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PROVIDING ENERGY TODAY BUILDING VALUE FOR TOMORROW FINANCIAL RESULTS FOR THE YEAR TO 31 MARCH 2020 17 JUNE 2020 PROVIDING ENERGY TODAY, BUILDING VALUE FOR TOMORROW 2019/20 Results Presentation Part One 2019/20 a year of progress

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SLIDE 1

FINANCIAL RESULTS FOR THE YEAR TO 31 MARCH 2020 17 JUNE 2020

PROVIDING ENERGY TODAY

BUILDING VALUE FOR TOMORROW

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SLIDE 2

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

2

PROVIDING ENERGY TODAY, BUILDING VALUE FOR TOMORROW

2019/20 Results Presentation

Part One

  • 2019/20 – a year of progress

Part Two

  • Responding to coronavirus –

positioning the business well for the long term

Part Three

  • Contributing to green recovery,

creating value through transition to net zero

Alistair Phillips-Davies

Chief Executive

Gregor Alexander

Finance Director

Martin Pibworth

Energy Director

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SLIDE 3

SSE’s vision is to be a leading energy company in a net zero world

Clear objectives

  • Sustaining dividend payments on which pensioners and savers depend
  • Promoting long term success of company for benefit of all stakeholders

Focus on regulated electricity networks and renewables

  • Achieving excellence
  • Contributing to green economic recovery
  • Delivering growth
  • Creating value through transition to net zero

SUSTAINING DIVIDENDS AND PROMOTING LONG-TERM SUCCESS

3

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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SLIDE 4

Supporting electricity supplies

  • Maintaining reliability of electricity networks
  • Ensuring availability of power generation

Being a responsible employer

  • Working closely with trade unions
  • No employees furloughed

Committing to C-19 Business Pledge

  • Focus on customers, communities, suppliers and employees

FULFILLING OUR CORE PURPOSE

4

Responding to coronavirus

New photo?

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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SLIDE 5

A YEAR OF PROGRESS

Part One

5

RESULTS TO 31 MARCH 2020

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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SLIDE 6

6

Increases in adjusted operating profit, adjusted profit before tax and adjusted earnings per share

A solid recovery from the previous year

SOLID FINANCIAL RESULTS

RESULTS TO 31 MARCH 2020

A year of progress

Success in CfD auctions and quality RIIO T2 business plan

Completed Energy Services sale to focus on the core

STRATEGIC EXECUTION

Total recordable injuries down to 71 in 2019/20 from 86 in 2018/19

Best ever year for safety performance, wellbeing and environmental care

OPERATIONAL DELIVERY

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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SLIDE 7

RESULTS TO 31 MARCH 2020

Coronavirus and related impacts

7

2019/20 Income Statement

£m

Adjusted EBIT impact (18.2) Exceptional charge (33.7) Total estimated impact (51.9)

  • Demand impacts
  • Increased provision

within customer businesses for bad debts Main components 2019/20 Adjusted EPS

Pence

March 27 forecast (pre-coronavirus impact) 83-88 Adjusted EPS 83.6

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

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SLIDE 8

RESULTS TO 31 MARCH 2020

Overview

Income statement – continuing operations* FY20 FY19 Adjusted Operating Profit - £m 1,488.4 1,088.7 Adjusted Profit Before Tax - £m 1,023.4 685.1 Reported Profit Before Tax - £m 587.6 1,300.3 Adjusted EPS - pence 83.6 61.8

8

Key movements

  • Restoration of GB Capacity Market payments
  • Reduction in EPM-related loss
  • Strong performance in SSE Renewables

* 2019/20 discontinued operations: SSE Energy Services adjusted operating profit £32.7m; Gas Production Assets adjusted operating profit £25.8m

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

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SLIDE 9

IFRS9 Movements

RESULTS TO 31 MARCH 2020

Exceptional items

FY20 Exceptional items (£m)

Cont. Operations Discont. Operations Total

Reshaping the SSE Group (176.0) (237.7) (413.7) Market conditions (291.3) (291.3) Coronavirus impact (33.7) (33.7) Total exceptional items (209.7) (529.0) (738.7)

9

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Main components

  • Loss on disposal of Energy

Services is £231m lower then reported at HY due to novation of

  • ut-the-money derivatives
  • Loss on closure of final coal plant
  • Telecoms and onshore wind

gains

  • Gas Production impairment

For a full description of exceptional charges see note 7 of the summary financial statements

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SLIDE 10

RESULTS TO 31 MARCH 2020

Regulated networks businesses

10

Adjusted EBIT (£m) FY20 FY19 Electricity Transmission 218.1 252.1 Electricity Distribution* 356.3 401.3 Investment in SGN 202.3 176.8 Total Networks 776.7 830.2 RAV

  • Combined RAV £9.1bn at 31 March 2020

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

*September 2019 forecast was £375m; variance due to lower than expected volumes in 2H20

Year on year movement

  • Phasing of allowed revenue
  • Increased depreciation

Net increase in costs including

  • Increased depreciation
  • Higher costs associated with

supplying Shetland

  • Increased Totex outperformance
  • Additional commercial income
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SLIDE 11

11

RESULTS TO 31 MARCH 2020

SSE Renewables

Adjusted EBIT (£m) FY20 FY19 Hydro (inc. pumped storage) 191.1 178.7 Onshore wind 201.4 188.3 Offshore wind 174.8 88.9 Total SSE Renewables 567.3 455.9 Year on year movement

  • Net increase in wind energy capacity, mainly Beatrice
  • Total renewable output 11.4 TWh including 0.7TWh

constrained off wind

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

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SLIDE 12

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RESULTS TO 31 MARCH 2020

Core Businesses

SSE Renewables and regulated networks (SSEN and SGN) contributed around 90% of Group EBIT and 85% of Group EBITDA in FY20

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Adjusted EBITDA (£m) FY20 FY19 SSE Renewables 803.3 694.0 SSEN Electricity Networks 798.9 850.9 Total Core Businesses 1,602.2 1,544.9 Investment in SGN 259.1 234.3 Total Renewables and Networks 1,861.3 1,779.2 Adjusted EBIT (£m) FY20 FY19 SSE Renewables 567.3 455.9 SSEN Electricity Networks 574.4 653.4 Total Core Businesses 1,141.7 1,109.3 Investment in SGN 202.3 176.8 Total Renewables and Networks 1,344.0 1,286.1

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SLIDE 13

RESULTS TO 31 MARCH 2020

Energy Businesses

13

Adjusted EBIT (£m) FY20 FY19 Total Renewables and Networks 1,344.0 1,286.1 Thermal Generation 152.7 (22.3) Gas Storage 3.7 (5.7) Gas Production contracts 77.1 n/a EPM (137.4) (284.9) Total Energy Businesses 96.1 (312.9) Total Customer Businesses 66.1 122.0 Corporate unallocated (17.8) (6.5) SSE Group 1,488.4 1,088.7

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Year on year movement

  • Capacity market reinstatement
  • Increased multifuel profits
  • Benefitting from merchant
  • peration in volatile markets
  • Reflecting split of assets and

contracts pursuant to sale

Variance to guidance

  • OVO transaction impact
  • Weaker Sterling
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SLIDE 14

RESULTS TO 31 MARCH 2020

Customer Businesses

14

Adjusted EBIT (£m) FY20 FY19 Total Renewables and Networks 1,344.0 1,286.1 Total Energy Businesses 96.1 (312.9) Business Energy 9.2 51.6 Airtricity 48.8 38.6 Enterprise 8.1 31.8 Total Customer Businesses 66.1 122.0 Corporate unallocated (17.8) (6.5) SSE Group 1,488.4 1,088.7

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Year on year movement

  • Higher bad debts and other

indirect costs

  • Non-commodity costs
  • Slightly improved margins
  • Reflects reduced earnings due to

50% disposal of Telecoms

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SLIDE 15

RESULTS TO 31 MARCH 2020

Pension schemes

Contributing to employees’ pension schemes FY20 FY19 Net pension scheme asset - £m 341.7 287.1

15

  • Net accounting surplus across SSE’s two pension schemes
  • SHEP conversion of swap covering £800m of liabilities to ‘buy-in’
  • Significantly reducing exposure to fluctuations in valuation of scheme obligations

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

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SLIDE 16

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RESULTS TO 31 MARCH 2020

Investment and Capital Expenditure

FY20 Summary Transmission

  • Total £329.0m
  • New substations

Distribution

  • Total £364.9m
  • Subsea reinforcement

Renewables

  • Total £342.7m
  • Seagreen contribution

Thermal

  • Total £177.0m
  • Keadby 2 and multifuel

Capital Recycling

  • 19MW Sleive Divena II at

£2,700/kW

200 400 600 800 1000 1200 1400 1600

FY20 FY19 FY18 Investment and CapEx Networks Renewables Other

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

£m

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SLIDE 17

RESULTS TO 31 MARCH 2020

Managing net debt

FY20 HY20 FY19 Adjusted net debt and hybrid capital - £m 10,466 10,339 9,437 Average cost of debt at period end, incl. hybrid capital 3.51% 3.60% 3.70% Adjusted net finance costs - £m 465.0 403.6

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SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Adjusted net finance cost movement

  • Higher net debt
  • Higher JV interest costs
  • Lower capitalised interest
  • Impact of IFRS 16
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SLIDE 18

RESULTS TO 31 MARCH 2020

Dividend

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  • Dividends provide vital income for pensions and savings
  • 2019/20 was a year of progress
  • Quality and nature of core businesses

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

* recommended

56p*

FULL YEAR DIVIDEND 2019/20 FINAL DIVIDEND 2019/20

Payment 18 September

80p

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SLIDE 19

Part Two

19

2020/21 AND BEYOND

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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SLIDE 20

SUSTAIN DIVIDENDS

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2020/21 AND BEYOND

Overview

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

  • Quality and nature of SSE’s businesses and assets and their potential for sustainable value

creation transcends the financial impact of coronavirus in 2020/21

  • Coronavirus impact on the wider economy is expected to have short term adverse effects on

SSE’s business; substantial in context of one year, largely temporary in duration

KEY OBJECTIVES

PROMOTE LONG TERM SUCCESS Sustain SSE’s ability to pay dividends on which pensioners and savers depend for income Contribute to green economic recovery and create value through the transition to net zero

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SLIDE 21

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Main expected adverse effects resulting from economic impact of coronavirus

2020/21 AND BEYOND

Potential impact of coronavirus

1. Reduced demand for electricity affecting DUoS 2. Reduced demand from customers for electricity and related services 3. Excess electricity hedges with negative mark- to-market valuations 4. Higher level of customers bad debt

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

EPS guidance to be provided later in the year Coronavirus impact modelling

2020/21 Estimated impact Electricity Distribution EBIT* £50m - £90m Customer Solutions EBIT £60m - £110m Enterprise EBIT £30m - £35m SGN EBIT £10m - £15m Total £150m - £250m

*at least 80% of which expected to be recoverable under the price control

Expect Transmission, Renewables and Thermal to see no net material impact

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SLIDE 22

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2020/21 AND BEYOND

A comprehensive plan

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

KEY OBJECTIVES

SUSTAIN DIVIDENDS PROMOTE LONG TERM SUCCESS Sustain SSE’s ability to pay dividends on which pensioners and savers depend for income Contribute to green economic recovery and create value through the transition to net zero EFFECTIVE FINANCIAL MANAGEMENT MANAGING CASH OUTFLOW SECURING VALUE FROM DISPOSALS

COMPREHENSIVE PLAN

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2020/21 AND BEYOND

Financial management and liquidity

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Good liquidity position

  • Moved quickly to issue new debt in April 2020
  • Average debt maturity 6.5 years
  • Cash and committed facilities of over £2bn, after planned redemption of €600m

Eurobond today Refinancing requirements

  • Only financing requirement over the next two years relates to around £1.2bn hybrid

bond, assuming £2bn disposals

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SLIDE 24

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2020/21 AND BEYOND

Managing cash outflow

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Reducing 2020/21 cash outflow by c£250m

  • Prioritising and deferring capital expenditure (90%)
  • Execution of options to extend renewables internationally deferred
  • Reducing and deferring operational expenditure plans (10%)

Strategic investment projects unaffected

  • Designed to earn sustainable returns to support earnings

No new share buy-back programmes in 2020/21

  • No buy-back of shares irrespective of scrip uptake
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2020/21 AND BEYOND

Securing value of over £2bn

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Targeting proceeds of over £2bn by the autumn of 2021

  • Sustains dividends
  • Sharpens focus on core business
  • Supports financial management
  • Underpins future investment

Timing subject to market conditions, but confident of significant interest in assets and securing over £2bn

SUSTAIN DIVIDENDS

KEY OBJECTIVES

PROMOTE LONG TERM SUCCESS Sustain SSE’s ability to pay dividends on which pensioners and savers depend for income Contribute to green economic recovery and create value through the transition to net zero

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2020/21 AND BEYOND

Securing value from sales

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

Disposal of non-core assets

  • SSE not main operator
  • Less aligned with transition to net zero
  • Slough Multifuel sold April 2020

IN PROGRESS TO BE INITIATED

  • Gas Production Assets
  • Contracting
  • Walney Offshore Wind

Farm

  • Multifuel
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2020/21 AND BEYOND

Securing value from partnering

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

RENEWABLES SGN

  • Further SSER

project partnering

  • Option to sell

remaining stake SSEN

  • Consider sale of

minority stakes*

*enabling SSE to retain the lead role in relation to governance and operational control

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SLIDE 28

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2020/21 AND BEYOND

Capital and investment spend

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

  • Capital and investment to focus on core strategic

projects:

  • Making greatest early contribution to transition

to net zero

  • Contributing to wider green economic recovery
  • Helping achieve our 2030 goals on renewable

energy and electrification

  • Earning sustainable returns in the years ahead

2020/21 Capex (net of project finance refunds) expected to be around £1bn*

Forecast CAPEX to FY2025

Transmission Distribution Renewables Thermal Energy Other

£7.5bn

* Before mitigation

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SLIDE 29

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2020/21 AND BEYOND

A sustainable financial framework

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

EFFECTIVE FINANCIAL MANAGEMENT MANAGING CASH OUTFLOW SECURING VALUE FROM DISPOSALS

FINANCIAL FRAMEWORK NET DEBT/EBITDA RANGE CREDIT RATING

NET DEBT/EBITDA RANGE

  • Maintain net debt/EBITDA

ratio at the lower end of a 4.5 to 5 times range from 2021-2025 CREDIT RATING

  • Maintain credit ratios

comfortably above those required for an investment grade credit rating

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SLIDE 30

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2020/21 AND BEYOND

Dividend

SSE Financial Results for the Year to 31 March 2020 Presenter: Gregor Alexander

*assuming 1.5% RPI for 2020/21

EFFECTIVE FINANCIAL MANAGEMENT MANAGING CASH OUTFLOW SECURING VALUE FROM DISPOSALS

FINANCIAL FRAMEWORK NET DEBT/EBITDA RANGE CREDIT RATING

Full year dividend of 80p for 2019/20 Target full year dividend of 80p + RPI for 2020/21

KEY OBJECTIVES

SUSTAIN DIVIDENDS PROMOTE LONG TERM SUCCESS

Sustain SSE’s ability to pay dividends on which pensioners and savers depend for income Contribute to green economic recovery and create value through the transition to net zero

Expected interim dividend of 24.4p* for 2020/21 Confident SSE can deliver 2018-23 dividend plan

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SLIDE 31

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2020/21 AND BEYOND

Dividend

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

EFFECTIVE FINANCIAL MANAGEMENT MANAGING CASH OUTFLOW SECURING VALUE FROM DISPOSALS

FINANCIAL FRAMEWORK NET DEBT/EBITDA RANGE CREDIT RATING

KEY OBJECTIVES

SUSTAIN DIVIDENDS PROMOTE LONG TERM SUCCESS

Sustain SSE’s ability to pay dividends on which pensioners and savers depend for income Contribute to green economic recovery and create value through the transition to net zero

Plan to invest £7.5bn net in five years to 2025 Full year dividend of 80p for 2019/20 Target full year dividend of 80p + RPI for 2020/21 Expected interim dividend of 24.4p* for 2020/21 Confident SSE can deliver 2018-23 dividend plan

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SLIDE 32

Part Three

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CREATING VALUE THROUGH NET ZERO

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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CREATING VALUE THROUGH NET ZERO

Strategy and capability

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

  • Urgent need to secure green economic recovery
  • SSE ‘Greenprint’ for a cleaner, more resilient economy
  • Strategic focus on networks and renewables
  • Ambitious goals for 2030
  • Commitment to having right credentials for ESG

investors

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Strategy and capability

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

Alignment of strategy demonstrated by:

  • Ambitious goals for 2030 relating to decarbonisation and electrification
  • Options for new opportunities, using capital discipline in selecting investments
  • Skills in development, build and operation of electricity infrastructure
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SSE Renewables – Offshore wind – Seagreen

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

  • Seagreen to be Scotland’s largest offshore wind farm
  • 51% stake sold to Total
  • SSE Renewables gross equity contribution around £850m
  • £320m investment to date repaid through equity divestment

and project finance

  • Capacity of 1,075MW; typical annual output around 5TWh
  • c40% under CfD; c30% under contract with SSE Group

SEAGREEN EXPECTED TIMELINE

  • FID reached June 2020
  • Targeting first export Dec 2021; completion Dec 2022

NEW MAPS IN DEVELOPMENT. TO BE SUPPLIED BY CALLUM TOSH. 15/06/20

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CREATING VALUE THROUGH NET ZERO

SSE Renewables – Offshore wind – Dogger Bank

  • Dogger Bank to be world’s largest wind farm
  • Using world’s largest turbine GE Haliade-X 12+MW
  • 50:50 JV with Equinor, three 1,200MW sites each expected

to generate around 5.5TWh annually

  • Each project has secured a CfD, with prices ranging from

£39.65/MWh to £41.61/MWh at 2012 prices

NEW MAPS IN DEVELOPMENT. TO BE SUPPLIED BY CALLUM TOSH. 15/06/20

DOGGER BANK EXPECTED TIMELINE

  • Dogger Bank A & B FID Q4 2020, targeting first export Q3 2023
  • Dogger Bank C progressing to FID Q3 2021

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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CREATING VALUE THROUGH NET ZERO

SSE Renewables – Onshore wind – Viking

  • Decision to invest around £580m in Viking wind farm, subject

to final outcome of Ofgem consultation

  • 443MW project with estimated load factor of 48%
  • Largest onshore wind farm in the UK in output terms

VIKING WIND FARM EXPECTED TIMELINE

  • FID reached subject to Ofgem consultation
  • First export expected Q2 2024

NEW MAPS IN DEVELOPMENT. TO BE SUPPLIED BY CALLUM TOSH. 15/06/20

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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SSE Renewables – Growth

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

1 2 3 4 5 6 7 Mar-20 Mar-21 Mar-22 Mar-23 Mar-24 Mar-25 Mar-26

Renewables Growth from Core Projects (before any sell-downs)

Hydro Onshore Offshore

GW

5

1

  • 1. Dogger Bank A/B FID
  • 2. Gordonbush ext completion
  • 3. Dogger Bank C FID
  • 7. Dogger Bank A Completion
  • 8. Dogger Bank B first power
  • 9. Viking Completion
  • 4. Seagreen first power
  • 5. Seagreen Completion
  • 6. Dogger Bank A first power

4 6

3

8 11

  • 10. Dogger Bank B Completion
  • 11. Dogger Bank C first power
  • 12. Dogger Bank C Completion

12 10 8, 9 2 7

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CREATING VALUE THROUGH NET ZERO

SSE Renewables – Future wind development

SSE Financial Results for the Year to 31 March 2020 Presenter: Martin Pibworth

ONSHORE OFFSHORE

MW GB Onshore 1,247 NI Onshore 122 ROI Onshore 567 Total 1,936

SSE has a further 1.6GW of offshore options being explored in Ireland

OPERATIONAL DUE FID OR IN CONSTRUCTION CONSENTED REQUIRING CONSENT

MW Greater Gabbard 252 Beatrice 235 Walney 92 Total 579 MW Viking 443 Gordonbush Ext. 38 Total 481 MW Dogger Bank A 600 Dogger Bank B 600 Dogger Bank C 600 Seagreen 1 (42% CfD) 526 Total 2,326

MW Yellow River 105 Tangy 57 Lenalea 15 Galway Wind Park 14 Total 192 MW Arklow Bank 2 520 Total 520

MW Strathy South 208 Cloiche 155 Doraville 138 Other circa. 300 Total 801 MW Seagreen 2 & 3 3,200 Gabbard Extension 250 Total 3,450

TOTAL: 2.5GW TOTAL: 2.8GW TOTAL: 0.7GW TOTAL: 4.3GW

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SLIDE 40
  • Largest electricity storage capacity in the UK
  • 400MW of ‘run-of-river’
  • 750MW flexible hydro
  • 300MW pumped storage
  • Uniquely placed to deliver large-scale flexible zero-

carbon power

  • Total hydro output of 3,870GWh in 2019/20 vs

3,543GWh in 2018/19 (including pumped storage)

  • Increasing in value as the electricity system adjusts
  • Total EBITDA £223m for FY20 (vs £220m in FY19)

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CREATING VALUE THROUGH NET ZERO

SSE Renewables – Hydro

SSE Financial Results for the Year to 31 March 2020 Presenter: Martin Pibworth

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SLIDE 41
  • High levels of availability, operating efficiently with low levels of
  • perational spend
  • Proactive long term capital investment programme
  • Consent for new pumped storage at Coire Glas
  • Continuing to explore business case

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CREATING VALUE THROUGH NET ZERO

SSE Renewables – Hydro

SSE Financial Results for the Year to 31 March 2020 Presenter: Martin Pibworth

Hydro profitability FY20 FY19 Conventional hydro EBITDA - £m 207.8 195.6 Foyers EBITDA - £m 15.1 24.4 Total EBITDA - £m 222.9 220.0 Conventional hydro EBIT - £m 177.9 157.0 Foyers EBIT - £m 13.2 21.7 Total EBIT - £m 191.1 178.7 Conventional hydro volumes - GWh 3,743 3,318 Foyers gross volumes - GWh 127 168

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SLIDE 42
  • Older high-carbon stations at end of useful lives
  • Keadby 2 to be Europe’s cleanest and most efficient CCGT
  • Expected to achieve 63% gross efficiency
  • On target for commissioning 2021
  • 15 year capacity contract expected to be worth

£17.29/kW by 2024

  • Low carbon pathway

SSE Thermal Energy participating in the world’s first ‘zero-carbon cluster’ by 2040

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CREATING VALUE THROUGH NET ZERO

Low carbon thermal

SSE Financial Results for the Year to 31 March 2020 Presenter: Martin Pibworth

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SLIDE 43
  • SSE’s vision is to be a leading energy company in a net zero world
  • Delivered 50% reduction in carbon intensity between 2006 and 2018
  • In 2018 set a new target to achieve another 50% reduction by 2030

New science based target

  • Targeting a 60% reduction in carbon intensity of electricity generated

by 2030, compared with 2018 levels

  • Strategic commitment to creating value through transition to net zero

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CREATING VALUE THROUGH NET ZERO

New emissions targets

SSE Financial Results for the Year to 31 March 2020 Presenter: Martin Pibworth

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SLIDE 44
  • Vital role in the transition to net zero
  • Electrification of heat and transport create long

term growth opportunity

  • Heavily focused on delivering change and

modernising operations, infrastructure and work practices

  • Aiming for strong finish to RIIO-ED1
  • Working with stakeholders to prepare for

RIIO-ED2

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CREATING VALUE THROUGH NET ZERO

SSEN Distribution

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

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SLIDE 45

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CREATING VALUE THROUGH NET ZERO

SSEN Transmission

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

  • Strong record in enabling decarbonisation
  • Renewable capacity connected to the grid
  • Increased to 6.3GW in 2019/20
  • Forecast to reach 10GW by 2025/26
  • RIIO-T2 minimum Totex of close to £2.4bn over the

five years to 2025/26

  • Net zero points to £3.5bn Totex
  • Potentially taking Transmission RAV to over £5bn
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SLIDE 46

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CREATING VALUE THROUGH NET ZERO

SSEN Transmission

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

  • £2.4bn Totex excludes any island links
  • 600MW HVDC Shetland link required by Viking
  • Approximate cost £600m
  • Subject to final approval from Ofgem, work could

begin in late summer

  • Longer term strategic opportunities
  • E.g. Peterhead to Drax HVDC
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SLIDE 47

2 4 6 8 10 12 14 FY20 FY21 FY22 FY23 FY24 FY25 FY26 Networks RAV forecast Transmission Distribution SGN

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CREATING VALUE THROUGH NET ZERO

SSE Regulated Networks Growth

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

£bn

  • 1. RIIO T2
  • 2. RIIO GD2
  • 3. RIIO ED2
  • 4. Combined Networks RAV could reach £12bn

1, 2 3 4

£2.4bn Transmission Totex (excl. Island links)

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SLIDE 48

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CREATING VALUE THROUGH NET ZERO

Summary

SSE Financial Results for the Year to 31 March 2020 Presenter: Alistair Phillips-Davies

SSE’s vision is to be a leading energy company in a net zero world Clear objectives

  • Sustaining dividend payments on which pensioners and savers depend
  • Promoting long term success of the company for the benefit of all stakeholders

Focus on regulated electricity networks and renewables

  • Achieving excellence
  • Contributing to a green economic recovery
  • Delivering growth
  • Creating value through the transition to net zero
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SLIDE 49

THANK YOU

Questions