City power brokers are to meet the energy regulator to counter the threat of billion-pound blackouts. Clayton Hirst reports
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The Independent Online

A group of some of the country's most powerful financial institutions, including the London Stock Exchange, are planning a high-level meeting with the energy regulator to ensure that the lights don't go out in the City.

After the blackouts in New York and south London last month, City firms are worried that a power cut of just a few seconds could cost Britain's financial hub billions. The meeting is being organised by the Corporation of London and the firms are expected to raise their concerns with the energy regulator, Ofgem, this autumn.

Ofgem has started a review of the way the electricity distribution companies are financed. The Corporation declined to comment, but it is expected to argue that the so-called price control review must not prejudice electricity companies' ability to invest in their networks.

In a letter sent to Ofgem days after the blackouts in Manhattan, the Corporation's deputy City surveyor, Peter Bennett, said: "A loss of power, however infrequent or short in duration, will have a detrimental affect on [companies'] balance sheets in terms of business lost. This loss in revenue has far reaching effects for the wider economy. The Corporation feels that traditional methods of measuring performance of electricity supply do not take into account the wider economic effect of power failures."

The letter also warned that many City companies didn't have their own on-site backup generators to protect against power loss.

The Corporation is in talks with distribution company EDF Energy about strengthening the supply in specific areas of the City. In particular, it is keen to see improvements in Bishopsgate on the north-eastern side of the City. This is where the Corporation expects most of its growth to take place over the next 10 to 15 years. It already has plans for three to four million square feet of new office space.

Last week the Corporation met with EDF executives and London property companies to discuss how improvements to the electricity network would be paid for. Developers proposed phased paymentsfor the upgrade work.

Last year EDF spent £300m improving its London networks and added enough capacity at its City substations to serve a small town. The French government-owned company claims a 99.99 per cent reliabilty rate in London.