Infrastructure Bill (HC Bill 154)

(c) exercising functions under Chapter 3 of Part 2 of the Energy Act
2011 (upstream petroleum infrastructure),

(d) exercising any function or using any power under a petroleum
licence, and

(e) 5exercising any other function or using any power—

(i) to provide advice or assistance to another person, or

(ii) to acquire, use or supply information,

for the purpose of enabling the principal objective to be met.

9C Carrying out of certain petroleum industry activities

(1) 10A person who is the holder of a petroleum licence must act in
accordance with the current strategy or strategies when planning and
carrying out activities as the licence holder.

(2) A person who is an operator under a petroleum licence must act in
accordance with the current strategy or strategies when planning and
15carrying out activities as the operator under the licence.

(3) A person who is the owner of upstream petroleum infrastructure must
act in accordance with the current strategy or strategies when planning
and carrying out the person’s activities as the owner of upstream
petroleum infrastructure (including the development, construction,
20deployment and use of the infrastructure).

(4) A person must act in accordance with the current strategy or strategies
when planning and carrying out the commissioning of upstream
petroleum infrastructure.

9D Reports by the Secretary of State

(1) 25As soon as practicable after the end of each reporting period, the
Secretary of State must—

(a) consider the extent to which, during that period, these persons
have followed section 9C by acting in accordance with the
current strategy or strategies—

(i) 30licence holders,

(ii) operators under petroleum licences,

(iii) owners of upstream petroleum infrastructure, and

(iv) persons planning and carrying out the commissioning
of upstream petroleum infrastructure; and

(b) 35produce a report on the results of the consideration of that
question.

(2) The report may contain other material, including a statement of action
which the Secretary of State has taken, or is proposing to take, in
response to any matter included in the report (including changes to a
40strategy).

(3) The Secretary of State must publish, and lay before each House of
Parliament, a copy of each report produced under this section.

(4) In this section “reporting period” means—

(a) the period of two years beginning with the day when this
45section comes into force, and

(b) each subsequent period of one year beginning with the day after
the end of a previous reporting period.

9E Secretary of State’s security and resilience functions

(1) This Part does not limit the exercise of the Secretary of State’s security
5and resilience functions.

(2) This Part is subject to the exercise of the security and resilience
functions by the Secretary of State.

(3) In this section “security and resilience function” means any function
which relates to—

(a) 10the security of petroleum supplies, or

(b) the resilience of the petroleum industry.

9F Producing and revising a strategy

(1) The Secretary of State must produce the first strategy before the end of
the period of one year beginning with the day on which this section
15comes into force.

(2) The Secretary of State may subsequently—

(a) produce a new strategy, or

(b) revise a current strategy,

whenever the Secretary of State thinks appropriate.

(3) 20The Secretary of State must review each current strategy before the end
of each relevant four year period.

(4) In reviewing a current strategy, the Secretary of State must (in
particular) take account of the results of any consideration undertaken
under section 9D in respect of reporting periods falling within the
25relevant four year period.

(5) In this section “relevant four year period”, in relation to a current
strategy, means a period of four years beginning with—

(a) the date on which the strategy was issued, or

(b) if later, the date on which the last review under subsection (3)
30was concluded.

9G Procedure for producing and revising a strategy

(1) Before—

(a) producing the first strategy,

(b) producing a new strategy, or

(c) 35revising a current strategy,

the Secretary of State must prepare a draft of the strategy or revised
strategy.

(2) The Secretary of State must—

(a) consult such persons as the Secretary of State thinks appropriate
40about the draft, and

(b) consider any representations made by them.

(3) If, after complying with that duty, the Secretary of State decides to
proceed with the draft (in its original form or with modifications), the

Secretary of State must lay a copy of the draft before each House of
Parliament.

(4) The Secretary of State may not take any further steps in relation to the
draft if, within the 40 day period, either House resolves not to approve
5the draft (a “negative resolution”).

(5) If neither House passes a negative resolution, the Secretary of State may
issue the strategy or revised strategy in the form laid before Parliament.

(6) The strategy or revised strategy comes into force on the date specified
by the Secretary of State (which must not be before the date when it is
10issued).

(7) Subsection (4) does not prevent a new draft of a strategy or revised
strategy from being laid before Parliament.

(8) In this section “40 day period”, in relation to the draft of a strategy or
revised strategy, means the period of 40 days beginning with the day
15on which the draft is laid before Parliament (or if the draft is not laid
before each House on the same day, the later of the 2 days on which it
is laid).

(9) For the purposes of calculating the 40 day period, no account is to be
taken of any period during which Parliament is dissolved or prorogued
20or during which both Houses are adjourned for more than four days.

9H “Upstream petroleum infrastructure” and its owners

(1) In this Part “upstream petroleum infrastructure” means—

(a) a gas processing facility,

(b) an oil processing facility, or

(c) 25an upstream petroleum pipeline,

if and in so far as it meets conditions A and B.

(2) A facility or pipeline meets condition A if and in so far as it is situated
in Great Britain or relevant UK waters.

(3) A facility or pipeline meets condition B if and in so far as it is used in
30relation to UK petroleum (including such petroleum after it has been
got).

(4) But an upstream petroleum pipeline is not “upstream petroleum
infrastructure” if it is a pipeline to which section 17GA applies
(petroleum pipelines subject to Norwegian access system).

(5) 35In this section, the following expressions have the same meanings as in
Chapter 3 of Part 2 of the Energy Act 2011 (see section 90 of that Act)—

(a) “gas processing facility”;

(b) “oil processing facility”;

(c) “upstream petroleum pipeline”.

(6) 40In this Part, “owner”, in relation to upstream petroleum infrastructure,
means—

(a) a person in whom the pipeline or facility is vested;

(b) a lessee and any person occupying or controlling the pipeline or
facility; and

(c) a person who has the right to have things conveyed by the
pipeline or processed by the facility.

9I Other interpretation

In this Part—

• 5“current strategy”, in relation to any particular time, means a
  strategy under section 9A(2) in force at that time;

• “operator under a petroleum licence” means a person who is
  responsible for organising or supervising any of the operations
  of searching for, boring for, or getting UK petroleum in
  10pursuance of the petroleum licence;

• “owner”, in relation to upstream petroleum infrastructure, has the
  meaning given in section 9H;

• “petroleum” has meaning given in section 1;

• “petroleum licence” means a licence granted under—

  (a)

  15section 3 of this Act, or

  (b)

  section 2 of the Petroleum (Production) Act 1934;

• “principal objective” has the meaning given in section 9A;

• “relevant UK waters” means—

  (a)

  the territorial sea adjacent to the United Kingdom, and

  (b)

  20the sea in any area designated under section 1(7) of the
  Continental Shelf Act 1964;

• “UK petroleum” means petroleum which for the time being exists
  in its natural condition in strata beneath relevant UK waters;

• “upstream petroleum infrastructure” has the meaning given in
  25section 9H.”

38 Levy on holders of certain energy industry licences

(1) The Secretary of State may, by regulations, provide for a levy to be imposed on,
and be payable by, one or more of the following kinds of persons—

(a) persons who hold licences under section 2 of the Petroleum
30(Production) Act 1934 or licences under section 3 of the Petroleum Act
1998 (exploitation of petroleum);

(b) persons who hold licences under section 4 of the Energy Act 2008
(unloading and storing gas);

(c) persons who hold licences under section 18 of the Energy Act 2008
35granted by the Secretary of State (storage of carbon dioxide).

(2) No licensing levy is to be imposed in respect of a time which falls after the end
of the period of 3 years beginning with the first day of the first charging period.

(3) The Secretary of State must exercise the power conferred by subsection (1) so
as to secure—

(a) 40that the total amount of licensing levy which is payable in respect of a
charging period does not exceed the costs incurred by the Secretary of
State in exercising the relevant functions in respect of that period; and

(b) that no levy is payable in respect of costs incurred in any exercise of
relevant functions for which a charge is payable under the Gas and
45Petroleum (Consents) Charges Regulations 2013 (as those Regulations
stand when this section comes into force).

(4) In determining for the purposes of subsection (3)(a) the total amount of
licensing levy payable in respect of a charging period, an amount of levy
payable in respect of that period may be ignored if (during that period or
subsequently)—

(a) 5having been paid, it is repaid or credit for it is given against other
licensing levy that is payable; or

(b) having not been paid, the requirement to pay it is cancelled.

(5) The “relevant functions” referred to in subsection (3) are—

(a) functions under the following enactments—

(i) 10the Pipe-lines Act 1962 (cross-country pipe-lines);

(ii) section 3 and the other provisions of Part 1 of the Petroleum Act
1998 (exploitation of petroleum);

(iii) Part 1A of the Petroleum Act 1998 (maximising economic
recovery of UK petroleum);

(iv) 15Part 3 of the Petroleum Act 1998 (submarine pipelines);

(v) Part 4 of the Petroleum Act 1998, in so far as the functions
concern reduction of the costs of abandonment of offshore
installations and submarine pipelines;

(vi) section 4 and the other provisions of Chapter 2 of Part 1 of the
20Energy Act 2008 (importation and storage of combustible gas);

(vii) section 18 and the other provisions of Chapter 3 of Part 1 of the
Energy Act 2008 (storage of carbon dioxide);

(viii) Chapter 3 of Part 2 of the Energy Act 2011 (upstream petroleum
infrastructure);

(b) 25carrying out policy work on matters relating to UK petroleum and its
recovery;

(c) providing advice and assistance to the petroleum industry on matters
relating to UK petroleum and its recovery;

(d) collaborating with the petroleum industry on matters relating to UK
30petroleum and its recovery;

(e) acquiring, using and supplying information on matters relating to UK
petroleum and its recovery;

(f) encouraging development of the petroleum industry in relation to the
recovery of UK petroleum;

(g) 35carrying out, or providing advice and assistance to those carrying out,
research and development in relation to technology and products
relevant to the recovery of UK petroleum;

(h) functions which relate to—

(i) the security of petroleum supplies, or

(ii) 40the resilience of the petroleum industry;

(i) international co-operation on matters relating to UK petroleum and its
recovery, including—

(i) resolution of disputes relating to the entitlements of different
countries in relation to petroleum fields, and

(ii) 45openness and accountability in the management of natural
resources.

(6) The matters relating to UK petroleum and its recovery which fall within
paragraphs (b), (c), (d) and (e) of subsection (5) include—

(a) maximising the economic recovery of UK petroleum, and

(b) 50improving the supply chain of UK petroleum.

(7) The amount or amounts of licensing levy payable by licence holders must be—

(a) set out in the regulations, or

(b) calculated in accordance with a method set out in the regulations.

(8) The licensing levy is payable to the Secretary of State.

(9) 5Schedule 7 (the licensing levy) has effect.

(10) Schedule 7 does not limit the provision that may be made by regulations under
this section.

(11) The Secretary of State may, by regulations, amend subsection (3)(b) by adding,
removing or amending a reference to any regulations made under section 188
10of the Energy Act 2004.

(12) In this section and Schedule 7—

• “charging period” means a period in respect of which licensing levy is
  payable;

• “licensing levy” means the levy provided for in regulations under this
  15section;

• “UK petroleum” means petroleum (within the meaning given in section 1
  of the Petroleum Act 1998) which for the time being exists in its natural
  condition in strata beneath—

  (a)

  the territorial sea adjacent to the United Kingdom, and

  (b)

  20the sea in any area designated under section 1(7) of the
  Continental Shelf Act 1964.

Petroleum and geothermal energy in deep-level land

39 Petroleum and geothermal energy: right to use deep-level land

(1) A person has the right to use deep-level land in any way for the purposes of
25exploiting petroleum or deep geothermal energy.

(2) Land is subject to the right of use (whether for the purposes of exploiting
petroleum or deep geothermal energy) only if it is—

(a) deep-level land, and

(b) within a landward area.

(3) 30But that does not prevent deep-level land that is within a landward area from
being used for the purposes of exploiting petroleum or deep geothermal
energy outside a landward area.

(4) Deep-level land is any land at a depth of at least 300 metres below surface level.

(5) This section confers the right to use Scottish deep-level land for the purposes
35of exploiting deep geothermal energy only in cases where the sole, or main, use
of that energy is to be, or is, the generation of electricity.

40 Further provision about the right of use

(1) The ways in which the right of use may be exercised include—

(a) drilling, boring, fracturing or otherwise altering deep-level land;

(b) 40installing infrastructure in deep-level land;

(c) keeping, using or removing any infrastructure installed in deep-level
land;

(d) passing any substance through, or putting any substance into, deep-
level land or infrastructure installed in deep-level land;

(e) 5keeping, using or removing any substance put into deep-level land or
into infrastructure installed in deep-level land.

(2) The purposes for which the right of use may be exercised include—

(a) searching for petroleum or deep geothermal energy;

(b) assessing the feasibility of exploiting petroleum or deep geothermal
10energy;

(c) preparing for exploiting petroleum or deep geothermal energy;

(d) decommissioning, and other activity which falls to be continued or
undertaken, in consequence of activities undertaken for the purposes of
exploiting petroleum or deep geothermal energy.

(3) 15The right of use includes the right to leave deep-level land in a different
condition from the condition it was in before an exercise of the right of use
(including by leaving any infrastructure or substance in the land).

(4) The right of use—

(a) does not give a person (“R”) any power which is greater than, or
20different from, the power which R would have had if the right had been
granted by a person legally entitled to grant it; and

(b) does not relieve a person (“R”) from any obligation or liability to which
R would have been subject if the right had been granted by a person
legally entitled to grant it.

(5) 25A person (“L”) who owns land (the “relevant land”) is not liable, as the owner
of that land, in tort or delict for any loss or damage which is attributable to the
exercise, or proposed exercise, of the right of use by another person (whether
in relation to the relevant land or any other land).

(6) For that purpose, loss or damage is not attributable to the exercise, or proposed
30exercise, of the right of use (in particular) if, or to the extent that, the loss or
damage is attributable to a deliberate omission by L.

(7) There is a “deliberate omission by L” if L, as owner of the relevant land,
decides—

(a) not to do an act, or

(b) 35not to allow another person to do an act,

and the circumstances at the time of that decision were such that L would not
have had to bear any of the costs incurred (whether by L or any other person)
in doing or allowing the act.

(8) Section 39 and this section bind the Crown.

41 40Payment scheme

(1) The Secretary of State may, by regulations, require relevant energy
undertakings to make payments in respect of the proposed exercise, or
exercise, of the right of use.

(2) The regulations may require payments to be made—

(a) 45to owners of relevant land or interests in relevant land;

(b) to other persons for the benefit of areas in which relevant land is
situated.

(3) The regulations may—

(a) specify the amount or amounts of payments;

(b) 5make provision for determining the amount or amounts of payments.

(4) The regulations may require relevant energy undertakings to provide the
Secretary of State, or any other specified person, with specified information
about—

(a) the proposed exercise, or exercise, of the right of use;

(b) 10the making of payments in accordance with regulations under this
section.

(5) Before making any regulations under this section, the Secretary of State must
consult such persons as the Secretary of State considers appropriate.

42 Notice scheme

(1) 15The Secretary of State may, by regulations, require relevant energy
undertakings to give notice of the proposed exercise, or exercise, of the right of
use.

(2) The regulations may require relevant energy undertakings—

(a) to give notice—

(i) 20to owners of relevant land or interests in relevant land;

(ii) to persons of other specified descriptions;

(b) to display notice within the area in which relevant land is situated or
elsewhere;

(c) to publish notice (otherwise than by displaying the notice).

(3) 25The regulations may make provision about the information which the notice is
to contain, including provision about information relating to—

(a) any payment scheme regulations which are in force;

(b) the application of any payment scheme regulations to the proposed
exercise, or exercise, of the right of use;

(c) 30the method for obtaining a payment under any payment scheme
regulations.

(4) The regulations may make provision about the manner in which notice is to be
given, displayed or published, including provision requiring notice to be—

(a) displayed at specified places or places of specified descriptions;

(b) 35published in specified publications or publications of specified
descriptions.

(5) The regulations may require relevant energy undertakings to provide the
Secretary of State, or any other specified person, with specified information
about—

(a) 40the proposed exercise, or exercise, of the right of use;

(b) the giving of notice in accordance with regulations under this section.

(6) Before making regulations under this section, the Secretary of State must
consult such persons as the Secretary of State considers appropriate.

(7) In this section “payment scheme regulations” means regulations under section
41.

43 Payment and notice schemes: supplementary provision

(1) Regulations under section 41 or 42 may make provision about the enforcement
5of relevant requirements, including provision for the imposition of financial
penalties in respect of breach of relevant requirements.

(2) Regulations under section 41 or 42 may confer a function on—

(a) the Secretary of State, or

(b) any other person, apart from the Scottish Ministers or the Welsh
10Ministers.

(3) The functions that may be imposed include—

(a) a duty (including a restriction or prohibition);

(b) a function involving the exercise of a discretion;

(c) a requirement to consult.

(4) 15The provisions of sections 41 and 42 and this section which specify particular
kinds of provision that may be made in regulations under section 41 or 42 do
not limit the powers conferred by that section to make such regulations.

(5) The Secretary of State must carry out a review of sections 41 and 42 and the
preceding provisions of this section as soon as reasonably practicable after the
20end of the period of 5 years beginning with the day on which they come into
force.

(6) The Secretary of State must by regulations—

(a) repeal section 41, and make any consequential amendments (including
repeals) of the other provisions of this Act that the Secretary of State
25considers appropriate, if the relevant conditions are met in relation to
the power under section 41;

(b) repeal section 42, and make any consequential amendments (including
repeals) of the other provisions of this Act that the Secretary of State
considers appropriate, if the relevant conditions are met in relation to
30the power under section 42.

(7) The relevant conditions are met in relation to the power under section 41 or the
power under section 42 if—

(a) that power is not exercised within the period of 7 years beginning with
the day on which that section comes into force, and

(b) 35the Secretary of State is satisfied that there is no convincing case for
retaining that power.

44 Interpretation

(1) For the purposes of deciding whether land is deep-level land—

(a) the depth of a point in land below surface level is the distance between
40that point and the surface of the land vertically above that point; and

(b) in determining what is the surface of the land, any building or other
structure on the land, and any water covering the land, must be
ignored.

(2) In sections 39 to 43 and this section—

Infrastructure BillPage 49

• “deep geothermal energy” means geothermal energy in deep-level land
  (including in water or any other fluid in deep-level land);

• “deep-level land” has the meaning given in section 39(4);

• “landward area” has the same meaning as in the Petroleum Licensing
  5(Exploration and Production) (Landward Areas) Regulations 2014 (see
  regulation 1(2) of those Regulations);

• “petroleum” has the same meaning as in Part 1 of the Petroleum Act 1998
  (see section 1 of that Act);

• “relevant energy undertaking” means a person who proposes to exercise,
  10or exercises, the right of use;

• “relevant land” means land in respect of which the right of use is
  proposed to be, or is, exercised;

• “relevant requirement” means a requirement imposed by regulations
  under section 41 or 42;

• 15“right of use” means the right conferred by section 39;

• “Scottish deep-level land” means deep-level land in Scotland or beneath
  waters adjacent to Scotland;

• “specified” means specified in regulations under section 41 or 42;

• “substance” includes electricity and any other intangible thing.

(3) 20The power of the Secretary of State to make regulations under section 4 of the
Petroleum Act 1998 includes power to make such amendments of the
definition of “landward area” in subsection (2) above as the Secretary of State
considers appropriate in consequence of any other exercise of the power under
section 4 of the 1998 Act.

25Renewable heat incentives

45 Renewable heat incentives

(1) Section 100 of the Energy Act 2008 (renewable heat incentives) is amended in
accordance with subsections (2) to (4).

(2) After subsection (1) insert—

“(1A) 30Regulations under this section may confer any function on any person.

(1B) Regulations under this section may provide for a function conferred on
a person to be exercisable on behalf of another person.”

(3) In subsection (2)—

(a) in paragraph (a), for the words before sub-paragraph (i) substitute—

“(a) 35make provision giving any of the following persons
entitlements to payments (“RHI payments”) in specified
circumstances—”;

(b) in paragraph (b), for “such payments” substitute “RHI payments”;

(c) after paragraph (b) insert—

“(ba) 40make provision about the circumstances in which, and
descriptions of persons to whom, the whole or a part of
an entitlement to an RHI payment may be assigned
(whether the person has the entitlement by virtue of
regulations under paragraph (a) or regulations under
45this paragraph);