Power chief Anderson warns against zonal pricing – Daily Business

An energy company leader will today reiterate his opposition to regional pricing, warning that it could deter investment.

Keith Anderson, chief executive of ScottishPower, will tell a conference in Glasgow that there are dangers in making a fundamental change to the UK’s electricity system at a time when investors want clarity to back huge projects in areas such as grid upgrades, cabling and renewables.

He has previously warned of the risks in zonal pricing, which would potentially see different wholesale charges for electricity around the UK in an attept to cut bills in some places.

Energy Secretary Ed Miliband is said to be considering the change which has support in Scotland where wind turbines provide most of the UK’s electricity but customers face some of the highest bills.

Greg Jackson, the chief executive of Octopus Energy, is among those backing the idea. Mr Anderson has warned that it could lead to swings in pricing and some customers paying much higher bills.

He will tell the All-Energy trade show in Glasgow that investors want clarity to back huge projects in areas such as grid upgrades, cabling and renewables. The focus, he says, should be on the benefits that will derive from the overhaul of the electricity transmission network.

His parent company Iberdrola recently benefited from a £1.35 billion package of support from a consortium of banks and the National Wealth Fund to upgrade the connections between Scotland and England.

Additional storage and connectivity will also mean turbines do not have to be switched off when there is an over-supply.

UK Energy minister Michael Shanks and Kate Forbes, the Scottish Deputy First minister and Economy Secretary, are among other speakers at the event.

Juergen Maier, chair of the investment vehicle GB Energy and Claire Mack, chief executive of Scottish Renewables, are also among those addressing delegates.

Ms Mack will be among those calling on the UK government to double down on its support for the renewables sector amid growing net zero jitters and wider economic headwinds.

Senior industry executives will tell officials from London as well as Holyrood that urgent clarity is required in a range of areas to ensure wind, solar and other technologies continue to be built.

While there has been an uplift in investment and intentions to reform the system, Ms Mack will say that high uncertainty on major policy decisions about market design and a lack of sustained project activity is damaging confidence.