THE head of Scottish Power has underlined the company’s enthusiasm for the renewable energy business in the UK where it intends to invest €8.4 billion (£6.3bn) over the next five years.

Chief corporate officer Keith Anderson said the investment will be concentrated on boosting the company’s renewable energy generating capacity and related networks reflecting the Spanish-owned company’s confidence in the UK market.

“Our renewables business has been performing very, very well. We have seen the profitability of the business grow very, very rapidly,” he said.

As Scottish Power gave the green light to plans to build a £2.5bn windfarm off East Anglia yesterday, Mr Anderson emphasised the appeal of such assets compared with traditional plants.

“Coal and gas generation is not making any money,” complained Mr Anderson, who said the supply of gas and electricity to consumers is a fiercely competitive business.

Scottish Power will close the coal fired Longannet power station in Fife next month.

However, Mr Anderson said the Government needed to do more to encourage firms to build new gas plants as growing numbers of coal-fired generators are closed.

“Otherwise longer term we’re going to have some significant issues around security of supply,” warned Mr Anderson. He believes the UK gains some assurance from being part of the EU.

“The EU Referendum is a matter for the British people,” noted Mr Anderson, adding: “We are encouraged by and support the strong position the Prime Minister is putting to the people of Britain. From tackling emissions to strengthening security of supply, the UK benefits from being part of a greater European market.”

As a subsidiary of Iberdrola, Scottish Power is part of a giant European group which has decided to devote around a third of its total €24bn investment budget to the UK over the five years to 2020.

Mr Anderson said the appeal of wind energy assets in the UK had been reinforced by weather conditions last year. The company generated record amounts of renewable energy helped by very windy conditions in Scotland

The costs of developing wind farms has fallen dramatically. Offshore wind facilities cost around £160 per megawatt hour three years ago.

The new ONE facility off East Anglia will cost £120 per megawatt hour.

He praised the UK Government for providing the stable regulatory environment needed to encourage firms to invest in offshore windfarms.

Scottish Power will continue investing in onshore windfarms, although the Government wants to end subsidies. It is investing £300m in the Kilgallioch scheme in South Ayrshire, which will become one of the biggest onshore windfarms in the UK.

Scottish Power’s Whitelee wind farm near Glasgow is the UK's largest onshore windfarm.

Mr Anderson said the company does not want subsidies. However, the Government must ensure companies will be able to sell power to the National Grid at a price that makes it worthwhile investing in new facilities.

Scottish Power’s renewables division increased earnings before interest, tax, depreciation and amortisation by 65 per cent to €438m in 2015, from €265m the preceding year, helped by a first full year’s contribution from the West of Duddon Sands windfarm in the Irish Sea.

The division of Scottish Power that runs traditional power generation facilities and sells and electricity to consumers had a tougher time, with ebitda falling eight per cent to €421m from €460m.

Mr Anderson said the fall partly reflected competition in the retail business and defended the company’s record on the prices charged for electricity and gas.

The company is cutting standard domestic gas prices by an average 5.4 per cent next month.

Mr Anderson said the cost of a typical fixed price duel fuel supply deal has fallen to £850 a year, from £1,100 around three years ago.

Scottish Power increased customer numbers by 20,000 to 5.5m in 2015.

Iberdola recorded a €230m after tax impairment charge for the closure of Longannet.

Scottish Power’s ebitda increased to around €2bn from €1.7bn.

Profits in the networks arm, which runs power lines and the like, increased to €1.14bn from €1.02bn.

Iberdrola increased ebitda to €7.3bn from €6.9bn.