Law

Energy Act 2023

United Kingdom · statute

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In force since 2026-09-30, as the publisher states.

Copy read on 2026-11-08. The page it was read from

Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.

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Contents: 352 provisions
  1. Title and introductory text
  2. 1 Principal objectives and general duties of Secretary of State and economic regulator
  3. 2 Prohibition on unlicensed activities
  4. 3 Consultation on proposals for additional activities to become licensable
  5. 4 Territorial scope of prohibition
  6. 5 Exemption from prohibition
  7. 6 Revocation or withdrawal of exemption
  8. 7 Power to grant licences
  9. 8 Power to create licence types
  10. 9 Procedure for licence applications
  11. 10 Competitive tenders for licences
  12. 11 Conditions of licences: general
  13. 12 Standard conditions of licences
  14. 13 Modification of conditions of licences
  15. 14 Modification of conditions under section 13: supplementary
  16. 15 Modification by order under other enactments
  17. 16 Interim power of Secretary of State to grant licences
  18. 17 Termination of licence
  19. 18 Transfer of licences
  20. 19 Consenting to transfer
  21. 20 Appeal to the CMA
  22. 21 Procedure on appeal to CMA
  23. 22 Determination by CMA of appeal
  24. 23 CMA’s powers on allowing appeal
  25. 24 Time limits for CMA to determine an appeal
  26. 25 Determination of appeal by CMA: supplementary
  27. 26 Provision of information to or by the economic regulator
  28. 27 Power of Secretary of State to require information
  29. 28 Monitoring, information gathering etc
  30. 29 Power to require information for purposes of monitoring
  31. 30 Duty to carry out impact assessment
  32. 31 Reasons for decisions
  33. 32 Enforcement of obligations of licence holders
  34. 33 Making of false statements etc
  35. 34 Liability of officers of entities
  36. 35 Criminal proceedings
  37. 36 Functions under the Enterprise Act 2002
  38. 37 Functions under the Competition Act 1998
  39. 38 Sections 36 and 37: supplementary
  40. 39 Forward work programmes
  41. 40 Information in relation to CCUS strategy and policy statement
  42. 41 Annual report on transport and storage licensing functions
  43. 42 Transport and storage administration orders
  44. 43 Objective of a transport and storage administration
  45. 44 Application of certain provisions of the Energy Act 2004
  46. 45 Conduct of administration, transfer schemes etc
  47. 46 Modification of conditions of licences
  48. 47 Modification under the Enterprise Act 2002
  49. 48 Power to make further modifications of insolvency legislation
  50. 49 Interpretation of Chapter 4
  51. 50 Transfer schemes
  52. 51 Consultation in relation to transfers
  53. 52 Conduct of transfer schemes
  54. 53 Cooperation of storage licensing authority with economic regulator
  55. 54 Amendments related to Part 1
  56. 55 Interpretation of Part 1
  57. 56 Chapter 1: interpretation
  58. 57 Revenue support contracts
  59. 58 Duties of revenue support counterparty
  60. 59 Designation of carbon dioxide transport and storage counterparty
  61. 60 Direction to offer to contract with licence holder
  62. 61 Designation of hydrogen transport counterparty
  63. 62 Direction to offer to contract with eligible hydrogen transport provider
  64. 63 Designation of hydrogen storage counterparty
  65. 64 Direction to offer to contract with eligible hydrogen storage provider
  66. 65 Designation of hydrogen production counterparty
  67. 66 Direction to offer to contract with eligible low carbon hydrogen producer
  68. 67 Designation of carbon capture counterparty
  69. 68 Direction to offer to contract with eligible carbon capture entity
  70. 69 Appointment of hydrogen levy administrator
  71. 70 Obligations of relevant market participants
  72. 71 Payments to relevant market participants
  73. 72 Functions of hydrogen levy administrator
  74. 73 Power to appoint allocation bodies
  75. 74 Standard terms of revenue support contracts
  76. 75 Allocation notifications
  77. 76 Allocation of contracts
  78. 77 Duty to offer to contract following allocation
  79. 78 Modification of standard terms
  80. 79 Sections 75 to 78: supplementary
  81. 80 Licence conditions regarding functions of certain allocation bodies
  82. 81 Further provision about designations
  83. 82 Application of sums held by a revenue support counterparty
  84. 83 Information and advice
  85. 84 Enforcement
  86. 85 Consultation
  87. 86 Transfer schemes
  88. 87 Modification of transfer schemes
  89. 88 Shadow directors, etc
  90. 89 Modifications of licences etc for purposes related to levy obligations
  91. 90 Electricity system operator and gas system planner licences: modifications
  92. 91 Sections 89 and 90: supplementary
  93. 92 Financing of costs of decommissioning etc
  94. 93 Section 92: supplementary
  95. 94 Regulations under section 92(1): procedure with devolved authorities
  96. 95 Provisions relating to Part 4 of the Petroleum Act 1998
  97. 96 Change of use relief: installations
  98. 97 Change of use relief: carbon storage network pipelines
  99. 98 Change of use relief: supplementary
  100. 99 Designation of strategy and policy statement
  101. 100 Duties with regard to considerations in the statement
  102. 101 Review
  103. 102 Procedural requirements
  104. 103 Specified provisions in carbon dioxide storage licences
  105. 104 Content of storage permits under carbon dioxide storage licences
  106. 105 Offences relating to carbon dioxide storage licences
  107. 106 Power of OGA to require information about change in control of licence holder
  108. 107 Chapter 5: key definitions
  109. 108 Retention of information and samples
  110. 109 Preparation and agreement of information and samples plans
  111. 110 Information and samples plans: supplementary
  112. 111 Information and samples coordinators
  113. 112 Power of OGA to require information and samples
  114. 113 Prohibition on disclosure of information or samples by OGA
  115. 114 Power of Secretary of State to require information and samples
  116. 115 Power of OGA to give sanction notices
  117. 116 Enforcement notices
  118. 117 Financial penalty notices
  119. 118 Revocation notices
  120. 119 Operator removal notices
  121. 120 Duty of OGA to give sanction warning notices
  122. 121 Publication of details of sanctions
  123. 122 Subsequent sanction notices
  124. 123 Withdrawal of sanction notices
  125. 124 Sanctions: information powers
  126. 125 Appeals
  127. 126 Procedure for enforcement decisions
  128. 127 Interpretation of Chapter 5
  129. 128 Access to infrastructure
  130. 129 Financial assistance
  131. 130 Key definitions for Part 3
  132. 131 Designation
  133. 132 Designation: procedure
  134. 133 Revocation of designation
  135. 134 Grant, extension or restriction of gas transporter licence by Secretary of State
  136. 135 Applications for grant etc of gas transporter licence
  137. 136 Modification of gas transporter licence by Secretary of State
  138. 137 Scope of modification powers under section 136
  139. 138 Procedure etc relating to modifications under section 136
  140. 139 Information and advice
  141. 140 Conditions of gas transporter licences for conveyance of hydrogen
  142. 141 Secretary of State directions to the GEMA
  143. 142 Repeal of Part 3
  144. 143 Low-carbon heat schemes
  145. 144 Application of scheme
  146. 145 Setting of targets etc
  147. 146 Further provision about scheme regulations
  148. 147 Administration of scheme
  149. 148 Enforcement, penalties and offences
  150. 149 Application of sums paid by virtue of section 146(4) or 148(3)
  151. 150 Appeals
  152. 151 Scheme regulations: procedure etc
  153. 152 Interpretation of Chapter 1
  154. 153 Modifications of the gas code
  155. 154 Regulations for protection of consumers
  156. 155 Power to modify Gas Act 1986 in relation to hydrogen
  157. 156 Fusion energy facilities: nuclear site licence not required
  158. 157 Treatment of recycled carbon fuel and nuclear-derived fuel as renewable transport fuel
  159. 158 Revenue certainty scheme for sustainable aviation fuel producers: consultation and report
  160. 159 Renewable liquid heating fuel obligations
  161. 160 Climate Change Act 2008: meaning of “UK removals”
  162. 161 The Independent System Operator and Planner (“the ISOP”)
  163. 162 Designation etc
  164. 163 Duty to promote particular objectives
  165. 164 Duty to have regard to particular matters
  166. 165 Duty to have regard to strategy and policy statement
  167. 165A Functions relating to network connections: duty to have regard to designated plans
  168. 166 Licensing of electricity system operator activity
  169. 167 Direction for transmission licence to have effect as electricity system operator licence
  170. 168 Licensing of gas system planning activity
  171. 169 Modification of licences etc
  172. 170 Procedure relating to modifications under section 169
  173. 171 Provision of advice, analysis or information
  174. 172 Power to require information from regulated persons etc
  175. 173 Duty to keep developments in energy sector under review
  176. 174 Transfers
  177. 175 Pension arrangements
  178. 176 Financial assistance for the ISOP
  179. 177 Cross-sectoral funding
  180. 178 Principal objective and general duties of Secretary of State and GEMA under Part 5
  181. 179 Minor and consequential amendments
  182. 180 Interpretation of Part 5
  183. 181 Regulations under Part 5
  184. 182 Designation of codes etc
  185. 183 Meaning of “code manager” and “code manager licence”
  186. 184 Designation of central systems
  187. 185 Licence under Gas Act 1986 for performance of code management function
  188. 186 Licence under Electricity Act 1989 for performance of code management function
  189. 187 Selection of code manager
  190. 188 Selection on a non-competitive basis
  191. 189 Selection on a competitive basis
  192. 190 Strategic direction statement
  193. 191 Transfer of functions under section 190 to Independent System Operator and Planner
  194. 192 Modification of designated documents by GEMA
  195. 193 Modification under section 192
  196. 194 Directions relating to designated central systems
  197. 195 Directions under section 194
  198. 196 Principal objective and general duties of Secretary of State and GEMA under Part 6
  199. 197 GEMA’s annual report to cover matters relating to designated documents
  200. 198 Regulations under Part 6
  201. 199 Interpretation of Part 6
  202. 200 Transitional provision and pension arrangements
  203. 201 Minor and consequential amendments
  204. 202 Principal objectives of Secretary of State and GEMA
  205. 203 Competitive tenders for electricity projects
  206. 204 Mergers of energy network enterprises
  207. 209 Power to make consequential etc provision
  208. 211 Electricity support payments for energy-intensive industries
  209. 212 Levy to fund electricity support payments
  210. 213 Electricity storage
  211. 214 Payment as alternative to complying with certain energy company obligations
  212. 215 Smart meters: extension of time for exercise of powers
  213. 216 Relevant heat network
  214. 217 The Regulator
  215. 218 Alternative dispute resolution for consumer disputes
  216. 219 Heat networks regulations
  217. 220 Regulations made by Secretary of State: consultation with devolved authorities
  218. 221 Heat networks regulations: other provision about procedure
  219. 222 Recovery of costs by GEMA and NIAUR
  220. 223 Heat networks: licensing authority in Scotland
  221. 224 Heat networks: enforcement in Scotland
  222. 225 Interpretation of Chapter 1
  223. 226 Regulations about heat network zones
  224. 227 Heat Network Zones Authority
  225. 228 Zone coordinators
  226. 229 Identification, designation and review of zones
  227. 230 Zoning methodology
  228. 231 Requests for information in connection with section 229 or 230
  229. 232 Heat networks within zones
  230. 233 Delivery of district heat networks within zones
  231. 234 Enforcement of heat network zone requirements
  232. 235 Penalties
  233. 236 Records, information and reporting
  234. 237 Interpretation of Chapter 2
  235. 238 Energy smart appliances and load control
  236. 239 Energy smart regulations
  237. 240 Prohibitions and requirements: supplemental
  238. 241 Enforcement
  239. 242 Sanctions, offences and recovery of costs
  240. 243 Appeals against enforcement action
  241. 244 Regulations: procedure and supplemental
  242. 245 Power to amend licence conditions etc: load control
  243. 246 Power to amend licence conditions etc: procedure
  244. 247 Load control: supplemental
  245. 248 Application of general duties to functions relating to load control
  246. 249 Licensing of activities relating to load control
  247. 250 Power to make energy performance regulations
  248. 251 Energy performance regulations relating to new premises
  249. 252 Sanctions
  250. 253 Regulations under Part 10
  251. 254 Energy savings opportunity schemes
  252. 255 Application of energy savings opportunity schemes
  253. 256 Requirement for assessment of energy consumption
  254. 257 Assessors
  255. 258 ESOS action plans
  256. 259 Action to achieve energy savings or emissions reductions
  257. 260 Scheme administration
  258. 261 Enforcement, penalties and offences
  259. 262 Appeals
  260. 263 ESOS regulations: procedure etc
  261. 264 Directions to scheme administrators
  262. 265 Financial assistance to scheme administrators and participants
  263. 266 Interpretation of Part 11
  264. 267 General objective
  265. 268 “Core fuel sector activity” and other key concepts
  266. 269 Directions to particular core fuel sector participants
  267. 270 Procedure for giving directions
  268. 271 Offence of failure to comply with a direction
  269. 272 Corresponding powers to make regulations
  270. 273 Power to require information
  271. 274 Duty to report incidents
  272. 275 Contravention of requirement under section 273 or 274
  273. 276 Provision of information at specified intervals
  274. 277 Disclosure of information held by the Secretary of State
  275. 278 Disclosure of information by HMRC
  276. 279 Appeal against notice or direction
  277. 280 False statements etc
  278. 281 Offences under regulations
  279. 282 Proceedings for offences
  280. 283 Liability of officers of entities
  281. 284 Enforcement undertakings
  282. 285 Guidance: criminal and civil sanctions
  283. 286 Guidance: Parliamentary scrutiny
  284. 287 Financial assistance for resilience and continuity purposes
  285. 288 Power to amend thresholds
  286. 289 Interpretation of Part 12
  287. 290 Meaning of “relevant offshore wind activity”
  288. 291 Strategic compensation for adverse environmental effects
  289. 292 Marine recovery fund
  290. 293 Assessment of environmental effects etc
  291. 294 Regulations under section 293: consultation and procedure
  292. 295 Interpretation of Chapter 1
  293. 296 Arrangements for responding to marine oil pollution
  294. 297 Habitats: reducing effects of offshore oil or gas activities etc
  295. 298 Regulations under sections 296 and 297: procedure with devolved authorities
  296. 299 Charges in connection with abandonment of offshore installations
  297. 300 Model clauses of petroleum licences
  298. 301 Power of OGA to require information about change in control of licensee
  299. 302 Application to the territorial sea of requirement for nuclear site licence
  300. 304 Excluded disposal sites
  301. 305 Accession to Convention on Supplementary Compensation for Nuclear Damage
  302. 306 Power to implement Convention on Supplementary Compensation for Nuclear Damage
  303. 307 Provision of additional police services
  304. 308 Provision of assistance to other forces
  305. 309 Cross-border enforcement powers
  306. 310 Publication of three-year strategy plan
  307. 311 Civil nuclear industry: amendment of relevant nuclear pension schemes
  308. 312 Meaning of “relevant nuclear pension scheme”
  309. 313 Information
  310. 314 Further definitions
  311. 315 Application of relevant pensions legislation
  312. 316 Procedure for regulations under Chapter 3
  313. 317 Great British Nuclear
  314. 318 Crown status
  315. 319 Great British Nuclear’s objects
  316. 320 Financial assistance
  317. 321 Secretary of State directions and guidance
  318. 322 Annual report
  319. 323 Annual accounts
  320. 324 Transfer schemes
  321. 325 Transfer schemes: compensation
  322. 326 Transfer schemes: taxation
  323. 327 Transfer schemes: provision of information or assistance
  324. 328 Reimbursement and compensation in connection with designation
  325. 329 Pension arrangements in connection with Great British Nuclear
  326. 330 Power to make consequential provision
  327. 331 Regulations
  328. 332 General definitions
  329. 333 Extent
  330. 334 Commencement
  331. 335 Short title
  332. Schedule 1 Interim power of Secretary of State to grant licences
  333. Schedule 2 Procedure for appeals under section 20
  334. Schedule 3 Enforcement of obligations of licence holders
  335. Schedule 4 Transfer schemes
  336. Schedule 5 Amendments related to Part 1
  337. Schedule 6 Carbon dioxide storage licences: licence provisions
  338. Schedule 7 Permitted disclosures of material obtained by OGA
  339. Schedule 8 Carbon storage information and samples: appeals
  340. Schedule 9 Independent System Operator and Planner: transfers
  341. Schedule 10 Independent System Operator and Planner: pensions
  342. Schedule 11 Minor and consequential amendments relating to Part 5
  343. Schedule 12 Governance of gas and electricity industry codes: transitional provision
  344. Schedule 13 Governance of gas and electricity industry codes: pensions
  345. Schedule 14 Minor and consequential amendments relating to Part 6
  346. Schedule 15 Competitive tenders for electricity projects
  347. Schedule 16 Mergers of energy network enterprises
  348. Schedule 18 Heat networks regulation
  349. Schedule 19 Licensing of activities relating to load control
  350. Schedule 20 Enforcement undertakings
  351. Schedule 21 Petroleum licences: amendments to model clauses
  352. Schedule 22 Accession to Convention on Supplementary Compensation for Nuclear Damage

Proposed changes to this act

No one has proposed a change to this act yet.

352 provisions

120 Duty of OGA to give sanction warning notices

(1) This section applies where the OGA proposes to give a sanction notice in respect of a failure to comply with a sanctionable requirement. (2) The OGA must give a sanction warning notice in respect of the sanctionable requirement to— (a) the person or persons to whom it proposes to give a sanction notice, and (b) where it proposes to give an operator removal notice, the relevant licensee (see section 119(2)(c)). (3) A sanction warning notice, in respect of a sanctionable requirement, is a notice which— (a) specifies the sanctionable requirement, (b) informs the person or persons to whom it is given that the OGA proposes to give a sanction notice in respect of a failure to comply with the requirement, (c) gives details of the failure to comply with the sanctionable requirement, and (d) informs the person or persons to whom it is given that the person or persons may, within the period specified in the notice (“the representations period”), make representations to the OGA in relation to the matters dealt with in the notice. (4) The representations period must be such period as the OGA considers appropriate in the circumstances. (5) Subsections (6) and (7) apply where the OGA gives a sanction warning notice to a person or persons in respect of a sanctionable requirement. (6) The OGA must not give a sanction notice to the person or persons in respect of a failure to comply with the requirement until after the end of the representations period specified in the sanction warning notice. (7) Having regard to representations made during the representations period specified in the sanction warning notice, the OGA may decide— (a) to give the person or persons a sanction notice in respect of the failure to comply with the requirement detailed in the sanction warning notice under subsection (3)(c), (b) to give the person or persons a sanction notice in respect of a failure to comply with the requirement which differs from the failure detailed in the sanction warning notice under subsection (3)(c), or (c) not to give the person or persons a sanction notice in respect of a failure to comply with the requirement.

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121 Publication of details of sanctions

(1) The OGA may publish details of any sanction notice given in accordance with this Chapter. (2) But the OGA may not publish anything that, in its opinion— (a) is commercially sensitive, (b) is not in the public interest to publish, or (c) is otherwise not appropriate for publication. (3) If, after details of a sanction notice are published by the OGA, the sanction notice is— (a) cancelled on appeal, or (b) withdrawn under section 123, the OGA must publish details of the cancellation or withdrawal.

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122 Subsequent sanction notices

(1) This section applies where the OGA gives a sanction notice in respect of a particular failure to comply with a sanctionable requirement (whether the notice is given alone or at the same time as another type of sanction notice). (2) If the sanction notice given is a revocation notice or an operator removal notice, no further sanction notices may be given in respect of the failure to comply. (3) If the sanction notice given is a financial penalty notice which does not require compliance with the sanctionable requirement, no further sanction notices may be given in respect of the failure to comply. (4) Subsection (5) applies if the sanction notice given is— (a) an enforcement notice, or (b) a financial penalty notice which requires compliance with the sanctionable requirement. (5) No further sanction notices may be given in respect of the failure to comply before the end of the period specified under section 116(1)(c) or 117(1)(c)(i), as the case may be (period for compliance with sanctionable requirement).

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123 Withdrawal of sanction notices

(1) The OGA may, at any time after giving a sanction notice, withdraw the sanction notice. (2) If a sanction notice is withdrawn by the OGA— (a) the notice ceases to have effect, and (b) the OGA must notify the following persons of the withdrawal of the notice— (i) the person or persons to whom the notice was given; (ii) in the case of an operator removal notice, the licensee under whose carbon storage licence the exploration operator operates.

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124 Sanctions: information powers

(1) This section applies for the purposes of an investigation which— (a) concerns whether a person has failed to comply with a sanctionable requirement, and (b) is carried out by the OGA for the purpose of enabling it to decide whether to give the person a sanction notice, or on what terms a sanction notice should be given to the person. (2) The OGA may by notice in writing, for the purposes of that investigation, require the person to provide specified documents or other information. (3) “Specified” means specified, or of a description specified, in a notice under this section. (4) A requirement under subsection (2) applies only to the extent— (a) that the documents requested are documents in the person’s possession or control, or (b) that the information requested is information in the person’s possession or control. (5) A requirement imposed by a notice under subsection (2) is sanctionable in accordance with this Chapter. (6) The documents or information requested— (a) may include documents or information held in any form (including in electronic form); (b) may include documents or information that may be regarded as commercially sensitive; (c) may not include items that are subject to legal privilege. (7) The notice must specify— (a) to whom the information is to be provided; (b) where it is to be provided; (c) when it is to be provided; (d) the form and manner in which it is to be provided.

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125 Appeals

In Schedule 8— (a) Part 1 contains provision about appeals against decisions by the OGA relating to the preparation of an information and samples plan and appeals against the giving of a notice under section 112, and (b) Part 2 contains provision about appeals against the imposition of sanction notices and appeals against the giving of a notice under section 124.

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126 Procedure for enforcement decisions

(1) The OGA— (a) must determine the procedure that it proposes to follow in relation to enforcement decisions, and (b) must issue a statement of its proposals. (2) The procedure mentioned in subsection (1)(a) must be designed to secure, among other things, that an enforcement decision is taken— (a) by a person falling within subsection (3), or (b) by two or more persons, each of whom falls within subsection (3). (3) A person falls within this subsection if the person was not directly involved in establishing the evidence on which the enforcement decision is based. (4) The statement mentioned in subsection (1)(b) must be published in whatever way appears to the OGA to be best calculated to bring the statement to the attention of the public. (5) When the OGA takes an enforcement decision, the OGA must follow its stated procedure. (6) If the OGA changes its procedure in a material way, it must publish a revised statement. (7) A failure of the OGA in a particular case to follow its procedure as set out in the latest published statement does not affect the validity of an enforcement decision taken in that case. (8) But subsection (7) does not prevent the Tribunal from taking into account any such failure in considering an appeal under paragraph 4 or 5 of Schedule 8 in relation to a sanction notice. (9) In this section, “enforcement decision” means— (a) a decision to give a sanction notice in respect of a failure to comply with a sanctionable requirement, or (b) a decision as to the details of the sanction to be imposed by the notice.

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127 Interpretation of Chapter 5

In this Chapter— “information and samples plan” has the meaning given in section 109; “items subject to legal privilege”— in England and Wales, has the same meaning as in the Police and Criminal Evidence Act 1984 (see section 10 of that Act); in Scotland, has the meaning given by section 412 of the Proceeds of Crime Act 2002; in Northern Ireland, has the same meaning as in the Police and Criminal Evidence (Northern Ireland) Order 1989 (S.I. 1989/1341 (NI 12)); “OGA” means the Oil and Gas Authority; “protected material” has the meaning given in section 113; “sanction notice” has the meaning given in section 115; “storage permit” has the same meaning as in the Storage of Carbon Dioxide (Licensing etc) Regulations 2010 (S.I. 2010/2221) (see regulation 1(3) of those Regulations); “subsequent holder” has the meaning given in section 113; “Tribunal” means the First-tier Tribunal.

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128 Access to infrastructure

(1) The Secretary of State may by regulations make provision about the acquisition of rights to use relevant infrastructure (whether existing or proposed). (2) In exercising the power under subsection (1) the Secretary of State must have regard to the need to ensure that the process for acquiring such rights operates in a transparent and non-discriminatory manner. (3) Without prejudice to the generality of subsection (1), regulations under that subsection may amend, revoke or replace or make provision similar or corresponding to— (a) the Storage of Carbon Dioxide (Access to Infrastructure) Regulations 2011 (S.I. 2011/2305); (b) the Storage of Carbon Dioxide (Access to Infrastructure) Regulations (Northern Ireland) 2015 (S.R. (N.I.) 2015 No. 388). (4) Regulations under subsection (1)— (a) may confer functions (including discretions) on any person; (b) may confer jurisdiction on a court or tribunal; (c) may create criminal offences or impose civil penalties; (d) may make other provision about enforcement; (e) must provide for any offences created by the regulations to be triable— (i) only summarily, or (ii) either summarily or on indictment. (5) Where regulations under subsection (1) impose a civil penalty, they must also provide for a right of appeal against the imposition of the penalty. (6) Before making regulations under subsection (1) the Secretary of State must give to the appropriate consultees a notice— (a) stating that the Secretary of State proposes to make regulations under subsection (1), and (b) specifying the period (of not less than 28 days from the date on which the notice is given) within which representations must be made with respect to the proposed provisions, and must consider any representations duly made and not withdrawn. (7) For the purposes of this section the “appropriate consultees” are— (a) the GEMA; (b) the Scottish Ministers, if the regulations contain provision that would be within the legislative competence of the Scottish Parliament if it were contained in an Act of that Parliament; (c) the Welsh Ministers, if the regulations contain provision that would be within the legislative competence of Senedd Cymru if it were contained in an Act of the Senedd (ignoring any requirement for the consent of a Minister of the Crown imposed under Schedule 7B to the Government of Wales Act 2006); (d) the Department for the Economy in Northern Ireland, if the regulations contain provision that— (i) would be within the legislative competence of the Northern Ireland Assembly if it were contained in an Act of that Assembly, and (ii) would not, if it were contained in a Bill in the Northern Ireland Assembly, result in the Bill requiring the consent of the Secretary of State under section 8 of the Northern Ireland Act 1998; (e) the Oil and Gas Authority. (8) Regulations under subsection (1) are subject to the affirmative procedure. (9) In this section “relevant infrastructure” means— (a) a site for the geological storage of carbon dioxide that is situated in a regulated place, or (b) a pipeline, situated in a regulated place, which is used or intended to be used to convey carbon dioxide to a site falling within paragraph (a), and any associated installations, apparatus or works. (10) For the purposes of this section a site or pipeline is situated in a “regulated place” if it is situated— (a) in the United Kingdom, or (b) in, under or over— (i) the internal waters of the United Kingdom, (ii) the territorial sea adjacent to United Kingdom, or (iii) waters in a Gas Importation and Storage Zone (within the meaning given by section 1 of the Energy Act 2008). (11) In this section “geological storage” has the same meaning as in Part 1 (see section 55).

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129 Financial assistance

(1) The Secretary of State may provide financial assistance to any person for the purpose of encouraging, supporting or facilitating— (a) transportation of carbon dioxide; (b) storage of carbon dioxide; (c) carbon dioxide capture facilities which operate (or are to operate) in association with facilities for any activity mentioned in paragraph (a) or (b); (d) low carbon hydrogen production; (e) transportation of hydrogen; (f) storage of hydrogen. (2) The financial assistance referred to in subsection (1) includes expenditure incurred by the Secretary of State for the purposes of, or in connection with— (a) the establishment of a revenue support counterparty, a hydrogen levy administrator or an allocation body; (b) making payments to a revenue support counterparty. (3) Financial assistance under this section— (a) may be provided in any form and in particular by way of grants, loans, guarantees or indemnities or by the provision of insurance; (b) may be provided subject to conditions (which may include conditions about repayment with or without interest or other return); (c) may be provided pursuant to a contract; (d) may be provided to an investment fund for onward investment or for administrative costs relating to onward investment; (e) may be provided by incurring expenditure for the benefit of the person assisted; (f) may be provided by the acquisition of shares or any other interest in, or securities of, a body corporate; (g) may be provided by the acquisition of any undertaking or of any assets. (4) The Secretary of State is not authorised by this section to give financial assistance in the way described in subsection (3)(f) without the consent of the body corporate concerned. (5) The power to provide financial assistance under this section is in addition to (and does not limit or replace) any other power of a Minister of the Crown to provide financial assistance. (6) In this section— “allocation body” has the same meaning as in Chapter 1 (see section 73(6)); “greenhouse gas” has the meaning given by section 92(1) of the Climate Change Act 2008; “hydrogen levy administrator” has the same meaning as in Chapter 1 (see section 69(6)); “low carbon hydrogen production” means production of hydrogen by a method which in the opinion of the Secretary of State will contribute to a reduction in emissions of greenhouse gases; “revenue support counterparty” has the same meaning as in Chapter 1 (see section 58(6)); “storage”, in relation to carbon dioxide, means any storage with a view to the permanent containment of carbon dioxide; “undertaking” means any trade or business or any other activity providing employment.

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130 Key definitions for Part 3

(1) In this Part— “designated person” means a person in relation to whom a designation under section 131(1) has effect (and any reference to designation, in relation to a person, is to be construed accordingly); “designated project”, in relation to a person, means a hydrogen pipeline project in relation to which the person is designated; “gas transporter licence” means a licence under section 7 of the Gas Act 1986; “hydrogen” means any gas that consists wholly or mainly of hydrogen; “hydrogen pipeline project” means a project involving the construction, alteration or operation of a pipeline for the purpose of the conveyance of hydrogen. (2) References in this Part to the extension or restriction of a licence are to the giving of a direction in respect of the licence under (respectively) section 7(4) or (4A) of the Gas Act 1986.

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131 Designation

(1) The Secretary of State may by notice given to a person designate the person in relation to a hydrogen pipeline project. (2) The Secretary of State may designate a person in relation to a hydrogen pipeline project only if the Secretary of State is of the opinion— (a) that it is likely to be appropriate for conditions described in section 137(1)(a) and (b) to be included in any gas transporter licence held by the person for the purposes of the project (whether or not the person already holds such a licence), and (b) that the project is likely to result in value for money. (3) A person may be designated only with the person’s consent. (4) A designation may not relate to more than one hydrogen pipeline project (but a person who is designated in relation to one project may be designated separately in relation to another).

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132 Designation: procedure

(1) The Secretary of State must publish a statement setting out— (a) the procedure that the Secretary of State expects to follow in determining whether to exercise the power under section 131(1), and (b) how the Secretary of State expects to determine whether the conditions in section 131(2) are met. (2) A duty imposed by subsection (1) may be satisfied by things done before the passing of this Act (as well as by things done after that time). (3) A designation notice must include— (a) a description of the hydrogen pipeline project to which the designation relates, (b) the Secretary of State’s reasons for the designation, (c) details of any conditions to which the designation is subject, and (d) the date of the notice. (4) The Secretary of State must give the GEMA a copy of a designation notice. (5) The Secretary of State must publish a designation notice, but may exclude from publication any material the disclosure or publication of which the Secretary of State considers— (a) would be likely to prejudice the commercial interests of any person, or (b) would be contrary to the interests of national security. (6) In this section, “designation notice” means a notice under section 131(1).

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133 Revocation of designation

(1) The Secretary of State may by notice given to a designated person revoke the person’s designation in relation to a hydrogen pipeline project if— (a) either of the conditions in section 131(2) ceases to be met in relation to the project, (b) the Secretary of State determines that a condition to which the designation is subject has not been met, or (c) the person consents to the designation being revoked. (2) Section 132(3)(a), (b) and (d), (4) and (5) applies (with necessary modifications) in relation to the revocation of a person’s designation as it applies in relation to the designation of a person. (3) Where the Secretary of State gives a notice to a person under subsection (1), the person’s designation in relation to the hydrogen pipeline project in question ceases to have effect at the end of the day on which the notice is given to the person. (4) The revocation of a person’s designation in relation to a hydrogen pipeline project does not affect anything done in relation to the licence by the Secretary of State under or by virtue of this Part while the person was designated in relation to the project.

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134 Grant, extension or restriction of gas transporter licence by Secretary of State

(1) The Secretary of State may exercise the power under section 7(2) of the Gas Act 1986 (grant of gas transporter licences) so as to grant a gas transporter licence to a designated person, subject to subsection (2). (2) The Secretary of State may only grant a gas transporter licence which authorises the conveyance of hydrogen through pipes for the purposes of the person’s designated project. (3) The Secretary of State may exercise the power under section 7(4) of the Gas Act 1986 (direction to extend licence) so as to extend a gas transporter licence where— (a) the licence is held by a designated person, and (b) the extension authorises the conveyance of hydrogen through pipes for the purposes of the person’s designated project. (4) The Secretary of State may exercise the power under section 7(4A) of the Gas Act 1986 (direction to restrict licence) so as to restrict a gas transporter licence where— (a) the licence is or was held by a designated person, and (b) the restriction is in connection with the revocation of the person’s designation in relation to a hydrogen pipeline project. (5) In its application for the purposes of subsections (1), (3) and (4), the Gas Act 1986 has effect as if— (a) in the following provisions, references to the GEMA were to the Secretary of State— (i) section 7(5) and (6)(a); (ii) section 7B(9); (iii) section 8(3), (4) and (5)(a); (b) in sections 7(6)(b) and 8(5)(b), references to the Secretary of State were to the GEMA; (c) in section 7B(4)(c), the reference to the GEMA included a reference to the Secretary of State, but only for the purpose of enabling the inclusion of conditions requiring the rendering of a payment on the grant of a licence; (d) section 7B(9) also required a copy of the licence to be sent to the GEMA. (6) When granting or extending a gas transporter licence by virtue of this section, the Secretary of State must have regard to— (a) costs, expenditure or liabilities of any description that the designated person may reasonably be expected to incur in carrying out its activities; (b) the need to secure that the designated person is able to finance its activities; (c) the need to secure that the designated person has appropriate incentives in relation to the carrying on of its activities; (d) such other matters as the Secretary of State considers appropriate. (7) References in subsection (6) to a designated person’s activities are to the person’s activities for the purposes of— (a) the designated project to which the grant or extension relates, and (b) in the case of an extension, any other designated project already authorised by the person’s gas transporter licence. (8) A gas transporter licence granted, extended or restricted by the Secretary of State by virtue of this section has effect for all purposes as if it had been granted, extended or restricted by the GEMA.

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135 Applications for grant etc of gas transporter licence

(1) The Secretary of State may by regulations make provision about the making, consideration and determination of relevant applications, including provision— (a) about the person to whom a relevant application must be made; (b) about the form and manner in which a relevant application must be made; (c) imposing timing requirements in relation to the making of a relevant application; (d) requiring a relevant application to be accompanied by such information and documents as may be specified in the regulations; (e) requiring a relevant application to be accompanied by such fee (if any) as may be— (i) specified in the regulations, or (ii) determined, by the person to whom the application is made, in accordance with the regulations; (f) about the matters to be taken into account in determining a relevant application; (g) requiring a determination to be accompanied by reasons; (h) requiring determinations to be published; (i) conferring functions on the Secretary of State or the GEMA (including functions involving the exercise of a discretion); (j) for anything falling to be determined under the regulations to be determined— (i) by the Secretary of State, the GEMA or another person specified in the regulations, and (ii) in accordance with such procedure and by reference to such matters and to the opinion of such persons as may be so specified. (2) “Relevant application” means an application within any of the following paragraphs (whether made to the Secretary of State or the GEMA)— (a) an application by a designated person for the grant of a gas transporter licence that authorises the conveyance of hydrogen through pipes for the purposes of the person’s designated project; (b) an application by a designated person for the extension of a gas transporter licence held by the person so that it authorises the conveyance of hydrogen through pipes for the purposes of the person’s designated project; (c) an application by a person who is or has been designated for the restriction of a gas transporter licence held by the person, in connection with the person’s designation in relation to a hydrogen pipeline project ceasing to have effect. (3) Provision made by virtue of subsection (1)(j)(ii) may in particular be made by reference to a document as amended from time to time. (4) Regulations under this section— (a) may provide for cases in which an application is not required; (b) may provide for a relevant application that has been rejected by one person to be dealt with afresh by another person. (5) Before making regulations under this section, the Secretary of State must consult the GEMA. (6) Section 7B(1) to (2A) of the Gas Act 1986 does not apply to an application for the grant, extension or restriction of a gas transporter licence so far as the application is one to which regulations under this section apply. (7) Any sums received by the Secretary of State or the GEMA by virtue of this section are to be paid into the Consolidated Fund. (8) Regulations under this section are subject to the negative procedure. (9) For the purposes of section 5A(1) to (10) of the Utilities Act 2000 (duty of the GEMA to carry out impact assessment), a function exercisable by the GEMA by virtue of regulations under this section is to be treated as if it were a function exercisable by it under or by virtue of Part 1 of the Gas Act 1986.

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136 Modification of gas transporter licence by Secretary of State

(1) The Secretary of State may modify— (a) the conditions of a designated person’s gas transporter licence; (b) the terms of a designated person’s gas transporter licence; (c) the standard conditions incorporated in gas transporter licences by virtue of section 8 of the Gas Act 1986; (d) a document maintained in accordance with the conditions of licences of a relevant type or an agreement that gives effect to a document so maintained. (2) The Secretary of State may exercise the power under subsection (1) only for the purpose of— (a) facilitating or supporting the financing of the design, construction, commissioning or operation of a hydrogen pipeline project (or of hydrogen pipeline projects generally), or (b) promoting value for money in connection with a hydrogen pipeline project (or in connection with hydrogen pipeline projects generally). (3) When making modifications under subsection (1)(a) or (b), the Secretary of State must have regard to— (a) the duties in sections 1 and 4(1)(b) of the Climate Change Act 2008 (carbon targets and budgets); (b) the interests of existing and future consumers of gas conveyed through pipes, including their interests in relation to the cost and security of supply of gas; (c) costs, expenditure or liabilities of any description that the designated person may reasonably be expected to incur in carrying out its activities; (d) the need to secure that the designated person is able to finance its activities; (e) the need to secure that the designated person has appropriate incentives in relation to the carrying on of its activities; (f) such other matters as the Secretary of State considers appropriate. In paragraph (b), “gas” has the same meaning as in Part 1 of the Gas Act 1986 (see section 48(1) of that Act). (4) The Secretary of State may modify the conditions or terms of a gas transporter licence held by a person who is or was a designated person in connection with the revocation of the person’s designation in relation to a hydrogen pipeline project. (5) For the purposes of subsection (1), each of the following is a relevant type of licence— (a) a gas transporter licence; (b) a licence under section 7A(1) of the Gas Act 1986 (gas supply licence); (c) a licence under section 7AA of that Act (gas system planner licence); (d) a licence under section 7AC of that Act (code manager licence). (6) References in this section to a designated person’s activities are to the person’s activities for the purposes of— (a) the designated project to which the modification relates, and (b) any other designated project authorised by the person’s gas transporter licence.

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137 Scope of modification powers under section 136

(1) Modifications made under section 136(1)(a) may include, for example, provision— (a) about the revenue that the designated person may receive in respect of its activities (its “allowed revenue”); (b) about how the designated person’s allowed revenue is to be calculated; (c) about the amounts that the designated person is entitled to receive, or is required to pay, under any hydrogen transport revenue support contract (within the meaning of Chapter 1 of Part 2) to which it is a party; (d) about activities that the designated person must, may or may not carry on; (e) about the management of the designated person’s activities, including the manner in which they are carried out; (f) conferring functions on the GEMA, including provision enabling or requiring the designated person to refer for determination, decision or approval by the GEMA matters specified, or of a description specified, in the licence; (g) for the amendment of the licence for the purpose of implementing a determination or decision of the GEMA or the Competition and Markets Authority; (h) requiring the designated person to comply with any direction or instruction, or to have regard to any guidance, given by the GEMA in relation to matters specified, or of a description specified, in the licence; (i) requiring the designated person to co-operate with the GEMA and to provide such information and assistance to the GEMA as it may require for the purposes of carrying out any of its functions; (j) about the payment by the designated person, to the GEMA or to the Competition and Markets Authority, of such amounts as may be determined by or in accordance with the licence; (k) about the disclosure or publication of information by the designated person. (2) Modifications made under section 136(1)(b) may include, for example, provision about the circumstances in which a licence may be revoked or suspended. (3) The powers under section 136(1) and (4) to “modify” include the power to amend, add to or remove; and references to modification in section 136, this section and section 138 are to be construed accordingly. (4) The powers conferred by section 136(1) and (4)— (a) may be exercised generally, only in relation to specified cases, or subject to exceptions (including by making provision for a case to be excepted only so long as specified conditions are satisfied); (b) may be exercised differently for different purposes or areas; (c) include power to make incidental, supplementary, consequential or transitional modifications. (5) Provision included in a gas transporter licence, or in a document or agreement described in section 136(1)(d), by virtue of section 136— (a) need not relate to the activities authorised by the licence; (b) may do anything authorised for gas transporter licences by section 7B(4A), (5)(a), (6) or (7) of the Gas Act 1986. (6) The modification under section 136(1) or (4) of part of a standard condition of a gas transporter licence does not prevent any other part of the condition from continuing to be regarded as a standard condition for the purposes of Part 1 of the Gas Act 1986. (7) In section 81(2) of the Utilities Act 2000 (standard conditions of gas licences), after “section 89” (as inserted by section 91(13) of this Act) insert “, section 136(1) or (4)”. (8) References in this section to a designated person’s activities are to the person’s activities for the purposes of— (a) the designated project to which the modification relates, and (b) any other designated project authorised by the person’s gas transporter licence.

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138 Procedure etc relating to modifications under section 136

(1) Before making a modification under section 136(1) or (4), the Secretary of State must consult— (a) the holder of any licence being modified, (b) the GEMA, and (c) such other persons as the Secretary of State considers appropriate. (2) If under section 136(1) the Secretary of State modifies the standard conditions of a gas transporter licence, the GEMA must— (a) make the same modification of those standard conditions for the purposes of their incorporation in gas transporter licences granted after that time, and (b) publish the modification. (3) The Secretary of State must publish details of any modifications made under section 136(1) and (4) as soon as reasonably practicable after they are made. (4) The Secretary of State may exclude from publication under subsection (3) any material the disclosure or publication of which the Secretary of State considers— (a) would be likely to prejudice the commercial interests of any person, or (b) would be contrary to the interests of national security.

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139 Information and advice

(1) The Secretary of State may by regulations make provision about the provision and publication of information and advice in connection with the carrying out of functions of any person under or by virtue of this Part. (2) The provision that may be made by virtue of subsection (1) includes provision— (a) for the Secretary of State to require the GEMA to provide information to a hydrogen transport counterparty or any other specified person; (b) for a hydrogen transport counterparty to require the GEMA to provide information to it; (c) for the Secretary of State to require a designated person, a hydrogen transport counterparty or any other specified person to provide information to the GEMA; (d) for the GEMA to require a designated person, a hydrogen transport counterparty or any other specified person to provide information to the GEMA; (e) for the Secretary of State to require a designated person, a hydrogen transport counterparty, the GEMA or any other specified person to provide information or advice to the Secretary of State or any other specified person; (f) for the classification and protection of confidential or sensitive information; (g) for the enforcement of any requirement imposed by virtue of any of paragraphs (a) to (f). (3) Section 105(1) of the Utilities Act 2000 (general restrictions on disclosure of information) does not apply to a disclosure required by virtue of this section. (4) The first regulations under this section are subject to the affirmative procedure. (5) Any other regulations under this section are subject to the negative procedure. (6) In this section— “designated person” includes a person who has been a designated person; “hydrogen transport counterparty” has the same meaning as in Chapter 1 of Part 2 (see section 56); “specified person” means a person specified, or of a description specified, in regulations under this section. (7) See also section 34(4) of the Gas Act 1986 (general duty for the GEMA to give information, advice and assistance to the Secretary of State or the Competition and Markets Authority).

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140 Conditions of gas transporter licences for conveyance of hydrogen

(1) For the purposes of this section, “relevant licence” means a gas transporter licence so far as it authorises a person to convey hydrogen through pipes in connection with the carrying on of a hydrogen pipeline project. (2) Without prejudice to the generality of section 7B(4)(a) of the Gas Act 1986 (conditions of licences), conditions described in subsection (3) may be included in a relevant licence in respect of circumstances where a person other than the licence holder (“the candidate”)— (a) has applied for, or is considering whether to apply for, a relevant licence, or (b) is considering whether to apply for financial support for activities relating to the production, transportation, storage or use of hydrogen. (3) The conditions referred to in subsection (2) are conditions that require the licence holder to comply with a direction given by the Secretary of State or the GEMA requiring the holder to provide to the candidate— (a) information in relation to the activities authorised by the licence, and (b) any other assistance that the candidate may reasonably require for the purpose of determining whether to— (i) apply for a relevant licence, or (ii) apply for financial support as mentioned in subsection (2)(b). (4) A person (“P”) may not under section 8(3) of the Gas Act 1986 modify a condition of a relevant licence unless P is of the opinion that the modification is such that— (a) the licence holder would not be unduly disadvantaged in competing with one or more other holders of relevant licences, and (b) no other holder of a relevant licence would be unduly disadvantaged in competing with other holders of such licences (including the holder of the relevant licence to be modified).

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141 Secretary of State directions to the GEMA

(1) In exercising any functions it has in relation to relevant gas transporter licences, the GEMA must comply with general or particular directions given to it by the Secretary of State for the purpose of promoting value for money in connection with a hydrogen pipeline project (or in connection with hydrogen pipeline projects generally). (2) In subsection (1), “relevant gas transporter licence” means a gas transporter licence, held by a designated person, that authorises the conveyance of hydrogen through pipes in connection with the person’s designated project.

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142 Repeal of Part 3

(1) The Secretary of State may by regulations repeal any of the preceding provisions of this Part. (2) So far as any of those provisions is still in force on a relevant date, the Secretary of State must— (a) consider whether it is appropriate to repeal that provision, and (b) if satisfied that it is not appropriate to do so, publish a statement no later than 3 months after that date explaining why not. (3) “Relevant date” in subsection (2) means 31 December 2040 and each five-year anniversary of that date. (4) Regulations under this section are subject to the affirmative procedure.

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143 Low-carbon heat schemes

(1) The Secretary of State may by regulations make provision for the establishment and operation of one or more low-carbon heat schemes. (2) A “low-carbon heat scheme” is a scheme for encouraging the supply or installation in the United Kingdom of relevant heating appliances through the imposition of low-carbon heat targets on persons to whom the scheme applies. (3) In this Chapter— “low-carbon heat target” means a target imposed by or under scheme regulations; “relevant heating appliance” means— a heating appliance that generates heat but is incapable of burning fossil fuels or peat to do so, or a heating appliance that generates heat by burning fossil fuels or peat, but does so only as part of a wider system to supplement heat from air, water or the ground. (4) In the definition of “relevant heating appliance” in subsection (3), “fossil fuel” means— (a) coal, (b) lignite, (c) natural gas (within the meaning of the Energy Act 1976), (d) crude liquid petroleum, (e) petroleum products (within the meaning of that Act), or (f) any substance produced directly or indirectly from a substance mentioned in paragraphs (a) to (e). (5) The provision made by sections 144 to 150 is without prejudice to the generality of subsection (1). (6) In this Chapter, “scheme regulations” means regulations under subsection (1).

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144 Application of scheme

(1) Scheme regulations that provide for the establishment of a low-carbon heat scheme must identify— (a) the descriptions of person to whom the scheme applies; (b) the kinds of relevant heating appliance to which the scheme applies. (2) A person within a description identified by virtue of subsection (1)(a) is referred to in this Chapter as a “scheme participant”. (3) Scheme regulations may— (a) set low-carbon heat targets, or (b) provide for low-carbon heat targets to be set in accordance with provision made by the regulations. Section 145 contains further provision about the setting of targets. (4) Scheme regulations must make provision about the period or periods in relation to which low-carbon heat targets have effect. (5) The provision that may be made by virtue of subsection (4) includes— (a) provision authorising things done by a scheme participant before the first period in relation to which a low-carbon heat target has effect to be treated as done by the scheme participant during that period; (b) provision authorising things done by a scheme participant during one period in relation to which a low-carbon-heat target has effect to be treated instead as done by the scheme participant during a different period in relation to which such a target has effect.

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145 Setting of targets etc

(1) A low-carbon heat target may be set in whatever way, and by reference to whatever criteria, the Secretary of State considers appropriate, and may for example be set— (a) by reference to the carrying on of specified activities; (b) as a proportion of the activities of a scheme participant that must relate to relevant heating appliances; (c) by reference to the average level of energy efficiency (determined in accordance with scheme regulations) to be achieved in relation to heating appliances, or specified descriptions of heating appliances, supplied or installed by a scheme participant; (d) by reference to the average carbon intensity of heat generation (determined in accordance with scheme regulations) of heating appliances, or specified descriptions of heating appliances, supplied or installed by a scheme participant; (e) where a scheme participant manufactures heating appliances, by specifying what proportion of those heating appliances, or of specified heating appliances, that are supplied or installed (whether or not by the scheme participant) must be relevant heating appliances. (2) The power to specify an activity by virtue of subsection (1)(a) includes power to specify circumstances or conditions relating to the carrying out of the activity. (3) In the case of a low-carbon heat target that is imposed by virtue of subsection (1)(c) or (d) on a scheme participant who manufactures heating appliances, the target may be set by reference to heating appliances that are supplied or installed (whether or not by the scheme participant). (4) Scheme regulations may confer a discretion on the Secretary of State or any other person in connection with the setting of low-carbon heat targets. (5) The reference in subsection (1)(d) to the carbon intensity of heat generation, in relation to an appliance, is a reference to the level of greenhouse gas emissions per unit of heat generated by the appliance. “Greenhouse gas emissions” means emissions of any greenhouse gas within the meaning of section 92(1) of the Climate Change Act 2008. (6) Scheme regulations may provide— (a) for different weight to be given to different kinds of appliance or different activities; (b) for low-carbon heat targets to be set at different levels for different kinds of appliance or different activities. (7) Scheme regulations may provide for specified activities to count towards the meeting of a low-carbon heat target. (8) In this section, “specified” means specified in scheme regulations.

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146 Further provision about scheme regulations

(1) Scheme regulations must provide for the making of determinations as to whether a scheme participant has met a low-carbon heat target imposed on the scheme participant. (2) Scheme regulations may make provision for monitoring the operation of a low-carbon heat scheme, and may in particular make provision about— (a) the keeping of records by scheme participants and others; (b) the provision of information by scheme participants and others; (c) the audit and verification of information provided by scheme participants and others. (3) Scheme regulations may make provision— (a) enabling scheme participants to pool or transfer low-carbon heat targets imposed on them; (b) for the issuing of certificates representing activities or appliances to which a low-carbon heat target relates; (c) enabling scheme participants to acquire certificates mentioned in paragraph (b) for the purpose of meeting a low-carbon heat target; (d) about the keeping of records in relation to— (i) the pooling or transfer of low-carbon heat targets; (ii) the acquisition of certificates. (4) Scheme regulations may make provision— (a) requiring a scheme participant who fails to meet a low-carbon heat target to make a payment, before a specified deadline, of an amount specified by or determined in accordance with the regulations; (b) for a payment mentioned in paragraph (a) to be made to the administrator (see section 147) or to such other person as the regulations may specify; (c) for a person who fails to meet a low-carbon heat target to be subject to such consequences (instead of or in addition to a requirement mentioned in paragraph (a)) as may be specified; (d) about how liability to make a payment, or to other consequences, is to be determined where low-carbon heat targets have been pooled or transferred by virtue of provision made under subsection (3)(a). (5) In subsection (4), “specified” means specified in scheme regulations.

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147 Administration of scheme

(1) Scheme regulations may provide for the appointment of a person as the administrator of a low-carbon heat scheme. (2) Scheme regulations— (a) may confer functions on the administrator for the purposes of the scheme; (b) may authorise the administrator to arrange for another person to carry out any functions of the administrator. (3) The functions that may be conferred on the administrator by virtue of subsection (2) include, for example, functions in connection with— (a) setting low-carbon heat targets; (b) determining whether low-carbon heat targets have been met; (c) obtaining information; (d) keeping records; (e) requiring scheme participants to make payments to the administrator in connection with the costs of operating the scheme. (4) Only the following may be appointed as the administrator of a low-carbon heat scheme— (a) the Secretary of State; (b) the Scottish Ministers; (c) the Welsh Ministers; (d) the Department for the Economy in Northern Ireland; (e) a public authority (other than a person within any of paragraphs (a) to (d)); (f) any combination of the above. (5) More than one person may be appointed as the administrator of a low-carbon heat scheme. (6) Scheme regulations that appoint a public authority as the administrator of a low-carbon heat scheme may make such amendments to primary legislation as the Secretary of State considers appropriate for the purpose of enabling the authority to carry out the functions conferred on it by the regulations. (7) In this section, “public authority” means a person with functions of a public nature.

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148 Enforcement, penalties and offences

(1) Scheme regulations may authorise the administrator of a low-carbon heat scheme— (a) to require the production of documents or the provision of information; (b) to question the officers of a company or other individuals; (c) to enter premises with a warrant; (d) to seize documents or records. (2) Scheme regulations may authorise the administrator of a low-carbon heat scheme, in circumstances specified in the regulations— (a) to treat activities of a person (A) as activities of a different person (B) for the purposes of the scheme, and (b) to treat a low-carbon heat target imposed on A as if it had been imposed on B. (3) Scheme regulations may provide that a person is liable to one or more penalties in respect of a failure to comply with a requirement imposed on the person by or under a low-carbon heat scheme. (4) Where by virtue of subsection (3) scheme regulations provide that a person is liable to a financial penalty, the regulations— (a) may specify the amount of the penalty or provide for the amount of the penalty to be determined in accordance with the regulations; (b) must provide for the penalty to be paid to the administrator or to such other person as the regulations may specify. (5) Scheme regulations may create offences for failure to comply with a requirement imposed by or under a low-carbon heat scheme. (6) Scheme regulations made by virtue of subsection (5) may provide for an offence created by the regulations to be triable— (a) only summarily, or (b) either summarily or on indictment. (7) Scheme regulations made by virtue of subsection (5) may provide for an offence created by the regulations to be punishable with a fine.

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149 Application of sums paid by virtue of section 146(4) or 148(3)

(1) Scheme regulations may make provision about the application of amounts paid by virtue of section 146(4)(a) or 148(3). (2) Provision made by virtue of subsection (1) may require the payment of amounts into the Consolidated Fund.

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150 Appeals

(1) Scheme regulations that, by virtue of section 148(3), provide that a person is liable to a financial penalty must also provide for a person to have a right of appeal to a court or tribunal against the imposition of the penalty. (2) Scheme regulations may make provision about appeals against— (a) decisions made by the administrator of a low-carbon heat scheme, and (b) penalties imposed (other than financial penalties) or enforcement action taken for failure to comply with a requirement imposed by or under a low-carbon heat scheme. (3) Scheme regulations that make provision by virtue of subsection (2) must specify the court, tribunal or person who is to hear and determine an appeal made by virtue of that subsection.

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151 Scheme regulations: procedure etc

(1) Scheme regulations are subject to the negative procedure unless subsection (2) applies, in which case they are subject to the affirmative procedure. (2) This subsection applies if scheme regulations— (a) establish a low-carbon heat scheme; (b) extend the descriptions of person, or the kinds of relevant heating appliance, to which a low-carbon heat scheme applies; (c) provide for new penalties; (d) increase the amount of existing financial penalties by more than is necessary to reflect changes in the value of money; (e) create an offence or increase the fine for an existing offence; (f) confer new powers to enforce requirements imposed by or under a low-carbon heat scheme; (g) amend primary legislation. (3) Scheme regulations may create exceptions to any requirement imposed by the regulations. (4) Before making scheme regulations that apply in relation to Scotland, Wales or Northern Ireland, the Secretary of State must give notice— (a) stating that the Secretary of State proposes to make scheme regulations, (b) setting out or describing the provisions of the regulations that apply in relation to Scotland, Wales or Northern Ireland, and (c) specifying the period (of not less than 28 days from the date on which the notice is given) within which representations may be made with respect to those provisions, and must consider any representations duly made and not withdrawn. (5) A notice under subsection (4) must be given to each relevant devolved authority, that is to say— (a) the Scottish Ministers, so far as the regulations apply in relation to Scotland; (b) the Welsh Ministers, so far as the regulations apply in relation to Wales; (c) the Department for the Economy in Northern Ireland, so far as the regulations apply in relation to Northern Ireland. (6) The Secretary of State need not wait until the end of the period specified under subsection (4)(c) before making regulations if, before the end of that period, each relevant devolved authority to which the notice was given has confirmed that it has made any representations it intends to make with respect to the provisions referred to in subsection (4)(b). (7) The Secretary of State must, if requested to do so by a relevant devolved authority, give the authority a statement setting out whether and how representations made by the authority with respect to the provisions referred to in subsection (4)(b) have been taken into account in the regulations.

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152 Interpretation of Chapter 1

In this Chapter— “low-carbon heat scheme” has the meaning given by section 143(2); “low-carbon heat target” has the meaning given by section 143(3); “primary legislation” means— an Act, an Act of the Scottish Parliament, a Measure or Act of Senedd Cymru, or Northern Ireland legislation; “relevant heating appliance” has the meaning given by section 143(3); “scheme participant” has the meaning given by section 144(2); “scheme regulations” has the meaning given by section 143(6).

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153 Modifications of the gas code

(1) For the purposes of this section, “hydrogen grid conversion trial” means a scheme designated by the Secretary of State that— (a) relates to a particular place or area (the “trial location”), (b) is designed to gather evidence for the purpose of enabling assessments to be made about the feasibility, costs and benefits of using hydrogen for heating or cooking, (c) requires the network for supplying gas to the trial location to be modified so as to enable the supply of hydrogen, and (d) is intended to have effect for a definite period. (2) Schedule 2B to the Gas Act 1986 (the gas code) applies in relation to a hydrogen grid conversion trial— (a) as if references to a gas transporter included a person (other than a gas transporter) who is conducting the trial, and (b) as if it were modified in accordance with subsections (3) to (5). (3) Paragraph 16 (alterations etc of burners on change of calorific value) applies as if— (a) in sub-paragraph (1), the words “at a rate not exceeding 75,000 therms a year” were omitted, and (b) in sub-paragraph (2), the steps required to be taken in respect of premises in the trial location also included any works required in respect of the premises (other than works already mentioned in sub-paragraph (2)) for the purposes or in consequence of the trial. (4) Paragraph 23 (entry of premises during supply) applies as if the power conferred by sub-paragraph (1)(a) included power to enter premises in the trial location for the purpose of inspecting anything on the premises, or carrying out any tests on the premises, in preparation for or otherwise in connection with the trial. (5) Paragraph 24 (entry of premises to discontinue supply) applies as if the power conferred by sub-paragraph (2) were exercisable for the purposes of the trial— (a) in relation to any premises in the trial location, and (b) notwithstanding sub-paragraph (1). (6) For the purposes of the application of the Rights of Entry (Gas and Electricity Boards) Act 1954 in relation to a relevant power of entry (see paragraph 28(5) of Schedule 2B to the Gas Act 1986), the reference in section 1(2) of the 1954 Act to a gas operator includes a reference to a person (other than a gas transporter) who is conducting a hydrogen grid conversion trial. (7) In subsection (6), “relevant power of entry” means a power of entry conferred by Schedule 2B to the Gas Act 1986, as it applies by virtue of this section in relation to a hydrogen grid conversion trial.

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154 Regulations for protection of consumers

(1) The Secretary of State may by regulations make provision— (a) requiring a gas transporter to take specified steps to secure that consumers in a trial location are properly informed about a hydrogen grid conversion trial being conducted in the trial location; (b) requiring a gas transporter to take specified steps to secure that consumers are given adequate warning of the need for their premises to be disconnected for the purposes of a hydrogen grid conversion trial; (c) about the enforcement of requirements imposed by virtue of paragraph (a) or (b). (2) Regulations under subsection (1) may confer functions on gas transporters in connection with the discharge of requirements imposed by the regulations. (3) The provision that may be made by virtue of subsection (1)(c) includes provision for the imposition of civil penalties in respect of a failure to comply with a requirement imposed by the regulations (but does not include provision for the creation of a criminal offence). (4) The Secretary of State may by regulations make provision designed to secure protection for consumers and other people who are affected, or likely to be affected, by a hydrogen grid conversion trial. (5) The provision that may be made by regulations under subsection (4) includes, for example, provision— (a) about the making of complaints about the exercise by a gas transporter of a power conferred by a relevant statutory provision; (b) about the award of redress in specified circumstances; (c) imposing requirements on gas transporters or other persons to provide information to consumers and others; (d) for securing that consumers and others are not required to incur expenditure, or are not otherwise financially disadvantaged, as a result of a hydrogen grid conversion trial; (e) for securing fair treatment of consumers and others before, during and after a hydrogen grid conversion trial; (f) about the quality of products provided to consumers and others and the quality of works carried out on premises owned by consumers and others; (g) about the enforcement of requirements imposed by the regulations on gas transporters or other persons. (6) The provision that may be made by virtue of subsection (5)(g) includes provision for the imposition of civil penalties in respect of a failure to comply with a requirement imposed by the regulations (but does not include provision for the creation of a criminal offence). (7) Where regulations under this section make provision for a civil penalty, they must also include provision for a right of appeal to a court or tribunal against the imposition of the penalty. (8) Regulations under this section are subject to the negative procedure. (9) In this section— “consumer” and “disconnected” have the same meaning as in Schedule 2B to the Gas Act 1986 (see paragraph 1(1) of that Schedule); “gas transporter” means— a gas transporter within the meaning of Part 1 of the Gas Act 1986 (see section 7 of that Act), or any other person who— is conducting a hydrogen grid conversion trial, and does not require a licence under section 7 of the Gas Act 1986 as a result of an exemption under section 6A of that Act; “hydrogen grid conversion trial” and “trial location” have the same meaning as in section 153; “specified” means specified by regulations.

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155 Power to modify Gas Act 1986 in relation to hydrogen

(1) The Secretary of State may by regulations provide for any provision of the Gas Act 1986— (a) not to apply, or (b) to apply with modifications specified in the regulations, in relation to the production, transportation, storage or use of hydrogen. (2) The power under subsection (1) may be exercised by amending the Gas Act 1986. (3) The power under subsection (1) may be exercised only for the purpose of facilitating or promoting the production, transportation, storage or use of hydrogen. (4) Before exercising the power under subsection (1), the Secretary of State must consult— (a) the GEMA, and (b) such other persons as the Secretary of State considers appropriate. (5) Regulations under subsection (1) are subject to the affirmative procedure.

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156 Fusion energy facilities: nuclear site licence not required

(1) Section 1 of the Nuclear Installations Act 1965 (restriction of certain nuclear installations to licensed sites) is amended as follows. (2) After subsection (2) insert— (2A) Subsection (1) does not apply to a fusion energy facility. (2B) In subsection (2A), “fusion energy facility” means a site that is— (a) used for the purpose of installing or operating any plant designed or adapted for the production of electrical energy or heat by fusion, and (b) not also used for the purpose of installing or operating a nuclear reactor.

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157 Treatment of recycled carbon fuel and nuclear-derived fuel as renewable transport fuel

After section 131C of the Energy Act 2004 insert— Recycled carbon fuel and nuclear-derived fuel 131D (1) An RTF order may— (a) designate as recycled carbon fuel a description of liquid or gaseous fuel which is produced wholly from waste derived from a fossil source of energy; (b) designate as nuclear-derived fuel a description of liquid or gaseous fuel which is produced wholly using, or by a process powered wholly by, nuclear fuel. (2) Where a designation under subsection (1) is in force, the recycled carbon fuel or nuclear-derived fuel is to be treated for the purposes of this Chapter and any RTF order as renewable transport fuel.

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158 Revenue certainty scheme for sustainable aviation fuel producers: consultation and report

(1) The Secretary of State must carry out a public consultation on the options for designing and implementing a sustainable aviation fuel revenue certainty scheme. (2) A “sustainable aviation fuel revenue certainty scheme” is a scheme whose purpose is to give producers of sustainable aviation fuel greater certainty than they otherwise would have about the revenue that they will earn from sustainable aviation fuel that they produce. (3) The Secretary of State must open the consultation within the period of 6 months beginning with the day on which this Act is passed. (4) The Secretary of State must bring the consultation to the attention of, in particular, such of each of the following as the Secretary of State considers appropriate— (a) producers of sustainable aviation fuel; (b) suppliers of sustainable aviation fuel; (c) airlines. (5) The Secretary of State must, within the period of 18 months beginning with the day on which this Act is passed, lay before Parliament a report on progress made towards the development of a sustainable aviation fuel revenue certainty scheme. (6) In this section, “sustainable aviation fuel” means aviation turbine fuel whose use (as compared with the use of other aviation turbine fuel) will, in the opinion of the Secretary of State, contribute to a reduction in emissions of greenhouse gases; and for this purpose— “aviation turbine fuel” has the meaning given by article 3(1B) of the Renewable Transport Fuel Obligations Order 2007 (S.I. 2007/3072); “greenhouse gas” has the meaning given by section 92(1) of the Climate Change Act 2008.

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159 Renewable liquid heating fuel obligations

(1) The Secretary of State may by regulations subject off-grid heating fuel suppliers (or off-grid heating fuel suppliers of a particular description) to an obligation in respect of renewable liquid heating fuel that corresponds to or is similar to the obligation mentioned in section 124(2) of the Energy Act 2004 (renewable transport fuel obligation). (2) The regulations may, for any purpose connected with that obligation, make provision corresponding to or similar to any provision made by, or that may be made under, Chapter 5 of Part 2 of the Energy Act 2004 (powers etc relating to renewable transport fuel obligation). (3) Before making regulations under this section, the Secretary of State must consult such persons as the Secretary of State considers appropriate. (4) Regulations under this section are subject to the affirmative procedure. (5) In this section— “off-grid heating fuel supplier” means a person who, in the course of business, supplies any— renewable liquid heating fuel, fossil fuel, or other fuel, apart from solid fuel, at or for delivery to places in Great Britain with a view to its being used wholly or mainly for the purpose of heating buildings to which there is no mains gas supply; “renewable liquid heating fuel” means fuel that is typically supplied or stored in a liquid state and that is— biofuel or blended biofuel, or fuel (other than fossil fuel or nuclear fuel) produced— wholly by energy from a renewable source, or wholly by a process powered wholly by such energy; and “biofuel”, “blended biofuel”, “fossil fuel” and “renewable source” have the meanings given in section 132 of the Energy Act 2004.

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