Session 2010-11
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Energy Bill [HL]


FIFTH
MARSHALLED
LIST OF AMENDMENTS
TO BE MOVED
IN GRAND COMMITTEE

The amendments have been marshalled in accordance with the Instruction of 12th January 2011, as follows—

Clauses 66 to 68
Schedule 1
Clauses 69 to 85
Schedule 2
Clauses 86 to 102
Schedule 3
Clauses 103 to 105

[Amendments marked * are new or have been altered]

Clause 66

BARONESS SMITH OF BASILDON

LORD GRANTCHESTER

LORD DAVIES OF OLDHAM

30ZA

Page 48, line 14, at end insert—

“( ) to assess whether the person’s obligations under section 41B of the Electricity Act 1989 or section 33BC of the Gas Act 1986 are, in particular, being discharged transparently, cost-effectively and consistently throughout the duration of the obligations and achieving value for money; and

( ) to assess whether these obligations are consistently targeting priority groups and properties”

BARONESS NOAKES

Baroness Noakes gives notice of her intention to oppose the Question that Clause 66 stand part of the Bill.

After Clause 66

BARONESS NOAKES

30A

Insert the following new Clause—

“Annual report on cost of energy company obligations

(1) The Secretary of State must prepare a report each year containing an assessment of the costs transferred from energy suppliers to their customers in meeting obligations imposed under this Chapter.

(2) The first report under this section must be published no later than one year after this section comes into force and subsequent reports must be published no later than one year after the previous report.

(3) A report under this section must include—

(a) the tonnes of carbon saved as a result of energy suppliers meeting their obligations under this Chapter,

(b) the costs incurred by energy suppliers as a result of meeting their obligations under this Chapter,

(c) the costs passed through to energy bills of the customers of those energy suppliers analysed into each tariff offered by them, and

(d) such other information as the Secretary of State considers necessary in order to allow an understanding of how the costs and benefits of implementing this Chapter affect the customers of energy suppliers.

(4) “Energy supplier” means—

(a) gas transporters and gas suppliers, and

(b) electricity distributors and electricity suppliers.”

Clause 67

BARONESS NOAKES

BARONESS SMITH OF BASILDON

LORD GRANTCHESTER

LORD DAVIES OF OLDHAM

The above-named Lords give notice of their intention to oppose the Question that Clause 67 stand part of the Bill.

After Clause 67

BARONESS MADDOCK

LORD TEVERSON

31

Insert the following new Clause—

“Sustainable energy plans

(1) The purpose of this section is to facilitate the involvement of principal councils and of citizens resident in their areas in action taken to promote sustainable energy policies in order to help achieve the following objectives—

(a) the reduction of carbon emissions;

(b) the reduction of home heating costs;

(c) the security of energy supplies;

(d) the achievement of national fuel poverty targets.

(2) Every principal council may, and if the condition specified in subsection (3) is satisfied must, publish a sustainable energy plan (“a plan”) specifying the body’s contribution to achieving the objectives specified in subsection (1).

(3) The condition referred to in subsection (2) is that a petition requesting the publication of a plan, signed by at least 5% of electors in the area of the council, has been delivered to the council.

(4) The Secretary of State must, within 12 months of the passing of this Act, make regulations specifying the rules for the drawing up and presenting of petitions pursuant to this section.

(5) Without prejudice to the generality, a plan must specify the steps that the council proposes to take to promote, namely—

(a) energy efficiency in buildings;

(b) microgeneration;

(c) renewable energy;

(d) combined heat and power.

(6) A plan prepared by a council may—

(a) request such new functions as in the opinion of the council would enable it to make a greater contribution to achieving the objectives specified in subsection (1); and

(b) make a recommendation to the Secretary of State for a transfer of functions from another body to itself provided that no such recommendation may be made unless the council has consulted the person to whose functions it relates.

(7) Within six months of receiving any request pursuant to subsection (6)(a) or recommendation pursuant to subsection (6)(b), the Secretary of State must either—

(a) adopt and implement, or take the necessary steps to commence the process of implementation, or

(b) reject,

the request or recommendation and in either case shall give reasons for the decision.

(8) Where any functions are conferred or transferred pursuant to this section, the Secretary of State shall ensure that the monies necessary for the discharge of those functions are provided or transferred.

(9) Any principal council on which functions are conferred or to which functions are transferred under this section must determine how the functions are then performed.

(10) Where the Secretary of State is spending money in an area covered by a plan in order to achieve any of the objectives specified in subsection (1), and in the Minister’s opinion—

(a) any measure contained in a plan is a more efficient way of achieving the Minister’s objectives; and

(b) offers better value,

then the Minister shall provide resources for the principal council to implement those measures in its plan.

(11) Before drawing up a plan pursuant to this section, a principal council must—

(a) consult such persons in its area as in its opinion will have an interest in the plan;

(b) establish a panel of representatives of local persons;

(c) consult and try to reach agreement with the panel about the content of the plan.

(12) A panel set up pursuant to this section must include representatives of parish councils in the council’s areas.

(13) A principal council shall select the representatives of parish councils to be members of the panel, unless parish councils nominate or otherwise select members to serve on the panel within 6 months of its establishment.

(14) In this section—

“fuel poverty” shall be construed in accordance with the provisions of section 1 of the Warm Homes and Energy Conservation Act 2000;

“principal council” means a county borough council, a district council, a metropolitan district council or a London Borough Council;

“microgeneration” has the same meaning given by section 26 of the Climate Change and Sustainable Energy Act 2006.”

32

Insert the following new Clause—

“Promotion of reduction of home heating costs: reduced VAT rate

(1) For the purpose of enabling consumers to purchase energy efficient products in order to reduce home heating costs and carbon emissions, the Chancellor of the Exchequer must within 12 months of the coming into force of this section lay before Parliament an order to reduce the rate of VAT to 5% on—

(a) passive flue gas heat recovery systems; and

(b) energy efficient windows in specified premises.

(2) An order pursuant to this section shall be made by statutory instrument subject to the negative resolution procedure.

(3) In this section—

“passive flue gas heat recovery systems” means technology that can use the waste heat from condensing boilers in order to heat water;

“low emissivity glass” has the same meaning as in Part L of the Building Regulations.”

After Clause 68

LORD DEBEN

32A

Insert the following new Clause—

“Local carbon budgets

(1) The Secretary of State shall introduce a system of local carbon budgets, consistent with meeting national Climate Change Act carbon budgets, requiring all councils to—

(a) develop a strategy for cutting CO2 emissions across their local area to meet their local carbon budget; and

(b) work in partnership with local residents, businesses and stakeholders including schools and hospitals in drawing up and carrying out the strategy.

(2) The Secretary of State may determine circumstances in which two or more councils may develop a joint strategy for cutting CO2 in their areas.

(3) The Secretary of State shall introduce the local carbon budget system to begin at the start of the second national carbon budget period.”

Schedule 1

BARONESS NOAKES

Baroness Noakes gives notice of her intention to oppose the Question that Schedule 1 be the First Schedule to the Bill.

Clause 69

LORD WHITTY

32B

Page 50, line 26, at end insert—

“( ) In subsection (2), after paragraph (a), insert—

“(aa) requiring the holder of a licence to—

(i) abstain from any sales activities while they provide or install, or facilitate the provision, installation or operation of, meters of a particular kind;

(ii) only supply marketing material in written form while they provide or install, or facilitate the provision, installation or operation of, meters of a particular kind;

(iii) supply independently written information outlining how to use the smart meter while they provide or install, or facilitate the provision, installation or operation of, meters of a particular kind”.”

LORD WHITTY

BARONESS SMITH OF BASILDON

LORD GRANTCHESTER

LORD DAVIES OF OLDHAM

32C

Page 50, line 26, at end insert—

“( ) In subsection (2), after paragraph (b), insert—

“(c) requiring the holder of a licence to suspend the provision, instalment, or the facilitation of the provision, installation, or operation of meters of a particular kind if—

(i) the smart metering cannot support the switching of a consumer from a credit-based payment method to prepayment and vice versa; or

(ii) the smart metering system cannot support the switching of a consumer from one supply licence holder to another.””

After Clause 69

LORD TEVERSON

BARONESS PARMINTER

33

Insert the following new Clause—

“Energy tariffs

Energy tariffs

(1) After consultation with electricity and gas retail sellers, and consumer groups, the Secretary of State shall introduce regulations that make it mandatory for electricity and gas through pipeline supply companies supplying to domestic properties to configure their tariffs so that the initial units of energy supplied are at a lower cost to the consumer than remaining units.

(2) The principles of the scheme shall be—

(a) that the number of lower priced initial units shall represent the average amount of energy required for a household of that size to keep warm, clean and fed to a modest but acceptable standard;

(b) the tariff price for the initial units shall be equal to the medium term marginal cost of the production of that energy;

(c) overall, the new combined tariff should be revenue neutral to the energy supply companies.

(3) The scheme and its tariffs will be assessed and audited by the Office of the Gas and Electricity Markets, who will also be responsible for the capture, analysis, and reporting of all information to the Secretary of State regarding the implementation and management of the scheme.”

Clause 70

BARONESS SMITH OF BASILDON

LORD GRANTCHESTER

LORD DAVIES OF OLDHAM

33ZA

Page 51, line 15, at end insert—

“( ) requiring the disclosure of sufficient information to enable green deal participants, improvers and bill payers to decide what measures may be appropriate for a property”

LORD JENKIN OF RODING

33A

Page 51, line 25, leave out paragraph (e)

BARONESS NOAKES

33B

Page 51, line 39, after “section” insert “other than subsection (2)(e)”

33C

Page 51, line 40, at end insert—

“( ) A statutory instrument containing regulations under subsection (2)(e) may not be made unless a draft of the instrument has been laid before, and approved by a resolution of, each House of Parliament.”

Clause 72

LORD WHITTY

BARONESS SMITH OF BASILDON

LORD GRANTCHESTER

LORD DAVIES OF OLDHAM

33D

Page 53, line 5, at end insert—

“( ) The information to be provided about a tariff by virtue of subsection (2) with regards to the amount of the tariff must be guaranteed not to change for a period of 12 weeks.”

After Clause 74

BARONESS MADDOCK

LORD TEVERSON

34

Insert the following new Clause—

“Cost benefit assessment of energy saving and energy generating

(1) The Secretary of State must within 12 months of the passing of this Act publish an assessment (“the assessment”) of the costs and benefits of saving energy compared with those of generating energy.

(2) In this section saving energy includes measures to—

(a) reduce demand for energy;

(b) conserve energy; and

(c) use energy more efficiently.

(3) Before publishing the assessment, the Secretary of State must consult—

(a) such bodies as in the Secretary of State’s opinion represent—

(i) the energy efficiency industry;

(ii) the energy generating industry; and

(iii) environmental interests; and

(b) such other persons as considered appropriate.

(4) The Secretary of State must take into account the assessment when making any estimates, projections or policies regarding the amount of energy that is required to be generated in order to satisfy the needs of the United Kingdom.”

Clause 77

LORD JENKIN OF RODING

34A

Page 57, line 33, at end insert—

“36D Strengthening the Authority’s powers with regard to Public Service Obligations on suppliers

The Authority may modify the arrangements contained in Gas Licence Agreements to impose further obligations in the PSO requirements, as follows—

(a) the Authority may modify the gas storage Public Service Obligation for gas suppliers in the United Kingdom;

(b) the Authority may set new industrial and commercial PSOs on suppliers requiring suppliers to meet the mandated levels of gas storage as set by the Authority;

(c) the Authority shall publish gas storage targets annually and may monitor supply licence holders’ compliance with such obligations.”

Clause 78

BARONESS SMITH OF BASILDON

LORD GRANTCHESTER

LORD DAVIES OF OLDHAM

The above-named Lords give notice of their intention to oppose the Question that Clause 78 stand part of the Bill.

Clause 90

LORD JENKIN OF RODING

34B

Page 70, line 43, at end insert—

“( ) In the application of section 157(2), insert “or” at the end of paragraph (a) and omit paragraph (b).”

After Clause 97

LORD TEVERSON

LORD OXBURGH

35

Insert the following new Clause—

“Geothermal power

(1) Within eighteen months of this Act coming into force, the Secretary of State shall, after a period of consultation with industry, geological experts, the devolved administrations, local authorities, energy producers and other interested parties, put into place for the United Kingdom a licensing system and regulations for the exploitation of heat from deep geothermal sources for both the direct use of that heat and for the generation of electricity.

(2) The licences shall relate to—

(a) individual geographically delineated areas on land;

(b) the heat held by rocks greater than one kilometre below the surface.

(3) Licences shall give exclusive exploration and production rights for the purpose of energy production from geothermal sources, both direct heat and electricity generation, to the licensee, for that area, and for a specific period of time.

(4) The Secretary of State shall lay down regulations for the method of allocation of licences to those organisations wishing to explore or exploit those resources, or both.

(5) The Secretary of State shall undertake the first round of allocations within six months of the licensing regulations under subsection (1) being approved.

(6) Any organisation already undertaking exploration or exploitation from geothermal sources within the United Kingdom, in that they have already undertaken, at the time the licensing regime comes into force, boring for the purpose of exploiting geothermal heat to below one kilometre, shall be entitled to hold the first licence awarded for that licence area, and any licence fee or other consideration for that licence area as a part of the licencing regime will then be determined by arbitration under rules determined by the Secretary of State reflecting the fees or other consideration paid for licences deemed to have similar potential.

(7) The holding of a licence for the exploration or exploitation of deep geothermal heat, or both, shall not convey any automatic rights in terms of planning permissions for surface development, or give any rights in terms of surface access.”

After Clause 98

LORD WHITTY

36

Insert the following new Clause—

“Secretary of State not to grant petroleum licence incompatible with offshore renewable energy site

(1) In this section, “offshore renewable energy site” means a site in United Kingdom territorial waters or the REZ which is developed or operated, or is intended to be developed or operated, for—

(a) generating electricity from wind, wave or tidal energy, or

(b) transmitting electricity generated in that way,

in respect of which the Crown Estates have granted a lease, licence, agreement to lease or agreement to license for that purpose.

(2) The Secretary of State may not grant a licence under section 3 of the Petroleum Act 1998 (licence to search and bore for and get petroleum) to the extent that the licence would permit an activity within an offshore renewable energy site, unless the person entitled to the benefit of the lease, licence or agreement in respect of that site so agrees in writing to the grant.”

After Clause 99

LORD JUDD

BARONESS SMITH OF BASILDON

LORD GRANTCHESTER

LORD GREAVES

37

Insert the following new Clause—

“Bodies able to produce and supply renewable energy

Production and supply of renewable energy by National Park authorities and the Broads Authority

(1) Section 11 of the Local Government (Miscellaneous Provisions) Act 1976 (production and supply of heat etc. by local authorities) is amended as follows.

(2) After subsection (1) insert—

“(1A) In subsection (1) the definition of “a local authority” shall be understood to include the Broads Authority and National Park authorities when applied to subsection (1)(a), (b) and (d) (production of heat or electricity or both; establishment and operation of generating stations for production of heat or electricity or both; and use or sale of heat or electricity).”

(3) In subection (3), after “a local authority” insert “including the Broads Authority and National Park authorities”.”

After Clause 101

LORD LEA OF CRONDALL

37A

Insert the following new Clause—

“PART 4A Energy revenues and taxes: price effects

Statement on energy revenues, taxes and subsidies

(1) The Treasury shall publish an annual financial statement of all fiscal instruments, including revenues, tax expenditures and subsidies, currently in force which relate to the supply of energy, and the quantum of money generated or provided by each of them.

(2) The statement shall also list any relevant regulations relating to those fiscal instruments.

(3) The Treasury shall also publish, along with the statement, an assessment of the degree to which each fiscal instrument differentially affects consumers with different levels of income.

(4) The statement published under subsection (1) must assess the effect of any revenue, expenditure or subsidy on the Energy component of the Retail Prices Index, and must specify what effect those fiscal instruments have distinct from other impacts on the energy component.”

37B

Insert the following new Clause—

“Energy Industry and Consumer Impact Forum

(1) The Secretary of State shall, within six months of this Act coming into force, establish an Energy Industrial and Consumer Impact Forum.

(2) The Forum shall consider the statement and assessment published under section (Statement on energy revenues, taxes and subsidies) and report on the economic and social impacts, including any regressive effects, of the fiscal instruments.

(3) If, in its report under subsection (2), the Forum identifies any regressive effects of any of the fiscal instruments on the Retail Price Index, the Treasury must publish a report laying out possible options to reduce that effect.

(4) For the purposes of subsection (3), the Treasury shall treat the quantum defined in section (Statement on energy revenues, taxes and subsidies)(1) as hypothecated for the purpose of considering possible options to reduce any regressive effects.

(5) Every six months following its establishment, the Forum shall produce a report for the Secretary of State, in relation to each carbon budgetary period specified under the Climate Change Act 2008, assessing the impact of each of the financial instruments listed in section (Statement on energy revenues, taxes and subsidies)(1) on each sector of the economy, including—

(a) manufacturing and services;

(b) public and private transport, including—

(i) road travel (by bus and private vehicles),

(ii) rail and air travel (both personal and freight);

(c) home and industrial heating.

(6) The Treasury shall publish a response to the Forum’s report within two months of receiving it.”

Clause 105

BARONESS SMITH OF BASILDON

LORD GRANTCHESTER

LORD DAVIES OF OLDHAM

38

Page 79, line 2, after “Energy” insert “Framework”