Keith Anderson raises concerns over ‘pounds for pylons’ scheme

Scottish Power chief executive Keith Anderson has questioned the effectiveness of the government’s “pounds for pylons” scheme.

Anderson expressed concerns about the government proposal which would provide financial benefits to households near to infrastructure developments.

Instead, Anderson said that demonstrating the economic benefits of grid upgrades is a better way to win support for new infrastructure, while speaking at the House of Commons energy security and net zero committee’s inquiry into grid flexibility.

As part of its response to the Winser review of transmission network planning, the government announced last November that electricity bill discounts of up to £1,000 per annum could be offered to households living within 200m of new grid infrastructure.

In addition, the government is proposing packages of benefits for affected communities, which would be worth £200,000 per km of overhead transmission line.

But Anderson, whose company has awarded around £60 millon over the last two decades to communities hosting renewables projects, cast doubt on whether cash payments are the most effective way of securing support for infrastructure.

He said: “Whether for wind farms or the transmission network, where we get the best linkage is where we are creating local economic benefits by getting people involved in the construction programme and work, putting money into the local economy. […]

“Jobs, investment and economic benefits for the local area, that is a far more effective engagement tool than sending a cheque to someone.”

Anderson’s concerns were backed up by RenewableUK’s director of future electricity systems Barnaby Wharton.

He said: “The risk is that if it’s just a load of cash, people will see it as a bribe.”

Anderson also called for the government to follow Germany’s lead by centrally co-ordinating procurement of transmission equipment, like cables, where the UK faces growing competition as countries worldwide seek to upgrade their grids in order to meet emission reduction targets.

Scottish Power announced this week that it has procured £5.4 billion worth of supply chain capacity for manufacturing cables.

But pointing to how Germany has bought up 10 years of cable manufacturing capacity, he said: “The UK could be better at attracting into this country by being more strategic.

“We’re not very good at getting companies to come and invest in manufacturing facilities.

“We need the additional capacity.”

Anderson also said it is “phenomenally difficult” to recruit experienced engineers for network upgrades.

“The most difficult people to recruit are experienced engineers with design capability. We can get apprentices and trainees but getting engineers with 10 to 15 years’ experience is phenomenally difficult.”

And he told the committee that Scottish Power is not proposing to develop any onshore wind farms in England, despite recent moves by the government to tweak the planning process for such projects.

He said: “It’s godforsaken. The number of sites available aren’t great, the wind yields aren’t brilliant and the process is cumbersome, slow and fraught with uncertainty.”