The Government should introduce new financial incentives to encourage both business and consumers to reduce energy consumption, Nick Horler, E.ON UK's retail managing director, has urged.
Speaking at Birmingham Chamber of Commerce and Industry's Annual Conference, Mr Horler predicted that high and volatile energy prices would continue for the fore-seeable future.
With 25 per cent of power stations in the UK coming to the end of their lifetimes in the next 14 years, investment was urgently needed to ensure the long-term security of supply.
Outlining the German giant's plans to invest £5 billion in UK energy supply - it owns Powergen and Central Networks in the Midlands - Mr Horler said wind farms, gas storage, biomass, combined cycle gas turbines and gas interconnectors were all part of the solution.
He added that fiscal incentives were needed to encourage change.