Hewitt takes charge of plans to prevent blackouts

Patricia Hewitt, the Secretary of State for Trade and Industry, has taken personal charge of Government plans to prevent blackouts this winter.

Ms Hewitt chaired a meeting of senior Whitehall officials last week, which was convened to draw up contingency plans to avoid power cuts, should a prolonged cold snap test the electricity grid to the limit.

As Secretary of State she has a legal responsibility for maintaining security of supply, along with the energy regulator Ofgem.

News of Ms Hewitt's close involvement follows the warning earlier this week from National Grid Transco that Britain's "safety margin" between peak electricity demand and generating capacity could run dangerously low this winter.

The Grid forecast that the margin would fall to just seven per cent at peak periods and could vanish altogether under certain circumstances.

Big UK generators warned yesterday that there was a real danger of blackouts this winter because of the number of power stations that have been mothballed due to falling wholesale prices.

The chief executive of one of the country's largest generators said: "I think it will be tight. We are concerned." Another chief executive said: "If there is a prolonged spell of cold weather then I think we will be in trouble."

DTI sources said contingency plans to prevent power cuts would be one of the department's highest priorities this winter.

Ms Hewitt will today set out the arrangements, which are being put in place at a utility industry conference in London. These involve encouraging generators to make more plant available and keeping gas-fired power stations in operation.

But Ms Hewitt will stress that she would prefer to see "market mechanisms" used to keep the light burning rather than direct intervention by Ofgem to force gas shippers to maintain supplies to gas-fired plants.

Separately Ms Hewitt told MPs yesterday that the European Union stood ready to impose sanctions on US imports unless the Bush administration withdrew its "unlawful and wholly unjustified"' tariffs on steel imports.

The World Trade Organisation is due to rule shortly on a US appeal against its original ruling that Europe was entitled to retaliate against the American measures.

If the WTO upholds the EU's position the trade sanctions will come into effect automatically after a five-day period. Ms Hewitt told the Trade and Industry Select Committee: "If and when we do win this appeal I hope the US will move very quickly to remove those illegal tariffs." She also attacked the CBI over its claims earlier this week that Labour had increased the business tax burden by £54bn since it came to power.

She said the CBI's figures had been "comprehensively demolished" by the Treasury and said the figures showing that the UK levied a higher proportion of taxes on companies than rival countries were "a pretty meaningless and misleading comparison."