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Energy Bill


Energy Bill
Part 1 — Gas Importation and Storage
Chapter 1 — Gas Importation and Storage Zones

1

 

A

Bill

To

Make provision relating to gas importation and storage; to make provision in

relation to electricity generated from renewable sources; to make provision

about the decommissioning of energy installations and wells; to make

provision about the management and disposal of waste produced during the

operation of nuclear installations; to make provision relating to petroleum

licences; to make provision about third party access to oil and gas

infrastructure and modifications of pipelines; to make provision about reports

relating to energy matters; to make provision relating to gas meters and

electricity meters and provision relating to electricity safety; to make provision

about the security of equipment, software and information relating to nuclear

matters; and for connected purposes. 

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and

consent of the Lords Spiritual and Temporal, and Commons, in this present

Parliament assembled, and by the authority of the same, as follows:—

Part 1

Gas Importation and Storage

Chapter 1

Gas Importation and Storage Zones

1       

Exploitation of areas outside the territorial sea for gas importation and storage

5

(1)   

The rights to which this section applies have effect, by virtue of this section, as

rights belonging to Her Majesty.

(2)   

This section applies to the rights under Part V of the Convention that are

exercisable by the United Kingdom in areas outside the territorial sea—

(a)   

with respect to any of the matters mentioned in subsection (3), or

10

(b)   

for any other purposes connected with any of those matters.

(3)   

The matters are—

 

Bill 53                                                                                                 

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Energy Bill
Part 1 — Gas Importation and Storage
Chapter 2 — Importation and storage of combustible gas

2

 

(a)   

the exploitation of those areas for the unloading of gas to installations

or pipelines;

(b)   

the exploitation of those areas for the storing of gas (whether or not

with a view to its being recovered), or the recovery of gas so stored;

(c)   

the exploration of those areas with a view to their exploitation as

5

mentioned in paragraph (a) or (b).

(4)   

For the purposes of subsection (3), references to gas include any substance

which consists wholly or mainly of gas.

(5)   

Her Majesty may by Order in Council designate an area as an area within

which the rights to which this section applies are exercisable (a “Gas

10

Importation and Storage Zone”).

(6)   

In this section—

“the Convention” means the United Nations Convention on the Law of

the Sea 1982 (Cmnd 8941) and any modifications of that Convention

agreed after the passing of this Act that have entered into force in

15

relation to the United Kingdom;

“gas” means any substance which is gaseous at a temperature of 15equation: char[degree]

a pressure of 101.325 kPa (1013.25 mb);

“installation” includes any floating structure or device maintained on a

station by whatever means.

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Chapter 2

Importation and storage of combustible gas

Activities requiring a licence

2       

Prohibition on unlicensed activities

(1)   

No person may carry on an activity within subsection (2) except in accordance

25

with a licence.

(2)   

The activities are—

(a)   

the use of a controlled place for the unloading of gas to an installation

or pipeline;

(b)   

the use of a controlled place for the storage of gas;

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(c)   

the conversion of any natural feature in a controlled place for the

purpose of storing gas;

(d)   

the recovery of gas stored in a controlled place;

(e)   

the exploration of a controlled place with a view to, or in connection

with, the carrying on of activities within paragraphs (a) to (d);

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(f)   

the establishment or maintenance in a controlled place of an installation

for the purposes of activities within this subsection.

(3)   

In this section—

“controlled place” means a place in, under or over—

(a)   

the territorial sea, or

40

(b)   

waters in a Gas Importation and Storage Zone (within the

meaning of section 1(5));

 
 

Energy Bill
Part 1 — Gas Importation and Storage
Chapter 2 — Importation and storage of combustible gas

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“gas” means any combustible substance which is gaseous at a

temperature of 15equation: char[degree]

which consists wholly or mainly of—

(a)   

methane,

(b)   

ethane,

5

(c)   

propane,

(d)   

butane,

(e)   

a substance designated for the purposes of this section by an

order made by the Secretary of State, or

(f)   

a mixture of two or more of the substances mentioned in

10

paragraphs (a) to (e).

Licensing

3       

Licences

(1)   

The Secretary of State may grant a person a licence in respect of one or more

activities within section 2(2).

15

(2)   

The controlled place in respect of which a licence is granted may be determined

by reference to the provisions of a Crown lease which has been or may be

granted.

(3)   

For this purpose “Crown lease” means a lease of property forming part of the

Crown Estate, or an authorisation to exercise rights forming part of that Estate

20

(whether by virtue of section 1 or otherwise).

4       

Applications

The Secretary of State may by regulations—

(a)   

prescribe the persons, or classes of persons, by whom an application for

a licence may be made;

25

(b)   

prescribe requirements which must be met by, or in relation to, a person

who makes an application;

(c)   

prescribe the manner in which an application must be made;

(d)   

prescribe the information which an application must contain and any

documents which must accompany it;

30

(e)   

require an application to be accompanied by a fee of an amount

prescribed by, or determined in accordance with, the regulations.

5       

Terms and conditions

(1)   

A licence may be granted on such terms and subject to such conditions as the

Secretary of State considers appropriate.

35

(2)   

The provisions of a licence may be expressed by reference to provision made

in a Crown lease, and, in particular, may provide—

(a)   

for the commencement of the licence to be conditional upon the

commencement of a Crown lease which has been or may be granted in

respect of the controlled place to which the licence relates or any part of

40

that place;

(b)   

for the period of the licence to be determined by reference to the period

of such a Crown lease.

 
 

Energy Bill
Part 1 — Gas Importation and Storage
Chapter 2 — Importation and storage of combustible gas

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(3)   

A licence may authorise, in such circumstances and subject to such conditions

as are specified, the transfer of the licence to another person (or the inclusion

of another person as a joint licence holder).

(4)   

The provisions of a licence may include—

(a)   

provision requiring the licence holder to obtain the prior written

5

consent of the Secretary of State or another person for specified acts or

omissions;

(b)   

provisions providing that any such consent may be given subject to

conditions.

(5)   

The conditions imposed on a consent by virtue of subsection (4)(b) may include

10

conditions requiring, or otherwise providing for, the modification of the

licence in such manner as the Secretary of State considers appropriate.

(6)   

In this section—

“Crown lease” has the same meaning as in section 3;

“specified”, in relation to a licence, means specified in, or determined in

15

accordance with, the licence.

6       

Model clauses

(1)   

The Secretary of State may make regulations prescribing model clauses for

licences.

(2)   

Subject to subsection (3), the model clauses, as they have effect at the time a

20

licence is granted, are deemed to be incorporated into the licence.

(3)   

The Secretary of State may decide to exclude or modify one or more of those

model clauses in the case of a particular licence.

Enforcement

7       

Offence to carry on unlicensed activities

25

(1)   

It is an offence for a person to carry on an activity within section 2(2) at a

controlled place unless, at the time the activity is carried on, that person—

(a)   

has a licence for the carrying on of that activity at that place, or

(b)   

is carrying on the activity on behalf of a person who has such a licence.

(2)   

It is an offence for a person to cause or permit another person to commit an

30

offence under subsection (1).

(3)   

A person guilty of an offence under this section is liable—

(a)   

on summary conviction, to a fine not exceeding the statutory

maximum, or

(b)   

on conviction on indictment, to a fine.

35

8       

Offences relating to licences

(1)   

An offence is committed by a licence holder if—

(a)   

a thing is done for which the licence specifies that the prior consent of

the Secretary of State or any other person is required, without that

consent first having been obtained;

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Energy Bill
Part 1 — Gas Importation and Storage
Chapter 2 — Importation and storage of combustible gas

5

 

(b)   

such a thing is done in circumstances where that consent was obtained

subject to conditions and those conditions have not been satisfied;

(c)   

the licence holder fails to keep records, give a notice or make a return

or report, in accordance with the provisions of the licence;

(d)   

the licence holder breaches any other provision of the licence which is

5

specified, or of a description specified, in an order made by the

Secretary of State.

(2)   

In proceedings against a person for an offence under subsection (1), it is a

defence for the person to prove that due diligence was exercised to avoid

committing the offence.

10

(3)   

It is an offence for a person to make a statement which the person knows to be

false, or recklessly to make a statement which is false, in order to obtain—

(a)   

a licence, or

(b)   

the consent of the Secretary of State or any other person for the

purposes of any requirement imposed by virtue of section 5(4).

15

(4)   

It is an offence for a person to fail to disclose information which the person

knows, or ought to know, to be relevant to an application for—

(a)   

a licence, or

(b)   

the consent of the Secretary of State or any other person for the

purposes of any requirement imposed by virtue of section 5(4).

20

(5)   

A person guilty of an offence under this section is liable—

(a)   

on summary conviction, to a fine not exceeding the statutory

maximum, or

(b)   

on conviction on indictment, to a fine.

9       

Secretary of State’s power of direction

25

(1)   

This section applies if a licence holder fails to comply with any provision of the

licence.

(2)   

The Secretary of State may direct the licence holder to take steps which the

Secretary of State considers necessary or appropriate to comply with the

provision within a period specified in the direction.

30

(3)   

The Secretary of State must consult the licence holder before giving a direction

under subsection (2).

(4)   

If the licence holder fails to comply with a direction under subsection (2), the

Secretary of State may—

(a)   

comply with the direction on behalf of the licence holder, or

35

(b)   

make arrangements for another person to do so.

(5)   

A person taking action by virtue of subsection (4) may—

(a)   

do anything which the licence holder could have done, and

(b)   

recover from the licence holder any reasonable costs incurred in taking

the action.

40

(6)   

A person (“P”) liable to pay any sum by virtue of subsection (5)(b) must also

pay interest on that sum for the period beginning with the day on which the

person taking action by virtue of subsection (4) notified P of the sum payable

and ending with the date of payment.

 
 

Energy Bill
Part 1 — Gas Importation and Storage
Chapter 2 — Importation and storage of combustible gas

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(7)   

The rate of interest payable in accordance with subsection (6) is a rate

determined by the Secretary of State as comparable with commercial rates.

(8)   

The licence holder must provide a person taking action by virtue of subsection

(4) with such assistance as the Secretary of State may direct.

(9)   

The power to give a direction under this section is without prejudice to any

5

provision made in the licence with regard to the enforcement of any of its

provisions.

10      

Failure to comply with a direction under section 9

(1)   

It is an offence for a person to fail to comply with a direction under section 9,

unless the person proves that due diligence was exercised in order to avoid the

10

failure.

(2)   

A person guilty of an offence under subsection (1) is liable—

(a)   

on summary conviction, to a fine not exceeding the statutory

maximum, or

(b)   

on conviction on indictment, to a fine.

15

11      

Injunctions restraining breaches of section 2(1)

(1)   

Where the Secretary of State considers it necessary or expedient to restrain any

actual or apprehended breach of section 2(1), the Secretary of State may apply

to the court for an injunction or, in Scotland, an interdict.

(2)   

An application may be made whether or not the Secretary of State has

20

exercised or is proposing to exercise any of the other powers under this

Chapter.

(3)   

On an application under subsection (1), the court may grant such an injunction

or interdict as the court thinks appropriate for the purpose of restraining the

breach.

25

(4)   

Rules of court may provide for an injunction or interdict to be issued against a

person whose identity is unknown.

(5)   

In this section “the court” means—

(a)   

the High Court, or

(b)   

in Scotland, the Court of Session.

30

12      

Inspectors

(1)   

The Secretary of State may appoint persons to act as inspectors to assist in

carrying out the functions of the Secretary of State under this Chapter.

(2)   

The Secretary of State may make payments, by way of remuneration or otherwise, to

inspectors appointed under this section.

35

(3)   

The Secretary of State may make regulations about—

(a)   

the powers and duties of inspectors appointed under this section;

(b)   

the powers and duties of any other person acting on the directions of

the Secretary of State in connection with a function under this Chapter;

(c)   

the facilities and assistance to be accorded to persons mentioned in

40

paragraph (a) or (b).

 
 

Energy Bill
Part 1 — Gas Importation and Storage
Chapter 2 — Importation and storage of combustible gas

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(4)   

The powers conferred by virtue of subsection (3) may include powers of a kind

specified in section 108(4) of the Environment Act 1995 (c. 25) (powers of entry,

investigation, etc).

(5)   

Any regulations under this section may provide for the creation of offences

which are punishable—

5

(a)   

on summary conviction by a fine not exceeding the statutory maximum

or such lesser amount as is specified in the regulations, and

(b)   

on conviction on indictment by a fine.

13      

Criminal proceedings

(1)   

Proceedings for a relevant offence may be taken, and the offence may for all

10

incidental purposes be treated as having been committed, in any place in the

United Kingdom.

(2)   

Section 3 of the Territorial Waters Jurisdiction Act 1878 (restriction on

prosecutions) does not apply to any proceedings for a relevant offence.

(3)   

Proceedings for a relevant offence alleged to have been committed in a

15

controlled place may not be instituted in England and Wales except—

(a)   

by the Secretary of State or a person authorised by the Secretary of

State, or

(b)   

by or with the consent of the Director of Public Prosecutions.

(4)   

Proceedings for a relevant offence alleged to have been committed in a

20

controlled place may not be instituted in Northern Ireland except—

(a)   

by the Secretary of State or a person authorised by the Secretary of

State, or

(b)   

by or with the consent of the Director of Public Prosecutions for

Northern Ireland.

25

(5)   

In the application of subsection (3) or (4) to an offence created by regulations

under section 12

(a)   

the words “alleged to have been committed in a controlled place” are to

be omitted, and

(b)   

the references to a person authorised by the Secretary of State are to be

30

read as references to an inspector appointed under that section.

(6)   

In this section “relevant offence” means an offence under this Chapter or

created by regulations under section 12.

Supplementary

14      

Interaction with the petroleum licensing requirements

35

(1)   

This section applies where there is a licence for the recovery of gas stored in a

controlled place.

(2)   

The Secretary of State may give a direction in respect of the place or any part

of it (“the relevant stratum”).

(3)   

The effect of the direction is that any operations under the licence to recover

40

gas from the relevant stratum are not to be regarded as resulting in the boring

for or getting of petroleum for the purposes of Part 1 of the Petroleum Act 1998

(c. 17).

 
 

 
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