Council’s energy firm investment a ‘step too far’

Sky News has reported that Together Energy faces collapsing within weeks as a last-ditch search for new funding nears its end.

It has learned that Together Energy, which is 50 per cent-owned by Labour-run Warrington Borough Council, is likely to run out of money later in January without an emergency capital injection.

But a spokeswoman for the company insisted on Wednesday that it was ‘still in active conversations’.

The news has sparked major concerns in the town.

Together Energy employs 15 members of staff in Warrington and hundreds of others in Scotland.

The council owns a 50 per cent stake in Together Energy after initially investing £18million in September 2019.

It has also given a loan of £20 million.

Cllr Bob Barr, leader of the town’s Liberal Democrats, has issued a statement on the issue.

He said: “It has always been the view of the Liberal Democrat group that investing in an energy company was too risky a move for Warrington Borough Council and we opposed it.

“When the investment was made, it was already clear that councils that had made similar investments were struggling.

“However, once committed, we hoped that WBC would make a success of the venture.

“While we were unconvinced by the cheap energy for low-income households and the job creation arguments, we believed the opportunity to trade the electricity generated by the council’s solar farms more profitably, was more persuasive.

“We do not accept the Conservative view that WBC should not be entrepreneurial by investing for revenue to support services.

“As one of the lowest funded councils in the country, WBC needs to be inventive to generate money.  But, in our view, investing in Together Energy was a step too far.

“We hope that, if Together does have to cease trading, it can do so in an orderly manner so minimising Warrington’s exposure.”

Tory Warrington South MP Andy Carter has raised the issue in the House of Commons.

He said Labour-run Warrington Borough Council now have debts totalling around £1.6 billion.

Mr Carter also told the House that £52 million of public money has been invested into the ‘loss-making company’ by the council, which has a ‘potentially catastrophic impact’ on local services were it to enter administration.

He added: “So can we have a debate in Government time on how councils are using public money to invest in private companies, and can I again urge the Government to launch an inquiry into this gambling practice by local councils.”

Leader of the House of Commons Jacob Rees-Mogg said he was ‘very grateful’ to Mr Carter for raising the question.

He added councils ‘are not there to speculate’ and they are there ‘to run public services and to handle taxpayers’ money well’.