Britain faces a return to 1970s-style power blackouts and disruption to its electricity supplies within four years, the energy regulator warned yesterday.

Ofgem raised the spectre of a return to the three-day week for British industry as the country scrambles to renovate its crumbling power infrastructure ahead of new EU pollution rules that will force the closure of a quarter of UK power stations by 2015.

Alistair Buchanan, Ofgem’s chief executive, said: “There could be a potential shortfall in the period 2013-18 ... Life might be pretty cold.”

In extreme scenarios such as during periods of unusually harsh winter weather, Mr Buchanan said that Britain could be forced to switch off power supplies to large factories to conserve dwindling electricity supplies for households.

Ofgem said that in such circumstances, “involuntary curtailment of demand” for large energy users might be the only solution.

Speaking at the publication of Project Discovery, a report from Ofgem on the security of energy supplies, Mr Buchanan said that a failure to tackle the issue had left Britain more vulnerable to energy supply shocks than any other major country in Europe. Germany and France, he said, were “way ahead of us” in terms of investing in new, lower-carbon power supplies, adding that only “massive reductions” in demand achieved through energy savings could rescue consumers from swingeing increases in their energy bills of up to 60 per cent.

Ofgem said that by 2020 Britain needed to spend between £95 billion and £200 billion on new wind farms, gas, nuclear and biomass power stations, as well as high-voltage transmission networks to ensure reliable supplies and meet tough targets to cut carbon emissions.

But Jeremy Nicholson, of the Energy Intensive Users Group, which represents some of Britain’s biggest manufacturers, including Corus, the steelmaker, said Britain was entering “very dangerous territory”.

He warned that such major disruption presented a “material threat to heavy industry” and added that manufacturers could be facing even bigger rises in their energy bills than consumers — as much as 120 per cent.

Ed Miliband, Secretary of State for Energy and Climate Change, acknowledged the need for greater action.

He said: “I think Government does need to play more of a role if we are going to get the low-carbon transition and if we are going to get security of supply.”

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