Debt rating giant Moody’s Ratings said it has affirmed its Baa1 long-term issuer and senior unsecured ratings of SSE plc, the Perth-based electricity infrastructure giant, and its Baa3 ratings on the company’s junior subordinated (hybrid) instruments.

Analysts consider Baa1 and Baa3 bond ratings the lowest “medium-grade” tier of investment grade.

SSE, a FTSE 100 firm, is the largest London-listed company run from Scotland. Its share price has soared about 70% in the past year to more than £25 to give the firm a stock market value in excess of £30 billion.

“SSE’s Prime-2 other short-term rating has also been affirmed,” said Moody’s.

“We have also affirmed the Baa1 ratings of SSE’s subsidiaries — Scottish Hydro Electric Transmission plc (SHET), Scottish Hydro Electric Power Distribution (SHEPD), Southern Electric Power Distribution plc (SEPD), SSE Generation Ltd (SSE Generation) and SSE Energy Supply Ltd (SSE Energy Supply).

“The outlook on SSE and its subsidiaries remains stable.”

Explaining its ratings rationale, Moody’s said: “The ratings affirmation reflects that we expect SSE to maintain a financial profile commensurate with our amended ratio guidance for the Baa1 rating level over the remainder of the decade – Funds From Operations (FFO)/Net Debt of at least 18% (previously not materially below 20%).

“While successful execution of the group’s very large capital investment programme (£33 billion, net, over the five year period to March 2030) will materially increase leverage and weaken cash-flow based metrics this is from a solid base, following balance sheet strengthening measures in recent years, and be partially compensated by further improvements in the quality and the quantity of the group’s earnings.

“The group’s investment programme is focused on electricity networks (c. 80% – split £22 billion, net, in transmission and £5 billion in distribution) with the remainder in generation (£6 billion across generation and system flexibility).

“The huge scale of investments in transmission reflects SSE’s majority ownership of an electricity transmission network, SHET, in the north of Scotland that will continue to see one of the highest levels of annual regulated asset value (RAV) growth globally – averaging 30% through FY2030 under company projections – if it delivers 11 approved large projects, which account for over 75% of planned investments in transmission, according to planned timescales.

“The execution risk of delivering this ambitious investment programme, with electricity transmission presenting the greatest challenge in our view, is moderated by regulatory and company measures.

“Regulatory measures include (1) reduced exposure to over- or under-spend against regulatory cost allowance in the forthcoming transmission price control – RIIO-ET3, which will commence on 1 April 2026 and run for five years; (2) cost allowances on large transmission projects being finalised only when projects are at an advanced stage; (3) early funding mechanisms, facilitating transmission owners secure supply chains in a tight and stretched market; and (4) accelerated cost recovery, reversing a trend from the current electricity network controls.

“Company measures centre on facilitating timely transmission capex delivery, through good progress in securing the supply chain and obtaining key permits in a timely manner and balance sheet strengthening measures in recent years.

“As of 4 February 2026, SHET has three quarters (25/34) of the major consents required to fulfil its licence condition to deliver the 11 major (ASTI and LOTI) projects that reinforce the grid in the north of Scotland with five currently under construction.

“The £2 billion equity raise, announced and completed at the same time as the strategic update in November 2025; more modest distributions since the rebasing of the group’s dividend in FY2023; continued capital discipline with investment decisions for new renewable projects; and successful asset rotation, have all strengthened SSE’s financial profile in recent years.

“We estimate successful execution of this ambitious programme will lead to the proportion of earnings from the group’s regulated and contracted activities increasing from above 60% in FY2025 to around 90% in FY2030 with the share from regulated networks (41% in FY2025) accounting for the majority of this increase. (All figures in our estimated EBITDA split include joint ventures and 75% of electricity transmission, SHET).

“The scale of growth in network earnings also reflects regulatory measures that accelerate cash flow, including (1) the move from real to semi-real returns (adding 1.09% points to average cash returns over the RIIO-ET3 period) that we expect will be reflected in the next electricity distribution controls, commencing in April 2028; and (2) remunerating in-year up to 15% of the capex associated with the ASTI and LOTI investments (and indeed all ‘uncertainty mechanism totex’), as opposed to all over 45 years. While we believe such measures do not improve underlying credit quality, they do reduce the financing requirements of the sizeable investment programme.

“While material delays to planned network investments will slow the improvement in business mix profile, we expect SSE to deliver the majority of its planned transmission investments and close to its target for distribution investments over the period to FY2030. The amended ratio guidance reflects the expected evolution of earnings over the period towards the end of the decade but also anticipates a material and sustained reduction in off balance sheet debt, as a percentage of the consolidated SSE’s group debt, from FY2027 onwards.

“Overall, SSE’s Baa1 issuer rating continues to be supported by (1) its diversified business mix; (2) the material, and increasing share of earnings from regulated transmission and distribution networks under a well-established and transparent regulatory framework in Great Britain; (3) the improved quality and quantity of generation earnings following disciplined investment decisions; and (4) a solid financial profile that has been bolstered by balance sheet strengthening measures in recent years.

“These factors are, however, balanced against (1) the group’s very large capital investment programme (£33 billion, net, over the five year period to March 2030) that will materially increase leverage and weaken cash-flow based metrics, albeit from a solid base; (2) a degree of exposure to commodity markets and weather patterns; and (3) growing debt at the operating companies (all in transmission) and ongoing use of joint ventures which lead to a degree of structural subordination, absent mitigating measures.

“The Baa3 long-term ratings on the hybrid securities reflect their terms and position in the capital structure …”