Price freeze will end UK investment, says ScottishPower
One of Britain's Big Six threatens to halt £15bn investment if Miliband goes ahead with price freeze
THE boss of energy company ScottishPower has threatened to scrap investment in new power stations and electricity networks in Britain if Labour's proposed energy price freeze goes ahead.
According to The Times, Keith Anderson, who runs one of Britain's biggest energy companies, has written to Ed Miliband threatening to abandon plans to invest up to £15bn over the next ten years in projects that could have created up to 4,500 jobs in the UK.
In the industry's most explicit threat yet against Labour's plans to freeze prices for 20 months, Anderson says: "We are at a critical juncture in terms of future investment in the UK."
He explains that ScottishPower – one of Britian's 'Big Six' power corporations – had the opportunity to invest in several different markets, but chose the UK because "it is seen as working relatively well". However, Anderson warns in his letter that a state-imposed price freeze "would cause investors to doubt that they will receive an adequate return or to fear future similar interventions, [and] those doubts and fears would be reflected in the appetite to invest".
Tension has grown between the Labour leader and energy companies since his announcement at the Labour Party Conference last week. Many energy companies responded to the plans with warnings of blackouts and legal challenges. Sir Roger Carr, chairman of Centrica, said the policy was "potentially a recipe for economic ruin".
However, Miliband says that the power companies are "unreliable witnesses" and maintains that the move will go ahead if Labour wins the 2015 general election.
In his letter, Anderson also hits back at claims that energy companies are profiteering. He says that although net profits at ScottishPower rose to £646.3m in 2012 (from £301.6m in 2011), the company has invested £957m in the UK in the same period.
Ann Robinson, of the price comparison website uswitch.com, tells the paper: "We desperately need investment in energy infrastructure and new generation. We can't afford to have the Big Six pulling out." ·