Scottish Power: freeze prices and we’ll take £15bn elsewhere

Scottish Power has become the latest of the big six to warn Ed Miliband his plan to freeze energy prices could deter investment.

The company’s plans to invest up to £15 billion in the UK are under threat from the Labour leader’s proposed 20-month freeze, it warned.

Keith Anderson, chief corporate officer at the energy company, spelled out the considerations for Spanish parent company Iberdrola when deciding where to put its money.

In an open letter, he wrote: “As an international energy company, we carefully analyse all of the major markets in the world. Maintaining principles of sound regulation and avoiding regulatory uncertainty are critical to securing this global investment in the UK.”

Anderson disputed Miliband’s assertion, used to justify his election pledge made last week, that the market has “consistently failed to secure the confidence of the public or the investment Britain needs”.

He reminded Miliband that in his former role as energy secretary under the last government, he said bills were likely to rise for the rest of the decade.

Anderson said: “It is decisions about the pace of that decarbonisation and modernisation, and about the scale of social programmes, together with developments in world markets, that will define the future path of energy prices in Britain. Any move to freeze all domestic bills will not alter the fact that the investment Britain needs still has to be paid for. To the extent such a freeze would cause investors to doubt that they will receive an adequate return or to fear future similar interventions, those doubts and fears would be reflected in the appetite to invest.”