ScottishPower chief blasts Blair for pre-empting nuclear review

The chief executive of ScottishPower, Britain's biggest wind power company, criticised Tony Blair yesterday for pre-empting the outcome of the Government's energy review by giving his public backing to a new generation of nuclear reactors.

Philip Bowman, who took over at ScottishPower last autumn after the ousting of Ian Russell, said the Prime Minister had been "rather previous" in announcing last week that nuclear power was "back on the agenda with a vengeance". Mr Bowman also said it was "not helpful" that Mr Blair had reshuffled both the Trade and Industry Secretary, Alan Johnson, and the Environment Secretary, Margaret Beckett, midway through the review.

He was speaking as ScottishPower warned that further price rises for its 5.25 million domestic gas and electricity customers were "unavoidable", even though the company more than doubled profits in its energy retail and wholesale division last year and increased bills in March.

The consumer body Energywatch attacked the announcement, describing it as an "assault on the budgets of Britain's poorest households", and called for "joined-up action" from the Government to soften the impact on domestic users.

But Mr Bowman defended the plan to increase prices, saying ScottishPower's residential energy business lost £30m more in 2005-06 than the previous year because it had only passed on part of the increase in wholesale prices.

He said the 129 per cent increase in profits from energy retail and wholesale to £214m last year had been due to its heavy investment in new generating capacity, including wind farms.

ScottishPower also announced plans to increase investment by £1.3bn to a total of £4.8bn between now and 2010. This will include more spending on its UK energy networks, the construction of more onshore windfarms and the fitting of environmental clean-up equipment to the Longannet coal station in Scotland. The company aims to have 1,000 megawatts of UK wind power in operation by the end of the decade.

Mr Bowman also said that ScottishPower had decided to keep its US renewable energy and gas storage operation, PPM Energy, and would be investing £1.6bn in the business to increase its wind power generation by a half to 3,500 megawatts. He had put the business under review following his predecessor's decision to sell the West Coast utility PacifiCorp to Warren Buffett.

Group operating profits from continuing operations rose 39 per cent to £805m and the full-year dividend was increased by 11 per cent. ScottishPower shareholders will receive a £2.25bn return of cash next month following the PacifiCorp sale.