IBERDROLA, the Spanish utility group, is considering a £1.5bn investment to clean up ScottishPower's energy plants and meet its commitment to producing more green electricity.
Iberdrola is a world leader in low emission energy generation and its chairman, Ignacio Sanchez Galan, is understood to be uncomfortable with ScottishPower's heavy reliance on traditional coal power generation at power stations such as Longannet and
Cockenzie.
Longannet is the second biggest coal-fired power station in the UK and among Scotland's biggest sources of harmful emissions, while Cockenzie has been named by Friends of the Earth as the UK's most polluting power plant.
Iberdrola is expected to complete its £12bn takeover of ScottishPower in April and aims to convert the Scottish plants to clean coal technology or combined cycle gas technology, which would reduce emissions.
Iberdrola will make its plans clear after its AGM in March, where shareholders including wind farm builder ACS are expected to approve its £12bn cash-and-shares takeover bid.
One of the key factors in Iberdrola's decision to buy ScottishPower was the Glasgow group's strength in wind energy. Iberdrola has earmarked £7bn for investment worldwide between 2007 and 2009, of which just over a third will go into renewable energy. Iberdrola said: "We are committed to clean energy as a result of our strategy of complying with the Kyoto protocol and sustainability."
ScottishPower bosses will this week meet Doosan Babcock, the energy technology company, to discuss ways in which the generator can reduce its emissions.
Les King, Doosan Babcock's director of technology, estimates that converting Longannet, in Fife, to clean coal technology would cost £1bn. Cockenzie, in East Lothian, is about half the size of Longannet.
