Energy Bill

House of Commons

Session 2007 - 08
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Other Bills before Parliament

Energy Bill

Energy Bill
Part 6 — General
79

97
Short title
This Act may be cited as the Energy Act 2008.

80
Energy Bill
Schedule 1 — Amendments relating to Chapters 2 and 3 of Part 1

Schedules
Schedule 1
Section 35

Amendments relating to Chapters 2 and 3 of Part 1
Food and Environment Protection Act 1985 (c. 48)
1
The Food and Environment Protection Act 1985 is amended as follows.
5
2
In section 7A (regulation of deposits made in the sea: exclusion of certain oil
and gas activities)—
(a)
the existing provision becomes subsection (1), and
(b)
after that subsection insert—
“(2)
Nothing in this Part of this Act applies to anything done in
10
the course of carrying on an activity for which a licence under
section 3 or 17 of the Energy Act 2008 is required (gas
unloading, storage and recovery, and carbon dioxide
storage).
(3)
For this purpose, activities are to be regarded as activities for
15
which such a licence is required if, by virtue of such a licence,
they are activities which may be carried on only with the
consent of the Secretary of State or another person.
(4)
Subsection (2) does not apply in relation to anything done as
mentioned in that subsection in, under or over—
20
(a)
the territorial sea adjacent to Scotland, Wales or
Northern Ireland, or
(b)
waters in a Gas Importation and Storage Zone which
are United Kingdom controlled waters adjacent to
Scotland.”
25
3
In section 24 (interpretation)—
(a)
in subsection (1), after the definition of “Convention State” insert—
““Gas Importation and Storage Zone” has the meaning
given by section 1 of the Energy Act 2008;”, and
(b)
after subsection (2) insert—
30
“(2A)
An order or Order in Council made under or by virtue of
section 158(3) or (4) of the Government of Wales Act 2006
(apportionment of sea areas) has effect for the purposes of
Part 2 of this Act if, or to the extent that, the Order is
expressed to apply—
35
(a)
for the general or residual purposes of that Act, or
(b)
by virtue of this subsection, for the purposes of Part 2
of this Act.”

Energy Bill
Schedule 1 — Amendments relating to Chapters 2 and 3 of Part 1
81

Petroleum Act 1987 (c. 12)
4     (1)
Section 21 of the Petroleum Act 1987 (automatic establishment of safety
zones) is amended as follows.
      (2)
In subsection (2)—
(a)
after paragraph (a) insert—
5
“(aa)
the exploration of any place in, under or over such
waters with a view to the storage of gas in such a
place;
(ab)
the conversion of any place in, under or over such
waters for the purpose of storing gas;”,
10
(b)
in paragraph (b), for “in or under the shore or bed of” substitute “in,
under or over”,
(c)
after that paragraph insert—
“(ba)
the unloading of gas at any place in, under or over
such waters;”, and
15
(d)
in paragraph (d) for “paragraph (a), (b) or (c)” substitute “any of
paragraphs (a) to (c)”.
      (3)
After subsection (7) insert—
“(8)
In this section “gas” means gas within the meaning of section 2(3) of
the Energy Act 2008.”
20
Gas (Northern Ireland) Order 1996 (S.I. 1996/275 (N.I.2))
5
In Article 3(1) of the Gas (Northern Ireland) Order 1996 (interpretation of
provisions relating to gas supply and associated activities), in the definition
of “gas storage facility” after “any facility” insert “(other than a facility in,
under or over the territorial sea adjacent to Northern Ireland)”.
25
Petroleum Act 1998 (c. 17)
6
The Petroleum Act 1998 is amended as follows.
7
In section 11 (application of civil law)—
(a)
in subsection (1), after “Order in Council” insert “, subject to
subsection (4A)”,
30
(b)
in subsection (3), after paragraph (a) insert—
“(aa)
the exploration of any place in, under or over such
waters with a view to the storage of gas in such a
place;
(ab)
the conversion of any place in, under or over waters
35
to which this section applies for the purpose of
storing gas;”,
(c)
in paragraph (b) of that subsection, for “in or under the shore or bed
of” substitute “in, under or over”,
(d)
after that paragraph insert—
40
“(ba)
the unloading of gas at any place in, under or over
such waters;”,
(e)
in paragraph (d) of that subsection, for “paragraph (a), (b) or (c)”
substitute “any of paragraphs (a) to (c)”,

Energy Bill
Schedule 1 — Amendments relating to Chapters 2 and 3 of Part 1
82

(f)
after that subsection insert—
“(3A)
In subsection (3) references (in whatever form) to storing gas
include storing gas with a view to its permanent disposal.”,
(g)
after subsection (4) insert—
“(4A)
An Order in Council may not make provision under
5
subsection (1) in relation to questions arising out of acts or
omissions taking place in connection with any activity
carried on in, under or over relevant Scottish waters with a
view to, or in connection with, the storage of carbon dioxide.
(4B)
In subsection (4A)—
10
(a)
“relevant Scottish waters” means tidal waters, and
parts of the sea, in or adjacent to Scotland up to the
seaward limits of the territorial sea, and
(b)
references to the storage of carbon dioxide do not
include the use of carbon dioxide for a purpose
15
ancillary to getting petroleum (within the meaning of
section 1).”, and
(h)
after subsection (8) insert—
“(9)
In this section “gas” means—
(a)
gas within the meaning of section 2(3) of the Energy
20
Act 2008, or
(b)
carbon dioxide.”
8
In section 13 (interpretation of Part 2), after the existing provision (which
becomes subsection (1)) insert—
“(2)
An Order in Council under section 126(2) of the Scotland Act 1998
25
(apportionment of sea areas) has effect for the purposes of this Part
if, or to the extent that, the Order is expressed to apply—
(a)
for the general or residual purposes of that Act, or
(b)
by virtue of this subsection, for the purposes of this Part.”
9
In section 28 (interpretation of Part 3), in the definition of “gas”—
30
(a)
in paragraph (a), for “or carbon monoxide” substitute “, carbon
monoxide or a substance designated under paragraph (e) of the
definition of “gas” in section 2(3) of the Energy Act 2008”,
(b)
in paragraph (b) for “gases” substitute “substances”, and
(c)
in paragraph (c) for “gases” substitute “substances”.
35
10
In section 30 (persons who may be required to submit programmes)—
(a)
for subsection (5)(a) substitute—
“(a)
the person has the right—
(i)
to exploit or explore mineral resources in any
area,
40
(ii)
to unload, store or recover gas in any area or
to convert any natural feature in any area for
the purpose of storing gas, or
(iii)
to explore any area with a view to, or in
connection with, the exercise of a right within
45
sub-paragraph (i) or (ii), and”,

Energy Bill
Schedule 1 — Amendments relating to Chapters 2 and 3 of Part 1
83

(b)
in subsection (6), for paragraph (a) substitute—
“(a)
the exploitation or exploration of mineral resources in
the exercise of the right mentioned in subsection
(5)(a);
(aa)
the unloading, storage or recovery of gas in the
5
exercise of that right;
(ab)
the conversion, in the exercise of that right, of any
natural feature for the purpose of storing gas;
(ac)
the exploration in exercise of that right with a view to,
or in connection with, the exercise of a right within
10
subsection (5)(a)(ii);”, and
(c)
in paragraph (c) of that subsection, for “or (b)” substitute “to (b)”.
11
In section 44 (offshore installations)—
(a)
in subsection (3), after paragraph (a) insert—
“(aa)
the exploration of any place in, under or over relevant
15
waters with a view to the storage of gas in such an
place;
(ab)
the conversion of any place in, under or over relevant
waters for the purpose of storing gas;”,
(b)
in paragraph (b) of that subsection, for “in or under the shore or bed
20
of” substitute “in, under or over”,
(c)
after that paragraph insert—
“(ba)
the unloading of gas at any place in, under or over
relevant waters;”,
(d)
in paragraph (d) of that subsection, for “paragraph (a), (b) or (c)”
25
substitute “any of paragraphs (a) to (c)”, and
(e)
in subsection (5), after “section—” insert—
“ “gas” means gas within the meaning of section 2(3) of
the Energy Act 2008;”.
12
In section 47A (factors for the Secretary of State to take into account when
30
performing functions under the Petroleum Act 1998)—
(a)
in subsection (1), after paragraph (a) insert—
“(aa)
activities which are authorised by a licence under
Chapter 2 or 3 of Part 1 of the Energy Act 2008 (gas
importation and storage);”,
35
(b)
in paragraph (b) of that subsection for “such activities” substitute
“activities within paragraph (a) or (aa)”, and
(c)
after subsection (2) insert—
“(2A)
For the purposes of subsection (1)(aa), activities are to be
regarded as activities authorised by a licence under Chapter
40
2 or 3 of Part 1 of the Energy Act 2008 if, by virtue of such a
licence, they are activities which may be carried on only with
the consent of the Secretary of State or another person.”
Energy Act 2004 (c. 20)
13
In section 188 of the Energy Act 2004 (power to impose charges to fund
45
energy functions)—
(a)
in subsection (7), after paragraph (l) insert—
“(m)
Chapter 2 of Part 1 of the Energy Act 2008.”,

Energy Bill
Schedule 2 — Property schemes
84

(b)
in that subsection, after paragraph (m) (inserted by paragraph (a))
insert—
“(n)
Chapter 3 of Part 1 of the Energy Act 2008.”,
(c)
in subsection (8), after paragraph (d) insert—
“(da)
any activity for which a licence under Chapter 2 of
5
Part 1 of the Energy Act 2008 is required;”, and
(d)
in that subsection, after paragraph (da) (inserted by paragraph (c))
insert—
“(db)
any activity for which a licence under Chapter 3 of
Part 1 of the Energy Act 2008 is required;”.
10
Schedule 2
Section 40

Property schemes
“Schedule 2A
Section 6E.

property schemes
Scheme-making power
15
1     (1)
This paragraph applies where—
(a)
a tender exercise is held in relation to an offshore
transmission licence,
(b)
any transmission assets have been transferred to the
successful bidder or, for operational purposes, it is
20
necessary for any transmission assets to be so transferred,
and
(c)
those assets were not constructed or installed by the
successful bidder.
      (2)
The Authority may, on an application under paragraph 3, make a
25
scheme (“a property scheme”) providing for—
(a)
the transfer to the successful bidder of, or
(b)
the creation in favour of the successful bidder of rights in
relation to,

property, rights or liabilities.
30
      (3)
In sub-paragraph (1)—
(a)
“transmission assets” means the transmission system in
respect of which the offshore transmission licence is (or is
to be) granted or anything which forms part of that system,
and
35
(b)
the reference to the successful bidder in paragraph (c)
includes, if the successful bidder is a body corporate, a
reference to any body corporate which was associated with
the successful bidder at the time the transmission assets
were constructed or installed.
40
      (4)
Until such time as section 180 of the Energy Act 2004 (meaning of
“high voltage line”) comes into force, “transmission system” in

Energy Bill
Schedule 2 — Property schemes
85

sub-paragraph (3)(a) includes a system which, if that section were
in force, would be a transmission system.
Further provision about the content of a scheme
2     (1)
A property scheme may also contain—
(a)
provision for the creation, in relation to property which the
5
scheme transfers, of an interest in or right over the
property in favour of the asset owner;
(b)
provision for the creation of any rights or liabilities as
between the asset owner and the successful bidder;
(c)
provision for imposing on the asset owner or the
10
successful bidder an obligation to enter into a written
agreement with, or to execute an instrument of another
kind in favour of, the other;
(d)
provision requiring the successful bidder to pay the asset
owner compensation;
15
(e)
provision requiring the asset owner to pay the successful
bidder compensation;
(f)
supplemental, incidental and consequential provision.
      (2)
The property, rights and liabilities which may be transferred by a
property scheme include property, rights or liabilities which
20
would not otherwise be capable of being transferred.
      (3)
If a property scheme provides for the division of an estate or
interest in land and any rent is—
(a)
payable in respect of the estate or interest under a lease, or
(b)
charged on the estate or interest,
25

the scheme may contain provision for apportionment or division
so that one part is payable in respect of, or charged on, only one
part of the estate or interest and the other part is payable in respect
of, or charged on, only the other part of the estate or interest.
      (4)
A property scheme which contains provision which affects a third
30
party may also contain provision requiring the successful bidder
or the asset owner to pay the third party compensation.
Applications for schemes
3     (1)
An application for a property scheme may be made by—
(a)
the preferred bidder,
35
(b)
the successful bidder, or
(c)
a person who owns the property, rights and liabilities in
relation to which provision of a kind mentioned in
paragraph 1(2) is proposed to be included in the scheme.
      (2)
An application must specify—
40
(a)
the property, rights and liabilities in relation to which
provision of a kind mentioned in paragraph 1(2) is
proposed to be included in the scheme,
(b)
the name and address of the non-applicant party, and