Electricity firm 'abused subsidies'

Published on Saturday 4 October 2008 20:01

ONE of Scotland's leading electricity companies is facing allegations that it deliberately reduced the generating capacity of some of its hydro power stations to attract Government subsidies worth millions of pounds.

In a petition to be discussed by MSPs this week, Scottish & Southern Energy is accused of making the changes to qualify for subsidies aimed at encouraging small-scale renewable energy projects.

Supporting documents claim that power firms in the UK have picked up more than 380m in subsidies from the scheme. Now MSPs are being asked to investigate whether companies made legitimate claims on the cash fund.

The petition has been lodged by Nick Dekker, a retired civil engineer and Strathclyde University lecturer who lives in Cumbernauld. He said: "I want MSPs to ask for a breakdown of how much has been spent in each of these stations and what return they are getting. It (the subsidy scheme] is a licence to print money."

Scottish & Southern, which has 8.45 million customers, says the modifications were not made to attract subsidies but to improve efficiency and extend the life span of ageing hydro power stations.