Nicola Sturgeon defied objections from one of Scotland’s largest companies when she this week announced plans for a state-owned energy firm supplying homes nationwide, the Telegraph can disclose.

SSE, which was formerly Scottish and Southern Energy, said it was “not appropriate” for government to supply power on “a larger scale as it risks distorting the market and deterring private investment.”

In a submission to ministers about the Scottish Government’s draft energy strategy, which included the proposal for a state-owned power company, it argued there were different ways of improving “consumer value” that carried less risk to the public purse.

Meanwhile, energy market analysts predicted the First Minister’s plan would help households that had not switched suppliers but warned those who had sought out better deals were usually already making the "vast majority of savings it is possible to make".

SSE was one of the ‘Big Six’ energy companies that dominate the market to react to Ms Sturgeon’s announcement by publicly welcoming more competition.

However, the submissions to the draft strategy, which was published for consultation at the start of the year, suggest there are major reservations. SSE, which is headquartered in Perth, is one of the UK’s largest firms and is listed on the FTSE 100.