Energy Bill

House of Commons

Session 2013 - 14
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Other Bills before Parliament

Energy Bill

Energy Bill
Part 2 — Electricity Market Reform
Chapter 7 — The renewables obligation: transitional arrangements
40

(g)
such other persons, if any, as the Secretary of State considers
appropriate.
(2)
A certificate purchase order is not to be made unless a draft of the
instrument containing it has been laid before and approved by a
resolution of each House of Parliament.
5
(3)
The Secretary of State must, subject to subsection (5), consult the
Scottish Ministers before making a certificate purchase order that
extends to Scotland.
(4)
The Secretary of State must, subject to subsection (5), obtain the consent
of the Northern Ireland department before making a certificate
10
purchase order that extends to Northern Ireland.
(5)
Except as provided by subsection (6), the Secretary of State is not
required to—
(a)
consult the Scottish Ministers under subsection (3), or
(b)
obtain the consent of the Northern Ireland department under
15
subsection (4),

in respect of any provision of a certificate purchase order that is made
by virtue of section 32O(2)(m), 32P or 32Q (which together confer
power to make provision about the certificate purchase levy).
(6)
Designation of the Northern Ireland department as the administrator of
20
the certificate purchase levy by virtue of section 32P(8)(b) requires the
consent of that department.
32Z1
Interpretation of sections 32N to 32Z1
(1)
In this section and sections 32N to 32Z (“the relevant sections”), the
following terms have the meanings given in section 32M(1)—
25
“fossil fuel” (but see subsection (4));
“generated”;
“Northern Ireland authority”;
“Northern Ireland supplier”;
“renewables obligation certificate”;
30
“renewables obligation order”.
(2)
In the relevant sections—
“administrator”, in relation to the certificate purchase levy, is to be
construed in accordance with section 32P(7) to (10);
“banding provision” is to be construed in accordance with section
35
32V(3)
“CFD counterparty” has the same meaning as in Chapter 2 of Part
2 of the Energy Act 2013 (see section 7 of that Act);
“certificate purchase levy” is to be construed in accordance with
section 32P;
40
“certificate purchase order” is to be construed in accordance with
section 32N;
“the certificate purchase obligation” is to be construed in
accordance with section 32N(3);
“distribution system” includes a distribution system within the
45
meaning of Part 2 of the Electricity (Northern Ireland) Order
1992, and “distributing” is to be construed accordingly;

Energy Bill
Part 2 — Electricity Market Reform
Chapter 7 — The renewables obligation: transitional arrangements
41

“GB certificate” is to be construed in accordance with section 32S;
“NI certificate” is to be construed in accordance with section 32T;
“the Northern Ireland department” means the Department of
Enterprise, Trade and Investment;
“Northern Ireland RO certificate” means a certificate issued by the
5
Northern Ireland authority in accordance with provision
included in an order under Article 52 of the Energy (Northern
Ireland) Order 2003;
“the purchasing body of GB certificates” is to be construed in
accordance with section 32N(4);
10
“the purchasing body of NI certificates” is to be construed in
accordance with section 32N(5);
“relevant authority” means—
(a)
in relation to GB certificates, the Authority;
(b)
in relation to NI certificates, the Northern Ireland
15
authority;
“relevant purchasing body” means—
(a)
in relation to GB certificates, the purchasing body of GB
certificates;
(b)
in relation to NI certificates, the purchasing body of NI
20
certificates;
“renewable sources” means sources of energy other than fossil fuel
or nuclear fuel, but includes waste of which not more than a
specified proportion is waste which is, or is derived from, fossil
fuel;
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“specified”, in relation to a certificate purchase order, means
specified in the order;
“transmission system” includes a transmission system within the
meaning of Part 2 of the Electricity (Northern Ireland) Order
1992, and “transmitting” is to be construed accordingly.
30
(3)
For the purposes of the definition of “renewable sources”, a certificate
purchase order may make provision—
(a)
about what constitutes “waste”;
(b)
about how the proportion of waste which is, or is derived from,
fossil fuel is to be determined;
35
(c)
about what, subject to such exceptions as may be specified,
constitutes sufficient evidence of that proportion in any
particular case;
(d)
authorising the relevant authority, in specified circumstances,
to require an operator of a generating station to arrange—
40
(i)
for samples of any fuel used (or to be used) in the
generating station, or of any gas or other substance
produced as a result of the use of such fuel, to be taken
by a person, and analysed in a manner, approved by the
relevant authority;
45
(ii)
for the results of that analysis to be made available to the
relevant authority.
(4)
In the application of the relevant sections to Northern Ireland, “fossil
fuel” includes peat.

Energy Bill
Part 2 — Electricity Market Reform
Chapter 8 — Emissions performance standard
42

(5)
In the relevant sections “Northern Ireland” does not include any part of
the territorial sea of the United Kingdom, but this is subject to
subsection (6).
(6)
A certificate purchase order may provide that “Northern Ireland”
includes the territorial sea adjacent to Northern Ireland.
5
(7)
An Order in council under section 98(8) of the Northern Ireland Act
1998 (apportionment of sea areas) has effect for the purposes of this
section if, or to the extent that, the Order is expressed to apply—
(a)
by virtue of this subsection, for those purposes, or
(b)
if no provision has been made by virtue of paragraph (a), for the
10
general or residual purposes of that Act.
(8)
References in the relevant sections to the supply of electricity to
customers in Northern Ireland are to be construed in accordance with
the definition of “supply” in Article 3 of the Electricity (Northern
Ireland) Order 1992.
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(9)
A certificate purchase order may make provision, for the purposes of
the relevant sections, about the circumstances in which electricity is to
be regarded as having been supplied—
(a)
to customers in Great Britain;
(b)
to customers in Northern Ireland.”
20
(3)
In section 106 (regulations and orders), in subsection (2)(b) after “32,” insert
“32N, 32R(4),”.
(4)
In section 113 (extent etc), in subsection (3), at the beginning of the list (before
the entry for sections 65 to 70) insert “Sections 32N to 32Z1;”.
Chapter 8
25
Emissions performance standard
42
Duty not to exceed annual carbon dioxide emissions limit
(1)
The operator of any fossil fuel plant must secure that the emissions of carbon
dioxide from it that are attributable to the use of fossil fuel do not exceed EL
tonnes of carbon dioxide (“the emissions limit”) in any year, where—
30

and—
R is the statutory rate of emissions, in g/kWh;
C is the installed generating capacity, in MW, of the electricity generating
station comprised in the fossil fuel plant.
(2)
Until (and including) 2044, the statutory rate of emissions is 450 g/kWh.
35
(3)
In this Chapter, “fossil fuel plant” means an electricity generating station which
satisfies the conditions in subsection (4), together with any associated
gasification plant and any associated CCS plant.

Energy Bill
Part 2 — Electricity Market Reform
Chapter 8 — Emissions performance standard
43

(4)
Those conditions are that the generating station—
(a)
is constructed pursuant to a relevant consent given or made on or after
the date on which subsection (1) comes into force, and
(b)
uses—
(i)
fossil fuel, or
5
(ii)
fuel produced by gasification plant.
(5)
Subsection (1) is subject to any provision made by or under regulations made
under subsection (6).
(6)
The Secretary of State may by regulations—
(a)
make provision about the interpretation of the duty imposed by
10
subsection (1) (“the emissions limit duty”);
(b)
make any provision mentioned in Schedule 4 (application of emissions
limit duty to additional cases or subject to modifications).
(7)
Regulations under subsection (6)(a) may, in particular, make provision—
(a)
for determining whether gasification plant or CCS plant (including any
15
CCS plant associated with gasification plant) is associated with a
generating station;
(b)
for determining the emissions from fossil fuel plant;
(c)
for the use of fossil fuel—
(i)
for operating plant that is ancillary to a generating station for
20
safety purposes, or in an emergency, or
(ii)
by a network generating station at a time when it is not
exporting to a network,

to be disregarded for any of the purposes of this Chapter;
(d)
for determining (whether by apportionment or otherwise) which
25
emissions from fossil fuel plant are attributable to the use of fossil fuel;
(e)
for determining when plant ceases to be, or to be part of, fossil fuel
plant;
(f)
specifying the meaning of any of the following expressions—
(i)
“operator”, in relation to fossil fuel plant;
30
(ii)
“installed generating capacity”;
(iii)
“constructed pursuant to a relevant consent”, in relation to an
electricity generating station;
(g)
specifying any category of emissions by reference to provision made, or
that may from time to time be made, by or under regulations
35
implementing the ETS Directive.
(8)
Provision that may be made by virtue of subsection (7)(d) includes provision
for treating emissions attributable to the supply of heat to customers from
combined heat and power plant as not being attributable to the use of fossil
fuel.
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43
Suspension etc of emissions limit in exceptional circumstances
(1)
This section applies where an appropriate authority considers that there is an
electricity shortfall, or a significant risk of an electricity shortfall.
(2)
Where this section applies, the appropriate authority may direct that, in
relation to relevant plant, the emissions duty is to be treated as—
45
(a)
suspended for a period specified in the direction, or

Energy Bill
Part 2 — Electricity Market Reform
Chapter 8 — Emissions performance standard
44

(b)
modified for a period specified in the direction.
(3)
For the purposes of this section, there is an electricity shortfall when—
(a)
the electricity available in Great Britain is insufficient to meet demands
in Great Britain, or
(b)
the electricity available in Northern Ireland is insufficient to meet
5
demands in Northern Ireland.
(4)
For this purpose—
(a)
electricity available in Great Britain or Northern Ireland includes
electricity that is available there by virtue of an electricity
interconnector (within the meaning of Part 1 of EA 1989), and
10
(b)
subject to that, it is for the appropriate authority to determine what is
to be regarded as available electricity.
(5)
Before giving a direction under this section, the Secretary of State must
consult—
(a)
the Scottish Ministers,
15
(b)
the Welsh Ministers, and
(c)
such other persons as the Secretary of State considers it appropriate to
consult.
(6)
As soon as practicable after giving a direction under this section, the Secretary
of State must lay before Parliament a document containing—
20
(a)
a copy of the direction, and
(b)
a statement of the Secretary of State’s reasons for making the direction.
(7)
Before giving a direction under this section, the Department of Enterprise,
Trade and Investment must consult such persons as it considers it appropriate
to consult.
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(8)
As soon as practicable after giving a direction under this section, the
Department of Enterprise, Trade and Investment must lay before the Northern
Ireland Assembly a document containing—
(a)
a copy of the direction, and
(b)
a statement of the Department’s reasons for making the direction.
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(9)
A direction under this section—
(a)
is to be made in writing;
(b)
may include incidental, supplementary and transitional provision;
(c)
may be varied or revoked by a further direction under this section.
(10)
Provision that may be made by virtue of subsection (9)(b) includes, in
35
particular, provision imposing requirements on enforcing authorities (within
the meaning of Schedule 5) for Great Britain or Northern Ireland, as the case
may be.
(11)
Each appropriate authority—
(a)
must issue (and may from time to time revise) a statement of the
40
Secretary of State’s or, as the case may be, that Department’s policy in
relation to making directions under this section,
(b)
must publish the up-to-date text of the statement whenever it is issued
or revised, and
(c)
must have regard to the statement in making any direction under this
45
section.

Energy Bill
Part 2 — Electricity Market Reform
Chapter 8 — Emissions performance standard
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(12)
For the purposes of this section—
“appropriate authority” means—
(a)
the Secretary of State, or
(b)
the Department of Enterprise, Trade and Investment;
“relevant generating station” means a generating station which satisfies
5
paragraphs (a) and (b) of section 42(4);
“relevant plant” means—
(a)
in relation to a direction by the Secretary of State, fossil fuel
plant which consists of or includes a relevant generating station
in Great Britain;
10
(b)
in relation to a direction by the Department of Enterprise, Trade
and Investment, fossil fuel plant which consists of or includes a
relevant generating station in Northern Ireland.
44
Monitoring and enforcement
(1)
It is the duty of the appropriate national authority to make arrangements for
15
monitoring compliance with, and enforcement of, the emissions limit duty.
(2)
The appropriate national authority may by regulations make any provision
mentioned in Schedule 5 (monitoring compliance with, and enforcement of,
the emissions limit duty).
(3)
The arrangements under subsection (1) must include arrangements for giving
20
effect to directions under section 43 (and, in particular, for compliance by
enforcing authorities with any requirements imposed on them under
subsection (9) of that section).
(4)
In this section (and Schedule 5), the “appropriate national authority” means—
(a)
in relation to England, the Secretary of State;
25
(b)
in relation to Scotland, the Scottish Ministers;
(c)
in relation to Wales, the Welsh Ministers;
(d)
in relation to Northern Ireland, the Department of Environment.
(5)
Subsection (4) is subject to paragraph 5 of Schedule 5 (which provides for the
Secretary of State to make certain provision for Scotland, Wales and Northern
30
Ireland).
45
Interpretation of Chapter 8
(1)
In this Chapter—
“carbon capture and storage technology” means technology for doing, or
contributing to the doing of, any of the following things—
35
(a)
capturing carbon dioxide (or any substance consisting
primarily of carbon dioxide) that has been produced by, or in
connection with, generation of electricity on a commercial scale;
(b)
transporting such carbon dioxide (or substance) that has been
captured;
40
(c)
disposing of such carbon dioxide (or substance) that has been
captured, by way of permanent storage;
“CCS plant” means plant that uses, or is capable of using, carbon capture
and storage technology;

Energy Bill
Part 2 — Electricity Market Reform
Chapter 8 — Emissions performance standard
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“distribution system” has the meaning given by section 4(4) of EA 1989
(and “distributed” is to be read accordingly);
“emissions limit duty” means the duty imposed by section 42(1);
“ETS Directive” means Directive 2003/87/EC of the European Parliament
and of the Council (as amended from time to time);
5
“fossil fuel” means—
(a)
coal;
(b)
lignite;
(c)
peat;
(d)
natural gas (within the meaning of the Energy Act 1976);
10
(e)
crude liquid petroleum;
(f)
bitumen;
(g)
any substance which—
(i)
is produced directly or indirectly from a substance
mentioned in paragraphs (a) to (f) for use as a fuel, and
15
(ii)
when burned, produces a greenhouse gas (within the
meaning given in section 92 of the Climate Change Act
2008);
“fossil fuel plant” has the meaning given by section 42(3);
“gasification plant” means plant which—
20
(a)
uses fossil fuel, and
(b)
produces fuel for use in an electricity generating station;
“network generating station” means a station that exports to a network;
“relevant consent” means—
(a)
consent granted under section 36 of EA 1989 or Article 39 of the
25
Electricity (Northern Ireland) Order 1992 (S.I. 1992/231 (N.I. 1)),
or
(b)
an order granting development consent under the Planning Act
2008;
“transmission system” has the meaning given by section 4(4) of EA 1989;
30
“year” means any calendar year for which the emissions limit is defined
by section 42.
(2)
For the purposes of this Chapter, a generating station exports to a network
when it is generating any electricity that is conveyed from it by means of a
transmission system or is distributed by means of a distribution system.
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46
Regulations under Chapter 8
(1)
Any regulations made by the Secretary of State or the Welsh Ministers under
this Chapter must be made by statutory instrument.
(2)
Any power to make regulations under this Chapter that is exercisable by the
Department of Environment is to be exercisable by statutory rule for the
40
purposes of the Statutory Rules (Northern Ireland) Order 1979 (S.I. 1979/1573
(N.I. 12)).
(3)
An instrument containing—
(a)
regulations under section 42 (whether or not also containing
regulations by the Secretary of State under section 44), or
45
(b)
regulations by the Secretary of State under section 44 which amend or
repeal any provision of primary legislation,