British Energy, the nuclear firm which supplies a quarter of the UK's electricity, is in discussions with the government for immediate financial assistance to prevent it from going bankrupt.

Trading in the company's shares has been suspended and the company has warned that it needs to find £450 million within months in order to pay debts and cover losses.

Forum Response: British Energy

A spokesman for British Energy told ePolitix: "The Board has reasonable grounds for believing that these discussions will be successful but there can be no certainty that this will preserve value for investors. The Board anticipates that if these discussions are not successful, the company may be unable to meet its financial obligations as they fall due and therefore the company may have to take appropriate insolvency proceedings.

"These discussions follow commercial negotiations with BNFL. BNFL yesterday delivered its formal proposals to BE and the terms offered by BNFL fell short of those which BE requires.

"The Board is progressing the discussions for immediate financial support. However, the discussions over a longer term restructuring will be complex and are unlikely to be concluded in the near future. Any support from the Government will need to take into account both UK and EU regulations.

"BE continues to operate its power stations in the UK and in North America to supply electricity and comply with all safety and other regulatory requirements."

Forum Response: Ofgem

A spokesman for Ofgem told ePolitix.com: "NETA is fulfilling the objective set by the DTI and Ofgem to replace the former, flawed Electricity Pool, which produced artificially high prices for electricity, with a competitive electricity wholesale market.

"The combination of stronger competition and large amounts of generating capacity has reduced wholesale prices by 40 per cent since reforms began 4 years ago to the benefit of customers for whom wholesale costs make up the largest part of their bill.