Nicola Sturgeon: aiming to keep prices low (photo by Terry Murden)
Energy giant SSE, which trades as Scottish Hydro, has told First Minister Nicola Sturgeon that it is “not appropriate” for government to supply power on a large scale as it risks distorting the market.
A plan to create a publicly-owned energy company was unveiled by Ms Sturgeon this week at the SNP annual conference.
But in the first signs that it could be unravelling, the Perth-based utility said it could potentially deter private investment.
Its comments are contained in a submission to the Scottish Government’s draft energy strategy which is due out within weeks.
Energy market analysts also cast doubt on a publicly-owned company achieving substantial savings beyond those already achieved by those looking for the lowest possible deals, according to the Telegraph.
Nottingham City Council launched a similar initiative, Robin Hood Energy, and its initial tariffs were more than £200 cheaper than the average offered by the Big Six but still more expensive than the best deals offered by some other smaller suppliers.
SSE asked for more clarity on Ms Sturgeon meant by a “government-owned energy company”, before adding: “This is not appropriate at a larger scale as it risks distorting the market and deterring private investment.”
EDF, another of the ‘Big Six’, suggested in its submission that a government-owned company should focus on helping community energy and “capital intensive” projects get off the ground rather than supplying homes.
A ScottishPower spokesman said it welcomed new entrants to the market.
Dermot Nolan, chief executive of industry regulator Ofgem, said a government-owned firm would get a licence “within months’.