A NORTH-EAST MP is seeking assurances that thousands of jobs in the region will be safeguarded if proposals to sell energy provider npower go ahead.

Npower is owned by German utility group RWE, which is reported to be interested in off-loading the company for about £5bn in a bid to reduce some of its £24bn debts.

Iberdrola, the Spanish owner of Scottish Power, has been linked with a bid for the firm that last year made profits of £245m on revenue of £7bn. RWE share price rose at the news.

Npower, which partially replaced utility firm Northern Electric, has 6.5 million customers and produces some 8 per cent of the electricity used in the UK.

Last year its UK call centre and billing operation moved into a new £60m building at Rainton Bridge Business Park, Houghton-le-Spring, Wearside that had originally been the intended home of Northern Rock, before the bank collapsed. About 2,400 staff work in the luxurious offices which boast facilities such as a gym, complete with personal trainers, dance studios, a restaurant and deli-bar.

Bridget Phillipson MP Labour MP for Houghton & Sunderland South said npower was "a valued local employer who have invested considerably in the site at Rainton Bridge" and that she would be writing to RWE about its plans.

A buyout by a rival such as Iberdrola would reduce consumer choice of electricity and gas providers, and potentially lead to job losses if the two operations were merged. The reports also raised concerns that the Government's energy policy could be set to force investors overseas, threatening jobs and future investment in the sector.

Npower is among the energy firms wary that plans set to be unveiled later this month by Chris Huhne, the Energy Secretary will include low-carbon reforms which threaten profit margins. The changes aim to deliver up to £200bn of investment into nuclear power stations, wind farms and other forms of low-carbon power generation.

However, Tim Yeo, Conservative MP and chairman of the Energy and Climate Change Select Committee said he was worried by reports of the sale of Npower as it was the latest sign that companies could be set to withdraw from the UK in favour of more lucrative markets.

"In the work my committee has done this year we have seen a problem in how we will attract the investment needed into this industry," said Mr Yeo. "We will not get it if companies can see better returns elsewhere in countries with more sympathetic regulations and policies. People have not accepted that companies may just decide to go to Asia and not invest in Western Europe."

If the UK fails to attract enough investment then it will be difficult to meet emissions targets and could even lead to the country struggling to produce enough electricity to meet growing demand, Mr Yeo added.