Portsmouth City Council-owned Victory Energy shuts

Victory Energy was halted before it went in to operation

A council-owned energy company is set to finally close for good after losing up to £3.5m.

Victory Energy Supply Ltd was set up under the Conservative administration of Portsmouth City Council but scrapped when the Liberal Democrats won control in 2018.

The council said no buyers could be found for the business.

Opposition Conservative group leader Donna Jones insisted private companies had been interested in the firm.

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

'Draw the line'

It was scrapped by the Lib Dem-run council in November 2018 when it was deemed too risky, but had continued to operate at a cost of about £2,000 a month as directors hoped the firm could be sold, according to the Local Democracy Reporting Service.

Council leader Gerald Vernon-Jackson said: "I'm disappointed the council has been stuck paying money to keep the almost-lifeless body still going.

"No-one's wanted to touch it with a barge pole, we could not even get a tenner for it. We have to draw the line and say, 'that's it now'."

He added the council was "lucky" to avoid losses of up to £60m as had been experienced by other council-run energy firms such as Robin Hood Energy and Bristol Energy.

Ms Jones, who had run the administration when the company was set up, said companies had previously been interested and said Mr Vernon-Jackson's comments were "misleading".

The company previously employed nine people but they had previously been made redundant.

Sector watchdog Ofgem previously revoked the firm's gas and electric supply licences as it did not supply energy in the first year of gaining a licence.