Blackout costs 'run into millions'

BUSINESS reacted with fury to last night's crippling power blackout, which is estimated to have cost London tens of millions of pounds.

With firms already battling the capital's creaking infrastructure on a daily basis, many expressed concern that the power failure could damage London's reputation as a leading business centre.

Colin Stanbridge, chief executive of the London Chamber of Commerce, said: 'It is an event of enormous concern to businesses across London. We estimate that the cost will run into millions of pounds.

'If it had happened during the working day, the cost would have been much greater. What is even more alarming are suggestions that this could happen again. At a time of economic weakness, London cannot afford a series of potentially crippling power cuts.

'Having the Tube go down at the height of the evening rush hour is the very worst possible advertisement for London.'

Michael Snyder, chairman of the policy and resources committee at the Corporation of London, said: 'The transport system has enough problems without the threat of power cuts. Businesses will also be very concerned to see that such a large part of the capital can be blacked out like this and will rightly be asking if it can happen again.'

Mary Rance, director of CBI London, said: 'What is needed now is a calm assessment of what went wrong. Then we can judge if action is needed to make sure it doesn't happen again.'

Andrew Marre, spokesman for London First, said: 'This underlines the importance of having continuity plans to deal with this sort of issue.'

Michael Hunt, marketing director at fast-growing power generation firm Turbo Genset, said localised blackouts are likely to become more commonplace given the growing demands on creaking local grid networks.

He said: 'The digital economy is putting extreme stress on what are elderly localised systems.'

The Association of British Insurers said it was impossible to put a cost on the potential bill for the industry. It said many households should be covered under contents policies for food ruined as freezers stopped working.

John Williamson, director at brand consultants Wolff Olins, said: 'The truth is things in London don't work and it doesn't matter who's running it, it's always been a bit chaotic.'

Grid shares feel the heat

MANAGEMENT at National Grid Transco felt the City heat today as more than £150m was wiped from the value of its share price. The group's shares fell 5p to 389p as the group was forced to apologise for the embarrassing blackout that crippled the capital.

The company, headed by Roger Urwin, has been reeling ever since its US subsidiary Niagara Mohawk was linked with the power cuts that brought New York to its knees two weeks ago.

Fraser McLaren, utilities analyst at ING, said that while the group would probably escape any financial implications from last night's cut, it would face yet more bad Press.