Energy Bill

Page 15, line 22, at end insert—

“( )   Electricity capacity regulations must include provision for capacity to be
auctioned to demand reduction providers before any other providers.”

Page 15, line 25, at end insert—

“( )   for payments under capacity agreements to be commenced by the
settlement body within six months after the national system
operator has run a capacity auction;”

Page 15, line 35, at end insert—

“( )   Electricity capacity regulations must make provision for capacity auctions
to be conducted so as to prioritise the lowest carbon providers.”

Lord Jenkin of Roding gives notice of his intention to oppose the Question that Clause 26
stand part of the Bill.

Page 19, line 13, at end insert—

“( )   The Secretary of State shall modify section 6(1) to provide for an additional
license condition authorising a person to store electricity.”

Lord Jenkin of Roding gives notice of his intention to oppose the Question that Clause 32
stand part of the Bill.

Page 20, line 3, after “to” insert “the respective”

Page 20, line 3, after “Authority” insert “and the Secretary of State”

Page 20, line 22, leave out from “instrument” to end of line 25

Page 20, line 28, leave out from “instrument” to “is” in line 29 and insert “under
section 27”

Page 21, line 38, at end insert—

“(2)   The Secretary of State must ensure that any arrangements made under this
section take account of the role of Electricity Distribution Network
Operators in achieving permanent reductions in demand for electricity.”

Leave out Clause 37 and insert the following new Clause—

“Pilot schemes for electricity demand reduction

(1)   The Secretary of State must—

(a)   make arrangements—

(i)   for the purpose of reducing demand for electricity; and

(ii)   wholly or partly for the purpose of determining provision to
be included in electricity capacity regulations; and

(b)   make arrangements for the purpose of piloting a measure (or
measures) to secure a reduction in the demand for electricity.

(2)   Arrangements under this section may be paid for either by money
provided by Parliament or by the means established for the provision of
capacity agreements in sections 22 and 24.”

Insert the following new Clause—

“Strategy on interconnection

Within 12 months of this Act coming into force, the Secretary of State shall
bring forward a strategy for the UK to increase its interconnection links
with other European countries, in order to support the continued
development of a European internal electricity market.”

Page 5, line 30, at end insert—

“( )   The Secretary of State must ensure that any price designated for the
purposes of 2(a) incentivises uptake of contracts by eligible generators.”

Page 6, line 7, leave out “9, 10 or 11” and insert “6 to 17 or 20, except regulations
made under section 7(10).”

Page 6, line 10, leave out “Any other instrument containing regulations” and insert
“An instrument containing regulations under section 7(10)”

Insert the following new Clause—

“Expert Panel

New schedule [“The Expert Panel”] has effect.”

Insert the following new Schedule—

“THE EXPERT PANEL

The Expert Panel

1 Regulations shall establish a panel of experts (in this Act referred to as
“the Expert Panel”) in accordance with paragraphs (2) to (6) below.

Duty to consult

2    (1)   Regulations made by virtue of paragraph 1 shall provide that before—

(a)   any contract for differences are entered into under Part 1; or

(b)   any investment contracts are entered into under Schedule 3

the Secretary of State shall seek advice from, and the opinion of, the Expert Panel in relation to the matters specified in sub-paragraph (2) below.

(2)   The matters in relation to which advice and opinion is to be sought from
the Expert Panel are:

(a)   any advice provided to the Secretary of State by the national
system operator;

(b)   the financial and other terms on which it is proposed a contract
for difference or an investment contract be entered into;

(c)   whether the agreed strike price (or equivalent) represents value
for money for consumers; and

(d)   whether, in all the circumstances, it is appropriate for the CFD
Counterparty to enter into the relevant contract.

(3)   Where the Secretary of State proposes to disregard in whole or in part
any of the advice or opinion provided by the Expert Panel, he shall be
under a duty to ensure the Expert Panel is provided with his reasons for
disregarding or disagreeing with the advice or opinion.

3 Regulations made by virtue of paragraph 1 shall also—

(1)   Provide that it shall be the duty of the Secretary of State and the national
system operator to provide the Expert Panel with all such information as
it may require;

(2)   Require the Expert Panel to provide the Authority and Parliament with
details of any advice and opinion provided under this Part;

(3)   Require the Expert Panel to publish minutes of its meetings; and

(4)   Permit the Expert Panel to publish such information as the Expert Panel
thinks fit about the advice it gives.

Membership etc. of the Expert Panel

4 The members of the Expert Panel shall be appointed by the Secretary of
State and shall comprise a Chairman, a Consumer representative, a
representative of the Authority and such other members as the Secretary
of State may decide.

5    (1)   In appointing persons to be members of the Expert Panel, the Secretary
of State must secure, so far as practicable, that the Expert Panel—

(a)   is independent; and

(b)   is comprised of technical, academic, economic, legal and such
other experts necessary to give the informed advice required.

(2)   The Expert Panel must not include any person who is—

(a)   employed by an eligible generator, or who has been employed by
an eligible generator in the previous 12 months;

(b)   employed by an electricity supplier, or who has been employed
by an electricity supplier in the previous 12 months; or

(c)   employed by the national system operator.

(3)   The chairman and every member of the Expert Panel—

(a)   shall be appointed for a fixed period, specified in their terms of
his appointment, but shall be eligible for reappointment at the
end of that period;

(b)   shall not serve on the Expert Panel for longer than 8 years in total;

(c)   may at any time be removed by a notice from the Expert Panel to
the Secretary of State following a majority vote.

Committees and other procedures of the Expert Panel

6 The Expert Panel may make such arrangements as they think fit—

(a)   for committees established by the Expert Panel to give advice to
it about carrying out the Expert Panel’s functions, providing
such committees only include persons who are members of the
Expert Panel;

(b)   for regulating its own procedure and for regulating the
procedure of committees established by them, as it sees fit;

(c)   as to quorums and the making of decisions by majority.”

Page 7, line 29, at end insert—

“(4)   Regulations must set the duration of support provided by CFDs to
renewable technologies at a minimum of 25 years.”

Page 8, line 30, at end insert—

“( )   However such regulations shall not exclude any generator or potential
generator as ineligible on the grounds of size of capacity if such generator
is proposing to instal low capacity of at least 1 megawatt.”

Page 8, line 30, at end insert—

“( )   Eligibility rules will not exclude electricity supplied from generating
capacity located outside the United Kingdom.”

Page 9, line 9, leave out “may” and insert “must”

Page 9, line 10, at end insert “and those amounts must be greater than zero.”

Page 9, line 11, leave out “may” and insert “must”

Insert the following new Clause—

“Regulations: backstop power purchase agreements

(1)   Regulations made under section 6 must include provision under which—

(a)   every eligible generator who is a party to a CFD may, in specified
circumstances, by notice in writing require the Authority (or such
other person on whom the regulations confer functions) to secure,
within no later than one month after the notice is given, that an
electricity supplier (or a person of such other description as may be
specified) enter into a power purchase agreement on terms set out
in, or determined in accordance with, the regulations (a “backstop
PPA”); and

(b)   for the duration of the backstop PPA, the strike price under that
CFD (or under any other CFD entered into in connection with the
backstop PPA) is set at a level specified in, or determined in
accordance with, the regulations.

(2)   In determining the provision to be made under this section, the Secretary
of State must have regard, in particular, to—

(a)   the desirability of ensuring that every eligible generator who is a
party to a CFD is able to borrow money commercially for its
business purposes at reasonable cost and over a reasonable period
(including borrowing which involves the lender taking an equity
stake in the generator);

(b)   accordingly, the need to ensure that the terms of every backstop
PPA, and the level of the associated strike price, are such that every
backstop PPA is demonstrably viable for the eligible generator.

(3)   Where, at the time a CFD is made, regulations make provision for any
matter referred to in subsection (1), subsequent regulations may not alter
that provision in relation to that CFD during its term.

(4)   The Secretary of State may exercise the powers conferred by Chapter 6 of
this Part (modification of licence conditions) for the purpose of giving
effect to provision made under this section.

(5)   The Secretary of State must keep under review the effectiveness of
provision proposed or made under this section for achieving the objects set
out in paragraphs (a) and (b) of subsection (2).

(6)   In this section, “specified” means specified in the regulations.”

Insert the following new Clause—

“Alternative route to market

(1)   If at any time after the section (Regulations: backstop power purchase
agreements) comes into force, the Secretary of State is not satisfied that
provision made under that section will be effective, or (as the case may be)
has been effective, to achieve the objects set out in paragraphs (a) and (b) of
subsection (2) of that section, the Secretary of State must as soon as
practicable exercise the powers conferred by Chapter 6 of this Part so as to
establish an auction market (the “green power auction market”) in which
eligible generators are entitled to offer, and other persons (including, in
particular, electricity suppliers) are entitled to bid for, electricity generated
from renewable sources.

(2)   The Secretary of State must exercise those powers, and take such other
steps (including the exercise of any other power conferred by or under a
provision of this Part) as the Secretary of State considers necessary, for the
purpose of ensuring that—

(a)   the green power auction market begins to operate as soon as
reasonably practicable and does not cease to operate until expiry of
the last CFD that has been made; and

(b)   the reference price under a CFD entered into by a generator who is
a party to an agreement made through the green power auction
market is based on the price payable to the generator under that
agreement.”

Page 11, line 7, at end insert—

“(d)   conferring on the Secretary of State further powers to require
operators of generating stations which use woody biomass fuel to
provide a fuel supply strategy for approval by Ministers.”

Page 12, line 7, leave out subsection (4)

Page 12, line 14, at end insert—

“( )   The powers of the Secretary of State under this section must be exercised
with a view to ensuring that, within six months of commencement of this
section, an order is in force making provision pursuant to subsections (1)(c)
and (4)(a) and (c) for targets relating to the contribution to be made by
generating stations located outside the United Kingdom to electricity
supply in the United Kingdom.”

Page 26, line 40, at end insert—

“( )   The Secretary of State must by regulations make provisions for ensuring
that there is a route to market for independent electricity generators
employing renewable power technologies.”

Page 27, line 40, leave out from “by” to end of line 2 on page 28 and insert “means
of a power purchase agreement scheme.

(3)   For the purposes of this section and section (Power purchase agreement
scheme: regulations)—

(a)   a power purchase agreement scheme is a scheme established by
supply licence conditions and regulations under section (Power
purchase agreement scheme: regulations) for promoting the availability
to electricity generators of power purchase agreements, and

(b)   “power purchase agreement” means an arrangement under which
a licensed supplier agrees to purchase electricity generated by an
electricity generator.

For this purpose, “supply licence condition” means any condition,
document or agreement of a kind mentioned in subsection (1).

(4)   Provision that may be made under subsection (1) in relation to a power
purchase agreement scheme includes provision—

(a)   as to the eligibility of an electricity generator to enter into a power
purchase agreement under the scheme;

(b)   as to the terms of any power purchase agreement to be entered into
under the scheme, including provision—

(i)   for determining the price at which electricity is to be
purchased under the agreement;

(ii)   as to the duration of any such agreement;

(c)   as to the circumstances in which a licensed supplier is or may be
required or permitted to enter, or offer to enter, into a power
purchase agreement under the scheme;

(d)   for the provision of information in connection with the scheme.

(5)   Provision within subsection (4)(c) includes provision for determining
which licensed supplier or suppliers is or are to be required or permitted to
enter, or offer to enter, into a power purchase agreement with an electricity
generator in any particular case.

(6)   Such provision may in particular include provision for the licensed
supplier or suppliers in question to be determined—

(a)   by a process involving a determination or determinations by one or
more of the following—

(i)   the Secretary of State;

(ii)   the Authority;

(iii)   the electricity generator;

(b)   by auction or other competitive process;

and provision that may be made by virtue of paragraph includes
provision as to the circumstances in which a licensed supplier is or may be
required or permitted to participate in an auction or other process.

(7)   For the purposes of this section and section (Power purchase agreement
scheme: regulations), “licensed supplier” means the holder of a licence under
section 6(1)(d) of EA 1989.”

Insert the following new Clause—

“Power purchase agreement scheme: regulations

(1)   The Secretary of State may by regulations make provision, in connection
with any modifications made under section 44, for or in connection with a
power purchase agreement scheme.

(2)   Any such regulations may in particular—

(a)   make provision for apportioning amongst licensed suppliers, or
any of them, all or any part of the value of any or all of the costs or
benefits of any licensed supplier in connection with the scheme;

(b)   confer functions on the Secretary of State or the Authority (which
may include provision for directions to be given to the Authority by
the Secretary of State);

(c)   make provision for the delegation of functions conferred on the
Secretary of State or the Authority by the regulations or by virtue of
section 44;

(d)   include provision for obligations imposed by the regulations on
licensed suppliers to be enforceable by the Authority as if they were
relevant requirements on a regulated person for the purposes of
section 25 of EA 1989;

(e)   make provision about the provision of information in connection
with the scheme.

(3)   Provision that may be included in regulations under this section by virtue
of subsection (2)(a) includes, in particular, provision—

(a)   for requiring licensed suppliers to pay a levy to the Authority at
specified times;

(b)   specifying how such a levy is to be calculated;

(c)   conferring an entitlement on a licensed supplier to receive a
payment from the Authority.

(4)   Provision which may be included in regulations by virtue of subsection (3)
includes provision for the Secretary of State or the Authority to determine
what is to be taken into account as a cost or benefit of any licensed supplier
in connection with the scheme and its value.

“(5)   Regulations under this section may—

(a)   include incidental, supplementary and consequential provision;

(b)   make transitory or transitional provision or savings;

(c)   make different provision for different cases or circumstances or for
different purposes;

(d)   make provision subject to exceptions.

(6)   Before making any regulations under this section, the Secretary of State
must consult—

(a)   licensed suppliers,

(b)   the Authority, and

(c)   such other persons as the Secretary of State considers it appropriate
to consult.

(7)   Subsection (6) may be satisified by consultation before, as well as by
consultation after, the passing of this Act.

(8)   Regulations under this section must be made by statutory instrument.

(9)   An instrument containing regulations under this section is subject to
annulment in pursuance of a resolution of either House of Parliament.”

Insert the following new Clause—

“Power purchase agreement scheme: disclosure of information

In section 105 of the Utilities Act 2000 (general restrictions on disclosure of
information)—

(a)   in subsection (1)(a), after “2010” insert “or section 44 or (Power
purchase agreement scheme: regulations) of the Energy Act 2013”;

(b)   in subsection (3)(a), after “2010” insert “, sections 44 to (Power
purchase agreement scheme: regulations) of the Energy Act 2013”.”

Insert the following new Clause—

“Principal objective and general duties: power purchase agreement scheme

Sections 3A to 3D of EA 1989 (principal objective and general duties) apply
in relation to functions of the Secretary of State or the Authority conferred
by or by virtue of section or (Power purchase agreement scheme:
regulations), or section so far as it relates to a power purchase agreement
scheme, as they apply in relation to functions under Part 1 of that Act.”

Page 28, line 23, at end insert “for the purposes of replacing the arrangements in
effect under a renewables obligation order, and shall exercise their powers in a
manner that is best calculated to replicate the effect of such arrangements on the
accreditation status and renewable obligation certificate banding provision of, and
value derived from renewable obligation certificates by, accredited generating
stations.”

Page 40, line 29, leave out subsection (8)

Page 53, line 22, leave out “or (4)” and insert “, (4) or (6A)”

Insert the following new Clause—

“Domestic microhydro power

(1)   Domestically based microhydro power shall be exempt from non-domestic
rates.

(2)   For the purposes of the section “domestically based microhydro power” is
a single plant located within the curtelege of an owner or owner’s
residential property with a plant capacity of up to and including 1250 kW.”

Insert the following new Clause—

“Reduction of landfilling of organic waste

The Secretary of State must, as soon as reasonably practicable, set out a plan
and timeframe for the reduction and eventual elimination of landfilling of
organic waste in order to make it available for 100% renewable energy
generation, and other appropriate uses consistent with the waste hierarchy
as defined in the Waste (England and Wales) Regulations 2011.”

Insert the following new Clause—

“Energy storage systems

The Secretary of State must—

(a)   set out a plan to support the development of storage systems for
electricity that is generated from renewable sources,

(b)   put in place pilot schemes to store renewable energy and reduce the
problem associated with intermittency of supply,

(c)   set targets in relation to the provision of renewable energy storage
capacity, and

(d)   set out progress made on these issues in the form of a report, which
must be laid before Parliament.”

Page 108, line 20, at end insert—

“( )   Part 1 (decarbonisation);”

Page 108, line 30, at end insert—

“( )   Section (Fuel poverty) extends to England and Wales only.”

Page 109, line 18, at end insert—

“( )   section (Feed-in tariffs: increase in maximum capacity of plant) (feed-in
tariffs: increase in maximum capacity of plant);”

Page 109, line 18, at end insert—

“( )   section (Fuel poverty) (fuel poverty);”