Earnings of Scottish Power fell in 2010
Scottish Power experienced a 7% drop in earnings in 2010, as it faced squeezes between declining demands for energy and constantly rising wholesale costs.
The Iberdrola-owned company made 1.35bn euros in earnings before it took into account costs of tax, interest, and depreciation. Iberdrola is the biggest Spain’s biggest utility company, as well as a world leader in generating wind power.
From Scottish Power’s three divisions,transmission wires and sub-stations were the only two areas where good performances were displayed. New pricing agreements with regulator Ofgem handed more security of income, as a means of trying to encourage additional investment in the sector.
In general, the energy retail division was flat over the year and it had most problems in trading energy and generating it. The company is reported to have faced falling demands as a direct result of 2008’s economic downturn, in addition to energy efficiency measures starting to take effect.
It also discovered that increasing wholesale costs of energy throughout last year squeezed margins, until it announced that customer prices were about to rise in November.
Announcing Iberdrola’s Spanish results, the Bilbao-based outfit reported 10% rises in profit, boosted by strong performances in its home market – in addition to North and South America. The core earnings for the group came in at just over 7.5bn euros.