Power company SSE has hiked its earnings forecast for the second time in little more than two months as demand for energy from its gas-fired plants has more than offset lower-than-expected renewables output.

The Perth-based group, which no longer supplies energy directly to households, said earnings are now on track to top 160p per share for the year to March 31. This is up from 150p predicted at the end of January, when SSE raised its earnings guidance by 25 per cent.

The company said the shortfall in output from renewable sources has increased from around 10% below plan for the nine months to December 31 to now stand at around 13% below plan. However, it is staying the course on its pivot to renewables.

Capital expenditure on net zero - including acquisitions - is expected to hit a record in excess of £2.5 billion for the year just past. SSE said it will provide a further update on its net zero plans on May 24, when it is also due to post its year-end results.

READ MORE: Scottish energy giant SSE hikes earnings forecast after price boost

"As we progress our ambitious Net Zero Acceleration Programme, we are investing more than we make in profits into the infrastructure society needs for a more secure, affordable and clean energy system," finance director Gregor Alexander said. "Our balanced business model has performed well in a volatile year, helping to ensure security of supply.

" At the same time, we are progressing multiple projects and adding to our pipeline as we deliver on our net zero focused electricity infrastructure strategy. This strong performance leaves us well positioned to continue our significant investment programme and we will update the market with more detail in May."

Analysts at Hargreaves Lansdown said the shift to renewables comes with a "hefty dose" of risk because they not always reliable.

"To some degree, it's at the mercy of mother nature," the firm said.

READ MORE: Energy prices: Households pay as the UK gambles on volatile gas market

"Unseasonably calm and dry weather this winter left the group's renewable output lower than planned meaning flexible gas-fired plants will still have to plug the energy shortfall for now. Fortunately, these are also part of SSE's offering and can help to smooth its revenue profile."

The update from SSE came as UK Energy Secretary Grant Shapps was putting forward the Government’s new green power strategy. SSE said it had noted the plans and would respond in 'due course'.

Energy providers along with oil and gas firms have enjoyed a sizeable boost to their bottom lines over the past year amid surging whololesale prices. British Gas owner Centrica unveiled record annual profits in February, as did energy giant Shell.

Shares in SSE, which are listed on London's FTSE 100, closed yesterday's trading 72p higher at 1,809.5p, an rise of more than 4%.