British power generator and network operator SSE said on Friday it will sell a 25% stake in its power transmission network business to Canada’s Ontario Teachers’ Pension Plan Board for 1.47 billion pounds ($1.78 billion), as part of its efforts to cut greenhouse gas emissions. The stake sale of SSEN Transmission is part of a plan SSE outlined last November when it pledged to invest 12.5 billion pounds in clean energy projects.
So far, SSE has sold a 33.3% stake in gas distribution operator Scotia Gas Networks for nearly 1.29 billion pounds as part of a bid to focus on renewable power and networks.
“With significant growth forecast in transmission, bringing in Ontario Teachers’ as a minority stake partner will help fund our ambitious investment plans as we continue to deliver a network for net zero emissions across the north of Scotland,” SSEN Transmission Managing Director Rob McDonald said.
The investment plan announced last year represents 1 billion pounds of additional capital expenditure per year over its previous spending programme and SSE has said it will expand its renewable power capacity five fold to 50 terrawatt hours a year by 2031.
SSEN Transmission – which operates under its licensed entity – Scottish Hydro Electric Transmission plc, will be chaired by SSE’s finance director, Gregor Alexander, and Ontario Teachers’ will get proportional representation on the board, SSE said on Friday.
SSE also has a 750 million pound revolving credit facility to help SSEN Transmission with capital requirements, the company said.
Power companies in Britain have been hit by the government’s plans to increase a windfall tax to 35% and to extend it to power generation firms to help plug a major hole in public finances.
($1 = 0.8258 pounds)
(Reporting by Radhika Anilkumar in Bengaluru; editing by Savio D’Souza and Jason Neely)