Nicola Sturgeon has thrown her support behind Labour leader Sir Keir Starmer’s plans for a publicly-owned energy company a year after her government dropped a similar project.

The First Minister switched the policy to providing an advisory body and yesterday confirmed that a national public energy agency will be launched in the coming weeks.

She was pressed in the Holyrood chamber by Scottish Labour leader Anas Sarwar to say whether she supported Sir Keir’s intention to set up Great British Energy in his first year, if elected Prime Minister.

Ms Sturgeon said she would be “happy to give support to policies of that nature”.

At the SNP conference in October 2017 she announced that she would set up a not-for-profit energy company. The company would buy its energy on the wholesale market or generate it in Scotland from renewable sources to supply energy to consumers at “as close to cost price as possible”.

But with energy suppliers starting to fail in 2018, MSPs began raising questions about how the new company would add value and offer a cheaper alternative to what was already available.

In June 2021, Green Party co-leader and government minister Lorna Slater, criticised Ms Sturgeon for not moving fast enough on the plan.

Shadow Scottish Secretary Ian Murray said the new SNP-Green partnership made no mention of the energy company plan in a 50-page joint policy statement.

In September that year Daily Business revealed that the government had quietly abandoned the plan.

During yesterday’s exchanges during First Minister’s Questions, Mr Sarwar accused the First Minister of selling off rights to offshore wind generation “on the cheap”, and said that the Swedish company Vattenfall would profit more than Scottish taxpayers.

Ms Sturgeon said the Labour leader was “talking down the fantastic ScotWind programme” and despite her comments in 2017 she claimed that the SNP’s plans were for a retail energy company rather than a generating one.

“Yes, we committed to a publicly-owned retail energy company,” she said. “Covid unfortunately changed those plans. We will shortly set out our plans for the national public energy agency.”

Ms Sturgeon insisted that full powers over the energy market under independence would give the government access to the level of borrowing necessary to establish an energy generation company.