SSE Chief Marchant Quits After Leading Renewables Push
Ian Marchant, chief executive officer of SSE Plc (SSE), stepped down after a decade of leading the British power and gas utility’s push into renewable energy.
Deputy CEO Alistair Phillips-Davies will take over on July 1, SSE said today in a statement. Finance Director Gregor Alexander will have an expanded role deputizing for the chief executive, according to the utility, which is the U.K.’s second- biggest energy supplier.
“I need a change, the company needs a change,” Marchant, 51, said in a video posted on SSE’s website. He expects to do “a number of different jobs” in the future, he said, ruling out another “big, executive” role.
SSE produces about 29 percent of its power from renewable sources including wind turbines and hydroelectric dams following an investment program led by Marchant. The Perth, Scotland-based utility is now the biggest generator of electricity from renewables in the U.K. and Ireland. In 2011, SSE abandoned efforts to build nuclear reactors.
“Marchant oversaw significant growth in the business and improvement in its strategic position,” Edmund Reid, a U.K. utilities analyst at JPMorgan Chase & Co. (JPM), said by phone. He cited SSE figures showing the dividend grew 147 percent, market capitalization 136 percent and energy customer numbers 106 percent since Marchant became CEO.
“He did move the company more towards renewable energy, though it would be fair to say the jury is still out on the financial success of that strategy,” Reid said.
Marchant, who joined SSE’s predecessor company Southern Electric in 1992, has clashed with Prime Minister David Cameron’s government in the past month on plans to reform energy laws to spur development of atomic power and renewables. SSE said Marchant’s departure has been in the works for some time.
“This is something that Ian informed the board of some months ago, and the board has been working to ensure a very orderly succession,” said Brian Lironi, a spokesman for SSE.
The U.K. government is making its biggest changes to the energy market in two decades to lure investment in nuclear generation and push utilities into replacing more than a dozen power plants due to retire from service in the next 20 years.
The direction of the government’s clean energy policies will alter SSE’s future renewable energy developments more than Marchant’s departure, according Reid at JPMorgan.
Legislation detailed in an Energy Bill published in November would provide new financial mechanisms and incentives for low-carbon power such as nuclear and wind. The government has yet to clarify how all of the measures would work.
Marchant on Jan. 14 wrote an article for the Guardian newspaper expressing doubts about whether the arrangements could keep the nation adequately supplied with power into the 2030s.
He had also criticized the government’s negotiations with Electricite de France SA regarding the price for power from its planned nuclear reactors, saying decisions were being made in “smoke-filled rooms, over champagne and croissants.”
Phillips-Davies joined SSE’s predecessor Southern Electric in 1997 and landed a seat on the board as energy supply director in 2002. He was appointed as deputy CEO last year.
“I am leaving the company in good hands,” Marchant said.
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