Gazprom, the Russian gas giant, could build a power station in Britain with E.ON, the German power company that owns Powergen.

Wulf Bernotat, the E.ON chief executive, said that an alliance with Gazprom would give any new project sufficient access to fuel.

Several weeks ago E.ON said that it was discussing a link with Gazprom in which the Russian group would take a significant stake in E.ON’s British operations. The two have also been rumoured to be interested in buying into the Baglan Bay gas power station owned by GE Energy.

A significant move by Gazprom into the UK could spark fears over the power of the Russian monopoly. It already supplies a quarter of Europe’s energy and it has been estimated that this could increase to 30 per cent by 2020 as Russia develops oilfields and as North Sea capacity dwindles.

Gazprom has also prompted huge fears over energy security after cutting off gas supplies to Ukraine last winter amid a row over price increases.

Gazprom and E.ON have been moving increasingly close. Soon the German business expects to take a 25 per cent stake in the Russian gas-field Yuzhno-Russkoye, which is run by Gazprom. The Russian field is expected to be the main source of gas for the new Nord Stream continental pipeline.

E.ON has been looking for further expansion since it dropped a £28 billion bid for Endesa, the Spanish power group, in the spring.

Yesterday E.ON reported earnings ahead of expectations at €7.1 billion (£5 billion) for the nine months to September, a 12 per cent increase on the same period last year.

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