Energy Bill (HL Bill 30)

(b) a variation or termination of an investment contract;

(c) the settlement or compromise of a claim under an investment
contract;

(d) the conduct of legal proceedings relating to an investment contract;

(e) 5the exercise of rights under an investment contract.

(5) Regulations must include such provision as the Secretary of State considers
necessary to ensure that an investment contract counterparty or a CFD
counterparty can meet its liabilities under any investment contract to which
it is a party.

10Shadow directors, etc.

15 The Secretary of State is not, by virtue of the exercise of a power conferred
by or by virtue of this Schedule, to be regarded as—

(a) a person occupying in relation to an investment contract
counterparty or a CFD counterparty the position of director;

(b) 15being a person in accordance with whose directions or instructions
the directors of an investment contract counterparty or a CFD
counterparty are accustomed to act;

(c) exercising any function of management in an investment contract
counterparty or a CFD counterparty;

(d) 20a principal of an investment contract counterparty or a CFD
counterparty.

Part 4 Transfers

Transfers

16 (1) 25The Secretary of State may make one or more schemes for the transfer of
designated property, or designated rights or liabilities under an investment
contract—

(a) from the Secretary of State (“the transferor”) to a CFD counterparty
(“the transferee”);

(b) 30from the Secretary of State (“the transferor”) to an investment
contract counterparty (“the transferee”);

(c) from an investment contract counterparty (“the transferor”) to a CFD
counterparty (“the transferee”);

(d) from a person who has ceased to be an investment contract
35counterparty (“the transferor”) to a person who is an investment
contract counterparty (“the transferee”).

(2) If a scheme provides for a CFD counterparty to be the transferee, regulations
may provide for the investment contract to be treated to any extent as a CFD
for the purposes of provision made by or by virtue of Chapter 2 of Part 2 of
40this Act.

(3) Sub-paragraph (4) applies from the beginning of the first day on which all of
the following three conditions are met, namely—

(a) a definition of an “eligible generator” is in force by virtue of section
10(3) or the date is 1st January 2016 or later;

(b) 45a designation under section 7(1) has effect;

(c) provision required by section 9(1) to be made is in force.

(4) The Secretary of State must in respect of each investment contract, within
such period of time as the Secretary of State considers reasonable—

(a) make a transfer scheme by virtue of sub-paragraph (1)(a) or (c) to
5ensure the transfer of all rights and liabilities under the investment
contract, and

(b) make provision under sub-paragraph (2) for the investment contract
to be treated as a CFD for the purposes of all provision made by or
by virtue of Chapter 2 of Part 2 of this Act.

(5) 10But sub-paragraph (4) does not apply to the extent that the Secretary of State
considers it appropriate in all the circumstances of the case to disapply it.

(6) On the transfer date, the designated property, rights and liabilities are
transferred and vest in accordance with the scheme.

(7) The rights and liabilities that may be transferred by a scheme include those
15arising under or in connection with a contract of employment.

(8) A certificate by the Secretary of State that anything specified in the certificate
has vested in any person by virtue of a scheme is conclusive evidence for all
purposes of that fact.

(9) In this paragraph and paragraph 17—

• 20“designated”, in relation to a scheme, means specified in or determined
  in accordance with the scheme;

• “property” includes interests of any description;

• “the transfer date” means a date specified by a scheme as the date on
  which the scheme is to have effect.

17 (1) 25A scheme may make provision—

(a) for anything done by or in relation to the transferor in connection
with any property, rights or liabilities transferred by the scheme to
be treated as done, or to be continued, by or in relation to the
transferee;

(b) 30for references to the transferor in any agreement (whether written or
not), instrument or other document relating to any property, rights
or liabilities transferred by the scheme to be treated as references to
the transferee;

(c) about the continuation of legal proceedings;

(d) 35for transferring property, rights or liabilities which could not
otherwise be transferred or assigned;

(e) for transferring property, rights and liabilities irrespective of any
requirement for consent which would otherwise apply;

(f) for preventing a right of pre-emption, right of reverter, right of
40forfeiture, right to compensation or other similar right from arising
or becoming exercisable as a result of the transfer of property, rights
or liabilities;

(g) for dispensing with any formality in relation to the transfer of
property, rights or liabilities by the scheme;

(h) 45for transferring property acquired, or rights or liabilities arising,
after the scheme is made but before it takes effect;

(i) for apportioning property, rights or liabilities;

(j) for creating rights, or imposing liabilities, in connection with
property, rights or liabilities transferred by the scheme;

(k) for requiring the transferee to enter into any agreement of any kind,
or for a purpose, specified in or determined in accordance with the
5scheme.

(2) Sub-paragraph (1)(b) does not apply to references in primary legislation or
in subordinate legislation.

18 A scheme may contain provision for the payment of compensation by the
Secretary of State to any person whose interests are adversely affected by it.

10Part 5 Supplementary

Licence modifications

19 (1) The Secretary of State may modify—

(a) a condition of a particular licence under section 6(1)(a), (b) or (c) of
15EA 1989 (generation, transmission and distribution licences);

(b) the standard conditions incorporated in licences under that
provision by virtue of section 8A(1A) of that Act;

(c) a document maintained in accordance with the conditions of licences
under that provision, or an agreement that gives effect to a document
20so maintained.

(2) The Secretary of State may make a modification under sub-paragraph (1)
only for the purpose of—

(a) allowing or requiring services to be provided to the Secretary of
State, an investment contract counterparty or a CFD counterparty;

(b) 25enforcing obligations under an investment contract.

(3) Provision included in a licence, or in a document or agreement relating to
licences, by virtue of the power under sub-paragraph (1) may in particular
include provision of a kind that may be included in regulations.

(4) Before making a modification under this paragraph, the Secretary of State
30must consult—

(a) the Scottish Ministers,

(b) the Welsh Ministers,

(c) the holders of any licence being modified,

(d) electricity suppliers,

(e) 35the Department of Enterprise, Trade and Investment,

(f) the Authority, and

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

(5) Sub-paragraph (4) may be satisfied by consultation before, as well as by
40consultation after, the passing of this Act.

Expenditure

20 (1) There may be paid out of money provided by Parliament expenditure
incurred by the Secretary of State for the purpose of making payments in

respect of the Secretary of State’s obligations under an investment contract,
whether entered into before or after this Schedule comes into force.

(2) There may be paid out of money provided by Parliament expenditure
incurred by the Secretary of State for the purpose of, or in connection with—

(a) 5obtaining advice and assistance in relation to investment contracts
(including in relation to entering into an investment contract);

(b) the establishment of an investment contract counterparty;

(c) making payments or providing financial assistance to an investment
contract counterparty.

(3) 10Financial assistance or payments includes financial assistance or payments
given subject to such conditions as may be determined by, or in accordance
with arrangements made by, the Secretary of State; and such conditions may
in particular in the case of a grant include conditions for repayment in
specified circumstances.

(4) 15In this paragraph, “financial assistance” means grants, loans, guarantees or
indemnities, or any other kind of financial assistance.

Section 41

SCHEDULE 3 Orders under section 40: transfer schemes

Power to make transfer schemes

1 (1) 20The Secretary of State may exercise the power in sub-paragraph (2) in
connection with the making of an order under section 40 providing for a
person (“the transferee”) to carry out EMR functions in place of another
person (“the transferor”).

(2) The Secretary of State may make one or more schemes for the transfer of
25designated property, rights or liabilities of the transferor to the transferee.

(3) On the transfer date, the designated property, rights and liabilities are
transferred and vest in accordance with the scheme.

(4) The rights and liabilities that may be transferred by a scheme include those
arising under or in connection with a contract of employment.

(5) 30A certificate by the Secretary of State that anything specified in the certificate
has vested in any person by virtue of a scheme is conclusive evidence for all
purposes of that fact.

(6) In this Schedule—

• “designated”, in relation to a scheme, means specified in or determined
  35in accordance with the scheme;

• “EMR functions” has the same meaning as in section 40;

• “property” includes interests of any description;

• “the transfer date” means a date specified by a scheme as the date on
  which the scheme is to have effect.

40Contents of a scheme

2 (1) A scheme may make provision—

(a) for anything done by or in relation to the transferor in connection
with any property, rights or liabilities transferred by the scheme to
be treated as done, or to be continued, by or in relation to the
transferee;

(b) 5for references to the transferor in any agreement (whether written or
not), instrument or other document relating to any property, rights
or liabilities transferred by the scheme to be treated as references to
the transferee;

(c) about the continuation of legal proceedings;

(d) 10for transferring property, rights or liabilities which could not
otherwise be transferred or assigned;

(e) for transferring property, rights and liabilities irrespective of any
requirement for consent which would otherwise apply;

(f) for preventing a right of pre-emption, right of reverter, right of
15forfeiture, right to compensation or other similar right from arising
or becoming exercisable as a result of the transfer of property, rights
or liabilities;

(g) for dispensing with any formality in relation to the transfer of
property, rights or liabilities by the scheme;

(h) 20for transferring property acquired, or rights or liabilities arising,
after the scheme is made but before it takes effect;

(i) for apportioning property, rights or liabilities;

(j) for creating rights, or imposing liabilities, in connection with
property, rights or liabilities transferred by the scheme;

(k) 25for requiring the transferee to enter into any agreement of any kind,
or for a purpose, specified in or determined in accordance with the
scheme.

(2) Sub-paragraph (1)(b) does not apply to references in primary legislation or
in subordinate legislation.

30Compensation

3 A scheme must contain provision for the payment by the Secretary of State
of such amounts of compensation as the Secretary of State considers
appropriate to any person whose interests are adversely affected by it.

Section 47

SCHEDULE 4 35Application and modification of emissions limit duty

Application of duty: changes to main boilers

1 (1) Regulations under section 47(6)(b) may provide for the emissions limit duty
to apply (with or without modifications) in relation to fossil fuel plant in
cases where—

(a) 40immediately before the day on which section 47(1) came into force,
the electricity generating station in question was the subject of a
relevant consent, and

(b) on or after that day—

(i) any main boiler of the generating station is replaced, or

(ii) an additional main boiler is installed for the generating
station.

(2) Regulations made by virtue of this paragraph may, in particular, make
5different provision in relation to different parts of fossil fuel plant.

(3) For the purposes of sub-paragraph (1)(a), plant is to be treated as the subject
of a relevant consent if, by virtue of a consent or approval granted before
section 36 of EA 1989 or Article 39 of the Electricity (Northern Ireland) Order
1992 (S.I. 1992/231 (N.I. 1)S.I. 1992/231 (N.I. 1)) came into force, no relevant consent was
10required in respect of it.

Application of duty: generating stations not exporting to a network

2 Regulations under section 47(6)(b) may provide for the emissions limit duty
to apply with modifications (or not to apply) in relation to fossil fuel plant
which does not include a network generating station.

15Modifications where gasification or CCS plant associated with two or more generating stations

3 (1) Regulations under section 47(6)(b) may provide for the emissions limit duty
to apply with modifications in cases where—

(a) gasification plant or CCS plant is associated with two or more
electricity generating stations, and

(b) 20each of those generating stations is the subject of a relevant consent.

(2) Regulations made by virtue this paragraph may, in particular, provide for—

(a) the installed generating capacity of any of those generating stations
(or any part of it) to be treated as installed generating capacity of
another of those generating stations;

(b) 25any of the emissions from the gasification plant or CCS plant to be
treated as emissions from any of the generating stations.

Modifications of emissions limit for changes of circumstance during a year

4 Regulations under section 47(6)(b) may modify the emissions limit duty in
relation to fossil fuel plant in cases where the generating station—

(a) 30is used for the first time, or permanently ceases to be used, for the
generation of electricity, or

(b) is altered.

Section 49

SCHEDULE 5 Emissions limit duty: monitoring and enforcement

35Matters that may be contained in enforcement regulations

1 (1) Provision that may be contained in enforcement regulations includes
provision—

(a) conferring functions for or in connection with monitoring or
enforcing the compliance of operators with the emissions limit duty;

(b) determining the authorities by whom such functions are to be
exercisable (“enforcing authorities”);

(c) requiring enforcing authorities to comply with directions given by
the appropriate national authority in carrying out any of their
5functions under the regulations;

(d) requiring enforcing authorities to comply with requirements
imposed on them under section 48(9);

(e) requiring or authorising enforcing authorities to carry out
consultation in connection with the carrying out of any of their
10functions under the regulations;

(f) requiring enforcing authorities to publish guidance about the
carrying out of any of their functions under the regulations;

(g) about the provision, use and publication of information in relation to
the compliance of operators with the emissions limit duty;

(h) 15authorising the appropriate national authority to make schemes for
the charging by enforcing authorities of fees or other charges in
respect of or in connection with functions conferred on enforcing
authorities under the regulations;

(i) about the enforcement of contraventions of the emissions limit duty
20through enforcement notices and financial penalties (see paragraphs
2 and 3);

(j) about the procedure to be followed in connection with the service of
enforcement notices and imposition of financial penalties (including
requirements for enforcement notices to be published in draft before
25being served for the purpose of enabling representations to be made
about them);

(k) for the enforcement of—

(i) enforcement notices,

(ii) undertakings given in connection with such notices,

(iii) 30financial penalties, or

(iv) other obligations imposed on operators under the
regulations,

by proceedings in the High Court or any court of competent
jurisdiction in Scotland;

(l) 35conferring rights of appeal in respect of decisions made, notices
served, financial penalties imposed or other things done (or omitted
to be done) by enforcing authorities under the regulations (including
provision in relation to the making, consideration and determination
of such appeals);

(m) 40about the application of the regulations to the Crown.

(2) Provision under sub-paragraph (1)(a) may in particular include provision—

(a) conferring power on enforcing authorities to take samples or to make
copies of information;

(b) conferring power on enforcing authorities to arrange for
45preventative or remedial action to be taken at the expense of
operators;

(c) authorising enforcing authorities to appoint suitable persons to
exercise the functions mentioned in paragraph (a) or (b);

(d) conferring powers on persons so appointed (which may include, so
50far as relevant, the powers mentioned in section 108(4) of the
Environment Act 1995).

(3) Provision under sub-paragraph (1)(g) may in particular include provision—

(a) enabling enforcing authorities to use, for the purposes of their
functions conferred under the regulations in respect of fossil fuel
plant, information held for the purposes of their functions in relation
5to any such plant conferred under regulations implementing the ETS
Directive;

(b) requiring operators, or other persons of a description specified in the
regulations, to provide to an enforcing authority such information,
and in such manner, as—

(i) 10the regulations may specify, or

(ii) the authority may reasonably require;

(c) requiring or authorising enforcing authorities to publish such
information, and in such manner, as is specified in the regulations
(whether such information is held as mentioned in paragraph (a) or
15is provided as mentioned in paragraph (b));

(d) requiring operators to publish such information, and in such
manner, as—

(i) the regulations may specify, or

(ii) an enforcing authority may reasonably require.

(4) 20Provision under sub-paragraph (1)(h) in relation to a scheme may—

(a) require the scheme to be so framed that the fees and charges payable
under the scheme are sufficient, taking one year with another, to
cover such expenditure (whether or not incurred by the enforcing
authority or other person to whom they are so payable) as is
25specified;

(b) authorise any such scheme to make different provision for different
cases (and specify particular kinds of such cases).

Enforcement notices

2 (1) Enforcement regulations may authorise an enforcing authority to serve an
30enforcement notice on an operator who has breached the emissions limit
duty in respect of any fossil fuel plant—

(a) in relation to the year in which the notice is served, or

(b) in relation to the preceding year.

(2) The regulations may specify the requirements that may be imposed on an
35operator under an enforcement notice.

(3) Those requirements may in particular include requirements—

(a) to take such remedial action in respect of the breach as is specified in
the notice,

(b) to provide such undertakings in respect of the breach as may be
40agreed between the operator and the enforcing authority (whether
for the taking of remedial action or otherwise), or

(c) to comply with a modified emissions limit duty in relation to the
fossil fuel plant for any year to take account of excess emissions in
earlier years.

45Financial penalties

3 (1) Enforcement regulations may authorise an enforcing authority to serve a
notice on an operator who has breached the emissions limit duty requiring

the operator to pay such a financial penalty in respect of the breach as is
specified in, or calculated in accordance with, the notice or the regulations.

(2) Enforcement regulations which provide for the imposition of financial
penalties—

(a) 5may not permit an enforcing authority to impose a financial penalty
in respect of a breach of the emissions limit duty in any year which
began more than 5 years before the year in which the notice imposing
the penalty is served;

(b) may require enforcing authorities, in imposing such penalties, to
10have regard to any guidance issued by the appropriate national
authority;

(c) may provide for such penalties to be instead of, or in addition to,
requirements imposed under enforcement notices.

General

4 (1) 15Enforcement regulations may—

(a) make provision which corresponds or is similar to any provision
made, or capable of being made, under section 2(2) of the European
Communities Act 1972 in connection with the ETS Directive (subject
to any modifications that the appropriate national authority
20considers appropriate);

(b) apply or incorporate (with or without modifications) other
enactments relating to the prevention or control of environmental
pollution (including, in particular, regulations implementing the
ETS Directive and directly applicable EU legislation).

5 (1) 25Provision included in enforcement regulations by virtue of section 51(8)(a)
may affect legislation.

(2) For this purpose, provision affects legislation if it amends, repeals or revokes
any provision made by or under primary legislation.

(3) Enforcement regulations made by the Scottish Ministers, the Welsh
30Ministers or the Department of Environment may not include any provision
affecting legislation unless it is within legislative competence.

(4) Enforcement regulations made by the Secretary of State—

(a) may include provision affecting legislation that is made in
consequence of any enforcement regulations made by the Scottish
35Ministers, the Welsh Ministers or the Department of Environment,
but

(b) may not include any such provision that could be included in the
regulations mentioned in paragraph (a) except with the consent of
the authority making those regulations.

(5) 40For this purpose, a provision of enforcement regulations is within legislative
competence if—

(a) in the case of regulations by the Scottish Ministers, it would be within
the legislative competence of the Scottish Parliament if it were
included in an Act of that Parliament;

(b) in the case of regulations by the Welsh Ministers, it would be within
the legislative competence of the National Assembly for Wales if it
were included in an Act of that Assembly;

(c) in the case of regulations by the Department of Environment, it
5would be within the legislative competence of the Northern Ireland
Assembly if it were included in an Act of that Assembly.

(6) Provision included in enforcement regulations by virtue of section 51(8)(b)
may include provision modifying provision made by virtue of paragraph
2(3)(c) in cases where there is no applicable emissions limit in respect of any
10year.

Interpretation

6 In this Schedule “enforcement regulations” means regulations under section
49.

Section 63

SCHEDULE 6 15Nuclear regulations

Part 1 Introductory

Provision that may be made by nuclear regulations

1 Nuclear regulations may, in particular, make provision of any of the kinds
20mentioned in Part 2 of this Schedule for any of the purposes mentioned in
section 63(1).

2 No provision in Part 2 of this Schedule is to be regarded as limiting the
generality of—

(a) section 63(1), or

(b) 25any other provision in that Part of this Schedule.

Interpretation

3 In Part 2 of this Schedule, “activity” includes process, operation or act.

Part 2 Examples of provision that may be made by nuclear regulations

30Nuclear installations etc.

4 Imposing requirements with respect to the following, in relation to any
nuclear installation or its site—

(a) design and construction;

(b) siting, installation and commissioning;

(c) 35operation;

(d) testing, maintenance and repair;