London Electricity confident on review

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The Independent Online
LONDON ELECTRICITY has nothing to fear from the electricity regulator's review of its future supply agreements with Thames Power, an independent gas-fired power producer, according to the chairman, John Wilson.

'We believe that London Electricity's contracts with Thames have complied entirely with our obligations, under the terms of our electricity licence, to buy power economically,' he said.

Mr Wilson was speaking as London Electricity reported a 19 per cent increase in pre-tax profits to pounds 17.3m in the six months to 30 September. The interim dividend goes up by 12 per cent to 5.6p.

The profit advance came from a pounds 1.5m loss elimination in contracting and servicing and a pounds 2.5m cut in interest charges to pounds 3.1m.

Professor Stephen Littlechild, director-general of Offer, the electricity regulator, is expected to report next week the findings of an investigation into arrangements between regional electricity companies and independent gas-fired power stations.

The Offer investigation has been accelerated by the Government's review of pit closures. It has been suggested that in the recent 'dash for gas', gas-fired power stations now under construction may be more expensive than coal-fired plant.

London Electricity has a 14 per cent stake in a power station at Barking being built by Thames Power due to open in 1995. It expects to derive only 15 per cent of its needs from Barking whereas Northern, Southern and South Wales Electricity plan to take more than half their power from independent stations.

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