A fall in customer numbers and lower demand for gas and electricity due to milder weather saw earnings drop at energy giant ScottishPower last year.
Figures released by Spanish parent firm Iberdrola also showed that earnings from UK renewable generation fell by almost a third due to lower winds after a record 2015. Overall generation and supply earnings fell to £240.3 million, down 21.5 per cent, during a year when customer numbers dipped by 160,000 to 5.32 million at the end of 2016.
The group, which recently announced a 7.8 per cent price hike in standard tariffs, said it has since seen ScottishPower’s customer numbers bounce back to 5.48 million on the back of fixed rate deals.
It has seen 5 per cent of customers on standard variable tariffs switch to cheaper deals offered by the group. But around 1.1 million customers will still be affected by its price hike, which takes effect on 31 March as part of a round of similar moves by energy firms following rises in wholesale markets.
The Big Six energy firm will ramp up the price of electricity by an average of 10.8 per cent and gas by 4.7 per cent.
Earnings from UK renewable generation fell 31 per cent to £218.5m, largely driven by a drop in production. Earnings from its networks business came in at £799.1m, down 3.3 per cent, due to changes in the regulatory framework for the UK distribution network which came into force in April 2015.
Keith Anderson, chief corporate officer at ScottishPower, said: “2016 was a challenging year, but ScottishPower continued to make significant investments.”
The group said it placed more than £3 billion of contracts last year for planned investments in renewable energy, smart meters and upgrading power lines and substations.
Work due to complete this year includes a £1bn project with National Grid to install more than 380km of subsea electricity cables between Ayrshire and North Wales.
More than 240,000 smart meters have also been installed as part of a UK-wide rollout with an average rate of 2,500 a day expected in 2017.
Results for the wider Iberdrola group showed underlying earnings increased by 5.5 per cent to €7.81bn (£6.6bn).
Staff began moving into ScottishPower’s new headquarters in Glasgow city centre at the end of 2016 and all of the company’s 1,600 employees will move in during 2017.
The 14-floor building will also double as Iberdrola Group’s global offshore wind headquarters.