The plans will intensify last week's furious row over the privatisation of the National Grid - and the huge special dividends its chairman and other directors will gain from the sale.
They are being promoted by the same minister - Tim Eggar, Minister of State at the Department of Trade and Industry - who last week led calls to the directors to waive the windfall dividends, totalling more than pounds 300,000.
This summer Mr Eggar wrote to the Department of the Environment to press it to allow the National Grid to go on using polychlorinated biphenyls (PCBs) indefinitely. Although the department initially resisted, officials admit it is now giving way.
PCBs have been known to be highly dangerous since the early Seventies, when they were identified as causes of cancer.
In 1990 the Government undertook to remove and destroy all "identifiable" PCBs by 1999. But the electricity industry - which has more than half a million transformers containing the chemicals - says it would cost pounds 380m to remove them and has lobbied for exemption.