Accepts Ofgem's proposals

Scottish & Southern Energy PLC
09 December 2004


     SCOTTISH AND SOUTHERN ENERGY ACCEPTS OFGEM PRICE CONTROL PROPOSALS


Scottish and Southern Energy plc ('SSE') has decided to accept Ofgem's Final
Proposals in respect of the electricity distribution price control review for
2005 to 2010, as set out in the Paper it published on 29 November.

Throughout the process for determining the new price control, SSE's objective
has been to reach agreement with Ofgem on an overall package of measures in
respect of Southern Electric Power Distribution and Scottish Hydro-Electric
Power Distribution which will allow it to deliver the right quality of service
for customers while achieving a reasonable return for investors.

SSE believes that, taken together, the proposals for future allowed operational
and capital expenditure, operational expenditure efficiency assumptions, the
treatment of pensions costs and rising tax charges, the level of real post-tax
cost of capital, the incentive framework for delivery of good performance, and
other specific issues, such as the treatment of the cost of balancing
electricity generation and demand in the Shetland Islands, meet its objective.
Ian Marchant, Chief Executive, said: 'We have already gone on record to welcome
the transparent and constructive approach which Ofgem adopted during the process
for determining the distribution price control review for 2005 onwards. I
believe that the Final Proposals in respect of Scottish Hydro-Electric and
Southern Electric represent a reasonable outcome for all concerned. Our focus
now will be on maintaining the highest standards of customer service and
efficiency within the new price control framework.'


ENDS

Enquiries to: Alan Young or Denis Kerby 0870 900 0410



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