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End Punch and Judy fight says power chief

THE outgoing chairman of Scottish Gas parent Centrica has called for an end to the "Punch and Judy" debate over rising energy bills amid public and political anger at the Big Six providers.

In a robust defence of the industry, Sir Roger Carr has said investor confidence was being damaged by political rhetoric.

Figures in an analyst note from Liberum Capital reveal the extent of the damage from the recent reputational blows suffered by the sector, with £7 billion to £11bn wiped off from the value of energy stocks in the past two months.

Sir Roger, who is taking over as chairman of BAE Systems in the new year, wrote: "Political rhetoric [has] inflamed consumer passion, fed suspicion, discouraged investment and damaged investor confidence." He added: "All energy companies have been accused of profiteering, collaborating with competitors, manipulating costs to disguise profits, and caring little for their customers.

"These charges are false."

Any attempt to cap prices would threaten the "financial fabric" of energy companies, according to Sir Roger.

"They have short-term voter attraction, but lay a pathway to long-term under-investment," he said.

E.ON last week became the last of the major providers to raise prices, upping tariffs by an average of 3.7% from January 18.

It said it had scaled back a potentially higher price rise after the Government's change to green levies on energy bills.

British Gas said it would reduce bills by an average of 3.2% on January 1, following the Autumn Statement announcement, which comes after it informed nearly eight million customers of an average increase of 9.2% last month.

Sir Roger said the decision to raise prices was not made lightly.

"No energy company wants to increase bills - it enrages customers and damages relationships," he wrote.

Meanwhile, EDF Energy chief executive Vincent de Rivaz said politicians and the energy companies must work together to cut household bills and invest in new power plants.

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