Chief slams BE's 'unreliable' N-plants

BRITISH Energy's new boss Mike Alexander has described much of the company's nuclear plant as 'inherently unreliable'.

BE's Heysham power station is out of action - hit by the wrong kind of seawater in its cooling pipes.

Alexander joins the list of bosses who openly admit their firm's shortcomings - led by jeweller Gerald Ratner who called some of his products 'crap'.

BE said: 'He is saying there are problems which must be sorted out.'

Alexander has set up a performance improvement plan and brought the Sizewell B plant in Suffolk back on stream, but Heysham may not restart until February. These stoppages will cost £95m and BE's lengthy restructuring could cost a further £100m.

The shares have crashed from a peak of 749p in 1999 to 4p, making Railtrack look good by comparison.

Pre-tax losses in the half-year to September fell from £337m to £71m as UK output surged 10%. But full-year results will be below expectations.

The restructuring will cut present shareholders down to 2.5% of the equity, rising to 7.5% later. European Union clearance may not come until mid-2004.

Gallingly for BE, UK power prices are now so high that it would be making money had it not sold its power forward at low prices.

If Alexander delivers his improvements, substantial profits could flow in the long term.