further explained in A6.
During the year ended 31 March 2026, the Group completed an
assessment of the impact of transitioning from IAS 39 “Financial
Instruments: Recognition and Measurement” to the hedge
accounting requirements of IFRS 9 “Financial Instruments”. The
assessment concluded that the Group’s existing hedging relationships
and risk management strategies would continue to qualify for hedge
accounting on adoption of IFRS 9.
Accordingly, the Group has continued to apply the hedge accounting
requirements of IAS 39, as permitted by IFRS 9, as this model
continues to appropriately reflect the Group’s risk management
activities in the financial statements. The Group will adopt IFRS 9
Financial Instruments in full from 1 April 2026.
Interest rate and foreign exchange derivatives
Financial derivative instruments are used by the Group to manage
interest rate and currency exposures. All such derivatives are
recognised at fair value and are re-measured to fair value each
reporting period. Certain derivative financial instruments are
designated as being held for hedging purposes. The designation of
the hedge relationship is established at the inception of the hedge
and procedures are applied to ensure the derivative is highly effective
in achieving its objective and that the effectiveness of the hedge can
be reliably measured. The treatment of gains and losses on re-
measurement is dependent on the classification of the hedge and
whether the hedge relationship is designated as either a “fair value” or
“cash flow” hedge. Derivatives that are not designated as hedges are
treated as if held for trading, with all fair value movements being
recorded through the income statement.
A derivative classified as a “fair value” hedge recognises gains and
losses from re-measurement immediately in the income statement.
Loans and borrowings are measured at cost except where they form
the underlying transaction in an effective fair value hedge relationship.
In such cases, the carrying value of the loan or borrowing is adjusted
to reflect fair value movements with the gain or loss being reported in
the income statement.
A derivative classified as a “cash flow” hedge recognises the portion of
gains or losses on the derivative which are deemed to be effective
directly in equity in the hedge reserve. Any ineffective portion of the
gains or losses is recognised in the consolidated income statement.
When hedged cash flows result in the recognition of a non-financial
asset or liability, the associated gains or losses previously recognised
in equity are included in the initial measurement of the asset or liability.
For all other cash flow hedges, the gains or losses that are recognised in
equity are transferred to the income statement in the same period in
which the hedged cash flows affect the income statement.
Hedge accounting is discontinued when the hedging instrument
expires, or is sold, terminated or exercised, or no longer qualifies for
hedge accounting. At the point of discontinuation, any cumulative
gain or loss on the hedging instrument recognised in equity remains
in equity until the forecast transaction affects profit or loss. On
settlement, the cumulative gain or loss recognised in equity is
recognised in the income statement.
Commodity derivatives
Within its regular course of business, the Group routinely enters into
sale and purchase derivative contracts for commodities such as
power, gas and carbon. Where the contract was entered into and
continues to be held for the purpose of receipt or delivery in
accordance with the Group’s expected sale, purchase or usage
requirements, the contracts are designated as “own use” contracts
and are measured at cost. These contracts are not within the scope
of IFRS 9.
Derivative commodity contracts which are not designated as own use
contracts are accounted for as trading derivatives and are recognised
in the balance sheet at fair value. Where a hedge accounting
relationship is designated and is proven to be effective, the changes in
fair value will be recognised in accordance with the rules noted
above. There are currently no designated hedge relationships in
relation to commodity contracts.
Other commodity contracts, where own use is not established and a
hedge accounting relationship is not designated, are measured at fair
value with gains and losses on re-measurement being recognised in
the income statement in cost of sales.
Embedded derivatives
Derivatives embedded in other financial instruments or other
host contracts are treated as separate derivatives where the
characteristics of the derivatives are not closely related to those of
the host contracts.
Net investment hedges
Hedges of net investments in foreign operations are accounted in
a manner similar to effective cash flow hedges. Any gain or loss on
the effective portion of the hedge is recognised in equity, in the
translation reserve, and any gain or loss on the ineffective portion of
the hedge is recognised in the income statement. On disposal of the
foreign operation, the cumulative value of any gains or losses
recognised directly in equity is transferred to the income statement.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits
with a maturity of three months or less. Bank overdrafts that are
repayable on demand and form an integral part of the Group’s cash
management are included as a component of cash and cash
equivalents for the purpose of the statement of cash flows.
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Accompanying information continued
A1. Basis of consolidation and material
accounting policies continued
A1.2 Material accounting policies continued
Trade receivables
Trade receivables do not carry any interest and are measured at cost
less an appropriate allowance for lifetime expected credit losses.
At the end of each reporting period a review of the allowance
for impairment of trade receivables (or bad debt provision) is
performed by the respective businesses. Trade receivables do not
contain a significant financing element, and therefore expected credit
losses are measured using the simplified approach permitted by IFRS
9, which requires lifetime expected credit losses to be recognised on
initial recognition. A provision matrix is utilised to estimate the lifetime
expected credit losses, based on the age, status and risk of each class
of receivable, which is updated periodically to include changes to
both forward-looking and historical inputs.
Interest-bearing loans and borrowings
All such loans and borrowings are initially recognised at fair value
including transaction costs and are subsequently measured at
amortised cost, except where the loan or borrowing is the
hedged item in an effective fair value hedge relationship.
Commercial (and affiliate) contracts for difference
The Group has commercial Contracts for Difference (“CfD”)
arrangements in place where the Group has agreed to provide a
revenue support contract. Where the Group has entered into these
arrangements and there is no relationship with a government entity,
the instruments are classified as derivatives and accounted for under
IFRS 9. The Group has assessed that due to the valuation complexity
of these arrangements, they are Level 3 financial instruments in the
fair value hierarchy. On day 1, the Group recognises no gain or loss
arising from the instrument, but instead defers this gain or loss and
recognises it progressively over the life of the instrument. At each
balance sheet date the fair value of the instrument is assessed with
any movement in fair value recognised in the income statement in
the period it arises.
Financial guarantee liabilities
The Group issues financial guarantee contracts to make specified
payments to reimburse holders for losses incurred if certain former
subsidiaries and certain current joint venture investments fail to make
payments when due in accordance with the original or modified
terms of a debt instrument.
Financial guarantee contracts are initially measured at fair value and
subsequently measured at the higher of the loss allowance for
expected credit losses and the initial fair value less any income
recognised.
Share capital
Ordinary shares are accounted for as equity. Incremental costs
directly attributable to the issue of new shares are shown in
equity as a deduction from the proceeds received. Own equity
instruments that are reacquired are deducted from equity. No gain or
loss is recognised in the Group income statement on the purchase,
sale, issue or cancellation of the Group’s own equity instruments.
Hybrid equity
Hybrid equity comprises issued bonds that qualify for recognition
as equity as they have no fixed redemption date. Accordingly, any
coupon payments are accounted for as dividends and are recognised
directly in equity at the time the payment obligation arises. This is
because the coupon payments are discretionary and relate to equity.
Coupon payments consequently do not have any impact on the
income statement. Coupon payments are recognised in the cash flow
statement in the same way as dividends to ordinary shareholders.
Tax credits in relation to the coupon payments are linked to the past
transactions or events that support the coupon payments and
consequently the tax credits are reported in the income statement.
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A2. Taxation
The Group’s primary tax disclosures are included at note 10 . The following tables represent enhanced disclosures adopted in order to assist
stakeholder understanding of the Group’s tax position and policies as part of the Group’s commitment to its Fair Tax Mark accredited status.
Reconciliation of tax charge to adjusted underlying current tax
Group profit before tax
1,837.3
1,850.9
Less: share of results of associates and jointly controlled entities
(88.0)
(89.9)
Profit before tax
1,749.3
1,761.0
tax rate of 25% (2025: 25%)
437.3
25.0
440.3
25.0
Capital allowances less than depreciation
(276.9)
(15.9)
(216.8)
(12.3)
(Impairment reversal)/impairment of investments
(1.9)
(0.1)
65.1
3.7
Movement in restructuring and settlement provisions
4.8
0.3
(4.4)
(0.2)
Fair value movements on derivatives
12.4
0.7
7.3
0.4
Pension movements
(10.0)
(0.6)
(8.0)
(0.5)
Relief for capitalised interest and revenue costs
(41.2)
(2.4)
(37.9)
(2.2)
Hybrid equity coupon payments
(18.2)
(1.0)
(18.4)
(1.0)
Expenses not deductible for tax purposes
16.6
0.9
15.2
0.9
Losses carried forward
14.6
0.8
(1.2)
(0.1)
Impact of foreign tax rates
(6.0)
(0.3)
(15.3)
(0.9)
Electricity Generator Levy not deductible for tax purposes
–
–
19.8
1.1
Capitalised revenue expenditure
(22.8)
(1.3)
–
–
Adjustments to tax charge in respect of previous years
(11.2)
(0.6)
(8.3)
(0.5)
Other items
(0.1)
–
(3.7)
(0.1)
Reported current tax charge and effective rate
97.4
5.5
233.7
13.3
Depreciation in excess of capital allowances
278.4
15.9
217.8
12.4
Movement in provisions
(4.8)
(0.3)
4.4
0.2
Fair value movements on derivatives
(12.4)
(0.7)
(7.3)
(0.4)
Pension movements
10.0
0.6
8.0
0.5
Relief for capitalised interest and revenue costs
41.2
2.4
37.9
2.2
Adjustments to tax charge in respect of previous years
6.3
0.4
19.1
1.1
Capitalised revenue expenditure
22.8
1.3
–
–
Tax losses utilised
(13.4)
(0.8)
–
–
Other items
0.2
–
4.4
0.1
Reported deferred tax charge and effective rate
328.3
18.8
284.3
16.1
Group tax charge and effective rate
425.7
24.3
518.0
29.4
As noted at note 3 to the accounts, the Group’s results are reported on an “adjusted” basis in order to allow focus on underlying business
performance. The Adjusted Profit Before Tax is the measure utilised in calculation of the Group’s “adjusted effective rate of tax”.
219
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Accompanying information continued
A2. Taxation continued
The Adjusted Current Tax Charge can be reconciled to the adjusted profit before tax as follows:
Adjusted Profit Before Tax
2,024.8
2,144.5
Tax on profit on ordinary activities at standard UK corporation tax rate
506.2
25.0
536.1
25.0
Capital allowances in excess of depreciation
(294.1)
(14.5)
(224.7)
(10.5)
Non-taxable (gain)/loss on sale of assets
(1.7)
(0.1)
7.6
0.4
Non qualifying depreciation
11.4
0.6
25.2
1.2
Adjustment for profit on internal trading
–
–
4.3
0.2
Movement in restructuring and settlement provisions
6.1
0.3
(2.9)
(0.1)
Pension movements
(10.0)
(0.5)
(8.0)
(0.4)
Relief for capitalised interest and revenue costs
(28.4)
(1.4)
(21.9)
(1.0)
Hybrid equity coupon payments
(18.2)
(0.9)
(18.4)
(0.9)
Expenses not deductible for tax purposes
11.4
0.6
8.4
0.4
Fair value movements on derivatives
–
–
9.9
0.5
Electricity Generator Levy not deductible for tax purposes
–
–
19.8
0.9
Discount on losses on Scottish Hydro Electric Transmission plc
(4.8)
(0.2)
(4.3)
(0.2)
Share-based payments
(0.4)
–
(2.6)
(0.1)
Losses carried forward
28.9
1.4
–
–
Adjustments to tax charge in respect of previous years
(11.4)
(0.6)
(10.7)
(0.5)
Impact of foreign tax rates
(22.5)
(1.1)
(20.6)
(1.0)
Corporate interest restriction
19.9
1.0
–
–
Other
1.0
–
0.7
–
Adjusted Current Tax Charge and effective rate APM
193.4
9.6
297.9
13.9
* The comparative adjusted effective rate of tax been restated. See note 1.2.
The reconciling adjustments differ from those analysed in the Group tax charge reconciliation above because they include SSE’s share of
associates and joint ventures, and are based on Adjusted Profit Before Tax.
The majority of the Group’s profits are earned in the UK, with the standard rate of UK corporation tax being 25% for the year to 31 March 2026
(2025: 25%). Profits earned by the Group in the Republic of Ireland are taxable at either 12.5% or 25%, depending upon the nature of the income.
Capital allowances are tax reliefs provided in law for the expenditure the Group makes on property, plant and equipment. The rates are
determined by Parliament annually and spread the tax relief due over a number of years. This contrasts with the accounting treatment for such
spending, where the expenditure on property, plant and equipment is treated as an asset with the cost being depreciated over the useful life of
the asset, or impaired if the value of such assets is considered to have reduced materially.
The different accounting treatment of property, plant and equipment for tax and accounting purposes means that the taxable income of the
Group is not the same as the profit reported in the financial statements. The substantial reversals of impairments and impairments undertaken in
previous years in relation to certain property, plant and equipment assets, result in the depreciation or impairment charge to profit for the year
differing to the amount of capital allowances due to the Group.
Short term temporary differences arise on items such as provisions for restructuring costs and onerous contracts, and retirement benefit
obligations, because the treatment of such items is different for tax and accounting purposes. These differences usually reverse in the year
following that in which they arise, as is reflected in the deferred tax charge in these financial statements. Where interest charges or other costs
are capitalised in the accounts, tax relief is either given as the charges are incurred or when the costs are taken to the income statement.
As explained at Accompanying Information A1 and A6
, the Group measures its operating and financing derivatives at fair value under IFRS 9.
As a result of the Group’s subsidiaries applying the HMRC’s “disregard regulations”, the vast majority of the re-measurement movements have
no current tax effect impacting only the deferred tax position.
As detailed at note 22
and explained in the Accompanying Information A1 , the Group has issued Hybrid equity securities which are treated
as a component of equity. While the coupon payments relating to these securities are treated as distributions to the holders of the equity
instruments, tax relief is allowed on the amount paid in the year. These tax credits are linked to the past transactions or events that support the
coupon payments and consequently the tax credits are reported in the income statement.
220
SSE plc Annual Report 2026

A3. Related undertakings
A3.1.1 Subsidiary undertakings
Details of the Group’s subsidiary undertakings at 31 March are as follows:
Aberarder Wind Farm (Scotland) Limited
A
100.0
Aberarder Wind Farm LLP
B
100.0
Abernedd Power Company Limited
B
100.0
Aegletes III Holdco Limited
B
100.0
Aldbrough Pathfinder Limited
B
100.0
Berwick Bank A Limited
B
100.0
Berwick Bank B Limited
B
100.0
Berwick Bank C Limited
B
100.0
Berwick Bank Holdings A Limited
B
100.0
Berwick Bank Holdings B Limited
B
100.0
Berwick Bank Holdings C Limited
B
100.0
Berwick Bank Wind Farm Limited
A
100.0
Bhlaraidh Extension Wind Farm Limited
A
100.0
Bhlaraidh Wind Farm Limited
A
100.0
Building Automation Solutions Limited
D
100.0
By-Pass Farm Solar Limited
B
100.0
Coire Glas Hydro Pumped Storage Limited
A
100.0
Enerveo Limited
T
100.0
Ferrybridge Hydrogen Limited
B
100.0
Fibre Fuel Limited
B
100.0
Fibre Power (Slough) Limited
B
100.0
Griffin Wind Farm Limited
A
100.0
A
100.0
Keadby Developments Limited
E
100.0
Keadby Generation Limited
E
100.0
Keadby Next Generation Limited
B
100.0
Keadby Wind Farm Limited
B
100.0
LG-B-300 Limited
A
100.0
Littleton Pastures Solar Limited
B
100.0
Medway Power Limited
B
100.0
Optimal Power Networks Limited
B
100.0
Power from Waste Limited
B
100.0
A
100.0
Scottish Hydro Electric Power Distribution plc
A
100.0
Scottish Hydro Electric Transmission plc
A
75.0
Slough Domestic Electricity Limited
B
100.0
Slough Electricity Contracts Limited
B
100.0
Slough Energy Supplies Limited
B
100.0
Slough Heat & Power Limited
B
100.0
Slough Utility Services Limited
B
100.0
Southern Electric Power Distribution plc
B
100.0
SSE Airtricity Energy Services (NI) Limited
Q
100.0
SSE Airtricity Energy Supply (NI) Limited
F
100.0
SSE Airtricity Gas Supply (NI) Limited
F
100.0
SSE Battery Monk Fryston Limited
B
100.0
SSE Battery Salisbury Limited
B
100.0
A
100.0
SSE BTM HoldCo Limited
B
100.0
SSE BTM Operational Assets Limited
B
SSE Contracting Group Limited
B
100.0
SSE Cottered Solar Limited
B
100.0
SSE Daines BESS Limited
B
100.0
SSE DE Solar Holdco Limited
B
100.0
SSE Derrymeen BESS Limited
F
100.0
SSE Digital Services Limited
B
100.0
SSE Eggborough Limited
B
100.0
SSE Energy Markets Limited
B
100.0
SSE Energy Supply Limited
B
100.0
SSE Enterprise Limited
B
100.0
SSE Ewerby Solar Holdco Limited
B
100.0
SSE Ewerby Solar Limited
B
100.0
SSE Fancott BESS Limited
B
100.0
SSE Ferrybridge Battery Limited
B
100.0
SSE Fiddlers Ferry Battery Limited
B
100.0
SSE Foxholes Solar Limited
B
100.0
SSE Generation Limited
B
100.0
SSE Group Limited
A
100.0
SSE Heat Networks (Battersea) Limited
B
100.0
SSE Heat Networks Limited
A
100.0
SSE Hornsea Limited
B
100.0
SSE HV Electricity Assets Limited
B
100.0
SSE Hydrogen Holdings Limited
B
100.0
SSE Hydrogen Developments Limited
B
100.0
SSE IAMP Microgrid Limited
B
100.0
SSE Imperial Park PN Limited
B
100.0
SSE Knapthorpe Solar Limited
B
100.0
SSE Low Carbon Developments Limited
B
100.0
SSE Low Carbon Holdings Limited
B
100.0
SSE Maple Limited
B
100.0
SSE Medway Operations Limited
B
100.0
SSE Micro Renewables Limited
A
100.0
SSE Multifuel Generation Holdings Limited
B
100.0
SSE Muskham Solar Limited
B
100.0
SSE Newchurch Solar Limited
B
100.0
SSE OWS Glasgow Limited
A
100.0
SSE Private Networks Holdco Limited
B
100.0
SSE Production Services Limited
B
100.0
SSE Renewables Holdings (UK) Limited
F
100.0
SSE Renewables International Holdings Limited
A
100.0
SSE Renewables Limited
A
100.0
A
100.0
F
100.0
SSE Renewables Poland Holdings Limited
A
100.0
SSE Renewables Services (UK) Limited
F
100.0
B
100.0
SSE Renewables UK Limited
F
100.0
SSE Renewables Wind Farms (UK) Limited
A
100.0
SSE Retail Limited
A
100.0
SSE Seabank Investments Limited
B
100.0
SSE Seabank Land Investments Limited
B
100.0
SSE Services plc
B
100.0
SSE Southern Group Trustee Limited
B
100.0
SSE Staythorpe Battery Limited
B
100.0
SSE Staythorpe Power Limited
B
100.0
SSE Staythorpe SGT Limited
B
100.0
SSE Staythorpe Solar Limited
B
100.0
SSE Southery Solar Limited
B
100.0
SSE Stock Limited
A
100.0
SSE Thermal Energy Holdings Limited
B
100.0
SSE Thermal Energy Operations Limited
B
100.0
SSE Thermal Generation (Scotland) Limited
A
100.0
221
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Accompanying information continued
A3. Related undertakings continued
A3.1.1 Subsidiary undertakings continued
U
nite
d
Kingdo
m
continued
SSE Thermal Generation Holdings Limited
B
100.0
SSE Toddleburn Limited
A
100.0
SSE Trading Limited
B
100.0
SSE Trustees Limited
B
100.0
SSE Utility Services Limited
B
100.0
SSE Utility Solutions Limited
B
100.0
SSE Venture Capital Limited
A
100.0
SSE Viking Limited
B
100.0
SSE(SE) Quest Trustee Limited
B
100.0
SSEN Distribution Limited
A
100.0
SSEPG (Operations) Limited
B
100.0
Strathy Wind Farm Limited
A
100.0
Tealing Solar Park Limited
B
100.0
TESGL Limited
D
100.0
The Energy Solutions Group Bidco Limited
D
100.0
The Energy Solutions Group Midco Limited
D
100.0
The Energy Solutions Group Topco Limited
D
100.0
Viking Energy (Scottish Partnership)
A
100.0
Viking Energy Wind Farm LLP
A
100.0
Airtricity Windfarm Finance Limited
C
100.0
Arklow Offshore Phase II Company Limited
C
100.0
Bindoo Windfarm (ROI) Limited
C
100.0
Brickmount Limited
C
100.0
Comhlacht Gaoithe Teoranta
C
100.0
Coomacheo Wind Farm Limited
C
100.0
Coomatallin Windfarm (ROI) Limited
C
100.0*
Curragh Mountain Windfarm Limited
C
100.0
Dedondo Limited
C
100.0
Dromada Windfarm (ROI) Limited
C
100.0
Enerveo Ireland Limited
Z
100.0
C
100.0
Ganderoy Limited
C
100.0
Gartnaneane Limited
C
100.0*
Glenora Wind Farm Designated Activity Company
C
100.0
Green Wind Energy (Wexford) Limited
C
100.0
Leanamore Wind Farm Limited
C
100.0
Lenalea Wind Farm Designated Activity Company
C
100.0
Limerick West Windfarm Limited
C
100.0
March Winds Limited
C
100.0
Meentycat Limited
C
100.0
Milane Holdings Limited
C
100.0
Mullananalt Wind Farm (ROI) Limited
C
100.0
Platin Power Limited
C
100.0
Richfield Windfarm (ROI) Limited
C
100.0
C
100.0
SSE Airtricity Distributed Energy Limited
C
100.0
SSE Airtricity Energy Services Limited
C
100.0
SSE Airtricity Limited
C
100.0
SSE Cumarsáid Teoranta
C
100.0
SSE Generation Ireland Limited
C
100.0
SSE Renewables (Ireland) Limited
C
100.0
SSE Renewables Generation Ireland Limited
C
100.0
SSE Renewables Holdings (Europe) Limited
C
100.0
SSE Renewables Holdings Limited
C
100.0
SSE Renewables Off Shore Limited
C
100.0
SSE Renewables Wind (Ireland) Holdings Limited
C
100.0
SSE Renewables Wind Farms (Ireland) Limited
C
100.0
Sure Partners Limited
C
100.0
C
100.0
Tournafulla Windfarm (ROI) Limited
C
100.0
Zeusford Limited
C
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
AE
100.0
Société du Poste Privé (SPP) d’Orchamps SAS
AE
100.0
Société du Poste Privé (SPP) de la Cuesta SARL
AE
100.0
Société du Poste Privé (SPP) du Tonnerrois
AE
100.0
SSE Renewables France SARL
AE
100.0
U
100.0
222
SSE plc Annual Report 2026

AB
100.0
Energiaki Kleidi Single Member S.A.
AB
100.0
AB
100.0
Energiaki Mesovouniou Single Member S.A.
AB
100.0
Energiaki Platorrachis Single Member S.A.
AB
100.0
Energiaki Velanidias Single Member S.A.
AB
100.0
SSE Renewables Hellas Single Member S.A.
AB
100.0
SSE Insurance Limited
G
100.0
SPV Parco Eolico Libeccio S.r.l.
AC
100.0
SPV Parco Eolico Maestrale S.r.l.
AC
100.0
SPV Parco Eolico Tramontana S.r.l.
AC
100.0
SSE Renewables Italy S.r.l.
AC
100.0
Aichi Offshore Wind Power No. 1 G.K.
Y
80.0
Aichi Offshore Wind Power No. 2 G.K.
Y
80.0
Enshunada Offshore Wind Power No. 1 G.K.
Y
80.0
Y
80.0
Goto-Fukue Offshore Wind Power G.K.
Y
80.0
Izu Islands Offshore Wind Power No. 1 G.K.
Y
80.0
Minami-Izu Offshore Wind Power No. 1 G.K.
Y
80.0
Oki Islands Offshore Wind Power G.K.
Y
80.0
SSE Pacifico K.K.
Y
80.0
SSE Yuza Offshore Wind Power G.K.
Y
80.0
Tokushima Offshore Wind Power G.K.
Y
80.0
Y
80.0
Y
80.0
SSE Renewables (Netherlands) Holdings B.V.
AA
100.0
SSE Renewables Developments (The
Netherlands) B.V.
AA
100.0
SSE Sunflower Offshore Wind Holdco B.V.
AA
100.0
AA
100.0
AA
100.0
AA
100.0
AA
100.0
SSE Tulip Offshore Wind Holdco B.V.
AA
100.0
SSE Tulip Offshore Wind Limited Partner 1 B.V.
AA
100.0
SSE Tulip Offshore Wind Limited Partner 2 B.V.
AA
100.0
SSE Tulip Offshore Wind Limited Partner 3 B.V.
AA
100.0
IBC SE PL3 sp. z o.o.
AJ
100.0
IBC SE PL20 sp. z o.o.
AJ
100.0
IBC SE PL22 sp. z o.o.
AJ
100.0
IBC SE PL23 sp. z o.o.
AJ
100.0
IBC SE PL24 sp. z o.o.
AJ
100.0
IBC SE PL34 sp. z o.o.
AJ
100.0
Pomerania PV sp z.o.o.
AJ
100.0
(formerly SSE Renewables Poland sp z.o.o.)
X
100.0
ICE Torrecilla Renovables S.L.
W
80.3
Sistemas Energéticos Ábrego S.L.U.
AD
100.0
Sistemas Energéticos Ariel S.L.U.
AD
100.0
Sistemas Energéticos Boreas S.L.U.
AD
100.0
Sistemas Energéticos Céfiro S.L.U.
AD
100.0
Sistemas Energéticos del Sur S.A.U.
AD
100.0
Sistemas Energéticos Eolo S.L.U.
AD
100.0
Sistemas Energéticos Erbania 1 S.L.U.
AD
100.0
Sistemas Energéticos Erbania 2 S.L.U.
AD
100.0
Sistemas Energéticos Gregal S.L.U.
AD
100.0
Sistemas Energéticos Júpiter S.L.U.
AD
100.0
Sistemas Energéticos Marte S.L. U.
AD
100.0
Sistemas Energéticos Mercurio S.L.U.
AD
100.0
Sistemas Energéticos Neptuno S.L.U.
AD
100.0
Sistemas Energéticos Oberón S.L.U.
AD
100.0
Sistemas Energéticos Plutón S.L.U.
AD
100.0
Sistemas Energéticos Tablero Tabordo S.L.U.
AD
100.0
Sistemas Energéticos Terral S.L.U.
AD
100.0
Sistemas Energéticos Titán S.L.U.
AD
100.0
Sistemas Energéticos Urano S.L.U.
AD
100.0
SSE Renewables Southern Europe S.L.
AD
100.0
SSE Renewables Spain S.L.
AD
100.0
All shares in subsidiary companies are ordinary share capital, unless otherwise stated.
* 100% of voting rights held.
223
SSE plc Annual Report 2026
Financial StatementsGovernanceStrategic Report

Accompanying information continued
A3. Related undertakings continued
A3.1.1 Subsidiary undertakings continued
Statutory audit exemptions
SSE plc parent company has provided guarantees under section 479C of the Companies Act 2006 over the liabilities of the following
companies, which are therefore exempt from audit under the requirements of s479A-479C of the Companies Act 2006.
Aberarder Wind Farm (Scotland) Limited
SC746968
Aberarder Wind Farm LLP
OC398487
Abernedd Power Company Limited
06383166
Aegletes III Holdco Limited
13665453
Aldbrough Pathfinder Limited
15238323
Berwick Bank Holdings A Limited
07294660
Berwick Bank Holdings B Limited
13881643
Berwick Bank Holdings C Limited
07294689
Berwick Bank Wind Farm Limited
SC721781
Bhlaraidh Extension Wind Farm Limited
SC798136
Bhlaraidh Wind Farm Limited
SC663027
Building Automation Solutions Limited
05827765
By-Pass Farm Solar Limited
12558977
Ferrybridge Hydrogen Limited
15238441
Fibre Fuel Limited
02902165
Fibre Power (Slough) Limited
02902170
Griffin Wind Farm Limited
SC245113
Hydro Electric Pension Scheme Trustees Limited
SC567945
Keadby Developments Limited
02691516
Keadby Next Generation Limited
15866301
Keadby Wind Farm Limited
06852112
LG-B-300 Limited
SC765613
Power From Waste Limited
02902302
Slough Domestic Electricity Limited
03486588
Slough Energy Supplies Limited
02474514
Slough Heat & Power Limited
00174142
Slough Utility Services Limited
03486590
SSE Airtricity Energy Services (NI) Limited
NI056373
SSE Beatrice Offshore Windfarm Holdings Limited
SC436255
SSE BTM HoldCo Limited
14413957
SSE BTM Operational Assets Limited
14885059
SSE Contracting Group Limited
02471438
SSE Cottered Solar Limited
15346645
SSE Daines BESS Limited
15344013
SSE DE Solar HoldCo Limited
14189570
SSE Derrymeen BESS Limited
NI697259
SSE Digital Services Limited
14621186
SSE Eggborough Limited
14939853
SSE Enterprise Limited
10060563
SSE Ewerby Solar Holdco Limited
14939987
SSE Ewerby Solar Limited
14959032
SSE Fancott Bess Limited
15344001
SSE Ferrybridge Battery Limited
14411214
SSE Fiddlers Ferry Battery Limited
14418916
SSE Foxholes Solar Limited
14044466
SSE Group Limited
SC126049
SSE Heat Networks (Battersea) Limited
10176638
SSE HV Electricity Assets Limited
14418288
SSE Hydrogen Developments Limited
15238086
SSE Hydrogen Holdings Limited
15231331
SSE IAMP Microgrid Limited
15333093
SSE Imperial Park PN Limited
02631510
SSE Knapthorpe Solar Limited
14044446
SSE Low Carbon Developments Limited
15069108
SSE Low Carbon Holdings Limited
15052653
SSE Maple Limited
10604848
SSE Medway Operations Limited
02647585
SSE Micro Renewables Limited
SC386017
SSE Multifuel Generation Holdings Limited
12661566
SSE Muskham Solar Limited
14044402
SSE Newchurch Solar Limited
15348120
SSE OWS Glasgow Limited
SC228283
SSE Private Networks Holdco Limited
14921243
SSE Production Services Limited
02499702
SSE Renewables Holdings (UK) Limited
NI043239
SSE Renewables Offshore Windfarm Holdings Limited
SC436251
SSE Renewables Onshore Windfarm Holdings Limited
NI049557
SSE Renewables Poland Holdings Limited
SC723844
SSE Renewables Solar & Battery Holdings Limited
13561962
SSE Renewables UK Limited
NI048447
SSE Renewables Wind Farms (UK) Limited
SC654502
SSE Retail Limited
SC213458
SSE Seabank Investments Limited
02631512
SSE Seabank Land Investments Limited
07877772
SSE Southern Group Trustee Limited
04009847
SSE Southery Solar Limited
14953142
SSE Staythorpe Battery Limited
14046860
SSE Staythorpe Power Limited
14043534
SSE Staythorpe SGT Limited
14046946
SSE Staythorpe Solar Limited
14046913
SSE Thermal Energy Holdings Limited
12650549
SSE Thermal Generation Holdings Limited
12662248
SSE Toddleburn Limited
SC259104
SSE Trustees Limited
03048985
SSE Viking Limited
06021053
SSE(SE) Quest Trustee Limited
03487059
SSEPG (Operations) Limited
02764438
Strathy Wind Farm Limited
SC663103
Tealing Solar Park Limited
08783684
The Energy Solutions Group Bidco Limited
07187066
The Energy Solutions Group Midco Limited
07403400
The Energy Solutions Group Topco Limited
07419528
224
SSE plc Annual Report 2026

A3.1.2 Joint arrangements (incorporated)
AtlasConnect Limited
A
50.0
H2Northeast Limited
H
50.0
Baglan Pipeline Limited
K
50.0
Indian Queens Power Limited
AF
50.0
Beatrice Offshore Windfarm Holdco Limited
A
40.0
Marchwood Power Limited
N
50.0
Beatrice Offshore Windfarm Limited
A
40.0
Neos Networks Limited
A
50.0
Clyde Windfarm (Scotland) Limited **
A
50.1
NNXYZ Limited
B
50.0
DB Operational Base Limited
J
40.0
North Falls Offshore Wind Farm Holdco Limited
AG
50.0
Deeside Power (UK) Limited
AF
50.0
North Falls Offshore Wind Farm Limited
AG
50.0
Deeside Power Operations Limited
AF
50.0
Ossian Offshore Wind Farm Holdings Limited
A
40.0
B
50.0
Ossian Offshore Wind Farm Limited
A
40.0
B
40.0
Pride (SERP) Limited
AI
50.0
B
40.0
Reach Fibre Company Limited
B
50.0
B
40.0
Reach Holdings Group Limited
B
50.0
B
40.0
Reach Infrastructure Group Limited
B
50.0
B
40.0
Saltend Cogeneration Company Limited
AF
50.0
B
40.0
Saltend Operations Company Limited
AF
50.0
B
50.0
SCCL Holdings Limited
AF
50.0
B
50.0
Seabank Power Limited
O
50.0
B
50.0
Seagreen 1A (Holdco) Limited
B
49.0
B
50.0
Seagreen 1A Limited
B
49.0
A
50.0
Seagreen Alpha Wind Energy Limited
B
49.0
Dunmaglass Wind Farm Limited
A
50.1
Seagreen Bravo Wind Energy Limited
B
49.0
Eastern Green Link 2 Limited ***
B
50.0
Seagreen Holdco 1 Limited
B
49.0
Eastern Green Link 3 Limited ***
B
50.0
Seagreen Wind Energy Limited
B
49.0
Fearna PSH Limited
B
50.0
Source EV Limited
B
50.0
Greater Gabbard Offshore Winds Limited ***
B
50.0
Source EV UK Limited
B
50.0
Green H2 Developments Hold Co Limited
B
50.0
SSE Slough Multifuel Holdco Limited
B
50.0
Green H2 Developments Project Co Limited
B
50.0
SSE Slough Multifuel Limited
B
50.0
H2NE Parentco Limited
H
50.0
Stronelairg Wind Farm Limited
A
50.1
Allbrite Heatpump Specialists Limited
R
25.0
Green Energy Company Limited **
M
50.0
Bellair Wind Farm Designated Activity Company
I
50.0
Green Way Energy Limited
M
50.0
L
25.0
Kerry Power Limited
M
49.0
L
25.0
Kilberry Wind Farm Designated Activity Company I
50.0
I
50.0
Lemanaghan Wind Farm Designated Activity
I
50.0
I
50.0
Littleton Wind Farm Designated Activity
I
50.0
I
50.0
Marron Activ8 Energies Limited
R
50.0
C
50.0
Midas Energy Limited
M
49.0
Everwind Limited
S
49.0
Source EV Ireland Limited
C
50.0
I
50.0
Triton Power Holdings Limited
AH
50.0
Triton Power Limited
AH
50.0
Triton Power Intermediate Holdings Limited
AH
50.0
Lely Alpha Offshore Wind General Partner B.V.
AA
50.0
Lely Alpha Offshore Wind Projco C.V.
AA
50.0
225
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ICE Santa Engracia, S.L.
V
44.6
** Holding represents % of voting rights
*** Joint Operation
A3.1.3 Associates
Corran Environmental LP
AK
74.0
St Clements Services Limited
P
25.0
A3.1.4 Registered address key
Reference
Company registered address
A
Inveralmond House, 200 Dunkeld Road, Perth PH1 3AQ
B
No 1 Forbury Place, 43 Forbury Road, Reading RG1 3JH
E
Keadby Power Station, Trentside, Keadby, Scunthorpe, North Lincs DN17 3AZ
F
3rd Floor, Millennium House, 25 Great Victoria Street, Belfast, BT2 7AQ
G
Tower House, Loch Promenade, Douglas, Isle of Man
H
Suite 1, 7th Floor, 50 Broadway, London, United Kingdom, SW1H 0BL
J
One Kingdom Street, London, United Kingdom, W2 6BD
K
10 Fleet Place, London, EC4M 7QS
N
Oceanic Way, Marchwood Industrial Park, Marchwood, Southampton SO40 4BD
O
Severn Road, Hallen, Bristol, BS10 7SP
P
4 – 6 Church Walk, Daventry, NN11 4BL
Q
Unit 14 Maryland Industrial Estate, Ballygowan Road, Belfast
R
Nexus N2 Business Park, Carrickmacross, Monaghan, A81 XK73, Ireland
S
Gorthleahy, Macroom, Co Cork, Ireland
T
Second Floor Eagle Court 2, Hatchford Way, Birmingham B26 3RZ
U
c/o Bird & Bird LLP, Maximiliansplatz 22, Munich 80333
W
Avda Gomez Laguna, 25, 50009 – Zaragoza, Spain
Y
Azabudai Hills Mori JP Tower, 1-3-1 Azabudai, Minato-ku, Tokyo, Japan
Z
Unit 42 Block 528, Grants View, Greenogue Business Park, Rathcoole, Dublin, Ireland
AA
Hofplein 20, Rotterdam, 3032 AC, Netherlands
AB
16 Kifissias Ave, 11526, Athens, Greece
AC
Viale Luca Gaurico, 91/93, 00143, Rome, Italy
AD
Alameda Mazarredo 7, entreplanta, 48001, Bilbao, Spain
AE
97 allée Alexandre Borodine, Immeuble Cèdre 3,
69800,
Saint Priest, France
AF
Saltend Power Station Saltend Chemicals Park, Hedon Road, Hull, East Riding of Yorkshire, England, HU12 8GA
AG
Windmill Hill Business Park, Whitehill Way, Swindon, Wiltshire, United Kingdom, SN5 6PB
AH
22 Grenville Street, St Helier, Jersey, JE4 SPX
AI
Level 12, The Shard, 32 London Bridge Street, London, SE1 9SG
AJ
Plac Marszałka Józefa Piłsudskiego 2 00-073 Warsaw
AK
4th Floor, 7 Castle Street, Edinburgh, EH2 3AH
Accompanying information continued
A3. Related undertakings continued
226
SSE plc Annual Report 2026

A4. Joint ventures and associates
The Directors have assessed that the investments in the following equity accounted joint ventures and associates are of a sufficiently material
impact to warrant additional disclosure on an individual basis. Details of the financial position and financial results of the Group:
shares held %
Group Interest %
Year end date
Consolidation basis
Seabank Power Limited
Ordinary
50.0
50.0
31 December
Equity
Marchwood Power Limited
Ordinary
50.0
50.0
31 December
Equity
SSE Slough Multifuel Holdco Limited
Ordinary
50.0
50.0
31 March
Equity
Clyde Windfarm (Scotland) Limited
Ordinary
50.1
50.1
31 March
Equity
Seagreen Holdco 1 Limited
Ordinary
49.0
49.0
31 March
Equity
Beatrice Offshore Windfarm Holdco Limited
Ordinary
40.0
40.0
31 March
Equity
Dunmaglass Wind Farm Limited
Ordinary
50.1
50.1
31 March
Equity
Stronelairg Wind Farm Limited
Ordinary
50.1
50.1
31 March
Equity
Doggerbank Offshore Wind Farm Project 1 Holdco Limited
Ordinary
40.0
40.0
31 March
Equity
Triton Power Holdings Limited
Ordinary
50.0
50.0
31 December
Equity
227
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Accompanying information continued
A4. Joint ventures and associates continued
Summary information for material joint ventures and associates from unaudited financial statements is as follows:
Other
(i)
Revenue
279.8
69.1
64.9
206.9
322.5
149.4
43.5
105.3
370.5
109.9
230.0
1,951.8
Other income
–
–
–
–
3 . 9
2 6 6 . 9
–
–
–
–
–
2 7 0 . 8
Depreciation and
amortisation
(11.7)
(7.8)
(14.9)
(29.3)
(98.4)
(88.5)
(8.0)
(13.7)
(33.6)
(9.6)
(140.9)
(456.4)
Other operating costs
(232.5)
(21.3)
(23.4)
(44.4)
(101.0)
(133.1)
(9.6)
(19.1)
(365.3)
(11.4)
(130.1)
(1,091.2)
Movement on
derivatives
–
–
–
–
(48.6)
–
–
–
4.2
–
0.5
(43.9)
Operating profit
35.6
40.0
26.6
133.2
78.4
194.7
25.9
72.5
(24.2)
88.9
(40.5)
631.1
Interest expense
0.3
(0.7)
(23.6)
(21.1)
(153.9)
(56.9)
(6.5)
(12.9)
2.2
(58.5)
(33.9)
(365.5)
Profit before tax
35.9
39.3
3.0
112.1
(75.5)
137.8
19.4
59.6
(22.0)
30.4
(74.4)
265.6
Corporation tax
(8.3)
(9.7)
–
(29.3)
4.1
(34.7)
(4.4)
(14.8)
0.5
(3.5)
0.5
(99.6)
Profit after tax
27.6
29.6
3.0
82.8
(71.4)
103.1
15.0
44.8
(21.5)
26.9
(73.9)
166.0
Recognised in other
comprehensive
income
Cash flow hedges
–
–
–
–
(13.2)
(26.2)
–
–
–
(24.7)
(47.4)
(111.5)
Taxation
–
–
–
–
3.3
6.6
–
–
–
6.2
11.8
27.9
Other
–
–
–
–
–
–
–
–
–
–
( 1 5 . 8 )
( 1 5 . 8 )
–
–
–
–
(9.9)
(19.6)
–
–
–
(18.5)
(51.4)
(99.4)
income/(loss)
27.6
29.6
3.0
82.8
(81.3)
83.5
15.0
44.8
(21.5)
8.4
(125.3)
66.6
(based on % equity)
13.8
14.8
1.5
41.5
(35.0)
41.2
7.5
22.4
(10.8)
10.8
(19.7)
88.0
Dividends paid to
shareholders
21.0
37.0
–
116.1
26.6
53.7
25.5
68.5
25.0
–
8.4
381.8
Non-current assets
114.5
107.4
455.3
472.4
2,946.6
1,531.7
156.9
289.4
202.2
3,153.4
6,607.6
16,037.4
Current assets
94.9
13.7
15.0
100.3
87.8
595.3
21.9
48.6
130.1
883.9
62.2
2,053.7
equivalents
48.8
19.6
17.6
30.6
125.3
96.1
10.9
19.8
15.4
73.1
1 3 8 . 2
5 9 5 . 4
Current liabilities
(87.7)
(20.9)
(7.4)
(46.5)
(247.2)
(568.0)
(9.1)
(27.1)
(109.7)
(51.7)
(393.2)
(1,568.5)
Non-current liabilities
(42.8)
(32.8)
(351.1)
(427.4)
(2,230.9)
(1,527.5)
(143.4)
(260.7)
(12.5)
(3,415.0)
(5,528.6)
(13,972.7)
Net assets
127.7
87.0
129.4
129.4
681.6
127.6
37.2
70.0
225.5
643.7
886.2
3,145.3
Group equity interest
50.0%
50.0%
50.0%
50.1%
49.0%
40.0%
50.1%
50.1%
50.0%
40.0%
–
–
Group’s share of
ownership interest
63.9
43.5
64.7
64.8
334.0
51.0
18.6
35.1
112.8
257.5
411.2
1,457.1
Other adjustments
(21.0)
0.3
31.1
39.3
84.5
(1.1)
62.2
191.9
28.2
1.7
70.9
488.0
Carrying value of
Group’s equity
interest
42.9
43.8
95.8
104.1
418.5
49.9
80.8
227.0
141.0
259.2
482.1
1,945.1
228
SSE plc Annual Report 2026

(restated
(ii)
)
Other
(i) (ii)
Revenue
288.1
96.3
60.0
194.6
354.0
171.1
37.7
106.6
402.6
14.8
212.1
1,937.9
Other income
–
–
–
–
23.2
245.7
–
–
–
–
0.1
269.0
Depreciation and
amortisation
(7.0)
(35.0)
(8.4)
(29.2)
(98.6)
(88.0)
(8.0)
(13.7)
(34.5)
(2.2)
(134.7)
(459.3)
costs
(241.9)
(19.5)
(21.0)
(41.4)
(89.6)
(94.8)
(8.1)
(20.4)
(420.3)
(6.8)
(134.1)
(1,097.9)
Movement on
derivatives
–
–
–
–
(53.8)
–
–
–
(3.4)
–
–
(57.2)
Operating profit
39.2
41.8
30.6
124.0
135.2
234.0
21.6
72.5
(55.6)
5.8
(56.6)
592.5
Interest expense
1.4
(1.6)
(15.2)
(18.5)
(209.3)
(59.3)
(6.2)
(11.9)
5.1
(1.5)
(31.0)
(348.0)
Profit before tax
40.6
40.2
15.4
(74.1)
174.7
15.4
60.6
(50.5)
4.3
(87.6)
244.5
Corporation tax
(11.1)
(9.2)
3.8
(26.9)
63.5
(22.7)
(3.4)
(14.8)
14.9
(1.1)
(0.7)
(7.7)
Profit after tax
29.5
31.0
19.2
78.6
(10.6)
152.0
12.0
45.8
(35.6)
3.2
(88.3)
236.8
Recognised in
other
comprehensive
income
Cash flow hedges
–
–
0.6
–
(3.3)
(12.8)
–
–
–
(49.8)
9.7
(55.6)
Taxation
–
–
–
–
0.8
3.3
–
–
–
12.5
(2.6)
14.0
O t h e r
–
–
–
–
–
–
–
–
–
–
1 5 . 8
1 5 . 8
–
–
0.6
–
(2.5)
(9.5)
–
–
–
(37.3)
22.9
(25.8)
comprehensive
income/(loss)
29.5
31.0
19.8
78.6
(13.1)
142.5
12.0
45.8
(35.6)
(34.1)
(65.4)
211.0
equity)
14.8
15.5
9.6
39.4
(5.2)
60.8
6.0
22.9
(17.8)
1.3
(57.4)
89.9
Dividends paid to
shareholders
47.0
44.2
–
102.0
38.9
119.3
12.4
55.0
–
–
11.1
429.9
Non-current assets
82.8
114.1
471.4
510.1
3,027.6
1,750.4
165.2
304.7
184.1
3,670.4
6,460.3
16,741.1
Current assets
56.7
8.5
14.9
86.8
47.2
62.7
16.7
49.8
164.1
21.6
94.7
623.7
equivalents
51.8
20.7
21.9
45.1
95.3
104.0
18.4
27.7
5.1
60.6
278.8
729.4
Current liabilities
(44.9)
(18.2)
(11.1)
(42.8)
(13.0)
(199.7)
(7.3)
(25.5)
(68.7)
(86.7)
(348.7)
(866.6)
liabilities
(26.3)
(29.5)
(370.6)
(431.7)
(2,424.9)
(1,619.6)
(144.8)
(262.5)
(12.3)
(3,042.7)
(5,649.7)
(14,014.6)
Net assets
120.1
95.6
126.5
167.5
732.2
97.8
48.2
94.2
272.3
623.2
835.4
3,213.0
interest
50.0%
50.0%
50.0%
50.1%
49.0%
40.0%
50.1%
50.1%
50.0%
40.0%
–
–
Group’s share of
ownership
interest
60.1
47.8
63.3
83.9
358.8
39.1
24.1
47.2
136.2
249.3
384.5
1,494.3
Other adjustments
(20.4)
(0.3)
31.7
39.9
100.3
(1.1)
65.5
202.9
1.6
2.4
70.5
493.0
Carrying value of
Group’s equity
interest
39.7
47.5
95.0
123.8
459.1
38.0
89.6
250.1
137.8
251.7
455.0
1,987.3
(i) In addition to the above the following joint ventures and associates have an equity carrying value that constitutes a material investment of the Group: Doggerbank Offshore Wind Farm
Project 2 Holdco Limited £128.4m (2025: £118.8m): Doggerbank Offshore Wind Farm Project 3 and 4 Holdco Limited £95.0m (2025: £90.6m) and Ossian Offshore Wind Farm Holdings Limited
£63.6m (2025: £60.8m).
(ii) The comparatives have been restated to present Neos Networks Limited in Other, based on the significance of the investment to the Group.
229
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Accompanying information continued
A4. Joint ventures and associates continued
In addition to the above at 31 March 2026, the Group was owed the following loans from its principal joint ventures: SSE Slough Multifuel
Holdco Limited £172.5m (2025: £181.3m); Clyde Windfarm (Scotland) Limited £127.1m (2025: 127.1m); Seagreen Holdco 1 Limited £648.0m
(2025: £646.0m); Dunmaglass Wind Farm Limited £46.6m (2025: £46.6m); Stronelairg Wind Farm Limited £88.7m (2025: £88.7m); and
Doggerbank Offshore Wind Farm Project 1 Holdco Limited £313.4m (2025: 188.3m). This represents 86% (2025: 85%) of the loans provided to
equity-accounted joint ventures and associates.
A5. Related party transactions
The immediate parent and ultimate controlling party of the Group is SSE plc (incorporated in Scotland). Balances and transactions between the
Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this
note. Details of transactions between the Group and other related parties are disclosed below.
Trading transactions
The following transactions took place during the year between the Group and entities which are related to the Group, but which are not
members of the Group. Related parties are defined as those in which the Group has control, joint control or significant influence over.
2026
2026
2026
2026
2025
2025
2025
2025
Marchwood Power Limited
179.9
(100.8)
–
–
111.2
(116.1)
–
(5.0)
Limited
2.9
(202.5)
0.8
(64.7)
5.6
(187.6)
0.1
(51.6)
Limited
6.9
(75.1)
0.6
(11.9)
6.3
(86.1)
1.2
(7.1)
Stronelairg Wind Farm Limited
1.3
(91.9)
–
(29.2)
2.6
(88.4)
0.1
(25.1)
Triton Power Holdings Limited
–
(30.3)
–
(5.4)
–
–
–
–
Dunmaglass Wind Farm Limited
0.6
(37.5)
–
(11.2)
1.2
(32.6)
–
(9.0)
Neos Networks Limited
4.0
(25.5)
2.3
(5.3)
6.8
(28.2)
2.1
(4.0)
Seagreen Wind Energy Limited
48.8
(167.6)
7.9
(20.8)
54.6
(171.5)
13.6
(16.8)
Doggerbank A, B, C and D
45.6
(21.6)
61.1
(1.5)
47.7
(2.8)
36.5
(1.0)
Limited
7.1
(172.9)
0.5
(62.0)
7.5
(134.7)
0.6
(50.6)
Other joint arrangements
21.4
(49.8)
3.4
(5.1)
23.9
(37.4)
12.5
(3.7)
The transactions with Marchwood Power Limited relate to the contracts for the provision of energy or the tolling of energy under power
purchase arrangements.
Details of the Group’s 15-year Affiliate Contract for Difference agreement with Seagreen Wind Energy Limited are included in note A7.2 .
The amounts outstanding are trading balances, are unsecured and will be settled in cash. Aggregate capital loans to joint ventures and
associates are shown in note 16 .
A6. Financial risk management
This note presents information about the fair value of the Group’s financial instruments, the Group’s exposure to the risks associated with those
instruments, the Group’s objectives, policies and processes for measuring and managing risk, and the Group’s management of capital. Further
qualitative disclosures are included throughout these consolidated financial statements.
The Group has exposure to the following risks from its use of financial instruments:
– Credit risk
– Liquidity risk
–C o m m o d i t y r i s k
– Currency risk
– Interest rate risk
The Board has overall responsibility for the establishment and oversight of the Group’s risk management framework. The Group’s policies for
risk management are established to identify the risks faced by the Group, to set appropriate risk limits and controls, and to monitor risks and
adherence to limits. Exposure to commodity, currency and interest rate risks arise in the normal course of the Group’s business and derivative
financial instruments are entered into to manage exposure to these risks.
SSE has a Group wide Risk Committee reporting to the Group Executive Committee, which is responsible for reviewing the risks and exposures
across the Group by overseeing the controls and strategies employed to manage these risks and by ensuring and promoting an effective system
of internal control. In addition, the Group has two dedicated Energy Market risk committees reporting to the Group Executive Committee and
Board respectively, with the Group Executive Sub-committee chaired by the Chief Executive Officer (the “Group Energy Markets Exposures Risk
Committee”) and the Board Sub-committee chaired by Non-Executive Director Tony Cocker (the “Energy Markets Risk Committee (EMRC)”).
These Committees oversee the Group’s management of its energy market exposures, including its approach to hedging.
230
SSE plc Annual Report 2026

During the year ended 31 March 2026, the Group continued to be exposed to the economic conditions impacting the primary commodities to
which it is exposed (power, gas and carbon). The Group’s approach to hedging, and the diversity of its energy portfolios (across Wind, Hydro,
Thermal and Customers) has provided certain mitigation of these exposures.
At 31 March, the Group’s collateral position was as follows:
Collateral posted included within trade and other receivables
18
13.0
9.6
Collateral held included within trade and other payables
19
(271.3)
(82.5)
Net collateral held
(258.3)
(72.9)
Exposure to the commodity, currency and interest rate risks noted arise in the normal course of the Group’s business and derivative financial
instruments are entered into to manage exposure to these risks. The objectives and policies for holding or issuing financial instruments and
similar contracts, and the strategies for achieving those objectives that have been followed during the year are explained below.
A6.1 Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty fails to meet its contractual obligations.
Credit risk arising from the Group’s normal commercial operations is controlled by individual business units operating in accordance with Group
policies and procedures. Generally, for significant contracts, individual business units enter into contracts or agreements with counterparties
having investment grade credit ratings only, or where suitable collateral or other security has been provided. Counterparty credit validation is
undertaken prior to contractual commitment.
Credit risk management for the Group’s SSEN Transmission and SSEN Distribution businesses is performed in accordance with industry
standards as set out by the Regulator and is financially controlled by the individual business units. The Group’s greatest credit risks lie with the
operations of the Energy Customer Solutions business, the wholesale procurement activities conducted by SSE Energy Markets under a trust
arrangement and the activities carried out by the Group’s Treasury function. In all cases, specific credit risk controls that match the risk profile of
those activities are applied. Exposure to credit risk in the retail supply of power and gas to end user customers arises from the potential of a
customer defaulting on their invoiced payables. The Group exposure to domestic retail supply customers is limited to customers of the Group’s
Airtricity business within Energy Customer Solutions. The creditworthiness of these customers is reviewed from a variety of internal and external
information. The financial strength and creditworthiness of business customers is assessed prior to commencing, and for the duration of, their
contract of supply.
Exposure to credit risk in the procurement of wholesale energy and fuel is managed by reference to agreed transaction credit limits which are
determined by whether the counterparty:
– holds an investment grade credit rating; or
– can be assessed as adequately creditworthy in accordance with internal credit rules using information from other external credit agencies; or
– can provide a guarantee from an investment grade rated entity or post suitable collateral or provide other acceptable assurances in
accordance with group procedures where they have failed to meet the above conditions; or
– can be allocated a non-standard credit limit approved by the relevant authority as delegated by the Group Board.
Credit support clauses and Master Netting Agreements are typically included or entered into in order to mitigate the impact to the Group
against counterparty failure or non-delivery. As part of its normal activities, SSE Energy Markets transacts significant volumes of commodity
derivative products through cleared exchanges to mitigate credit risk. Such exchanges are subject to strict regulation by the UK Financial
Conduct Authority (FCA) and participants in these exchanges are obliged to meet rigorous capital adequacy requirements.
Individual counterparty credit exposures are monitored regularly and are subject to approved limits. At 31 March 2026, SSE Energy Markets had
pledged £0.2m of cash collateral (2025: £nil) and £459.6m (2025: £494.9m) of letters of credit, and had received £258.3m (2025: £72.9m) of
cash collateral and £80.5m (2025: £77.8m) of letters of credit principally to reduce exposures on credit risk.
Bank credit exposures, which are monitored and reported on daily, are calculated on a mark-to-market basis and adjusted for future volatility and
probability of default. Any issues relating to these credit exposures are presented for discussion and review by the Tax and Treasury Committee.
Credit exposure also exists in relation to financial guarantees issued by Group companies under which the total outstanding exposure at
31 March 2026 was £349.1m (2025: £339.9m) in respect of liabilities of joint ventures and associates and £479.3m (2025: £479.3m) in respect
of the liabilities of former subsidiaries. An amount of £21.4m (2025: £25.5m) is recorded as a liability at 31 March 2026 in respect of the carrying
value of these guarantees. Expected loss allowances for financial guarantee contracts have been reviewed at the balance sheet date and will be
reviewed on an annual basis.
Cash and cash equivalents comprise cash in hand and deposits of three months or less which are readily convertible to cash. These are subject
to insignificant risk of change in value or credit risk.
Derivative financial instruments are entered into to cover the Group’s market risks – commodity risk, interest rate risk, currency risk – and are
consequently covered elsewhere in this note.
Trade receivables represent the most significant exposure to credit risk and are stated after an allowance for impairment.
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Accompanying information continued
A6. Financial risk management continued
A6.2 Concentrations of risk
Trade receivables recorded by reported segment held at the 31 March were:
SSEN Transmission
3.9
14.0
SSEN Distribution
173.3
181.1
SSE Renewables
96.5
100.3
SSE Thermal
79.2
67.5
Energy Customer Solutions
527.9
678.0
SSE Energy Markets
467.6
423.8
Corporate Unallocated
21.8
15.5
Total SSE Group
1,370.2
1,480.2
* The comparatives have been restated to reallocate £1.0m of trade receivables from Gas Storage to SSE Thermal and aggregate £505.8m and £172.2m of trade receivables in SSE Business
Energy and SSE Airtricity respectively into Energy Customer Solutions.
Energy Customer Solutions accounts for 38.5% (2025: 45.8%) of the Group’s trade receivables. Trade receivables associated with the Group’s 1.0
million power and gas customers are recorded within this business unit. The Group also has significant trade receivables associated with its SSE
Energy Markets activities which are generally settled within two to four weeks from invoicing. The Group’s exposure to credit risk is therefore
subject to diversification with no exposure to individual Energy Customer Solutions customers totalling >10% of trade receivables. The largest
customer balance, due from a SSE Energy Markets customer (also a SSE Energy Markets supplier), is 7% (2025: 4%) of the total trade receivables.
The ageing of trade receivables at the reporting date was:
Not past due
1,030.6
1,081.0
0 – 30 days
95.4
140.0
31 – 90 days
115.6
142.7
Over 90 days
284.9
332.0
1,526.5
1,695.7
Less: allowance for impairment
(156.3)
(215.5)
Net trade receivables
1,370.2
1,480.2
The Group has past due debt which has not had an impairment allowance set aside to cover potential credit losses. The Group has certain
procedures to pursue customers in significant arrears and believes its impairment policy in relation to such balances is appropriate. The level of
aged debt across all periods remains consistent with the prior year. The Group also considers various risk factors when assessing the level of
provision to recognise. Trade receivables and contract assets are written off when there is no reasonable expectation of recovery.
The debt impairment charge of £29.4m per the income statement (2025: £47.1m), primarily includes the write-off of £88.6m of trade
receivables (2025: £85.0m) offset by a decrease in the bad debt provision of £59.2m (2025: £37.9m decrease).
The Group has other receivables which are financial assets totalling £6.8m (2025: £6.6m).
The movement in the allowance for impairment of trade receivables was:
Balance at 1 April
215.5
253.4
Increase in allowance for impairment
42.1
48.8
Impairment losses recognised
(101.3)
(86.7)
Balance at 31 March
156.3
215.5
232
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A6.3 Liquidity risk and Going Concern
Liquidity risk, the risk that the Group will have insufficient funds to meet its liabilities, is managed by the Group’s Treasury function. The Group
can be exposed to significant movements in its liquidity position due to changes in commodity prices, working capital requirements, the impact
of the seasonal nature of the business and phasing of its capital investment programme.
Treasury is responsible for managing the banking and liquidity requirements of the Group, risk management relating to interest rate and foreign
exchange exposures, and for managing the credit risk relating to the banking counterparties with which it transacts. Short term liquidity is reviewed
daily by Treasury, while the longer-term liquidity position is reviewed on a regular basis by the Board. The department’s operations are governed by
policies determined by the Board and any breaches of these policies are reported to the Tax and Treasury Committee and Audit Committee.
In relation to the Group’s liquidity risk, the Group’s policy is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities
when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Group’s reputation.
During the year, the Group’s internal approach to managing liquidity was to seek to ensure that the Group had available committed borrowings
and facilities equal to at least 100% of forecast borrowings over a rolling 12 month period.
The Group uses cash flow forecasts to monitor its ongoing borrowing requirements. Typically, the Group will fund any short term borrowing
positions by issuing commercial paper or borrowing from committed and uncommitted bank lines and will invest in money market funds when
it has a cash surplus. Details of the Group’s borrowings are disclosed at note 21
. In addition to the borrowing facilities listed at note 21.3 ,
the Group has a £21m overdraft facility.
The refinancing requirement in the 26/27 financial year is £1.7bn, being the £501m of short term commercial paper that matures between April
and June, and £1.2bn of medium to long term debt maturing being the £600m Hybrid maturing in April 2026, £300m of EIB loans maturing in
May 2026 and £311m of US Private Placements maturing between June 2026 and September 2026. The Directors are confident in the ability of
the Group to maintain a funding level above 100% for the Going Concern assessment period based on the strong credit standing and
borrowing history of the Group for both fixed debt and commercial paper, as discussed more fully below.
Given the committed bank facilities of £6.5bn, £3.0bn excluding Scottish Hydro Electric Transmission plc facilities, maintained by the Group
and the current commercial paper market conditions, the Directors have concluded that both the Group and SSE plc as parent company have
sufficient headroom to continue as a Going Concern. In coming to this conclusion, the Directors have taken into account the Group’s credit
rating and the successful issuance of £6.4bn of medium to long term debt and Hybrid equity in last 5 years, including £2.2bn of long term
funding in the current financial year as well as raising £2bn through an equity raise in November 2025.
The Group’s period of Going Concern assessment is performed to 31 December 2027, 21 months from the balance sheet date, which isatleast
12 months from the filing deadline of its subsidiary companies. While the formal assessment period was to the period ending 31 December
2027, a period of three months beyond this date was reviewed for significant events that may result in a change to the conclusion of the
assessment. No events or circumstances were identified in that period beyond the formal assessment. As well as taking account of the factors
noted, the Going Concern conclusion is arrived at after applying stress testing sensitivities to the Group’s cash flow and funding projections
including removal of proceeds from unconfirmed future divestments, negative and positive sensitivities on operating cash flows and
uncommitted capex and other adjustments. The Group has also considered its obligations under its debt covenants. There have been no
breaches of covenants in the year, and the Group’s projections support the expectation that there will be no breach of covenants over the
period to 31 December 2027. The statement of Going Concern is included in the Audit Committee Report.
As at 31 March 2026, the net value of outstanding cash collateral held in respect of mark-to-market related margin calls on exchange traded
positions was £258.3m (2025: £72.9m).
The contractual cash flows shown in the following tables are the contractual undiscounted cashflows under the relevant financial instruments.
Where the contractual cashflows are variable based on a price, foreign exchange rate or index in the future, the contractual cashflows in the
following tables have been determined with reference to the relevant price, foreign exchange rate, interest rate or index as at the balance sheet
date. In determining the interest element of contractual cashflows in cases where the Group has a choice as to the length of in
terest calculation
periods and the interest rate that applies varies with the period selected, the contractual cashflows have been calculated assuming the Group
selects the shortest available interest calculation periods. Where the holder of an instrument has a choice of when to redeem, the amounts in
the following tables are on the assumption the holder redeems at the earliest opportunity.
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Accompanying information continued
A6. Financial risk management continued
A6.3 Liquidity risk and Going Concern continued
The following are the undiscounted contractual maturities of financial liabilities, including interest and excluding the impact of netting
agreements:
2026
2026
2026
2026
2026
2026
Commercial paper and cash advances
501.2
(502.2)
(502.2)
–
–
–
Loans – floating
562.7
(693.6)
(26.2)
(226.2)
(300.4)
(140.8)
Loans – fixed
1,296.4
(1,615.3)
(658.0)
(73.4)
(113.1)
(770.8)
Unsecured bonds – fixed
7,288.5
(9,935.7)
(306.8)
(1,142.8)
(2,258.3)
(6,227.8)
Fair value adjustment
1 5 . 7
–
–
–
–
–
9,664.5
(12,746.8)
(1,493.2)
(1,442.4)
(2,671.8)
(7,139.4)
Lease liabilities
456.7
(700.1)
(86.8)
(61.6)
(161.6)
(390.1)
10,121.2
(13,446.9)
(1,580.0)
(1,504.0)
(2,833.4)
(7,529.5)
Operating derivatives designated at fair value
843.9
2,558.6
1,590.7
704.6
133.0
130.3
Interest rate swaps used for hedging
28.5
(28.5)
–
(16.0)
–
(12.5)
Interest rate swaps designated at fair value
20.7
(20.7)
–
(6.6)
(0.9)
(13.2)
Forward foreign exchange contracts held for hedging
34.5
(2,410.9)
(447.5)
(780.3)
(1,183.1)
–
Forward foreign exchange contracts designated at
fair value
2.7
(113.2)
(43.3)
(12.3)
(57.6)
–
930.3
(14.7)
1,099.9
(110.6)
(1,108.6)
104.6
Trade payables
898.7
(898.7)
(898.7)
–
–
–
Financial guarantee liabilities
21.4
(21.4)
(2.4)
(5.0)
(8.4)
(5.6)
920.1
(920.1)
(901.1)
(5.0)
(8.4)
(5.6)
Total
11,971.6
(14,381.7)
(1,381.2)
(1,619.6)
(3,950.4)
(7,430.5)
Financing derivatives
(160.3)
3,227.1
526.9
1,926.5
680.0
93.7
Operating derivatives designated at fair value
(685.0)
(1,278.3)
(1,077.7)
(223.3)
11.9
10.8
(845.3)
1,948.8
(550.8)
1,703.2
691.9
104.5
Net total
(i)
11,126.3
(12,432.9)
(1,932.0)
83.6
(3,258.5)
(7,326.0)
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SSE plc Annual Report 2026

2025
2025
2025
2025
2025
2025
Commercial paper and cash advances
1,230.5
(1,243.0)
(1,243.0)
–
–
–
Loans – floating
200.0
(233.3)
(11.1)
(11.1)
(211.1)
–
Loans – fixed
1,300.4
(1,669.0)
(54.6)
(346.7)
(459.1)
(808.6)
Unsecured bonds – fixed
7,507.1
(10,125.6)
(777.9)
(792.8)
(1,999.5)
(6,555.4)
Fair value adjustment
(88.6)
–
–
–
–
–
10,149.4
(13,270.9)
(2,086.6)
(1,150.6)
(2,669.7)
(7,364.0)
Lease liabilities
455.0
(711.9)
(75.2)
(64.4)
(169.1)
(403.2)
10,604.4
(13,982.8)
(2,161.8)
(1,215.0)
(2,838.8)
(7,767.2)
Operating derivatives designated at fair value
162.1
387.3
(81.1)
205.9
92.4
170.1
Interest rate swaps used for hedging
76.8
(76.8)
(45.5)
(17.4)
(12.6)
(1.3)
Interest rate swaps designated at fair value
31.0
(31.0)
(7.4)
(7.5)
(5.5)
(10.6)
Forward foreign exchange contracts held for hedging
19.9
(975.4)
(258.1)
(171.8)
(545.5)
–
Forward foreign exchange contracts designated at fair
value
4.2
(474.0)
(413.6)
(56.2)
(4.2)
–
294.0
(1,169.9)
(805.7)
(47.0)
(475.4)
158.2
Trade payables
710.7
(710.7)
(710.7)
–
–
–
Financial guarantee liabilities
25.5
(25.5)
(2.4)
(7.8)
(3.6)
(11.7)
736.2
(736.2)
(713.1)
(7.8)
(3.6)
(11.7)
Total
11,634.6
(15,888.9)
(3,680.6)
(1,269.8)
(3,317.8)
(7,620.7)
Financing derivatives
(83.7)
793.5
544.2
172.9
70.9
5.5
Operating derivatives designated at fair value
(158.2)
366.5
304.6
26.0
24.0
11.9
(241.9)
1,160.0
848.8
198.9
94.9
17.4
Net total
(i)
11,392.7
(14,728.9)
(2,831.8)
(1,070.9)
(3,222.9)
(7,603.3)
(i) The Group believes the liquidity risk associated with out-of-the-money operating derivative contracts needs to be considered in conjunction with the profile of payments or receipts arising
from derivative financial assets. It should be noted that cash flows associated with future energy sales and commodity contracts which are not IFRS 9 financial instruments are not included
in this analysis, which is prepared in accordance with IFRS 7 “Financial Instruments: Disclosures”.
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Accompanying information continued
A6. Financial risk management continued
A6.4 Commodity risk
The Group’s Energy Markets business implements the hedging policy through trading in the commodity markets and manages the requirement
for the delivery of the Group’s physical commodity needs as part of its normal course of business. The risk management activity carried out
by SSE Energy Markets arises from the Group’s requirement to source gas, electricity or other commodities such as renewable obligation
certificates for Energy Customer Solutions, and to procure fuel and other commodities and provide a route-to-market and risk management
services for SSE Renewables and SSE Thermal.
Current hedging approach
The Group has traded in three principal commodities during the year, as well as the spreads between two or more commodity prices: power
(baseload and other products); gas; and carbon (emissions allowances). Each commodity has different liquidity characteristics, which impacts
on the degree of hedging possible. Similarly, each of the Group’s assets carries different exposures to the commodity market and thus requires
a different approach to hedging. As such, the Group’s current hedging approach varies by each class of asset as follows:
Asset class
Minimum Hedge Target
Principal Commodity Exposures
Wind
Target to hedge less than 100% of anticipated wind energy output for the
Hydro
Target to hedge less than 100% of forecast generation 12 months in advance of
Thermal
Hedging for the flexible thermal fleet is by its nature dynamic, changing as market
SSE Business Energy
Sales to contract customers are 100% hedged: at point of sale for fixed, upon
However, there are three principal areas where significant variations in earnings cannot be fully mitigated through hedging:
– The impact of the weather on the volume of electricity produced from renewable sources;
– The impact of operational matters such as unplanned outages; and
– The ability of flexible thermal power stations to earn extrinsic income by providing services to the electricity system and by responding to
shorter-term electricity market conditions.
Hedging is carried out by each asset class trading internally with SSE Energy Markets to affect these hedges and SSE Energy Markets then
trading onwards with external counterparties and markets. SSE Energy Markets is only able to accept internal trades when there is sufficient
liquidity to offset them in the external market or they can be offset with internal trades from other asset classes. In this way, the commodity risks
to which SSE Energy Markets is individually exposed, are minimised.
The volumetric extent to which assets are hedged are reported monthly to the Group Energy Markets Exposures Risk Committee, and to the
Energy Markets Risk Committee (“EMRC”) on at least a quarterly basis. Variations to the hedging approach above will be required as markets and
other factors (such as asset disposals) change. The EMRC also receives reporting on credit risk, other risk measures, and market liquidity in
assessing whether any variations to the hedging approach are required.
The Group measures and manages the Commodity Risk associated with the financial and non-financial commodity contracts it is exposed to.
However, within the Group’s financial statements only certain commodity contracts are designated as financial instruments under IFRS 9. As a
result, it is only the fair value of those IFRS 9 financial instruments which represents the exposure of the Group’s commodity price risk under
IFRS 7. This is a consequence of the Group’s accounting policy which stipulates that commodity contracts which are designated as financial
instruments under IFRS 9 should be accounted for on a fair value basis with changes in fair value reflected in profit or equity. Conversely,
commodity contracts that are not designated as financial instruments under IFRS 9 will be accounted for as “own use” contracts. As fair value
changes in own use contracts are not reflected through profit or equity, these do not represent the IFRS 7 commodity price risk. Furthermore,
other physical contracts can be treated as the hedging instrument in documented cash flow hedging relationships where the hedged item is the
forecast future purchase requirement to meet production or customer demand. The accounting policies associated with financial instruments
are explained in the Accompanying Information section A1
.
Sensitivity analysis
The Group’s exposure to commodity price risk according to IFRS 7 is measured by reference to the Group’s IFRS 9 commodity contracts.
IFRS 7 requires disclosure of a sensitivity analysis for market risks that is intended to illustrate the sensitivity of the Group’s financial position and
performance to changes in market variables impacting upon the fair value or cash flows associated with the Group’s financial instruments.
Therefore, the sensitivity analysis provided discloses the effect on profit or loss and equity at the balance sheet date assuming that a reasonably
possible change in the relevant commodity price had occurred and been applied to the risk exposures in existence at that date. The reasonably
possible changes in commodity prices used in the sensitivity analysis were determined based on calculated or implied volatilities where
available, or historical data.
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The sensitivity analysis has been calculated on the basis that the proportion of commodity contracts that are IFRS 9 financial instruments remains
consistent with those at that point. Excluded from this analysis are all commodity contracts that are not financial instruments under IFRS 9.
2026
2025
Base Price
(i)
variable
Base Price(i)
UK gas (p/therm)
92
+62/-47
89
+50/–40
EU gas (€/MWh)
(ii)
–
–
34
+19/–15
UK power (£/MWh)
101
+94/-70
88
+39/–34
UK carbon (£/tonne)
43
+27/-21
45
+23/–19
EU carbon (€/tonne)
79
+37/-30
71
+40/–32
IRL power (€/MWh)
141
+65/-51
123
+59/–48
EU power (€/MWh)
(ii)
–
–
31
+11/–10
(i) The base price represents the weighted average forward market price over the duration of the active market curve used to calculate the sensitivity analysis. The reasonably possible
increase/decrease in market prices has been determined via SSE Energy Markets price model simulations and the volatility assumptions of the model have been calibrated from a look-back
analysis over the previous 12 month period.
(ii) A price sensitivity is not presented for EU power or EU gas as the Group had no EU power volumetric exposure and a net nil EU gas volumetric exposure at the reporting date; accordingly,
there would be no impact from a reasonably possible increase or decrease in these commodity prices.
The impacts of reasonably possible changes in commodity prices on profit after taxation based on the rationale described are as follows:
Commodity prices combined – increase
(645.2)
(287.1)
Commodity prices combined – decrease
487.4
212.6
The sensitivity analysis provided is hypothetical and is based on the exposure to energy-related commodities, and their corresponding valuation
under IFRS 9, that the Group has at each year end. This analysis should be used with caution as the impacts disclosed are not necessarily
indicative of the actual impacts that would be experienced given it does not consider all interrelationships, consequences and effects of such a
change in those prices.
A6.5 Currency risk
The Group presents its consolidated financial statements in pounds Sterling. The Group is exposed to foreign currency risk arising from
transactions denominated in currencies other than Sterling and from its net investments in foreign operations. As a result, it is subject to foreign
currency exchange risk arising from exchange rate movements which will be reflected in the Group’s transaction costs or in the underlying
foreign currency assets of its foreign operations.
The Group’s policy is to use forward contracts, swaps and options to manage its exposures to foreign exchange risk. All such exposures are
transactional in nature, and relate primarily to procurement contracts, commodity purchasing and related freight requirements, commodity
hedging, long term plant servicing and maintenance agreements and the purchase and sale of carbon emission certificates. The policy is
to seek to hedge 100% of its currency requirements arising under all committed contracts excepting commodity hedge transactions, the
requirements for which are significantly less predictable. The policy for these latter transactions is to assess the Group’s requirements on a
rolling basis and to enter into cover contracts as appropriate.
The Group has foreign operations with significant Euro-denominated and JPY-denominated net assets. The Group’s policy is to hedge its net
investment in its foreign operations by ensuring the net assets whose functional currency cash flows are denominated in foreign currencies
are matched by borrowings in the same currency. For SSE Pacifico, whose functional currency is JPY but which presently has limited capital
commitments, SSE has no JPY denominated borrowings and hence has no current net investment hedge. For the acquired net assets whose
functional cash flows are in Sterling, the Group will ensure Sterling denominated borrowings are in place to minimise currency risk.
Significant exposures are reported to, and discussed by, the Tax and Treasury Committee on an ongoing basis and additionally form part of the
bi-annual Treasury report to the Audit Committee.
At the balance sheet date, the total nominal value of outstanding forward foreign exchange contracts that the Group has committed to is:
Forward foreign exchange contracts
8,286.1
4,086.1
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Accompanying information continued
A6. Financial risk management continued
A6.5 Currency risk continued
The Group’s exposure to foreign currency risk was as follows:
2026
2025
Loans and borrowings
–
244.0
5,427.5
–
–
3,000.0
–
244.0
5,200.0
–
–
contract commitments
28,154.3
815.5
3,050.9
29.6
10.4
198.4
4,881.7
33.8
1,743.7
–
10.4
Gross exposure
28,154.3
1,059.5
8,478.4
29.6
10.4
3,198.4
4,881.7
277.8
6,943.7
–
10.4
contracts
28,154.3
1,059.5
5,596.5
29.6
10.4
3,198.4
4,881.7
277.8
4,028.9
–
10.4
Net exposure (in currency)
–
–
2 , 8 8 1 . 9
–
–
–
–
–
2 , 9 1 4 . 8
–
–
Net exposure (in £m)
–
–
2,516.7
–
–
–
–
–
2,441.6
–
–
This represents the net exposure to foreign currencies, reported in pounds Sterling, and arising from all Group activities. All sensitivity analysis
has been prepared on the basis of the relative proportions of instruments in foreign currencies being consistent as at the balance sheet date.
This includes only monetary assets and liabilities denominated in a currency other than Sterling and excludes the translation of the net assets
of foreign operations but not the corresponding impact of the net investment hedge.
The following sensitivity analysis is provided for monetary assets in Euro only, as the only currency with significant net exposure as at the current
and prior year end, as noted above. The sensitivity analysis is indicative only and it should be noted that the Group’s exposure to such market
rate changes is continually changing. The calculations are based on linear extrapolations of rate changes which may not reflect the actual result
which would impact upon the Group.
The majority of these contracts are held to limit exposure to foreign currency movements on asset procurement contracts. A 10% change in
foreign currency exchange rates would have had the following impact on profit after taxation, based on the assumptions presented above:
Equity
Income statement
Euro
187.6
167.5
22.2
35.9
The impact of a decrease in rates would be an identical reduction in the annual charge.
A6.6 Interest rate risk
Interest rate risk arises from the Group’s exposure to changes in the value of financial assets and liabilities, and to variability in future cash flows,
resulting from movements in market interest rates.
The Group manages this risk by maintaining a fixed interest rate profile. At each reporting period end, the Group’s policy is to ensure that at least
80% of debt is fixed for the following 12 months, at least 70% is fixed for the 12 month period commencing in 12 months’ time and at least 60%
is fixed for the 12-month period commencing in 24 months’ time, either directly through the debt instruments themselves or through the use
of derivative financial instruments. Floating rate borrowings are provided by banks including the European Investment Bank (EIB) and the short
term issuance on the €1.5bn commercial paper programme. Derivative instruments used to manage interest rate risk include interest rate swaps
and options, forward rate agreements and, where debt is raised in currencies other than Sterling, cross-currency interest rate swaps. These
practices serve to reduce the volatility of the Group’s financial performance.
Interest rate derivatives are primarily used to hedge risk relating to existing borrowings; in certain circumstances, derivatives may also be used to
hedge forecast borrowings. Any such pre-hedging is unwound at the time of pricing the underlying debt, either through cash settlement on a
net present value basis or by transacting offsetting trades. Floating rate borrowings mainly comprise term loans from the European Investment
Bank (EIB), and other relationship banks as well as outstanding commercial paper issuance. At the reporting date, the Group also held a surplus
cash of £1,542.9m (2025: £1,090.5m), which gives rise to interest rate exposure.
238
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The impact of a change in interest rates is dependent on the specific details of the financial asset or liability in question. Changes in fixed rate
financial assets and liabilities, which account for the majority of cash, loans and borrowings, are not measured at fair value through the income
statement and are therefore not sensitive to interest rate movements in the profit or loss. Changes in variable rate assets and liabilities, including
those arising from floating rate working capital arrangements and forecast interest cash flows, are managed through the use of derivative
financial instruments, including fixed-to-floating cross-currency interest rate swaps. Where fair value hedge accounting is applied, changes
in the fair value of both the hedged items and the hedging instruments that are attributable to interest rate risk are recognised in the income
statement. Where cash flow hedging accounting is applied, the effective portion of movements in the hedging instruments is initially recognised
in other comprehensive income and subsequently reclassified to the income statement as the hedged cash flows affect profit or loss.
Accordingly, the interest rate exposure reflects the Group’s variable rate debt, forecast interest cash flows and related derivative instruments,
rather than its fixed rate instruments.
The net exposure to interest rates at the balance sheet date can be summarised thus:
fixed
(9,424.5)
(9,901.8)
floating
913.8
349.1
(8,510.7)
(9,552.7)
Cash and cash equivalents
1,542.9
1,090.5
Derivative financial assets/(liabilities)
67.6
(38.8)
Loans and borrowings
(9,664.5)
(10,149.4)
Lease liabilities
(456.7)
(455.0)
(8,510.7)
(9,552.7)
The table below illustrates the expected impact on the income statement of a change of 100 basis points parallel shift in short term interest
rates at the reporting date. The analysis assumes that the interest rate change occurs at the balance sheet date and all other variables remain
constant.
The sensitivity is calculated based on the Group’s interest rate risk exposures outstanding at the balance sheet date, reflecting the proportion of
fixed to floating instruments at that date, and is stated after the effect of taxation. The analysis incorporates the impact of derivative instruments
designated in hedge accounting relationships, where applicable.
The sensitivity analysis is indicative only. The Group’s exposure to interest rate movements changes over time as the level and mix of debt and
derivative instruments vary, and year-end balances are not necessarily representative of average exposures during that period. The calculation is
based on linear extrapolations of interest rate movements and may not reflect the actual impact on the Group’s results.
Income statement
4.7
5.6
A decrease in interest rates of an equal magnitude would result in a corresponding reduction in the annual charge. There is no impact on equity
as the analysis relates to the Group’s net exposure at the balance sheet date.
239
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Financial StatementsGovernanceStrategic Report

Accompanying information continued
A7. Fair value of financial instruments
A7.1 Fair value of financial instruments within the Group
The fair values of the primary financial assets and liabilities of the Group together with their carrying values are as follows:
2026
2026
2026
2026
2025
2025
2025
2025
Amortised cost
(i)
FVTOCI
(ii)
cost
(i)
FVTOCI
(ii)
Trade receivables
1,370.2
–
1,370.2
1,370.2
1,480.2
–
1,480.2
1,480.2
Other receivables
6.8
–
6.8
6.8
6.6
–
6.6
6.6
Cash collateral and
other deposits
25.3
–
25.3
25.3
19.2
–
19.2
19.2
Cash and cash equivalents
1,542.9
–
1,542.9
1,542.9
1,090.5
–
1,090.5
1,090.5
Derivative financial assets
–
651.4
651.4
651.4
–
178.4
178.4
178.4
2,945.2
651.4
3,596.6
3,596.6
2,596.5
178.4
2,774.9
2,774.9
investments
–
7.6
7.6
7.6
–
8.8
8.8
8.8
Loan note receivable
220.0
–
220.0
220.0
193.5
–
193.5
193.5
Loans to associates and
jointly controlled entities
1,621.2
–
1,621.2
1,621.2
1,510.3
–
1,510.3
1,510.3
Derivative financial assets
–
193.9
193.9
193.9
–
63.5
63.5
63.5
1,841.2
201.5
2,042.7
2,042.7
1,703.8
72.3
1,776.1
1,776.1
4,786.4
852.9
5,639.3
5,639.3
4,300.3
250.7
4,551.0
4,551.0
Trade payables
(898.7)
–
(898.7)
(898.7)
(710.7)
–
(710.7)
(710.7)
Outstanding liquid funds
(271.3)
–
(271.3)
(271.3)
(82.5)
–
(82.5)
(82.5)
Loans and borrowings
(iii)
(1,112.1)
(12.5)
(1,124.6)
(1,123.7)
(1,924.3)
28.8
(1,895.5)
(1,937.0)
Lease liabilities
(79.8)
–
(79.8)
(79.8)
(68.5)
–
(68.5)
(68.5)
liabilities
–
(2.4)
(2.4)
(2.4)
–
(2.4)
(2.4)
(2.4)
liabilities
–
(641.1)
(641.1)
(641.1)
–
(126.3)
(126.3)
(126.3)
(2,361.9)
(656.0)
(3,017.9)
(3,017.0)
(2,786.0)
(99.9)
(2,885.9)
(2,927.4)
Loans and borrowings
(iii)
(8,536.7)
(3.2)
(8,539.9)
(8,133.3)
(8,313.7)
59.8
(8,253.9)
(7,960.4)
Lease liabilities
(376.9)
–
(376.9)
(376.9)
(386.5)
–
(386.5)
(386.5)
liabilities
–
(19.0)
(19.0)
(19.0)
–
(23.1)
(23.1)
(23.1)
liabilities
–
(289.2)
(289.2)
(289.2)
–
(167.7)
(167.7)
(167.7)
(8,913.6)
(311.4)
(9,225.0)
(8,818.4)
(8,700.2)
(131.0)
(8,831.2)
(8,537.7)
(11,275.5)
(967.4)
(12,242.9)
(11,835.4)
(11,486.2)
(230.9)
(11,717.1)
(11,465.1)
Net financial liabilities
(6,489.1)
(114.5)
(6,603.6)
(6,196.1)
(7,185.9)
19.8
(7,166.1)
(6,914.1)
(i) Financial assets and liabilities that are measured at amortised cost.
(ii) Financial assets and liabilities that are measured at either Fair Value through Profit and Loss (Derivative Financial Assets and Liabilities) or Fair Value through other comprehensive income
(Unquoted Equity Investments)
(iii) The fair value through profit or loss attributable to loans and borrowings totalling £15.7m (2025: £88.6m) relates to fair value hedges that are in place against the Group’s loans
and borrowings. At 31 March 2026, Scottish Hydro Electric Transmission plc had no drawings under its revolving credit facility (2025: £340.0m). The £340.0m drawn at 31 March 2025 was
classified as non-current within debt maturing in two to five years in accordance with IAS 1 paragraph 75A. The debt was repaid in April 2025, subsequent to the balance sheet date.
240
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A7.1.1 Basis of determining fair value
Certain assets and liabilities have been classified and carried at amortised cost on inception in line with IFRS 9 criteria. The carrying value
of these assets are approximately equivalent to fair value due to short term maturity aside from loans and borrowings which are subject to
longer maturity dates.
All other financial assets and liabilities are measured at either Fair Value through Profit and Loss (“FVTPL”) or Fair Value through Other
Comprehensive Income (“FVTOCI”). Fair values for energy derivatives are based on unadjusted quoted market prices, where actively traded. For
energy derivatives that are not actively traded, interest rate instruments, foreign currency hedge contracts and cross currency swap contracts
associated with foreign currency denominated long term fixed rate debt, the fair values are determined by reference to closing rate market
prices for similar instruments. Fair values for unquoted equity instruments are derived from venture capital or growth equity firm valuation
statements. Fair values for financial guarantee contracts are equal to the premium or fee received/charged.
The fair values are stated at a specific date and may be different from the amounts which will actually be paid or received on settlement of the
instruments. The fair value of items such as property, plant and equipment, internally generated brands or the Group’s customer base are not
included as these are not considered financial instruments.
A7.2 Fair value hierarchy
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into
Levels 1 to 3 based on the degree to which the fair value is observable.
– Level 1 fair value measurements are those derived from unadjusted quoted market prices for identical assets or liabilities.
– Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
– Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on
observable market data.
2026
2025
Energy derivatives
460.3
213.1
11.6
685.0
71.5
80.9
5.8
158.2
Interest rate derivatives
–
116.8
–
116.8
–
6 8 . 9
–
6 8 . 9
Foreign exchange derivatives
–
4 3 . 5
–
4 3 . 5
–
1 4 . 8
–
1 4 . 8
Unquoted equity investments
–
–
7 . 6
7 . 6
–
–
8 . 8
8 . 8
460.3
373.4
19.2
852.9
71.5
164.6
14.6
250.7
Energy derivatives
–
( 7 8 7 . 8 )
( 5 6 . 1 )
( 8 4 3 . 9 )
–
(80.8)
(81.3)
(162.1)
Interest rate derivatives
–
(49.2)
–
(49.2)
–
(107.8)
–
(107.8)
Foreign exchange derivatives
–
(37.2)
–
(37.2)
–
( 2 4 . 1 )
–
( 2 4 . 1 )
Loans and borrowings
*
–
( 1 5 . 7 )
–
( 1 5 . 7 )
–
88.6
–
88.6
–
(889.9)
(56.1)
(946.0)
–
(124.1)
(81.3)
(205.4)
* At 31 March 2025, the £88.6m relates to fair value hedges that are in place against the Group’s loans and borrowings and has been included in the table above within financial liabilities, as it
is presented in loans and borrowings liabilities in the balance sheet.
The table above excludes financial guarantee liabilities measured in accordance with IFRS 17. There were no significant transfers out of Level 1
into Level 2 and out of Level 2 into Level 1 during the current and prior year. There were no significant transfers out of Level 2 into Level 3 or out
of Level 3 into Level 2 during the current and prior year.
The Group has an Affiliate Contract for Difference (“ACfD”) agreement with Seagreen Wind Energy Limited (“SWEL”) with a 5 year term. SWEL is a
wholly owned subsidiary of Seagreen Holdco 1 Limited, a joint venture between the Group (49%) and TotalEnergies (25.5%) and PTT Exploration
& Production Public Company Limited (PTTEPP) (25.5%) and TOTAL SE has an equivalent ACfD with SWEL. The Group also has some smaller
commercial CfD arrangements with non-government third parties that are also classified as derivatives. The ACfD and the commercial CfDs
meet the definition of financial instruments and are classified as Level 3 on the fair value hierarchy due to significant unobservable inputs in the
determination of fair value.
The fair value measurement impact in the income statement attributable to Level 3 CfDs was a gain of £30.0m (2025: £23.9m gain). The fair
value was determined using the income approach with reference to future market prices which are beyond the liquid period in the
forward market.
The non-government CfDs were issued for £nil consideration, being the deemed transaction price. The Group has calculated that the contracts
had a fair value on day 1, being the difference between the strike price per the contract and the forward market spot price. This valuation is
based on unobservable inputs and is considered judgemental. Key assumptions applied when deriving the fair value are related to discount
rates; electricity volumes; and electricity prices. In line with IFRS 9, the day 1 gain is deferred and will be recognised over the life of the contract.
241
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Accompanying information continued
A7. Fair value of financial instruments continued
A7.2 Fair value hierarchy continued
The following table represents the difference between the Level 3 financial instruments at fair value at the start of the reporting period and at
the reporting date:
Level 3 financial instrument fair value at 1 April
(66.7)
(97.6)
Additions
(3.4)
3.4
Transfer from financial assets
–
4.6
Disposals in year
(2.9)
(0.1)
Cash settlement
(28.6)
(38.5)
Re-measurement gain recognised in income statement
37.4
5.2
Re-measurement loss recognised in other comprehensive income
0.1
(0.8)
Additions – new instruments entered in the year
(10.3)
342.3
Deferred day 1 gains on instruments entered in the year
10.3
(342.3)
Instruments derecognised in the year
–
(342.0)
Deferred day 1 gains derecognised in the year
–
370.7
Amortisation of day 1 gains in the year
27.2
28.4
Level 3 financial instrument fair value at 31 March
(36.9)
(66.7)
The following table details the valuation technique, significant unobservable inputs and the range of values for the energy derivatives measured
at fair value on a recurring basis and classified as Level 3.
£m
Valuation technique
31 March 2026
45.5
Discounted cash flow
31 March 2025
75.5
Discounted cash flow
Deferred measurement differences
Deferred measurement difference at 1 April
356.7
413.5
Deferred measurement difference adjustment in the year
(5.0)
–
Deferred measurement difference arising during the year on new instruments
(10.3)
342.3
Deferred measurement differences derecognised in the year
–
(370.7)
Deferred measurement difference recognised during the year
(27.2)
(28.4)
Deferred measurement difference at 31 March
314.2
356.7
The following table shows the impact on the fair value of the Level 3 energy derivatives when applying reasonably possible alternative
assumptions to the valuation obtained using the discounted cash flow model.
At 31 March 2026
At 31 March 2025
Discount rate
+1%/-1%
(10.6)/11.5
+1%/-1%
(12.8)/13.9
Volumes
+10%/-10%
28.4/(28.4)
+10%/-10%
26.5/(28.7)
Prices
+10%/-10%
115.1/(115.1)
+10%/-10%
87.5/(87.5)
242
SSE plc Annual Report 2026

A8. Hedge accounting
A8.1 Cash flow hedges
The Group designates qualifying derivative contracts as either as cash flow hedges or fair value hedges for hedge accounting purposes. Cash flow
hedges are used to hedge exposures to variability in cash flows from forecast transactions, primarily arising from changes in interest rates or
foreign currency exchange rates. The Group’s accounting policy on hedge accounting is set out in the Accompanying Information section A1
.
Following adoption of IFRS 9 on 1 April 2019, the Group elected to continue to apply IAS 39 for hedge accounting. The Group will adopt the
hedge accounting requirements of IFRS 9 from 1 April 2026 to align its hedge accounting more closely with the Group’s risk management
objectives. The impact of adoption is disclosed in note 2.2 .
The following table indicates the contractual maturity profile of forecast transactions and the associated qualifying cash flow hedging
instruments. Non-Sterling denominated contractual cash flows have been translated using the relevant forward foreign exchange rates.
2026
2026
2026
2026
2026
2026
2025
2025
2025
2025
2025
2025
Assets
33.6
34.8
7.1
20.5
(13.8)
21.0
15.4
16.5
5.9
5.3
5.3
–
Liabilities
(2.9)
(3.0)
–
(0.4)
(14.3)
11.7
–
–
–
–
–
–
30.7
31.8
7.1
20.1
(28.1)
32.7
15.4
16.5
5.9
5.3
5.3
–
Assets
62.2
85.9
16.2
(37.4)
(17.1)
124.2
32.7
48.5
7.9
7.2
(46.1)
79.5
Liabilities
(26.7)
(19.6)
(22.5)
(22.2)
(34.1)
59.2
(74.2)
(75.4)
(43.2)
(13.4)
(37.1)
18.3
35.5
66.3
(6.3)
(59.6)
(51.2)
183.4
(41.5)
(26.9)
(35.3)
(6.2)
(83.2)
97.8
Assets
41.9
3,011.6
435.9
1,913.4
642.9
19.4
9.6
584.8
292.9
133.5
158.4
–
Liabilities
(34.6)
2,410.9
447.5
780.3
1,183.1
–
(19.7)
861.1
234.8
182.2
444.1
–
7.3
5,422.5
883.4
2,693.7
1,826.0
19.4
(10.1)
1,445.9
527.7
315.7
602.5
–
A8.2 Net investment hedge
The Group’s net investment hedge consists of debt issued in the same currency (€) as the net investment in foreign subsidiaries with € denominated
functional currencies being the Airtricity Supply business within Energy Customer Solutions, the thermal plants in Ireland and wind farms in
Ireland and Southern Europe. The hedge compares the element of the net assets whose functional cash flows are denominated in € to the
matching portion of the € borrowings held by the Group. This therefore provides protection against movements in foreign exchange rates.
There is no net investment hedge in relation to SSE Pacifico as the Group has no JPY denominated debt.
Gains and losses on the hedging instruments are recognised in equity and will be transferred to the income statement on disposal of the foreign
operation (2026: £87.5m loss, 2025: £36.0m gain). Gains and losses on the ineffective portion of the hedge relationship are recognised immediately
in the income statement (2026: £nil, 2025: £nil).
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Company balance sheet
as at 31 March 2026
Note
2026
£m
2025
£m
Assets
Equity investments in joint ventures and associates 3 – 4.0
Loans to joint ventures and associates 3 86.7 83.5
Investments in subsidiaries 4 1,991.6 1,976.2
Trade and other receivables 5 13,522.7 9,412.2
Derivative financial assets 11 20.8 25.1
Retirement benefit assets 10 364.3 353.7
Non-current assets 15,986.1 11,854.7
Trade and other receivables 5 524.5 2,317.8
Cash and cash equivalents 1,411.7 987.6
Derivative financial assets 11 13.2 22.1
Current assets 1,949.4 3,327.5
Total assets 17,935.5 15,182.2
Liabilities
Loans and other borrowings 8 824.6 1,895.5
Trade and other payables 6 2,161.9 1,638.6
Current tax liability 7 44.7 36.5
Financial guarantee liabilities 12 9.1 9.3
Provisions 14 32.4 23.9
Derivative financial liabilities 11 0.5 53.6
Current liabilities 3,073.2 3,657.4
Loans and other borrowings 8 3,727.7 3,940.7
Deferred tax liabilities 7 76.4 83.5
Financial guarantee liabilities 12 73.1 90.8
Provisions 14 158.7 177.7
Derivative financial liabilities 11 36.6 53.0
Non-current liabilities 4,072.5 4,345.7
Total liabilities 7,145.7 8,003.1
Net assets 10,789.8 7,179.1
Equity
Share capital 9 607.7 555.6
Share premium 2,738.9 812.6
Capital redemption reserve 52.6 52.6
Hedge reserve 24.7 37.3
Retained earnings 4,380.1 3,838.6
Equity attributable to ordinary shareholders of the parent 7,804.0 5,296.7
Hybrid equity 9 2,985.8 1,882.4
Total equity 10,789.8 7,179.1
Result for the year
In accordance with the concession granted under section 408 of the Companies Act 2006, the income statement and statement of comprehensive
income of the Company have not been separately presented in these financial statements. The profit for the year dealt with in the financial
statements of the Company was £1,186.4m (2025: £1,338.2m) including dividends received from subsidiaries of £1,175.5m (2025: £1,615.0m).
These financial statements were approved by the Board of Directors on 27 May 2026 and signed on their behalf by:
Barry O’Regan, Sir John Manzoni,
Chief Financial Officer Chairman
SSE plc
Registered No: SC117119
244
SSE plc Annual Report 2026

Company statement of changes in equity
for the year ended 31 March 2026
Share capital
£m
Share
premium
£m
Capital
redemption
reserve
£m
Hedge reserve
£m
Retained
earnings
£m
Total
attributable to
ordinary
shareholders
£m
Hybrid
equity
£m
Total
equity
£m
At 1 April 2025 555.6 812.6 52.6 37.3 3,838.6 5,296.7 1,882.4 7,179.1
Profit for the year – – – – 1,113.5 1,113.5 72.9 1,186.4
Other comprehensive
income – – – (12.6) (1.6) (14.2) – (14.2)
Total comprehensive
income for the year – – – (12.6) 1,111.9 1,099.3 72.9 1,172.2
Dividends to shareholders – – – – (734.1) (734.1) – (734.1)
Scrip dividend related
share issue 3.2 (3.2) – – 133.0 133.0 – 133.0
Issue of shares net of costs 48.9 1,929.5 – – – 1,978.4 – 1,978.4
Issue of treasury shares – – – – 17.4 17.4 – 17.4
Distributions to Hybrid
equity holders – – – – – – (72.9) (72.9)
Issue of Hybrid equity ––––––1,103.41,103.4
Credit in respect of
employee share awards ––––38.738.7–38.7
Investment in own shares
(i)
– – – – (25.4) (25.4) – (25.4)
At 31 March 2026 607.7 2,738.9 52.6 24.7 4,380.1 7,804.0 2,985.8 10,789.8
for the year ended 31 March 2025
Share capital
£m
Share
premium
£m
Capital
redemption
reserve
£m
Hedge reserve
£m
Retained
earnings
£m
Total
attributable to
ordinary
shareholders
£m
Hybrid
equity
£m
Total
equity
£m
At 1 April 2024 548.1 820.1 52.6 17.0 3,016.6 4,454.4 1,882.4 6,336.8
Profit for the year – – – – 1,264.5 1,264.5 73.7 1,338.2
Other comprehensive
income – – – 20.3 5.3 25.6 – 25.6
Total comprehensive
income for the year – – – 20.3 1,269.8 1,290.1 73.7 1,363.8
Dividends to shareholders – – – – (671.0) (671.0) – (671.0)
Scrip dividend related
share issue 7.5 (7.5) – – 268.9 268.9 – 268.9
Issue of treasury shares – – – – 17.8 17.8 – 17.8
Distributions to Hybrid
equity holders – – – – – – (73.7) (73.7)
Share buyback – – – – (71.7) (71.7) – (71.7)
Credit in respect of
employee share awards – – – – 22.3 22.3 – 22.3
Investment in own shares
(i)
– – – – (14.1) (14.1) – (14.1)
At 31 March 2025 555.6 812.6 52.6 37.3 3,838.6 5,296.7 1,882.4 7,179.1
(i) Investment in own shares is the purchase of own shares less the settlement of Treasury shares for certain employee share schemes.
245
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Notes to the Company financial statements
for the year ended 31 March 2026
1. Principal accounting policies
1.1 General information
SSE plc (the “Company”) is a company domiciled in Scotland.
The address of the registered office is given on the back cover.
The Company financial statements present information about
the Company as a separate entity and not about the Group.
1.2 Basis of preparation
The financial statements have been prepared in accordance with
United Kingdom Generally Accepted Accounting Practice (United
Kingdom Accounting Standards and applicable law) including
Financial Reporting Standard 101, “Reduced Disclosure Framework”.
Under section 408 of the Companies Act 2006 the Company is
exempt from the requirement to present its own income statement
and related notes.
It has also taken advantage of the following disclosure exemptions
available under FRS 101.
– A cash flow statement and related notes;
– Related party disclosures;
– Disclosures in respect of capital management; and
– The effects of new but not yet effective IFRSs.
As the consolidated financial statements of SSE plc include the
equivalent disclosure, the Company has also taken advantage of the
exemptions, under FRS 101, available in respect of the following
disclosure:
– Certain disclosures required by IFRS 13 “Fair value measurement”
and the disclosures required by IFRS 7 “Financial instrument
disclosures”.
The Company previously assessed that, on the basis of materiality, the
disclosures required under IFRS 2 “Share-based Payment” should be
removed. The Company has assessed that at 31 March 2026 these
disclosures continue to be immaterial to the Company’s financial
statements.
New standards, amendments and interpretations effected or
adopted by the Company
During the year ended 31 March 2026, the Company adopted the
amendments to IAS 21 “The Effects of Changes in Foreign Exchange
Rates”. Adoption of this amendment had no impact on these
financial statements.
Following adoption of IFRS 9 on 1 April 2019, the Company elected to
continue to apply IAS 39 for hedge accounting. From 1 April 2026, the
Company will adopt the hedge accounting requirements of IFRS 9 to
align its hedge accounting more closely with the Group’s risk
management objectives. In the period to 31 March 2026, the
Company assessed its existing IAS 39 hedging relationships and
concluded that those relationships continue to meet the IFRS 9
hedge accounting criteria. These hedging relationships will be
designated as continuing hedges upon adoption of IFRS 9.
The Company will apply the prospective basis as permitted by IFRS 9,
whereby comparative information is not restated. The impact on the
income statement is immaterial.
The Company has elected to apply the cost of hedging approach,
under which certain elements of the fair value of hedging instruments
(such as forward points and currency basis spread) are recognised in
other comprehensive income rather than profit or loss. These
amounts will be accumulated in a cost of hedge equity reserve within
equity and subsequently reclassified to profit or loss in the same
period the hedged item affects profit or loss. On adoption, the cost of
hedge reserve will be £0.3m. There is no impact on total equity as a
result of this reclassification.
There were no other standards, amendments to standards or
interpretations relevant to the Company’s operations which were
adopted during the year.
Going Concern
The Directors consider that the Company has adequate resources to
continue in operational existence for the foreseeable future (further
details are contained in A6 Accompanying Information of the
consolidated financial statements). The financial statements are
therefore prepared on a Going Concern basis.
Basis of measurement
The financial statements of the Company are prepared on the
historical cost basis except for derivative financial instruments and
assets of the Company pension scheme which are stated at their fair
value, and liabilities of the Company pension scheme which are
measured using the projected unit credit method. The Directors
believe the financial statements present a true and fair view. The
financial statements of the Company are presented in pounds Sterling
and all values are rounded to the nearest million to one decimal place
(£m), unless otherwise stated.
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Critical accounting judgements and estimation uncertainty
In the process of applying the Company’s accounting policies,
management necessarily makes judgements and estimates that
have a significant effect on the amounts recognised in the financial
statements. Changes in the assumptions underlying the estimates
could result in a significant impact to the financial statements. The
Group’s key accounting judgement and estimation areas are noted in
note 4.1
of the consolidated financial statements, with the most
significant financial judgement areas as specifically discussed by
the Audit Committee being highlighted separately. In particular,
note 4.1(ii)
Retirement benefit obligations, and the related
disclosures in note 23
, note 4.1(iv) Valuation of other
receivables and note 4.3
Decommissioning costs, of the
consolidated financial statements are relevant to the Company.
Material accounting policies
The material accounting policies applied in the preparation of these
individual financial statements are set out below. These policies have
been applied consistently to all the years presented, unless
otherwise stated.
Investments in subsidiaries
Investments in subsidiaries are carried at cost less any
impairment charges.
Interests in joint arrangements and associates
Associates are those investments over which the Company has
significant influence but neither control nor joint control.
The Company’s joint ventures and associates are stated at cost less
any impairment.
Applicable Group accounting policies
The following material accounting policies are consistent with those
applied for the Group consolidated financial statements:
– Equity and equity-related compensation benefits (Supplementary
information A1.2
)
– Defined benefit pension scheme (Supplementary information
A1.2
)
– Taxation (Supplementary information A1.2
)
– Financial instruments (Supplementary information A1.2 and A6
)
– Financial guarantee liabilities (Supplementary information A1.2
)
2. Supplementary financial information
2.1 Auditor’s remuneration
The amounts paid to the Company’s auditor in respect of the audit of
these financial statements was £0.4m (2025: £0.4m).
Amounts paid to the Company’s auditor in respect of services
to the Company other than the audit of the Company’s financial
statements have not been disclosed as the information is required
instead to be disclosed on a consolidated basis.
2.2 Employee numbers
The average number of people employed by the Company (including
Executive Directors) during the year was 2 (2025: 3).
The costs associated with the employees of the Company, who
are the Executive Directors of the Group, are borne by Group
companies. No amounts are charged to the Company.
2.3 Directors’ remuneration and interests
Information concerning Directors’ remuneration, shareholdings,
options, long term incentive schemes and pensions is shown in the
Remuneration Report on pages 116 to 135
. No Director had,
during or at the end of the year, any material interest in any other
contract of significance in relation to the Group’s business.
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Notes to the Company financial statements continued
for the year ended 31 March 2026
3. Investments in associates and joint ventures
Share of net assets/cost
2026 2025
Equity
£m
Loans
£m
Total
£m
Equity
£m
Loans
£m
Total
£m
At 1 April 4.0 83.5 87.5 34.6 69.8 104.4
Additions –9.39.3 – 25.9 25.9
Repayment of shareholder loans ––– – (12.2) (12.2)
Impairment (4.0) (6.1) (10.1) (30.6) – (30.6)
At 31 March – 86.7 86.7 4.0 83.5 87.5
The impairment recognised in the current and prior year relates to the investment in Neos Networks Limited. The current year impairment of
£4.0m (2025: £30.6m) aligns the Company’s investment value (cost less impairment) with the carrying value in the Group financial statements
where the investment is equity accounted and a £6.1m expected credit loss impairment charge recognised against loans payable by Neos
Networks Limited.
4. Subsidiary undertakings
Details of the Company’s subsidiary undertakings are disclosed in the Accompanying Information section (A3 ).
Investment in subsidiaries
2026
£m
2025
£m
At 1 April 1,976.2 1,963.6
Increase in existing investments
(i)
29.6 24.5
Investment decrease in respect of financial guarantees
(ii)
(14.2) (11.9)
At 31 March 1,991.6 1,976.2
(i) The overall increase in investments held by the Company primarily relates to equity shares in the Company awarded to the employees of the subsidiaries of the Group under the Group’s
share schemes, which are recognised as an increase in the cost of investment in those subsidiaries as directed by IFRIC 11 (2026: £29.6m; 2025: £24.5m (both before tax)).
(ii) The investment decrease in respect of financial guarantees relates to £14.8m (2025: £18.6m) of unwind and expiry of guarantee contracts, less £0.6m (2025: £6.7m) for the fair value of fees
receivable on guarantees granted to subsidiary investments during the year.
5. Trade and other receivables
The balances of current and non-current trade and other receivables in the current and prior financial year predominantly consists of amounts
owed by subsidiary undertakings. At 31 March 2026 the Company assessed its exposure to expected credit losses on related party receivables
under IFRS 9 and held a provision against future losses of £55.2m (2025: £54.3m).
During the year ended 31 March 2026 the Company provided capital contributions of £164.8m to its subsidiaries (2025: waived £510.3m of
intercompany funding receivables due from other SSE Group companies), in both years the related charge has been expensed in the income
statement.
6. Trade and other payables
The balances of current trade and other payables in the current and prior financial year predominantly consists of amounts due to
subsidiary undertakings.
7. Taxation
Current tax liability
2026
£m
2025
£m
Corporation tax liability 44.7 36.5
248
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Deferred taxation
The following are the deferred tax liabilities and assets recognised by the Company and movements thereon during the current and prior
reporting periods:
Fair value
gains/(losses) on
derivatives
£m
Retirement
benefit
obligations
£m
Other
£m
Total
£m
At 31 March 2024 1.6 84.8 (3.9) 82.5
Charge/(credit) to income statement 0.8 1.7 (8.7) (6.2)
Charge to other comprehensive income 3.1 1.9 – 5.0
Charge to equity ––2.22.2
At 31 March 2025 5.5 88.4 (10.4) 83.5
Charge to income statement 1.5 3.5 0.9 5.9
Credit to other comprehensive income (3.4) (0.5) – (3.9)
Credit to equity – – (9.1) (9.1)
At 31 March 2026 3.6 91.4 (18.6) 76.4
Certain deferred tax assets and liabilities have been offset, including the asset balances analysed in the tables above. The following is an analysis
of the deferred tax balances (after offset) for financial reporting purposes:
2026
£m
2025
£m
Deferred tax liabilities 95.2 94.3
Deferred tax assets (18.8) (10.8)
Net deferred tax liability 76.4 83.5
The deferred tax assets/liabilities disclosed include the deferred tax relating to the Company’s pension scheme liabilities.
8. Loans and borrowings
2026
£m
2025
£m
Current
Other short term loans 824.6 1,895.5
824.6 1,895.5
Non-current
Loans 3,727.7 3,940.7
3,727.7 3,940.7
Total loans and borrowings 4,552.3 5,836.2
8.1 Borrowing facilities
The Company maintains a diversified portfolio of funding sources, including committed bank facilities, bond issuances, a €1.5bn commercial
paper programme and private placements to support its liquidity requirements and investment programme. At 31 March 2026, £501.2m of the
Company’s €1.5bn commercial paper programme was outstanding (2025: £890.5m).
At 31 March 2026, the Company had access to a total of £1.5bn of committed facilities (2025: £1.5bn), comprising revolving credit facilities and
other committed arrangements. As at 31 March 2026 there were no drawings on the revolving credit facilities (2025: undrawn).
The committed facilities are in place to ensure the Company has sufficient liquidity headroom when making significant capital investment. The
£1.5bn revolving credit facility for the Company is in place to provide back-up to the commercial paper programme and support the Group’s
capital expenditure plans.
On 31 March 2026, the Company signed an additional commitment letter which allows the Company to enter a £1.5bn committed facility
between 31 March 2026 and 30 June 2026.
The revolving credit facilities include sustainability-linked features which may or may not adjust the interest margin applicable. The rate of
interest is calculated annually, subject to fulfilling certain ESG KPIs and applied prospectively. At 31 March 2026, these features had no impact on
the carrying value of the borrowings.
During the year to 31 March 2026, the Company issued a total of £1.6bn of new borrowings, including £1.1bn of dual-tranche equity accounted
hybrid bonds (see note 22.5
) and £0.5bn of commercial paper rolled at maturity. A total of £1.9bn of debt instruments matured in the period,
including £1.0bn of Eurobonds and £0.9bn of commercial paper.
On 7 April 2026, subsequent to the balance sheet date, the Company issued a €400m (£346m) two-year floating rate note.
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Notes to the Company financial statements continued
for the year ended 31 March 2026
8. Loans and borrowings continued
8.1 Borrowing facilities continued
Analysis of borrowings
2026 2026 2026 2026 2025 2025 2025 2025
Weighted
average
interest rate
Face value
£m
Fair value
£m
Carrying
amount
£m
Weighted
average
interest rate
Face value
£m
Fair value
£m
Carrying
amount
£m
Current
Other short term loans – non-
amortising
(ii)
2.4% 502.2 503.7 501.2 5.0% 901.7 906.6 890.5
1.25% Eurobond repayable 16 April
2025 ––––1.3% 531.4 531.2 531.4
0.875% €600m Eurobond repayable
8 September 2025 ––––0.9% 502.6 499.2 502.4
US Private Placement 8 June 2026 3.1% 64.0 64.4 64.0 ––––
US Private Placement 6 September
2026 3.2% 247.1 259.0 246.9 ––––
Within one year 813.3 827.1 812.1 1,935.7 1,937.0 1,924.3
Fair value adjustment
(iii)
12.5 (28.8)
Total current borrowings 813.3 827.1 824.6 1,935.7 1,937.0 1,895.5
Non-current
Bank loans – non amortising
(i)
4.7% 100.0 102.1 100.0 5.5% 100.0 102.5 100.0
US Private Placement 8 June 2026 ––––3.1% 64.0 63.0 63.8
US Private Placement 6 September
2026 ––––3.2% 247.1 258.9 246.2
US Private Placement 6 September
2027 3.2% 35.0 34.0 34.9 3.2% 35.0 33.3 34.8
1.375% €650m Eurobond repayable
4 September 2027
(iv)(v)
1.4% 591.4 576.0 591.1 1.4% 591.4 573.7 590.9
8.375% Eurobond repayable on
20 November 2028 8.4% 500.0 538.7 498.9 8.4% 500.0 554.3 498.5
2.875% Eurobond repayable on
1 August 2029
(iv)
2.9% 567.6 560.0 566.8 2.9% 544.5 539.3 543.3
1.750% Eurobond repayable 16 April
2030
(vi)
1.8% 442.9 413.9 442.9 ––––
Between two and five years 2,236.9 2,224.7 2,234.6 2,082.0 2,125.0 2,077.5
1.750% Eurobond repayable 16 April
2030
(vi)
––––1.8% 442.9 413.9 442.9
6.25% Eurobond repayable on
27 August 2038 6.3% 350.0 350.5 348.0 6.3% 350.0 350.7 347.9
4.00% €750m Eurobond repayable
5 September 2031
(iv)(vii)
4.0% 655.0 664.5 653.7 4.0% 628.2 646.5 626.8
3.50% €600m Eurobond repayable
18 March 2032
(iv)(viii)
3.5% 524.0 516.2 521.4 3.5% 503.5 501.3 500.5
Over five years 1,529.0 1,531.2 1,523.1 1,924.6 1,912.4 1,918.1
Fair value adjustment
(iii)
(30.0) (54.9)
Total non-current borrowings 3,765.9 3,755.9 3,727.7 4,006.6 4,037.4 3,940.7
Total borrowings 4,579.2 4,583.0 4,552.3 5,942.3 5,974.4 5,836.2
(i) Balances include term loans and EIB debt and is a mixture of fixed and floating rate debt.
(ii) Balances include Commercial Paper and facility advances (£501.2m of Commercial Paper outstanding at 31 March 2026).
(iii) The fair value adjustment relates to the change in the carrying amount of the borrowings as a result of fair value hedges that are in place. The movement in the fair value adjustment is
recognised in the income statement with a corresponding movement on the hedging instrument also being recognised in the income statement.
(iv) Bonds have been issued under the Group’s Sustainability Financing Framework (previously the Group’s Green Bond Framework).
(v) The 1.375% €650m Eurobond maturing 4 September 2027 has been swapped to Sterling giving an effective interest rate of 2.56%.
(vi) The 1.750% €500m Eurobond maturing 16 April 2030 has been swapped to Sterling giving an effective interest rate of 2.89%.
(vii) The 4.00% €750m Eurobond maturing 5 September 2031 has been left in Euros as a net investment hedge for the Group’s Euro denominated subsidiaries.
(viii)The 3.50% €600m Eurobond maturing 18 March 2032 has predominantly been left in Euros as a net investment hedge for the Group’s Euro denominated subsidiaries.
250
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9. Equity
Details regarding SSE plc’s share capital, hybrid equity and capital redemption reserve can be found in note 22 of the Group consolidated
financial statements. The Company’s hedge reserve comprises the effective portion of the cumulative net change in the fair value of cash flow
hedge derivative instruments related to hedging transactions that have not yet occurred.
10. Retirement benefit obligations
Defined benefit scheme
The Company has a funded final salary pension scheme (“Scottish Hydro Electric Pension Scheme”) which provides defined benefits based on
final pensionable pay. The scheme is subject to an independent valuation at least every three years. The future benefit obligations are valued by
actuarial methods on the basis of an appropriate assessment of the relevant parameters. Further details regarding SSE plc’s defined benefit
pension scheme can be found in note 23
of the Group consolidated financial statements, including details of the latest actuarial valuation,
contributions, valuation assumptions, sensitivity analysis, and discussion of the pension scheme assets, obligations, policies, risks and strategy.
10.1 Valuation of pension scheme
Quoted
£m
Unquoted
£m
Value at
31 March 2026
£m
Quoted
£m
Unquoted
£m
Value at
31 March 2025
£m
Government bonds 448.5 – 448.5 396.0 – 396.0
Insurance contracts –432.4432.4 – 454.4 454.4
Other investments 325.3 – 325.3 373.1 – 373.1
Total fair value of plan assets 773.8 432.4 1,206.2 769.1 454.4 1,223.5
Present value of defined benefit obligation (841.9) (869.8)
Surplus in the scheme 364.3 353.7
Deferred tax thereon
(i)
(91.1) (88.4)
Net pension asset 273.2 265.3
(i) Deferred tax is recognised at 25% (2025: 25%) on the surplus.
10.2 Movements in the defined benefit assets and obligations during the year
2026 2025
Assets
£m
Obligations
£m
Total
£m
Assets
£m
Obligations
£m
Total
£m
At 1 April 1,223.5 (869.8) 353.7 1,328.6 (989.3) 339.3
Included in income statement
Current service cost – (6.5) (6.5) –(6.7)(6.7)
Past service cost –(0.6)(0.6) – (3.8) (3.8)
Interest income/(cost) 68.5 (48.2) 20.3 62.4 (46.1) 16.3
68.5 (55.3) 13.2 62.4 (56.6) 5.8
Included in other comprehensive income
Actuarial (loss)/gain arising from:
Demographic assumptions –6.36.3 – 3.8 3.8
Financial assumptions – 17.2 17.2 – 108.6 108.6
Experience assumptions – (5.4) (5.4) – 3.8 3.8
Return on plan assets excluding interest income (20.2) – (20.2) (108.5) – (108.5)
(20.2) 18.1 (2.1) (108.5) 116.2 7.7
Other
Contributions paid by the employer 0.9 – 0.9 0.9 – 0.9
Benefits paid (66.5) 65.1 (1.4) (59.9) 59.9 –
(65.6) 65.1 (0.5) (59.0) 59.9 0.9
Balance at 31 March 1,206.2 (841.9) 364.3 1,223.5 (869.8) 353.7
The return on pension scheme assets is as follows:
2026
£m
2025
£m
Return/(loss) on pension scheme assets 48.3 (46.1)
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Notes to the Company financial statements continued
for the year ended 31 March 2026
11. Financial instruments
For financial reporting purposes, the Company classifies derivative financial instruments as financing derivatives. These include interest rate
and foreign exchange derivatives designated at fair value or cash flow hedging relationships, as well as derivatives not designated for hedge
accounting. Derivatives not designated in a hedging relationship are accounted for as held for trading and measured at fair value through profit
or loss.
The derivative financial assets and liabilities are represented as follows:
2026
£m
2025
£m
Derivative financial assets
Non-current 20.8 25.1
Current 13.2 22.1
Total derivative assets 34.0 47.2
Derivative financial liabilities
Non-current (36.6) (53.0)
Current (0.5) (53.6)
Total derivative liabilities (37.1) (106.6)
Net liability (3.1) (59.4)
Information on the Group’s Financial risk management and the fair value of financial instruments is available at A6 and A7 .
12. Financial guarantee liabilities
2026
£m
2025
£m
Non-current liabilities
Financial guarantee liabilities 73.1 90.8
Current liabilities
Financial guarantee liabilities 9.1 9.3
Total financial guarantee liabilities 82.2 100.1
SSE plc has provided guarantees in respect of certain activities of subsidiaries, former subsidiaries and to certain current joint venture
investments both held directly and indirectly by the Company’s subsidiaries with carrying values as follows:
2026 2025
SSE on behalf of
subsidiary
£m
SSE on behalf of
joint operations
and ventures
£m
SSE on behalf of
3rd parties
£m
Total
£m
Total
£m
Financial guarantee liabilities 61.5 11.5 9.2 82.2 100.1
On transition to IFRS 17 on 1 April 2023, the Company elected to apply IFRS 9 “Financial Instruments” to the in scope financial guarantee
contracts and the contracts were valued on initial recognition and subsequently measured at the higher of the loss allowance for expected
credit loss and the initial value less any income recognised.
The decrease in financial guarantee liabilities during the year is primarily driven by the unwind and expiry of guarantee contracts of £20.6m,
relating to guarantees entered into on behalf of subsidiaries of £15.9m, joint ventures of £3.6m and former subsidiaries of £1.1m. During the
year, the Company provided new guarantees with a value of £2.1m on behalf of its subsidiaries and £0.6m on behalf of its joint ventures.
The Company continues to provide a guarantee to Group Trustee Independent Trustees in respect of SSE Southern Group of the Electricity
Supply Pension Scheme in respect of funding required by the scheme.
On behalf of Scottish Hydro Electric Transmission plc, SSE plc continues to provide a guarantee to ABB Limited in connection with the use of
HVDC Replica Control Panels for Caithness-Moray Project.
Furthermore, on behalf of SSE E&P (UK) Limited, previously a wholly owned subsidiary of the Company, now owned by a third party, SSE plc has
provided the following three guarantees: a guarantee to Hess Limited in respect of decommissioning liabilities, a guarantee to Britoil Limited
and Arco British Limited in respect of the acquisition of the Sean Field and also a guarantee to Perenco UK Limited in respect of a Sale and
Purchase Agreement for the Minerva, Apollo and Mercury Fields.
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13. Commitments and contingencies
Guarantees, indemnities and other contingent liabilities
Internal guarantees
The Company has in issue perpetual and long term guarantees of £2.3bn (2025: £2.3bn) in order to maintain the stand-alone credit ratings of
certain subsidiaries and to support electricity distribution licence conditions. These guarantees are not expected to be called.
Letters of credit
The Company indemnifies letters of credit issued to the following:
2026
£m
2025
£m
UK subsidiaries and certain joint ventures 965.8 949.3
European subsidiaries and certain joint ventures 167.7 162.4
Former UK subsidiaries 170.8 182.0
1,304.3 1,293.7
Letters of credit in substitution of cash collateral
The Company provides standby letters of credit in substitution for cash covering initial and delivery margins for exchange traded products and is
repayable on demand. As at 31 March 2026, there were letters of credit covering £nil (2025: £100.0m) of initial and variation margins.
Subsidiaries have provided guarantees on behalf of the Company as follows:
2026
£m
2025
£m
Bank borrowings 447.8 447.8
14. Provisions
2026
£m
2025
£m
At 1 April 201.6 219.7
Decrease in decommissioning provision (12.6) (17.9)
Unwind of discount 10.7 8.9
Utilised during the year (8.6) (9.1)
At 31 March 191.1 201.6
Non-current 158.7 177.7
Current 32.4 23.9
191.1 201.6
Decommissioning provision
The Company recognises a provision for the estimated net present value of decommissioning of Gas Production assets (retained as
part of the disposal agreement for this business). Estimates are based on the forecast remediation or clean-up costs at the projected date of
decommissioning and are discounted for the time value of money. Within the agreement for the disposal of its Gas Production assets to Viaro
Energy through its subsidiary RockRose Energy Limited on 14 October 2021, the Company agreed to retain 60% of the decommissioning
provision within the business. £12.6m has been removed (2025: £17.9m removed) from decommissioning during the current year due to
reassessment, movements in inflation and discounting assumptions. It is expected that the costs associated with decommissioning of these
Gas Production assets will be incurred through to 2044.
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Independent Auditor’s Report to the Members of SSE plc
Opinion
In our opinion:

SSE plc’s group financial statements and parent company financial statements (the “financial statements”) give a true and fair view of the
state of the group’s and of the parent company’s affairs as at 31 March 2026 and of the group’s profit for the year then ended;

the group financial statements have been properly prepared in accordance with UK adopted international accounting standards;

the parent company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting
Practice; and

the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements of SSE plc (the “parent company”) and its subsidiaries (the “group”) for the year ended 31 March 2026
which comprise:
Group Parent company
Consolidated income statement for the year then ended
Consolidated statement of comprehensive income for the year then ended
Consolidated balance sheet as at 31 March 2026 Balance sheet as at 31 March 2026
Consolidated statement of changes in equity for the year then ended Statement of changes in equity for the year then ended
Consolidated cash flow statement for the year then ended
Related notes 1 to 25 and A1 to A8 to the financial statements,
including material accounting policy information
Related notes 1 to 14 to the financial statements including
material accounting policy information
The financial reporting framework that has been applied in the preparation of the group financial statements is applicable law and UK adopted
international accounting standards. The financial reporting framework that has been applied in the preparation of the parent company financial
statements is applicable law and United Kingdom Accounting Standards, including FRS 101 “Reduced Disclosure Framework” (United Kingdom
Generally Accepted Accounting Practice).
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report. We believe
that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the group and parent in accordance with the ethical requirements that are relevant to our audit of the financial
statements in the UK, including the FRC’s Ethical Standard as applied to listed public interest entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the group or the parent company and we remain
independent of the group and the parent company in conducting the audit.
Conclusions relating to Going Concern
In auditing the financial statements, we have concluded that the directors’ use of the Going Concern basis of accounting in the preparation of
the financial statements is appropriate. Our evaluation of the directors’ assessment of the group and parent company’s ability to continue to
adopt the Going Concern basis of accounting included:

Confirming our understanding of management’s Going Concern assessment process as well as the review of controls in place over the
preparation of the group’s Going Concern model and the memorandum on Going Concern;

Engaging early with management to ensure all key matters were considered in their assessment;

Obtaining management’s board approved forecast cash flows, covenant forecasts and sensitivities to 31 December 2027, ensuring the same
forecasts are used elsewhere within the group for accounting estimates and that the forecasts reflect all committed spend;

Testing the models for arithmetical accuracy, as well as checking the net debt position at the year end date which is the starting point for
the model;

Assessing the reasonableness of the cashflow forecasts by analysing management’s historical forecasting accuracy. We also ensured climate
change considerations were factored into future cash flows;

Performing reverse stress testing to understand how severe the downside scenarios would need be to result in negative liquidity or a
covenant breach and the plausibility of the scenarios. Both management’s and EY’s assessment included consideration of all maturing debt
through to 31 March 2028 to consider any significant repayments falling due after the end of the going concern assessment period;

Reviewing management’s assessment of downside scenarios, and potential uncommitted capex reductions available to the group to reduce
cash flow spend in the Going Concern period, to determine their plausibility and whether such actions could be implemented by
management. We have obtained support to determine whether these are within the control of management;

Reading the borrowing facilities agreements to assess their continued availability to the group and to ensure completeness of covenants
identified by management;

Reviewing market data for indicators of potential contradictory evidence to challenge the company’s Going Concern assessment including
review of profit warnings within the sector and review of industry analyst reports. We held discussions with the Audit Committee to confirm
the Going Concern position prepared by management; and

Considering whether management’s disclosures in the financial statements sufficiently and appropriately reflect the Going Concern
assessment and outcomes.
The audit procedures performed in evaluating the directors’ assessment were performed by the group audit team. We also considered the
financial and non-financial information communicated to us from our component teams for sources of potential contrary indicators which may
cast doubt over the Going Concern assessment.
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Our key observations
The group is forecast to continue to be profitable and generate positive cashflows during the Going Concern period. Our reverse stress test
scenario assumed full repayment of debt maturing over the Going Concern period, and also extended three months beyond management’s
Going Concern period to 31 March 2028, no new refinancing over the Going Concern period, no uncommitted disposal proceeds, and a
£230m cash flow contingency to mitigate any downside performance against budget; offset by mitigating actions within management’s
control. We consider such a scenario to be highly unlikely.
Having considered our severe downside and reverse stress test scenarios, we have not identified a plausible scenario where the group would be
unable to maintain cash flow liquidity and covenant headroom during the Going Concern period.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually
or collectively, may cast significant doubt on the group and parent company’s ability to continue as a Going Concern for a period to
31 December 2027.
In relation to the group and parent company’s reporting on how they have applied the UK Corporate Governance Code, we have nothing
material to add or draw attention to in relation to the directors’ statement in the financial statements about whether the directors considered it
appropriate to adopt the Going Concern basis of accounting.
Our responsibilities and the responsibilities of the directors with respect to Going Concern are described in the relevant sections of this report.
However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the group’s ability to continue as
a Going Concern.
Overview of our audit approach
Audit scope

We performed an audit of the complete financial information of 17 components and audit procedures on specific
balances for a further 26 components and central procedures on pensions, derivatives, payroll, loans and taxation
Key audit matters
(KAM)

Impairment of specific non-current assets (being Southern Europe development assets and goodwill, Pacifico
development assets and goodwill, and Equity investment in Triton Power Holdings Limited (“Triton”))

Group and parent pension obligation

Accounting for estimated revenue recognition
Materiality

Overall group materiality of £109.5m which represents 5% of adjusted profit before tax
An overview of the scope of the parent company and group audits
Tailoring the scope
We have followed a risk-based approach when developing our audit approach to obtain sufficient appropriate audit evidence on which to base
our audit opinion. We performed risk assessment procedures, with input from our component auditors, to identify and assess risks of material
misstatement of the group financial statements and identified significant accounts and disclosures. When identifying components at which
audit work needed to be performed to respond to the identified risks of material misstatement of the group financial statements, we considered
our understanding of the group and its business environment, the potential impact of climate change, the applicable financial framework, the
group’s system of internal control at the entity level, the existence of centralised processes, applications and any relevant internal audit results.
We determined that following components are subject to centralised procedures
Key audit area on which procedures were performed centrally Component subject to central procedures
Pensions 2
Derivatives 16
Payroll 19
Loans 11
Taxation All
We then identified 31 components as individually relevant to the group due to relevant events and conditions underlying the identified risks of
material misstatement of the group financial statements being associated with the reporting components (or a pervasive risks of material
misstatement of the group financial statements or a significant risk or an area of higher assessed risk of material misstatement of the group
financial statements being associated with the components).
For those individually relevant components, we identified the significant accounts where audit work needed to be performed at these
components by applying professional judgement, having considered the group significant accounts on which centralised procedures will be
performed, the reasons for identifying the financial reporting component as an individually relevant component and the size of the
component’s account balance relative to the group significant financial statement account balance.
We then considered whether the remaining group significant account balances not yet subject to audit procedures, in aggregate, could give rise
to a risk of material misstatement of the group financial statements. We selected a further 12 components of the group to include in our audit
scope to address these risks.
Having identified the components for which work will be performed, we determined the scope to assign to each component.
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Of the 43 components selected, we designed and performed audit procedures on the entire financial information of 17 components (“full scope
components”). For 12 components, we designed and performed audit procedures on specific significant financial statement account balances
or disclosures of the financial information of the component (“specific scope components”). For the remaining 14 components, we performed
specified audit procedures to obtain evidence for one or more relevant assertions.
Our scoping to address the risk of material misstatement for each key audit matter is set out in the Key audit matters section of our report.
Involvement with component teams
In establishing our overall approach to the group audit, we determined the type of work that needed to be undertaken at each of the
components by us, as the group audit engagement team, or by component auditors operating under our instruction.
The group audit team interacted regularly with the component teams where appropriate during various stages of the audit. For the full and
specific scope components there were regular calls held between the lead audit engagement partner and component partners, with file reviews
performed by the group audit team over audit documentation that has not been retained within the group audit file, or retention of key audit
documentation within the group audit file. In total out of the 44 components, this split into a total of 9 component teams.
This was the fourth year where a non-EY auditor was involved in a specific scope component, being the group’s equity investment in Triton. We
issued instructions, held regular calls with them and attended an on-site file review and closing meeting. Other than the Irish Airtricity and Triton
entities in scope, all other entities in scope were based within Scotland (Perth and Glasgow), where lead audit partner William Binns visited UK
component teams throughout the year end audit. Management meetings were held in person and remotely throughout the year across both
the UK and Ireland. Members of the group audit team also visited the non-EY component auditors of Triton.
The component teams and non-EY component team visits involved discussion of audit approach, attending planning and closing meetings
(some of which were held virtually), meeting with local management and reviewing relevant audit working papers on risk areas. The group audit
team interacted regularly with the component teams where appropriate during various stages of the audit, reviewed relevant working papers
and were responsible for the scope and direction of the audit process.
This, together with the additional procedures performed at group level, gave us appropriate evidence for our opinion on the group
financial statements.
Climate change
The financial statement and audit risks related to climate change and the energy transition remain an area of audit focus in 2026. Stakeholders
are increasingly interested in how climate change will impact SSE plc. SSE operates principally within the UK and Ireland, and both are seeking
to achieve net zero across their economies by 2050.
SSE has determined that the most significant future impacts from climate change on its operations will be from accelerated wind investment
and accelerated Transmission growth, and the greatest risk is in relation to wind generation price, which is due to a reduction in average
electricity price as wind generation capacity increases. These are explained on pages 69 to 72
in the required Climate-related financial
disclosures. These disclosures form part of the “Other information,” rather than the audited financial statements. Our procedures on these
unaudited disclosures therefore consisted solely of considering whether they are materially inconsistent with the financial statements, or our
knowledge obtained in the course of the audit or otherwise appear to be materially misstated, in line with our responsibilities on “Other
information”. As described in note 4
, the financial statement impact of climate is considered to have the most impact on the valuation of
property, plant and equipment, impairment assessment of goodwill, valuation of decommissioning provisions, defined benefit schemes and
Going Concern and viability statement.
In planning and performing our audit we assessed the potential impacts of climate change on the group’s business and any consequential
material impact on its financial statements. The group has explained in note 4
how they have reflected the impact of climate change in their
financial statements including where assumptions applied align with their commitment to the aspirations of the Paris Agreement to achieve net
zero emissions by 2050.
Significant judgements and estimates relating to climate change are included in note 4
.
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Government and societal responses to climate change risks are still developing, and are interdependent upon each other, and consequently
financial statements cannot capture all possible future outcomes as these are not yet known. The degree of certainty of these changes may
also mean that they cannot be taken into account when determining asset and liability valuations and the timing of future cash flows under
the requirements of IAS 36. Budgets and forecasts for SSE plc reflect the spend to come on the announced £33bn investment programme. In
notes 15 and 20
to the financial statements, supplementary sensitivity disclosures reflecting the impact of climate with regards to valuation
of property, plant and equipment, impairment assessment of goodwill and valuation of decommissioning provisions and the impact of
reasonably possible changes in key assumptions have been provided and significant judgements and estimates relating to climate change have
been described within the aforementioned notes. We have ensured the completeness of climate consideration as part of our impairment and
Going Concern audit procedures, including those referred to within our impairment KAM below.
In order to respond to the impact of climate change, we ensured we had the appropriate skills and experience on the audit team, utilising
climate change internal specialists. Our audit team included professionals with significant experience in climate change and energy valuations.
Our audit procedures were carried out by the group and component teams, with the component teams working under the direction of the
group team.
Our audit effort in considering climate change focused on ensuring that the effects of material climate related risks disclosed on pages 69 to 72
have been appropriately reflected within the Going Concern cashflows, asset values and useful life and associated disclosures where values are
determined through modelling future cash flows, being impairment considerations over Intangible assets and Property, Plant & Equipment and
in the timing and nature of liabilities recognised, being decommissioning provisions. In addition, we performed detailed testing of the
sensitivities noted in the accounts. Details of our procedures and findings on impairment are included in our KAMs below.
In FY26 as in the previous year SSE conducted scenario analysis of its material climate related opportunities and risks. With the support of our
climate change internal specialists, we considered management’s scenario planning and modelling of the three risks and five opportunities
disclosed on pages 65 to 72
. We challenged the impact pathways developed and basis of the key assumptions included within these
scenarios. We checked the transition risk scenario frameworks used within the modelling to challenge the appropriateness, applicability to
SSE’s current and future business model to check the accuracy of the financial impact ranges disclosed on pages 69 to 72
.
We challenged the directors’ considerations of climate change in their assessment of Going Concern and viability and associated disclosures.
We also read the “Other information” in the annual report, and in doing so, considered whether the “Other information”, which includes SSE’s
climate targets, is materially consistent with the financial statements. We also considered consistency with other areas of assumptions,
judgements and estimates and where applicable the procedures performed have been included within our KAMs below.
Based on our work, whilst we have not identified the impact of climate change on the financial statements to be a standalone key audit matter,
we have considered the impact on the following key audit matters: Impairment of specific non-current assets (being Southern Europe
development assets and goodwill, Pacifico development assets and goodwill, Equity investment in Triton). Details of the impact, our procedures
and findings are included in our explanation of KAMs below.
Key audit matters (KAMs)
Key audit matters (KAMs) are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we
identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and
directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole,
and in our opinion thereon, and we do not provide a separate opinion on these matters.
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Independent Auditor’s Report to the Members of SSE plc continued
Risk Our response to the risk
Key observations communicated to the
Audit Committee
Impairment of specific non-
current assets (Southern Europe
development assets and goodwill,
Pacifico development assets and
goodwill, Equity investment in
Triton (Impairment reversal 2026
£29.4m; Impairment charge 2025:
£249.5m)
Refer to the Audit Committee
Report page 104 ; Accounting
p
olicies – significant judgements
p
age 159 ; and Note 15 of the
Consolidated Financial Statements
p
age 182
Renewables developments-
Southern Europe and Pacifico
There is a risk that due to the early
stage of the SSE Southern Europe
and SSE Pacifico developments,
there could be an impairment
charge over the goodwill and
development assets.
This is due to the early stages
of development, the passage of
time between acquisition date,
development progress and full
operationalisation, and the high
sensitivity of models to changes
in key assumptions.
For SSE Southern Europe, the key
assumptions are power price,
discount rate and the development
probability of success, including
greenfield and its related volumes.
For SSE Pacifico, the key
assumptions include revenue
support contract price, generation
volumes, capital expenditure,
operating expenditure, discount rate
and projected probability of success.
Equity investment in Triton
We determined that the investment
in Triton is at risk of impairment or
impairment reversal. This is due to
a number of global and national
factors reducing or increasing fair
value less costs of disposal,
triggering an impairment
assessment.
The key assumptions include
future power prices, price volatility,
uncontracted capacity income,
forecast power demand,
carbon prices, load factors
and discount rate.
The estimated recoverable amount
is subjective due to the inherent
uncertainty involved in forecasting
and discounting future cash flows as
a result of the above factors.
Scoping:
Testing was performed over this risk area, covering both full and
specific scope components (covering three components), which
represented 100% of the risk amount.
All audit work in relation to this key audit matter was undertaken
by the component audit teams, with oversight from the group
audit team.
We obtained management’s assessment of potential indicators in
accordance with IAS 36 for each of these risk areas.
A
udit procedures included:
We have understood management’s process and methodology
for assessing assets for indicators of impairment, including
indicators of reversal and, where applicable, we have understood
management’s modelling of cash flows including the source of
the key input assumptions.
We checked the historical accuracy of management’s forecasting
and verified that the assumptions are consistent with those used in
other areas such as PPE useful life and decommissioning provision.
We also considered contradictory indicators and any external facts
and circumstances to assist us in challenging management’s
assessment.
Renewables developments – Southern Europe and Pacifico
Due to the early stage of development of both the SSE Southern
Europe and SSE Pacifico platforms, a fair value less costs to sell
(“FVLCS”) assessment was performed for each, based on
discounted post-tax cash flows.
We engaged EY specialists in our assessment: a discount rate
specialist and a specialist with experience of assessing forward
prices in the overseas market. We consulted with colleagues in
Japan and in Southern Europe, with deep experience of the
renewables sector. Using our sector experience and our specialists,
we assessed any unusual or unexpected trends identified within
the cashflows year on year and assessed the impact on the overall
forecasted position.
We assessed the appropriateness of the model parameters and
clerical accuracy of the models used.
We applied sensitivities to management’s models to evaluate
headroom. For SSE Southern Europe, this included sensitivities
relating to discount rate, merchant price exposure, and the
probability of success of each project. In performing our
procedures, we independently calculated an estimated range
for the recoverable amount of the CGU. For SSE Pacifico, this
included sensitivities relating to discount rate, fixed prices,
generation volumes and the debt-to-equity funding ratio.
Renewables developments –
Southern Europe and Pacifico
We confirmed that it is appropriate
to recognise no impairment
charge for SSE Southern Europe
and SSE Pacifico.
We have concluded that the
methodology applied is
reasonable, the forecast period is
appropriate, and the impairment
models are mathematically
accurate.
We considered the
appropriateness of the related
disclosures provided in note 15 ,
considering whether any
reasonably possible change
disclosures were required based
upon the headroom within the
sensitivity analysis. We are satisfied
that management’s disclosures are
aligned with the requirements of
IAS36.
Equity investment in Triton
We confirmed that we concurred
with the impairment reversal
recognised for the equity
investment in Triton.
We communicated that the pricing
assumptions applied were
appropriate. We communicated
that the discount rates used were
materially in line with our
comparative range determined by
our specialist.
We also noted that we are satisfied
with the adequacy of disclosure
within the group financial
statements including climate
related disclosures.
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Risk Our response to the risk
Key observations communicated to the
Audit Committee
Equity investment in Triton
We considered prior period impairments for indication of reversal.
This involved considering indicators of reversal, focussed on
demand, load factors, prices and other internal factors.
We engaged EY specialists in our assessment: a discount rate
specialist and a specialist with industry experience of assessing
forward energy prices and gross margin. Using our sector
experience and our specialists, we assessed any unusual or
unexpected trends identified within the cashflows year on year
and assessed the impact on the overall forecasted position.
We assessed the appropriateness of the model parameters and
clerical accuracy of the models used.
We applied sensitivities to management’s models to evaluate the
reversal, including sensitivities relating to discount rate, price and
capacity market revenue.
Key assumptions (all relevant assets):
Using our sector experience and our specialists, we benchmarked
to industry sources, where appropriate, the directors’ judgement on
the key assumptions.
For SSE Southern Europe this included power price, discount rate,
and the development probability of success, including, greenfield
and its related volumes.
For SSE Pacifico, this included revenue support contract price,
generation volumes, capital expenditure, operating expenditure,
discount rate and projected probability of success.
For the equity investment in Triton, this included future power
prices, forecast power demand, carbon prices, load factors,
discount rate, useful economic life and operating expenditure.
We verified that the assumptions are consistent with those used
in other areas.
Disclosures
We assessed the accuracy and adequacy of the disclosures in line
with IAS 36, ensuring key assumptions are included and that the
disclosures adequately reflect the risks inherent in the valuation
of non-current assets and the impact of changes in assumptions
on the impairment booked.
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Risk Our response to the risk
Key observations communicated to the
Audit Committee
Group and parent pension
obligation (2026: £459.8m
surplus, 2025: £501.8m surplus)
Refer to the Audit Committee
Report page 105 ; Accounting
p
olicies – significant judgements
p
age 159 ; and Note 23 of
the group financial statements
p
age 203
Subjective valuation:
Small changes in the assumptions
and estimates used to value the
group and parent company pension
obligations (before deducting
scheme assets) would have a
significant effect on the carrying
value of those pension obligations.
The effect of these matters is that,
as part of our risk assessment, we
determined that the group and
parent company pension obligation
has a high degree of estimation
uncertainty, with a potential range
of reasonable outcomes greater
than our materiality for the financial
statements as a whole.
The principal assumptions
considered include rate of increase
in pensionable salaries and pension
payments, discount rate and
mortality rates.
There has been no change in this
risk from the prior year.
Scoping:
We performed audit procedures over this risk area centrally by the
group team, which covered 100% of the risk amount.
Our procedures included:
A
ssessing management process:
We have understood management’s process and methodology
for calculating the pension liability for each scheme, including
discussions with management’s external actuaries, walkthrough of
the processes, understanding the key inputs and the design and
implementation of key controls. We performed a fully substantive
audit approach rather than testing the operating effectiveness of
key controls.
A
ssessing management experts:
We have assessed the independence, objectivity and competence
of the group’s external actuaries, which included understanding
the scope of services being provided and considering the
appropriateness of the qualifications of the external actuary.
A
ssessing source data:
We tested a sample of the membership data used by the actuaries
to the group’s records.
Benchmarking assumptions:
With the support of our pension actuarial specialists, we assessed
the appropriateness of the assumptions adopted by the directors
by comparing them to the expectations of our pension actuarial
specialists which they derived from broader market data.
Disclosure:
We considered the adequacy of IAS 19 disclosures, including
presentation of commitments associated with deficit recovery
plans and in respect of sensitivity of the defined benefit obligation
to changes in the key assumptions.
We conclude that management’s
actuarial assumptions are
appropriate and sit within our
independently determined range.
We are satisfied with the adequacy
of disclosure within the financial
statements.
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Risk Our response to the risk
Key observations communicated to the
Audit Committee
A
ccounting for estimated revenue
recognition
Unbilled revenue (2026: £547.2m,
2025: £521.1m)
Refer to the Audit Committee
Report page 105 ; Accounting
p
olicies - significant judgements
p
age 159 ; and Note 18
of the group financial statements
p
age 193
Subjective estimate:
45% of the unbilled revenue year
end balance recognised within
the Energy Customer Solutions
segment relates to Business Energy
component only, and is based on
estimates of values and volumes of
electricity and gas supplied to the
year end date, less invoices raised.
The method of estimating such
revenues is complex and
j
udgemental for UK business
customers.
The key estimates and assumptions
are in relation to:
1. the volumes of electricity and gas
supplied to the customers between
the meter reading and year end;
2. the value attributed to those
volumes in the range of tariffs; and
3. embedded impairment risk over
the unbilled revenue.
As a result of the estimation
uncertainty this has been
identified as a significant risk.
Scoping:
The balance subject to the
significant risk relates to one
component, Business Energy.
Testing was performed covering
100% of the unbilled balance in
Business Energy. Unbilled revenue in
Airtricity in the Republic of Ireland
and Northern Ireland was not
included in the scope of this KAM
due to reduced judgement and
estimation complexity.
All audit work in relation to this
key audit matter was undertaken
by the component audit team
with oversight from the group
audit team.
A
udit methodology:
Our response to the assessed risk included understanding the
process for estimating unbilled revenue, testing selected IT general
and key application controls, and undertaking substantive audit
procedures and revenue data analytics.
Tests of detail:
We agreed the opening unbilled revenue to the closing 31 March
2025 balance sheet.
We agreed the volume data for customer usage of energy in the
year used in the calculation to external settlement systems and
agreed the volume data in relation to customer billings for the
year to SSE’s internal billing systems to assess consistency and to
understand remaining estimation risk. We have understood and
tested the historical accuracy of management’s forecasting of final
settlement volumes.
We have tested the unbilled unit pricing by agreeing historical
pricing to sample bills, tested a sample of billing dates from the
listing to confirm billing frequency and agreeing to post year end
billing prices.
We have also obtained and tested post year end billings to
substantiate the basis of the unbilled revenue estimate at
31 March 2026.
Within the unbilled revenue balance, we estimated the impact
of operational billing delays.
A
nalytical review:
Using a bespoke analytics tool, we set benchmark expectations as
to the likely level of total unbilled revenue, and compared this with
the actual unbilled revenue accrual, obtaining explanation for
significant variances. Benchmark expectation was derived from the
external settlements data combined with billing frequency, usage
and price movement from last billing date to year end. We also
tested the appropriateness of manual adjustments made by
management.
Disclosure:
We assessed the adequacy of the group’s disclosures about the
degree of estimation and judgement involved in arriving at the
estimated revenue.
Overall, through procedures
performed within Business Energy,
we are satisfied that the unbilled
revenue is appropriately
recognised by management.
We are satisfied with the adequacy
of disclosure within the financial
statements.
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Independent Auditor’s Report to the Members of SSE plc continued
We have refined the Impairment KAM, removing Great Island power station, reflecting the increased headroom and lower risk at this
power station.
Our application of materiality
We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the audit and
in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the economic
decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our audit procedures.
We determined materiality for the group to be £109.5 million (2025: £111.8 million), which is 5% (2025: 5%) of adjusted profit before tax. Our key
criterion in determining materiality remains our perception of the needs of SSE’s stakeholders. We consider which earnings, activity or capital-
based measure aligns best with their expectations.
We determined materiality for the Parent Company to be £215.9 million (2025: £143.6 million), which is 2% (2025: 2%) of net assets. The materiality
has been capped at the group materiality of £109.5 million.
During the course of our audit, we reassessed initial materiality and amended it for final adjusted profit before tax figures.
Performance materiality
The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected misstatements exceeds materiality.
On the basis of our risk assessments, together with our assessment of the group’s overall control environment, our judgement was that
performance materiality was 75% (2025: 75%) of our planning materiality, namely £82.1m (2025: £83.8m). We have set performance materiality
at this percentage due to a low number and value of corrected and uncorrected misstatements in the prior year audit, with misstatements in the
current year relating to one-off matters or having an immaterial impact on the consolidated income statement.
Audit work at component locations for the purpose of obtaining audit coverage over significant financial statement accounts is undertaken
based on a percentage of total performance materiality. The performance materiality set for each component is based on the relative scale and
risk of the component to the group as a whole and our assessment of the risk of misstatement at that component. In the current year, the range
of performance materiality allocated to components was £11.8m to £37.6m (2025: £13.0m to £36.0m).
Reporting threshold
An amount below which identified misstatements are considered as being clearly trivial.
We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of £5.5m (2025: £5.6m), which is
set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds.
We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other relevant
qualitative considerations in forming our opinion.
– Profit before tax – £1,837.3m
– Totals £2,190.9m adjusted profit before tax
– Materiality of £109.5m (5% of materiality basis)
– Movement on operating and financing derivatives – £139.8m
– Non-recurring exceptional items – £162.6m
– JV Tax – £51.2m
Starting basis
Materiality
Starting
basis
Adjustments
Materiality
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Other information
The “Other information” comprises the information included in the annual report set out on pages 1 to 142 , including the strategic report and
the directors’ report (Governance section) set out on pages 1 to 76 and 77 to 142
respectively other than the financial statements and our
auditor’s report thereon. The directors are responsible for the “Other information” contained within the annual report.
Our opinion on the financial statements does not cover the “Other information” and, except to the extent otherwise explicitly stated in this
report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the “Other information” and, in doing so, consider whether the “Other information” is materially inconsistent with
the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify
such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material
misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material
misstatement of the “Other information”, we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, the part of the directors’ remuneration report to be audited has been properly prepared in accordance with the Companies
Act 2006.
In our opinion, based on the work undertaken in the course of the audit:

the information given in the strategic report and the directors’ report for the financial year for which the financial statements are prepared is
consistent with the financial statements; and

the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit,
we have not identified material misstatements in the strategic report or the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if,
in our opinion:

adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from
branches not visited by us; or

the parent company financial statements and the part of the Directors’ Remuneration Report to be audited are not in agreement with the
accounting records and returns; or

certain disclosures of directors’ remuneration specified by law are not made; or

we have not received all the information and explanations we require for our audit.
Corporate Governance Statement
We have reviewed the directors’ statement in relation to Going Concern, longer-term viability and that part of the Corporate Governance
Statement relating to the group and company’s compliance with the provisions of the UK Corporate Governance Code specified for our review
by the UK Listing Rules.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the Corporate Governance
Statement is materially consistent with the financial statements or our knowledge obtained during the audit:

Directors’ statement with regards to the appropriateness of adopting the Going Concern basis of accounting and any material uncertainties
identified set out on page 76
;

Directors’ explanation as to its assessment of the company’s prospects, the period this assessment covers and why the period is appropriate
set out on page 76
;

Directors’ statement on whether it has a reasonable expectation that the group will be able to continue in operation and meets its liabilities
set out on page 76
;

Directors’ statement on fair, balanced and understandable set out on page 103
;

Board’s confirmation that it has carried out a robust assessment of the emerging and principal risks set out on pages 56 to 63
;

The section of the annual report that describes the review of effectiveness of risk management and internal control systems set out on
pages 107 to 109
; and

The section describing the work of the Audit Committee set out on pages 102 to 109
.
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set out on page 142 , the directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine is
necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the group and parent company’s ability to continue as a Going
Concern, disclosing, as applicable, matters related to Going Concern and using the Going Concern basis of accounting unless the directors
either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but
is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial statements.
263
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Independent Auditor’s Report to the Members of SSE plc continued
Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities,
outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of
not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations,
or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below.
However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the company
and management.

We obtained an understanding of the legal and regulatory frameworks that are applicable to the group and determined that the most
significant are IFRS, FRS 101, the Companies Act 2006 and UK Corporate Governance Code and relevant tax compliance regulations in the
jurisdictions in which the group operates. We also considered non-compliance of regulatory requirements, including the Office of Gas and
Electricity Markets (Ofgem) and regulations levied by the UK Financial Conduct Authority and Prudential Regulatory Authority. We confirmed
our understanding with the Internal Head of Regulation.

We understood how SSE plc is complying with those frameworks by making enquiries of management, internal audit, those responsible for
legal and compliance procedures. We verified our enquiries through our review of board minutes and papers provided to the Audit
Committee.

We assessed the susceptibility of the group’s financial statements to material misstatement, including how fraud might occur by meeting
with management from various parts of the business to understand where it considered there was susceptibility to fraud. We also considered
performance targets and their propensity to influence on efforts made by management to manage earnings. We considered the
programmes and controls that the group has established to address risks identified, or that otherwise prevent, deter and detect fraud; and
how senior management monitors those programmes and controls. Where the risk was considered to be higher, we performed audit
procedures to address each identified fraud risk.

Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures
involved: journal entry testing, with a focus on consolidation journals and journals indicating large or unusual transactions based on our
understanding of the business; enquiries of legal counsel, group management, internal audit, business area management at all full and
specific scope components; and focused testing. In addition, we completed procedures to conclude on the compliance of the disclosures
in the annual report and accounts with all applicable requirements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at
https://www.frc.org.uk/auditorsresponsibilities
. This description forms part of our auditor’s report.
Other matters we are required to address

Following the recommendation from the Audit Committee we were appointed by the company on 18 July 2019 to audit the financial
statements for the year ended 31 March 2020 and subsequent financial periods.

The period of total uninterrupted engagement including previous renewals and reappointments is 7 years, covering the years ended
31 March 2020 to 31 March 2026.

The audit opinion is consistent with the additional report to the Audit Committee.
Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit
work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s
report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the
company and the company’s members as a body, for our audit work, for this report, or for the opinions we have formed.
William Binns (Senior statutory auditor)
for and on behalf of Ernst & Young LLP, Statutory Auditor
London
27 May 2026
264
SSE plc Annual Report 2026

GlossaryGlossary
AIP
Annual Incentive Plan that applies to salaries
AGM
Annual General Meeting
APM
Alternative Performance Measures used to
track financial performance
ASTI
Ofgem’s Accelerated Strategic Transmission
Investment framework
BLET
Business of Leading the Energy Transition
summit hosted by SSE
CAGR
Compound Annual Growth Rate
Capex
Capital expenditure
CCGT
Combined Cycle Gas Turbine
CCS
Carbon capture and storage
CfD
Contract for Difference
CHP
Combined Heat and Power
COP30
The 30th Conference of Parties climate
summit held in Belém in November 2025
DNO
Distribution Network Operator
DSO
Distribution System Operator
EBITDA
Earnings before interest, taxes, depreciation,
and amortisation
EBRS
The UK Government’s Energy Bill Relief
Scheme
EGL
The UK Government’s Energy
GeneratorLevy
EGL2
The planned HVDC undersea transmission
link from Peterhead to Yorkshire
EPS
Earnings Per Share
ESG
Environment, Social and Governance
ETS
Emissions Trading Scheme
EV
Electric Vehicle
FID
Final Investment Decision
FFO
Funds From Operations
GAAP
Generally Accepted Accounting Principles
GDPR
General Date Protection Regulation
GHG
Greenhouse gas, used in relation to GHG
emissions
GW
Gigawatt
HVDC
High Voltage Direct Current
HVO
Hydrotreated Vegetable Oil, a fossil-free
alternative to diesel
IEA
International Energy Agency
IPCC
International Panel on Climate Change
KPI
Key Performance Indicator
kV
Kilovolt
LOTI
Ofgem’s Large Onshore Transmission
Investment plan
LTI
Lost Time Incidents
MW
Megawatt
NESO
National Energy System Operator
NIC
National Infrastructure Commission
OCGT
Open-cycle Gas Turbine
ORESS
Ireland’s Offshore Renewable Energy
Support Scheme
PSR
Priority Services Register
RAV
Regulated Asset Value as applies to SSE’s
networks businesses
RCF
Retained Cash Flow
REFIT
Renewable Energy Feed-in Tariffs
REGO
Renewable Energy Guarantee of Origin
REMA
The UK Government’s Review of Electricity
Market Arrangements
RIIO
The “Revenue = Incentives + Innovation +
Outputs” regulatory framework by which
SSE’s networks businesses are remunerated.
Scope 1, 2 and 3 emissions
Scope 1 and 2 are those emissions that
areowned or controlled by SSE. Scope 3
emissions are from sources not directly
owned or controlled by SSE.
Spark spread
The difference between the price received
by SSE for electricity produced and the
costof the natural gas needed to produce
that electricity.
TCFD
Task Force on Climate-related Financial
Disclosures
tCO
2
e
Tonnes of carbon dioxide equivalent
Totex
Total expenditure
TRIR
Total Recordable Injury Rate (SSE’s preferred
measure of safety performance)
TWh
Terawatt-hour
VAR
Value at Risk
WACC
Weighted Average Cost of Capital
265
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Shareholder information
Shareholder enquiries
The Company’s register of members is
maintained by our Registrar, Computershare
Investor Services PLC (Computershare).
Forqueries about shareholdings,
contactComputershare directly at:
Computershare Investor Services PLC,
ThePavilions, Bridgwater Road,
BristolBS996ZZ
Phone: +44 (0) 345 143 4005
Web: www-uk.computershare.com/
investor/#contact/enquiry
Investor Centre
Manage your shares online at
www.sse-shares.com
You can manage your holdings online
usingInvestor Centre, the free and secure
online portal provided by Computershare.
It’s easy to register for Investor Centre:
logon to www.sse-shares.com
, enter
your postcode and Shareholder Reference
Number (SRN) which can be found on any
recent communications from SSE, and
follow the instructions. Once registered,
you can:
– View, update and calculate the market
value of your shareholdings;
– Change address details and dividend
payment instructions; and
– See share price data and trading graphs
of listed companies.
Website
Our website, sse.com , provides
shareholders with information about the
Company and its performance. It includes
adedicated Investors section where you
can find electronic copies of Company
reports and a wide range of other
information including:
– share price information;
– regulatory news;
– dividend history and trading graphs;
– terms and conditions of the Scrip
Dividend Scheme; and
– Registrar contact details.
Digital news
We use a dedicated news and views website
(available at www.sse.com/news-and-views
) and LinkedIn (www.linkedin.com/
company/sse-plc ) tokeepshareholders,
investors, journalists, employees and other
interested parties upto date with news from
the Company.
It is also possible to sign up for email alerts
for regulatory news and press releases
relating to SSE at www.sse.com/investors/
regulatory-news/
.
Electronic communications
Receiving electronic communications from
SSE is better for shareholders, SSE and the
environment. It has the following benefits:
– Fast access: immediate notification
byemail when new shareholder
documentation is available – nothing
lost or delayed in the post.
– Cost-effective: reduced printing and
postage costs saves the Company and
itsshareholders money.
– Environmentally friendly: reducing the
environmental impact of printing and
delivering paper documents aligns with
our commitment to sustainability.
You must actively choose to receive SSE
investor communications electronically.
Youcan easily do this and change your
communication preferences in the online
Investor Centre, www.sse-shares.com
orbycontacting Computershare.
All new shareholders are automatically
registered to access shareholder
documentation through the Investors
section of our website but will be
notifiedbypost when new shareholder
documentation is available. We only send
printed copies of documentation where
shareholders specifically request a copy.
Financial calendar
Publication of Annual
Report 2026
12 Jun 2026
Q1 Trading Statement 16 Jul 2026
AGM 2026 16 Jul 2026
Ex-dividend date for final
dividend
23 Jul 2026
Record date for final
dividend
24 Jul 2026
Final date for Scrip elections 20 Aug 2026
Payment date for final
dividend
17 Sept 2026
Trading Update Around
30 Sept 2026
Interim results for six
months ended
30September 2026
18 Nov 2026
Dividend payments direct to your
bank account
The Company typically pays dividends
twiceyearly. Interim dividends are paid in
January/February, and final dividends are
paid in September once approved by
shareholders at the AGM. All dividends are
credited to a shareholder’s nominated UK
bank/building society account. You can
register or change your UK bank/building
society account details on the online
Investor Centre, www.sse-shares.com ,
orby contacting Computershare.
If you don’t have a UK bank or building
society account, you can have your
dividends paid directly into a non-UK
bankaccount using Computershare’s
International Funds Transfer (IFT).
For more information, please visit
www.sse-shares.com
or contact
Computershare.
SSE shareholder tracing programme
in association with Georgeson
SSE has engaged Georgeson (a trading
name of Computershare) to locate and
unite lost shareholders withtheir outstanding
dividends and/or shares. It is important that
shareholders who are contacted either
respond to Georgeson’s correspondence or
contact Computershare in their capacity as
Registrar to reclaim their dividends and/or
shares. Fees apply should shareholders
wishto useGeorgeson’s services.
In accordance with SSE’s Articles
ofAssociation, SSE may in certain
circumstances forfeit the shares of
shareholders who have been uncontactable
for over 12 years. To ensure the efficient
management of the Register of Members,
SSE may do so in circumstances where
Georgeson are unable to locate such
shareholders. Further details on the
programme are available on the
Company’swebsite, sse.com
.
Scrip dividend
You can choose to join our Scrip Dividend
Scheme to receive future dividends as
additional new shares. Details of the
Scheme are available at www.sse.com/
investors/shareholder-services/dividends-
and-scrip-scheme/ . Shareholders who
choose this Scheme should also complete a
bank mandate to make sure they continue
to receive future dividend payments should
they withdraw from the Scheme.
Share dealing
Please go to www.computershare.com/
dealing/uk
for a range of dealing services
provided by Computershare. To speak to
the Computershare Dealing Services team
directly, please call +44 (0) 370 703 0084.
American Depositary Receipts
SSE has established a sponsored Level I
American Depositary Receipt (ADR)
programme with Deutsche Bank Trust
Company Americas (Deutsche Bank).
EachADR represents one SSE Ordinary
Share. More information and Deutsche
Bank’s contact details can be found at
www.sse.com/investors/adrs .
266
SSE plc Annual Report 2026

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For further information
about us, please contact:
SSE plc
Corporate Affairs
Inveralmond House
200 Dunkeld Road
Perth PH1 3AQ
UK
+44 (0)1738 456000
info@sse.com
Registered in Scotland No. 117119
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