Portsmouth City Council-owned Victory Energy to close

Victory Energy was halted before it went in to operation

A council-owned energy company is to be closed after efforts to find a buyer failed.

Portsmouth City Council's previous Conservative administration set up Victory Energy, but it was mothballed before it went into operation.

The incoming Liberal Democrat-run administration deemed it too risky and planned to close it at a cost of £2.5m.

The council said negotiations with two potential buyers had failed. Nine employees are being made redundant.

Victory Energy was set up in 2017 with the aim of providing residents with low-cost renewable electricity and to generate revenue for the council.

Its set-up was halted in August 2018 when the Liberal Democrats regained control of the council following May's elections.

While waiting for a buyer, the company cost the council £18,000 a week, prompting Labour and Tory councillors to join forces to vote for its reinstatement during a budget debate in February.

Conservative group leader Donna Jones had insisted Victory Energy could bring in "£50m within five years" to boost council coffers.

However, council leader Gerald Vernon Jackson opposed the authority entering the "very challenging" energy market.

The council said there had since been "extensive efforts" to find a buyer.

It said two offers had been received - the first was deemed too financially risky and the second potential buyer had pulled out to pursue an alternative investment.