Haythornthwaite Warmed Up For Centrica Chair
The owner of British Gas is lining up a former head of Network Rail to become its new chairman as it heads towards the next general election braced for a political row over its freedom to set energy prices.
Sky News can exclusively reveal that Centrica is in detailed talks with Rick Haythornthwaite about succeeding Sir Roger Carr at the helm of Britain's biggest gas and electricity retailer.
The negotiations with Mr Haythornthwaite are understood to still be ongoing although an announcement about his appointment could be made as soon as next week. Other candidates are thought to remain in contention for the role.
Once confirmed, the new chairman will probably take over from Sir Roger, who is departing to become chairman of BAE Systems, the defence contractor, in the spring of next year.
Mr Haythornthwaite is a prominent figure in the international business arena. He is chairman of Mastercard Worldwide, the US-based financial services group, and has been a partner at Star Capital Partners, a private equity firm focused on investing in industrial companies.
Centrica's senior independent director, Mary Francis, who has been leading the search for Sir Roger's successor, is understood to have been enticed by Mr Haythornthwaite's strong political connections, enhanced during his chairmanship of Network Rail.
He is also well-versed in the energy industry, having spent more than two decades at companies including BP and Premier Oil.
The announcement of a new chairman of Centrica will be politically-charged given the broad expectation that British Gas will announce a hike of around 8% to gas and electricity prices in the coming weeks.
At last month's Labour conference, Ed Miliband, the party leader, sparked a row with the energy industry by pledging to freeze prices for the 20 months following a May 2015 general election.
Sir Roger condemned Mr Miliband's price freeze pledge, saying it could lead to "ruin" for Centrica, which added:
"If prices were to be controlled against a background of rising costs it would simply not be economically viable for Centrica, or indeed any other energy supplier, to continue to operate and far less to meet the sizeable investment challenge that the industry is facing," it said in response to Mr Miliband's announcement.
"The impact of such a policy would be damaging for the country's long term prosperity and for our customers."
A queue of political figures, including Lord Mandelson, the former Labour Business Secretary, also attacked the price freeze pledge as undermining the party's pro-business credentials, while the Chancellor, George Osborne, said there would be little to prevent utilities
Neil Woodford, Centrica's largest shareholder, added his voice to the tirade of criticism, saying that a Labour government would risk "the lights going out" and accused Mr Miliband of "economic vandalism at a time when this country needs all the help it can get. It is insane, not least it is also fundamentally dishonest to suggest to the electorate that electricity and gas prices are where they are because of profiteering by the companies."
The timing and scale of energy companies' impending price increases have not been finalised, although one source said the industry was "playing a game of chicken" as the big six providers waited to see which of them would announce first.
Another major task for the new Centrica chairman is likely to be identifying a successor to Sam Laidlaw, the company's chief executive, who has been in charge for more than seven years.
Centrica declined to comment while Mr Haythornthwaite was unavailable for comment.