40 Information in relation to CCUS strategy and policy statement
(1) As soon as reasonably practicable after the designation of a statement as the CCUS strategy and policy statement for the purposes of this Part, the economic regulator must publish a document setting out the required information in relation to the statement.
(2) The economic regulator must include the required information in relation to a CCUS strategy and policy statement in the transport and storage forward work programme for each financial year, subject to making such modifications to the information as the economic regulator considers appropriate from the version as last published under this subsection.
(3) The required information in relation to a CCUS strategy and policy statement to be set out in a document or forward work programme is—
(a) the strategy the economic regulator intends to adopt for the purpose of furthering the delivery of the policy outcomes contained in the statement (both in respect of the year in or for which the document or programme is issued and beyond);
(b) the things the economic regulator proposes to do in implementing that strategy (including when the economic regulator proposes to do them);
(c) the ways in which the economic regulator has had regard to the strategic priorities contained in the statement in setting out the information required under paragraphs (a) and (b).
(4) The duty under subsection (1) does not apply if—
(a) the economic regulator does not think it reasonably practicable to publish the document mentioned in that subsection before the time when the economic regulator is next required to publish a transport and storage forward work programme, and
(b) the economic regulator includes the required information in that forward work programme.
(5) The duty under subsection (2) does not apply in relation to the first financial year beginning after the designation of the statement if—
(a) the economic regulator does not think it reasonably practicable to include the required information in the transport and storage forward work programme for that year, and
(b) the economic regulator includes the required information in a document published under subsection (1).
(6) The duty under subsection (2) does not apply in relation to a financial year if the Secretary of State gives notice to the economic regulator under this subsection that the statement’s designation—
(a) will be withdrawn before the beginning of the year, or
(b) is expected to have been withdrawn before the beginning of the year.
(7) Subsections (4) and (5) of section 39 (notice requirements) apply to a document published under subsection (1) as they apply to a transport and storage forward work programme.
(8) In this section—
“CCUS strategy and policy statement”, “policy outcomes” and “strategic priorities” have the same meaning as in Chapter 3 of Part 2 (see section 99);
“designation”, in relation to a CCUS strategy and policy statement, means designation of the statement by the Secretary of State under section 99;
“transport and storage forward work programme” has the meaning given by section 39.
41 Annual report on transport and storage licensing functions
(1) The economic regulator must, as soon as practicable after the end of each financial year, make to the Secretary of State a report (the “annual T&S report” for that year) on—
(a) the exercise of its functions under this Part during that year including a general survey of developments in respect of matters falling within the scope of those functions, and
(b) the activities of the CMA during that year in respect of any references made by the economic regulator by virtue of section 36(1).
(2) The annual T&S report for each year must include–
(a) a report on the progress of the projects described in the transport and storage forward work programme for that year;
(b) a summary of final and provisional orders made and penalties imposed by the economic regulator during the year;
(c) a report on such other matters as the Secretary of State may from time to time require.
(3) The annual T&S report for each year must also include a report on—
(a) the ways in which the economic regulator has carried out its duties under section 100(1) in relation to the CCUS strategy and policy statement (so far as the statement’s designation was in effect during the whole or any part of the year), and
(b) the extent to which the economic regulator has done the things set out under section 40 in a transport and storage forward work programme or other document as the things the economic regulator proposed to do during that year in implementing its strategy for furthering the delivery of the policy outcomes contained in the statement (see subsection (3)(b) of that section).
(4) The report mentioned in subsection (3) must, in particular, include—
(a) the economic regulator’s assessment of how the carrying out of its functions under this Part during the year has contributed to the delivery of the policy outcomes contained in the CCUS strategy and policy statement, and
(b) if the economic regulator has failed to do any of the things mentioned in subsection (3)(b), an explanation for the failure and the actions the economic regulator proposes to take to remedy it.
(5) In subsections (3) and (4)—
“CCUS strategy and policy statement” and “policy outcomes” have the same meaning as in Chapter 3 of Part 2 (see section 99);
“transport and storage forward work programme” has the meaning given by section 39(1).
(6) The Secretary of State must consult the economic regulator before exercising the power under subsection (2)(c) in relation to any matter.
(7) The Secretary of State must–
(a) lay a copy of each annual T&S report before each House of Parliament,
(b) send a copy of the report to the Scottish Ministers, the Welsh Ministers and the Department for the Economy in Northern Ireland, and
(c) arrange for the report to be published in such manner as the Secretary of State considers appropriate.
(8) The Scottish Ministers must lay a copy of each annual T&S report before the Scottish Parliament.
(9) The Welsh Ministers must lay a copy of each annual T&S report before Senedd Cymru.
(10) The Department for the Economy in Northern Ireland must lay a copy of each annual T&S report before the Northern Ireland Assembly.
(11) In making or preparing any report under this section the economic regulator must have regard to the need for excluding, so far as practicable, any matter which relates to the affairs of a particular individual or body of persons (corporate or unincorporate), where publication of that matter would or might, in the opinion of the economic regulator, seriously and prejudicially affect the interests of that individual or body.
(1) A transport and storage administration order means an order which—
(a) is made by the court in relation to a company which holds a licence under section 7, and
(b) directs that, while the order is in force, the affairs, business and property of the company are to be managed by a person appointed by the court.
(2) In this Chapter—
(a) a transport and storage administration order is referred to as a T&S administration order,
(b) a company which holds a licence under section 7 is referred to as a T&S company, and
(c) the person appointed in relation to a T&S company for the purposes of a T&S administration order is referred to as the T&S administrator of the company.
(3) The T&S administrator of a company must manage the company’s affairs, business and property, and exercise and perform all the powers and duties of a T&S administrator, so as to achieve the objective set out in section 43.
(4) In relation to a T&S administration order applying to a non-GB company, references in this section to the affairs, business and property of the company are references only—
(a) to its affairs and business so far as carried on in Great Britain or a relevant controlled place, and
(b) to its property in Great Britain or a relevant controlled place.
(5) In this section, “relevant controlled place” means a controlled place within the meaning of section 17(3) to (4) of the Energy Act 2008 other than a place—
(a) in Great Britain,
(b) in Northern Ireland, or
(c) in, under or over so much of the internal waters and territorial sea of the United Kingdom as are adjacent to Northern Ireland.
43 Objective of a transport and storage administration
(1) The objective of a transport and storage administration is to secure—
(a) that the activities authorised by the licence of the T&S company to which the administration relates commence, or continue, in a manner which—
(i) is efficient and economical, and
(ii) ensures the safety and security of the transport and storage network, or the part of that network, to which the licence relates, and
(b) that it becomes unnecessary, by one or both of the following means, for the T&S administration order to remain in force for that purpose.
(2) Those means are—
(a) the rescue as a going concern of the company subject to the T&S administration order, and
(b) transfers falling within subsection (3).
(3) A transfer falls within this subsection if it is a transfer as a going concern—
(a) to another company, or
(b) as respects different parts of the undertaking of the company subject to the T&S administration order, to two or more different companies,
of so much of that undertaking as it is appropriate to transfer for the purpose of achieving the objective of the transport and storage administration.
(4) The means by which transfers falling within subsection (3) may be effected include, in particular—
(a) a transfer of the undertaking of the company subject to the T&S administration order, or of a part of its undertaking, to a wholly-owned subsidiary of that company, and
(b) a transfer to a company of securities of a wholly-owned subsidiary to which there has been a transfer falling within paragraph (a).
(5) The objective of a transport and storage administration may be achieved by a transfer falling within subsection (3) to the extent only that—
(a) the rescue as a going concern of the company subject to the T&S administration order is not reasonably practicable or is not reasonably practicable without such a transfer,
(b) the rescue of that company as a going concern will not achieve that objective or will not do so without such a transfer,
(c) such a transfer would produce a result for the company’s creditors as a whole that is better than the result that would be produced without it, or
(d) such a transfer would, without prejudicing the interests of those creditors as a whole, produce a result for the company’s members as a whole that is better than the result that would be produced without it.
(6) In subsection (1)(a)—
(a) the reference to the activities authorised by the licence of the T&S company to which the administration relates includes a reference to any construction work or other activities needing to be carried out to commence those activities, and
(b) the reference to the safety and security of the transport and storage network, or the part of that network, to which the licence relates includes a reference to the safety and security of any infrastructure and facilities being constructed for that network, or that part of that network.
44 Application of certain provisions of the Energy Act 2004
(1) Sections 156 to 167 of, and Schedules 20 and 21 to, the Energy Act 2004 (special administration regime for energy licensees) apply in relation to a T&S administration order as they apply in relation to an energy administration order within the meaning given by section 154(1) of that Act, but with the modifications set out in subsections (2) to (4).
(2) In the application of those provisions generally—
(a) for “energy administration”, in each place where it occurs, substitute “transport and storage administration”;
(b) for “energy administrator”, in each place where it occurs, substitute “T&S administrator”;
(c) for “Great Britain”, in each place it occurs (other than paragraphs 4(2)(e) and 11(4) and (7) of Schedule 21), substitute “Great Britain or a relevant controlled place”;
(d) for “a protected energy company”, in each place where it occurs, substitute “a T&S company”.
(3) In the application of Schedule 20—
(a) in paragraph 32(1)(d), for the words from ““energy administration application”” to “Energy Act 2004” substitute ““transport and storage administration application” means an application to the court for a transport and storage administration order under Chapter 3 of Part 3 of the Energy Act 2004, as applied by section 44 of the Energy Act 2023”;
(b) in paragraph 32(1)(e), for “section 155 of the Energy Act 2004” substitute “section 43 of the Energy Act 2023”;
(c) in paragraph 36, for “section 154(4) of this Act” substitute “section 42(4) of the Energy Act 2023”;
(d) in paragraph 43, after “the Energy Act 2004” insert “and section 44 of the Energy Act 2023”;
(e) in paragraph 44(5), after “the Energy Act 2004” insert “and section 44 of the Energy Act 2023”;
(f) in paragraph 45, after “section 157(1)(e) of this Act” insert “as applied by section 44 of the Energy Act 2023”;
(g) omit paragraph 46 (but see section 48 of this Act);
(h) in paragraph 47, after “Part 1 of this Schedule” insert “and section 44 of the Energy Act 2023”.
(4) In the application of Schedule 21—
(a) for “an energy transfer scheme”, in each place where it occurs, substitute “a T&S transfer scheme”;
(b) for “old energy company”, in each place where it occurs, substitute “old T&S company”;
(c) for “new energy company”, in each place where it occurs, substitute “new T&S company”;
(d) in paragraph 1(b), for “section 155(3)” substitute “section 43(3) of the Energy Act 2023”;
(e) in paragraph 3(1), for “an “energy transfer scheme”” substitute “a “T&S transfer scheme””;
(f) in paragraphs 3(8) and 9(6), for “GEMA” substitute
—
(a) GEMA,
(b) the Health and Safety Executive,
(c) the Oil and Gas Authority,
(d) the appropriate devolved authorities (if any), and
(e) such other persons as the Secretary of State considers appropriate.
;
(g) in paragraph 5, after sub-paragraph (4) insert—
(5) This paragraph also applies in relation to any licence or permit that the relevant licence mentioned in sub-paragraph (1) requires its holder to hold as it applies in relation to the relevant licence.
;
(h) in paragraphs 6(3) and 11(2), for “the energy transfer scheme” substitute “the T&S transfer scheme”;
(i) in paragraph 12, for “section 155” substitute “section 43 of the Energy Act 2023”;
(j) after paragraph 13 insert—
14 For the purposes of paragraphs 3(8)(e) and 9(6)(e) the “appropriate devolved authorities” are—
(a) the Welsh Ministers, if provision making the scheme or (as the case may be) modification 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);
(b) the Scottish Ministers, if provision making the scheme or (as the case may be) modification would be within the legislative competence of the Scottish Parliament if it were contained in an Act of that Parliament.
(5) Sections 171 and 196 of the Energy Act 2004 (interpretation) apply for the purposes of the application by subsection (1) of the provisions mentioned in that subsection, but with the modifications set out in subsection (6).
(6) In the application of section 171(1)—
(a) insert, at the appropriate places, the following definitions—
“objective of the transport and storage administration” is to be construed in accordance with section 43 of the Energy Act 2023;
;
“relevant controlled place” has the meaning given by section 42(5) of the Energy Act 2023;
;
“T&S company” has the meaning given by section 42(2) of the Energy Act 2023;
;
“transport and storage administration order” has the meaning given by section 42(1) of the Energy Act 2023;
;
“transport and storage administration rules” means the rules made under section 411 of the 1986 Act by virtue of section 159(3) of this Act, for the purpose of giving effect to this Chapter as applied by section 44 of the Energy Act 2023;
;
(b) for the definition of “energy administrator” substitute—
“T&S administrator” has the meaning given by section 49 of the Energy Act 2023;
;
(c) for the definition of “relevant licence” substitute—
“relevant licence” means a licence under section 7 of the Energy Act 2023.
45 Conduct of administration, transfer schemes etc
In section 159(3) of the Energy Act 2004 (conduct of administration, transfer schemes, etc under Chapter 3 of Part 3 of that Act), for “or section 33 of the Nuclear Energy (Financing) Act 2022” substitute “, section 33 of the Nuclear Energy (Financing) Act 2022 or section 44 of the Energy Act 2023”.
(1) The Secretary of State may modify the conditions of a T&S company’s licence (“the section 7 licence”) so that they include—
(a) conditions relating to the recovery of amounts owed to the Secretary of State by the T&S company by virtue of, or otherwise relating to, financial assistance given by the Secretary of State while a T&S administration order is in force in relation to the T&S company;
(b) conditions relating to raising of funds for the purpose of meeting of expenses arising by virtue of the order.
(2) The Secretary of State may exercise the power under subsection (1) only if a T&S administration order is in force in relation to the T&S company.
(3) Before making a modification under subsection (1), the Secretary of State must consult—
(a) the economic regulator,
(b) if the section 7 licence authorises activities within section 2(2)(a), the person who granted any associated licence under section 18 of the Energy Act 2008, and
(c) such other persons as the Secretary of State considers appropriate.
(4) The power to make modifications under subsection (1) includes power to make such incidental, consequential or transitional modifications as the Secretary of State considers necessary or expedient.
(5) In subsection (1)(a), “financial assistance” means grants, loans, guarantees or indemnities, or any other kind of financial assistance.
(6) For the purposes of this section, a licence under section 18 of the Energy Act 2008 (“the carbon storage licence”) is an “associated licence” in relation to the section 7 licence if—
(a) the carbon storage licence is in respect of activities within section 17(2)(a) of that Act, and
(b) any part of the site to which the section 7 licence relates is within any place to which the carbon storage licence relates.
(1) The power to modify or apply enactments conferred on the Secretary of State by each of the sections of the Enterprise Act 2002 mentioned in subsection (2) includes power to make such consequential modifications of this Chapter as the Secretary of State considers appropriate in connection with any other provision made under that section.
(2) Those sections are—
(a) sections 248 and 277 (amendments consequential on that Act); and
(b) section 254 (power to apply insolvency law to foreign companies).
(3) In section 170(1) of the Energy Act 2004 (modification of Chapter 3 of Part 3 of that Act under the Enterprise Act 2002), for “or section 33 of the Nuclear Energy (Finance) Act 2022” substitute “, section 33 of the Nuclear Energy (Finance) Act 2022 or section 44 of the Energy Act 2023”.
48 Power to make further modifications of insolvency legislation
(1) The Secretary of State may by regulations—
(a) provide for insolvency legislation to apply in relation to any provision made by or under this Chapter;
(b) make such modifications of insolvency legislation as the Secretary of State considers appropriate in relation to any provision made by or under this Chapter (including any insolvency legislation that is applied under paragraph (a)).
(2) In relation to regulations under subsection (1), “insolvency legislation” means—
(a) the Insolvency Act 1986,
(b) Chapter 3 of Part 3 of the Energy Act 2004, and
(c) any other provision that relates to insolvency, or makes provision by reference to anything that is or may be done under the Insolvency Act 1986, and is—
(i) contained in an Act passed before this Act or in the same Session, or
(ii) made under an Act before the regulations come into force.
(3) Provision made under subsection (1) may amend this Chapter.
(4) Regulations under this section are subject to the affirmative procedure.
(1) In this Chapter—
“business”, “member” and “property” have the same meanings as in the Insolvency Act 1986;
“company” means—
a company registered under the Companies Act 2006, or
an unregistered company;
“court”, in relation to a company, means the court—
having jurisdiction to wind up the company, or
that would have such jurisdiction apart from section 221(2) or 441(2) of the Insolvency Act 1986 (exclusion of winding up jurisdiction in case of companies having principal place of business in, or incorporated in, Northern Ireland);
“modification” includes omission, addition or alteration, and cognate expressions are to be construed accordingly;
“non-GB company” means a company incorporated outside Great Britain;
“objective of a transport and storage administration” is to be construed in accordance with section 43;
“subsidiary” and “wholly-owned subsidiary” have the meaning given by section 1159 of the Companies Act 2006;
“T&S administration order” (or “transport and storage administration order”) has the meaning given by section 42(1);
“T&S administrator” has the meaning given by section 42(2)(c) and is to be construed in accordance with subsection (2) of this section;
“T&S company” has the meaning given by section 42(2)(b);
“unregistered company” means a company that is not registered under the Companies Act 2006.
(2) In this Chapter references to the T&S administrator of a company—
(a) include references to a person appointed under paragraph 91 or 103 of Schedule B1 to the Insolvency Act 1986, as applied by Part 1 of Schedule 20 to the Energy Act 2004 and section 44 of this Act to be the T&S administrator of that company, and
(b) where two or more persons are appointed to be the T&S administrator of that company, are to be construed in accordance with the provision made under section 158(5) of the Energy Act 2004, as applied by section 44 of this Act.
(1) This section applies where—
(a) a termination event has arisen in relation to a licence, and
(b) the economic regulator has complied with its duties under section 17 in relation to the termination event.
(2) The Secretary of State may make a scheme for the transfer of designated property, rights or liabilities of the licence holder to a person falling within subsection (3), or two or more of those persons, with the objective of—
(a) securing that the activities authorised by the licence continue in a manner which—
(i) is efficient and economical, and
(ii) ensures the safety and security of the transport and storage network, or the part of that network, to which the licence relates, or
(b) facilitating the cessation of the transportation and injection of carbon dioxide authorised by the licence and ensuring the safety and security of the transport and storage network, or the part of that network, to which the licence relates.
(3) The persons to whom a scheme may transfer designated property, rights or liabilities are—
(a) the Secretary of State;
(b) any person the Secretary of State considers to be an appropriate person to achieve the objective in subsection (2)(a) or (as the case may be) (b).
(4) In determining whether a person is an appropriate person for the purposes of subsection (3)(b), the Secretary of State must take into account whether the person would be able to meet the conditions and requirements of any licence or permit that would be transferred to the person under the proposed scheme.
(5) The Secretary of State may not make a scheme without the consent of—
(a) the licence holder, and
(b) where the scheme would transfer designated property, rights and liabilities to a person or persons falling within subsection (3)(b), each such person.
(6) In this section—
“designated”, in relation to a scheme, means specified in or determined in accordance with the scheme;
“termination event” has the meaning given by section 17.
(1) If the Secretary of State proposes to make a scheme under section 50, the Secretary of State must consult the licence holder mentioned in section 50(2) (“the proposed transferor”) before making the scheme.
(2) If the Secretary of State proposes to make a scheme under section 50 which transfers designated property, rights or liabilities to a person or persons falling within section 50(3)(b) (“the proposed transferee or transferees”), the Secretary of State must consult before making the scheme—
(a) the proposed transferee or transferees, and
(b) where a proposed transferee is not a public authority—
(i) the economic regulator,
(ii) the Health and Safety Executive,
(iii) the Oil and Gas Authority,
(iv) the appropriate devolved authorities (if any), and
(v) such other persons as the Secretary of State considers appropriate.
(3) The matters on which the Secretary of State is to consult the proposed transferor, and the proposed transferee or transferees, must include the provision the proposed scheme should make.
(4) The matters on which the Secretary of State is to consult a body or person falling within subsection (2)(b)(i) to (v) must include whether the proposed transferee is an appropriate person, or whether the proposed transferees are appropriate persons, for the purposes of section 50(3)(b).
(5) For the purposes of subsection (2)(b)(iv) the “appropriate devolved authorities” are—
(a) the Welsh Ministers, if provision making the proposed scheme 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);
(b) the Scottish Ministers, if provision making the proposed scheme would be within the legislative competence of the Scottish Parliament if it were contained in an Act of that Parliament;
(c) the Department for the Economy in Northern Ireland, if provision making the proposed scheme—
(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.
(6) In this section, “designated” has the same meaning as in section 50.
53 Cooperation of storage licensing authority with economic regulator
(1) In Chapter 3 of Part 1 of the Energy Act 2008 (storage of carbon dioxide), after section 34 insert—
Cooperation with economic regulator
34A (1) This section applies where a licence holder also holds a relevant licence.
(2) The licensing authority who granted the licence to the licence holder must provide such assistance as the economic regulator may reasonably require in carrying out its functions in relation to the relevant licence.
(3) The licensing authority must, in particular, inform the economic regulator if it becomes aware of—
(a) circumstances that have arisen, or are likely to arise, in relation to the activities authorised by the licence which, in the opinion of the licensing authority, could affect the carrying on of activities authorised by the relevant licence;
(b) circumstances that have arisen, or are likely to arise, in which the licence or a storage permit granted under the licence may be terminated.
(4) In this section—
“economic regulator” has the same meaning as in Part 1 of the Energy Act 2023 (see section 55 of that Act);
“relevant licence” means a licence under section 7 of the Energy Act 2023;
“storage permit” means a storage permit within the meaning of—
regulation 1(3) of the Storage of Carbon Dioxide (Licensing etc) Regulations 2010 (S.I. 2010/2221), or
regulation 1(3) of the Storage of Carbon Dioxide (Licensing etc) (Scotland) Regulations 2011 (S.S.I. 2011/24).
Information sharing with economic regulator
34B (1) A licensing authority may provide information relating to a licence or a storage permit granted under a licence to the economic regulator for the purpose of enabling or facilitating the exercise of the economic regulator’s functions in relation to a relevant licence.
(2) Except as provided by subsection (3), the disclosure of information under this section does not breach—
(a) any obligation of confidence owed by the person making the disclosure, or
(b) any other restriction on the disclosure of information (however imposed).
(3) This section does not authorise or require a disclosure of information if the disclosure would contravene the data protection legislation (but in determining whether a disclosure would do so, the power conferred by subsection (1) is to be taken into account).
(4) In this section—
“the data protection legislation” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act);
“economic regulator”, “relevant licence” and “storage permit” have the same meaning as in section 34A;
“information” includes advice.
(2) In section 8 of the Energy Act 2016 (matters to which the Oil and Gas Authority must have regard), in subsection (1), in the paragraph headed “Collaboration”, after “government of the United Kingdom” insert “, with the Gas and Electricity Markets Authority,”.
In this Part—
“carbon dioxide stream” means a flow of substances that results from carbon dioxide capture processes;
“CMA” means the Competition and Markets Authority;
“contravention”, in relation to any direction, condition, requirement, regulation or order, includes any failure to comply with it and cognate expressions are to be construed accordingly;
“the data protection legislation” has the same meaning as in the Data Protection Act 2018 (see section 3 of that Act);
“economic regulator” has the meaning given by section 1(2);
“enactment” includes—
an enactment contained in subordinate legislation (as defined in section 21 of the Interpretation Act 1978);
an enactment contained in, or in an instrument made under, a Measure or Act of Senedd Cymru;
an enactment contained in, or in an instrument made under, an Act of the Scottish Parliament;
an enactment contained in, or in an instrument made under, Northern Ireland legislation;
any retained direct EU legislation;
“final order” has the meaning given by section 31(4);
“financial year” means a financial year of the economic regulator;
“functions” includes powers and duties;
“geological formation” means a lithostratigraphical subdivision within which distinct rock layers can be found and mapped;
“geological storage”, in relation to carbon dioxide, means storage of carbon dioxide streams in underground geological formations with a view to the permanent containment of carbon dioxide (and references to geological storage are to be read as including injection);
“grantor” has the meaning given by section 9(10);
“licence”, except where the context otherwise requires, means a licence under section 7, and “licence holder” is to be interpreted accordingly;
“licensable activities” has the meaning given by section 1(10);
“licensable means of transportation” has the meaning given by section 2(3);
“modifications” includes additions, alterations and omissions and cognate expressions are to be construed accordingly;
“operates”, in relation to a site for the geological storage of carbon dioxide, is to be interpreted in accordance with section 2(10);
“provisional order” has the meaning given by section 31(4);
“transport and storage network” has the meaning given by section 1.
(1) In this Chapter—
“allocation body” has the meaning given by section 73(6)(d);
“allocation notification” has the meaning given by section 75(3);
“carbon capture allocation body” has the meaning given by section 73(6)(b);
“carbon capture counterparty” has the meaning given by section 67(3);
“carbon capture entity” has the meaning given by section 67(7);
“carbon capture revenue support contract” has the meaning given by section 67(2);
“carbon dioxide transport and storage counterparty” has the meaning given by section 59(3);
“carbon dioxide transport and storage revenue support contract” has the meaning given by section 59(2);
“eligible carbon capture entity” is to be interpreted in accordance with regulations by virtue of section 68(4);
“eligible hydrogen storage provider” is to be interpreted in accordance with section 64(4);
“eligible hydrogen transport provider” is to be interpreted in accordance with section 62(4);
“eligible low carbon hydrogen producer” is to be interpreted in accordance with regulations by virtue of section 66(4);
“GB gas shipper” means a person who holds a licence under section 7A(2) of the Gas Act 1986;
“hydrogen levy administrator” has the meaning given by section 69(6);
“hydrogen production allocation body” has the meaning given by section 73(6)(a);
“hydrogen production counterparty” has the meaning given by section 65(3);
“hydrogen production revenue support contract” has the meaning given by section 65(2);
“hydrogen storage counterparty” has the meaning given by section 63(3);
“hydrogen storage provider” has the meaning given by section 63(7);
“hydrogen storage revenue support contract” has the meaning given by section 63(2);
“hydrogen transport counterparty” has the meaning given by section 61(3);
“hydrogen transport provider” has the meaning given by section 61(7);
“hydrogen transport revenue support contract” has the meaning given by section 61(2);
“low carbon hydrogen producer” has the meaning given by section 65(7);
“Northern Ireland gas shipper” means a person who holds a licence under Article 8(1)(c) of the Gas (Northern Ireland) Order 1996 (S.I. 1996/275 (N.I. 2)) and who in the opinion of the Secretary of State carries on an activity which is similar to an activity that (in Great Britain) may be authorised by a licence under section 7A(2) of the Gas Act 1986;
“relevant market participant” has the meaning given by section 70(8);
“revenue support contract” has the meaning given by section 57(2);
“revenue support counterparty” has the meaning given by section 58(6);
“revenue support regulations” has the meaning given by section 57(4).
(2) In this Chapter references to “allocating” a hydrogen production revenue support contract or carbon capture revenue support contract to a person are to be interpreted in accordance with section 73(6).
(1) The Secretary of State may by regulations make provision about revenue support contracts (including the funding of liabilities and costs in relation to such contracts).
(2) In this Chapter “revenue support contract” means—
(a) a carbon dioxide transport and storage revenue support contract (see section 59(2)),
(b) a hydrogen transport revenue support contract (see section 61(2)),
(c) a hydrogen storage revenue support contract (see section 63(2)),
(d) a hydrogen production revenue support contract (see section 65(2)), or
(e) a carbon capture revenue support contract (see section 67(2)).
(3) The provision made by this Chapter is without prejudice to the generality of subsection (1).
(4) In this Part “revenue support regulations” means regulations under this section.
(5) Revenue support regulations may—
(a) make different provision for different cases or circumstances or for different purposes;
(b) provide for exemptions or other exceptions to any requirement imposed by the regulations.
(6) Revenue support regulations may—
(a) include incidental, supplementary or consequential provision;
(b) make transitory or transitional provision or savings.
(7) Revenue support regulations may confer any function on any person.
(8) Revenue support regulations may provide for a function conferred on a person to be exercisable on that person’s behalf by another person.
(9) Regulations of any of the following kinds are subject to the affirmative procedure—
(a) the first revenue support regulations that make (with or without other provision) provision falling within any of sections 70, 71, 72, 77, 78, 82 or 83;
(b) revenue support regulations that make (with or without other provision) provision falling within any of sections 58(2), 60(3), 62(2) or (4), 64(2) or (4), 66(2) or (4), 68(2) or (4), 75, 76, 81(4) or 84.
(10) Any other revenue support regulations are subject to the negative procedure.
(11) If, apart from this subsection, a draft of an instrument containing revenue support regulations would be treated for the purposes of the standing orders of either House of Parliament as a hybrid instrument, it is to proceed in that House as if it were not such an instrument.
(1) A revenue support counterparty must act in accordance with—
(a) any direction given by the Secretary of State by virtue of this Chapter;
(b) any provision included in revenue support regulations.
(2) Revenue support regulations may make provision—
(a) to require a revenue support counterparty to enter into arrangements or to offer to contract for purposes connected to a revenue support contract;
(b) specifying things that a revenue support counterparty may or must do, or things that a revenue support counterparty may not do;
(c) conferring on the Secretary of State further powers to direct a revenue support counterparty to do, or not to do, things specified in the regulations or the direction.
(3) The provision that may be made by virtue of subsection (2)(b) or (c) includes provision requiring consultation with, or the consent of, the Secretary of State in relation to—
(a) the determination of an application for a modification agreement under section 78;
(b) the enforcement of obligations under a revenue support contract;
(c) a variation or termination of a revenue support contract;
(d) the settlement or compromise of a claim under a revenue support contract;
(e) the conduct of legal proceedings relating to a revenue support contract;
(f) the exercise of rights under a revenue support contract.
(4) A revenue support counterparty must exercise the functions conferred by or by virtue of this Chapter so as to ensure that it can meet its liabilities under any revenue support contract to which it is a party.
(5) Revenue support regulations must include such provision as the Secretary of State considers necessary so as to ensure that a carbon dioxide transport and storage counterparty, hydrogen transport counterparty, hydrogen storage counterparty, hydrogen production counterparty or carbon capture counterparty can meet its liabilities under any carbon dioxide transport and storage revenue support contract, hydrogen transport revenue support contract, hydrogen storage revenue support contract, hydrogen production revenue support contract or (as the case may be) carbon capture revenue support contract to which it is a party.
(6) In this Chapter “revenue support counterparty” means—
(a) a carbon dioxide transport and storage counterparty (see section 59(3)),
(b) a hydrogen transport counterparty (see section 61(3)),
(c) a hydrogen storage counterparty (see section 63(3)),
(d) a hydrogen production counterparty (see section 65(3)), or
(e) a carbon capture counterparty (see section 67(3)).
59 Designation of carbon dioxide transport and storage counterparty
(1) The Secretary of State may by notice given to a person designate the person to be a counterparty for carbon dioxide transport and storage revenue support contracts.
(2) A “carbon dioxide transport and storage revenue support contract” is a contract in relation to which both the following paragraphs apply—
(a) the contract is between a carbon dioxide transport and storage counterparty and the holder of a licence under section 7;
(b) the contract was entered into by a carbon dioxide transport and storage counterparty in pursuance of a direction given to it under section 60(1).
(3) A person designated under subsection (1) is referred to in this Chapter as a “carbon dioxide transport and storage counterparty”.
(4) A designation may be made only with the consent of the person designated (except where that person is the Secretary of State).
(5) The Secretary of State may exercise the power to designate so that more than one designation has effect under subsection (1), but only if the Secretary of State considers it necessary for the purposes of ensuring that—
(a) liabilities under a carbon dioxide transport and storage revenue support contract are met,
(b) arrangements entered into for purposes connected to a carbon dioxide transport and storage revenue support contract continue to operate, or
(c) directions given to a carbon dioxide transport and storage counterparty continue to have effect.
(6) As soon as reasonably practicable after a designation ceases to have effect, the Secretary of State must make one or more transfer schemes under section 86 to ensure the transfer of all rights and liabilities under any carbon dioxide transport and storage revenue support contract to which the person who has ceased to be a carbon dioxide transport and storage counterparty was a party.
60 Direction to offer to contract with licence holder
(1) The Secretary of State may, in accordance with any provision made by revenue support regulations, direct a carbon dioxide transport and storage counterparty to offer to contract with an eligible person specified in the direction, on terms specified in the direction.
(2) The following are “eligible” persons for the purposes of this section—
(a) the holder of a licence under section 7, or
(b) a person who is to be granted a licence under section 7 (and has been notified of that by the Secretary of State or the GEMA).
(3) Revenue support regulations may make further provision about a direction under this section and in particular about—
(a) the circumstances in which a direction may or must be given;
(b) the terms that may or must be specified in a direction.
(1) The Secretary of State may by notice given to a person designate the person to be a counterparty for hydrogen transport revenue support contracts.
(2) A “hydrogen transport revenue support contract” is a contract to which a hydrogen transport counterparty is a party and which was entered into by a hydrogen transport counterparty in pursuance of a direction given to it under section 62(1).
(3) A person designated under subsection (1) is referred to in this Chapter as a “hydrogen transport counterparty”.
(4) A designation may be made only with the consent of the person designated (except where that person is the Secretary of State).
(5) The Secretary of State may exercise the power of designation so that more than one designation has effect under subsection (1), but only if the Secretary of State considers it necessary for the purposes of ensuring that—
(a) liabilities under a hydrogen transport revenue support contract are met,
(b) arrangements entered into for purposes connected to a hydrogen transport revenue support contract continue to operate, or
(c) directions given to a hydrogen transport counterparty continue to have effect.
(6) As soon as reasonably practicable after a designation ceases to have effect, the Secretary of State must make one or more transfer schemes under section 86 to ensure the transfer of all rights and liabilities under any hydrogen transport revenue support contract to which the person who has ceased to be a hydrogen transport counterparty was a party.
(7) In this Chapter “hydrogen transport provider” means a person who carries on (or is to carry on) in the United Kingdom activities of transporting hydrogen.
(8) In subsection (7) the reference to carrying on activities in the United Kingdom includes carrying on activities in, above or below—
(a) the territorial sea adjacent to the United Kingdom;
(b) waters in a Renewable Energy Zone (within the meaning of Chapter 2 of Part 2 of the Energy Act 2004);
(c) waters in a Gas Importation and Storage Zone (within the meaning given by section 1 of the Energy Act 2008).
(9) In subsection (7) “transporting hydrogen” includes transporting a compound, of which hydrogen is an element, which revenue support regulations specify as a qualifying compound for the purposes of this section.
62 Direction to offer to contract with eligible hydrogen transport provider
(1) The Secretary of State may, in accordance with any provision made by revenue support regulations, direct a hydrogen transport counterparty to offer to contract with an eligible hydrogen transport provider specified in the direction, on terms specified in the direction.
(2) Revenue support regulations may make further provision about a direction under this section and in particular about—
(a) the circumstances in which a direction may or must be given;
(b) the terms that may or must be specified in a direction.
(3) Provision falling within subsection (2) may include provision for calculations or determinations to be made under the regulations, including by such persons, in accordance with such procedure and by reference to such matters and to the opinion of such persons, as may be specified in the regulations.
(4) Revenue support regulations must make provision for determining the meaning of “eligible” in relation to a hydrogen transport provider.
(5) Regulations within subsection (4) may in particular make provision by reference to standards or other published documents (as they have effect from time to time).
(1) The Secretary of State may by notice given to a person designate the person to be a counterparty for hydrogen storage revenue support contracts.
(2) A “hydrogen storage revenue support contract” is a contract to which a hydrogen storage counterparty is a party and which was entered into by a hydrogen storage counterparty in pursuance of a direction given to it under section 64(1).
(3) A person designated under subsection (1) is referred to in this Chapter as a “hydrogen storage counterparty”.
(4) A designation may be made only with the consent of the person designated (except where that person is the Secretary of State).
(5) The Secretary of State may exercise the power of designation so that more than one designation has effect under subsection (1), but only if the Secretary of State considers it necessary for the purposes of ensuring that—
(a) liabilities under a hydrogen storage revenue support contract are met,
(b) arrangements entered into for purposes connected to a hydrogen storage revenue support contract continue to operate, or
(c) directions given to a hydrogen storage counterparty continue to have effect.
(6) As soon as reasonably practicable after a designation ceases to have effect, the Secretary of State must make one or more transfer schemes under section 86 to ensure the transfer of all rights and liabilities under any hydrogen storage revenue support contract to which the person who has ceased to be a hydrogen storage counterparty was a party.
(7) In this Chapter “hydrogen storage provider” means a person who carries on (or is to carry on) in the United Kingdom activities of storing hydrogen.
(8) In subsection (7) the reference to carrying on activities in the United Kingdom includes carrying on activities in, above or below—
(a) the territorial sea adjacent to the United Kingdom;
(b) waters in a Renewable Energy Zone (within the meaning of Chapter 2 of Part 2 of the Energy Act 2004);
(c) waters in a Gas Importation and Storage Zone (within the meaning given by section 1 of the Energy Act 2008).
(9) In subsection (7) “storing hydrogen” includes storing a compound, of which hydrogen is an element, which revenue support regulations specify as a qualifying compound for the purposes of this section.
64 Direction to offer to contract with eligible hydrogen storage provider
(1) The Secretary of State may, in accordance with any provision made by revenue support regulations, direct a hydrogen storage counterparty to offer to contract with an eligible hydrogen storage provider specified in the direction, on terms specified in the direction.
(2) Revenue support regulations may make further provision about a direction under this section and in particular about—
(a) the circumstances in which a direction may or must be given;
(b) the terms that may or must be specified in a direction.
(3) Provision falling within subsection (2) may include provision for calculations or determinations to be made under the regulations, including by such persons, in accordance with such procedure and by reference to such matters and to the opinion of such persons, as may be specified in the regulations.
(4) Revenue support regulations must make provision for determining the meaning of “eligible” in relation to a hydrogen storage provider.
(5) Regulations within subsection (4) may in particular make provision by reference to standards or other published documents (as they have effect from time to time).
65 Designation of hydrogen production counterparty
(1) The Secretary of State may by notice given to a person designate the person to be a counterparty for hydrogen production revenue support contracts.
(2) A “hydrogen production revenue support contract” is a contract to which a hydrogen production counterparty is a party and which was entered into by a hydrogen production counterparty in pursuance of a direction given to it under section 66(1) or a notification given to it under section 75(1).
(3) A person designated under subsection (1) is referred to in this Chapter as a “hydrogen production counterparty”.
(4) A designation may be made only with the consent of the person designated (except where that person is the Secretary of State).
(5) The Secretary of State may exercise the power of designation so that more than one designation has effect under subsection (1), but only if the Secretary of State considers it necessary for the purposes of ensuring that—
(a) liabilities under a hydrogen production revenue support contract are met,
(b) arrangements entered into for purposes connected to a hydrogen production revenue support contract continue to operate, or
(c) directions given to a hydrogen production counterparty continue to have effect.
(6) As soon as reasonably practicable after a designation ceases to have effect, the Secretary of State must make one or more transfer schemes under section 86 to ensure the transfer of all rights and liabilities under any hydrogen production revenue support contract to which the person who has ceased to be a hydrogen production counterparty was a party.
(7) In this Chapter—
“low carbon hydrogen producer” means a person who carries on (or is to carry on) in the United Kingdom activities of producing hydrogen which in the opinion of the Secretary of State will contribute to a reduction in emissions of greenhouse gases;
“greenhouse gas” has the meaning given by section 92(1) of the Climate Change Act 2008.
(8) In subsection (7) the reference to carrying on activities in the United Kingdom includes carrying on activities in, above or below—
(a) the territorial sea adjacent to the United Kingdom;
(b) waters in a Renewable Energy Zone (within the meaning of Chapter 2 of Part 2 of the Energy Act 2004).
66 Direction to offer to contract with eligible low carbon hydrogen producer
(1) The Secretary of State may, in accordance with any provision made by revenue support regulations, direct a hydrogen production counterparty to offer to contract with an eligible low carbon hydrogen producer specified in the direction, on terms specified in the direction.
(2) Revenue support regulations may make further provision about a direction under this section and in particular about—
(a) the circumstances in which a direction may or must be given;
(b) the terms that may or must be specified in a direction.
(3) Provision falling within subsection (2) may include provision for—
(a) the determination of a matter on a competitive basis,
(b) calculations or determinations to be made under the regulations, including by such persons, in accordance with such procedure and by reference to such matters and to the opinion of such persons, as may be specified in the regulations.
(4) Revenue support regulations must make provision for determining the meaning of “eligible” in relation to a low carbon hydrogen producer.
(5) Regulations within subsection (4) may in particular make provision by reference to standards or other published documents (as they have effect from time to time).
(1) The Secretary of State may by notice given to a person designate the person to be—
(a) a counterparty for carbon capture revenue support contracts;
(b) a counterparty for any one or more descriptions of carbon capture revenue support contract.
(2) A “carbon capture revenue support contract” is a contract to which a carbon capture counterparty is a party and which was entered into by a carbon capture counterparty in pursuance of a direction given to it under section 68(1) or a notification given to it under section 75(2).
(3) A person designated under subsection (1) is referred to in this Chapter as a “carbon capture counterparty”.
(4) A designation may be made only with the consent of the person designated (except where that person is the Secretary of State).
(5) The Secretary of State may—
(a) exercise the power under paragraph (a) of subsection (1) so that more than one designation has effect under that paragraph;
(b) exercise the power under paragraph (b) of that subsection so that more than one designation has effect in respect of any description of carbon capture revenue support contract.
(6) As soon as reasonably practicable after a designation ceases to have effect, the Secretary of State must make one or more transfer schemes under section 86 to ensure the transfer of all rights and liabilities under any carbon capture revenue support contract to which the person who has ceased to be a carbon capture counterparty was a party.
(7) In this section—
“carbon capture entity” means a person who carries on (or is to carry on) in the United Kingdom, with a view to the storage of carbon dioxide, activities of capturing carbon dioxide (or any substance consisting primarily of carbon dioxide) that—
has been produced by commercial or industrial activities,
is in the atmosphere, or
has dissolved in sea water;
“storage”, in relation to carbon dioxide, means any storage with a view to the permanent containment of carbon dioxide.
(8) In subsection (7) the reference to carrying on activities in the United Kingdom includes carrying on activities in, above or below—
(a) the territorial sea adjacent to the United Kingdom;
(b) waters in a Gas Importation and Storage Zone (within the meaning given by section 1 of the Energy Act 2008).
68 Direction to offer to contract with eligible carbon capture entity
(1) The Secretary of State may, in accordance with any provision made by revenue support regulations, direct a carbon capture counterparty to offer to contract with an eligible carbon capture entity specified in the direction, on terms specified in the direction.
(2) Revenue support regulations may make further provision about a direction under this section and in particular about—
(a) the circumstances in which a direction may or must be given;
(b) the terms that may or must be specified in a direction.
(3) Provision falling within subsection (2) may include provision for—
(a) the determination of a matter on a competitive basis,
(b) calculations or determinations to be made under the regulations, including by such persons, in accordance with such procedure and by reference to such matters and to the opinion of such persons, as may be specified in the regulations.
(4) Revenue support regulations must make provision for determining the meaning of “eligible” in relation to a carbon capture entity.
(5) Regulations within subsection (4) may in particular make provision by reference to standards or other published documents (as they have effect from time to time).
(1) The Secretary of State may by regulations appoint a person to carry out functions with respect to obligations of relevant market participants under section 70.
(2) The Secretary of State may exercise the power under subsection (1) so that more than one appointment has effect under that subsection at the same time.
(3) An appointment may be made only with the consent of the person appointed (except where that person is the Secretary of State).
(4) An appointment ceases to have effect if the Secretary of State by regulations revokes the appointment.
(5) As soon as reasonably practicable after a person’s appointment under subsection (1) ceases to have effect, the Secretary of State must make one or more transfer schemes under section 86 to ensure the transfer of any rights and liabilities of that person that the Secretary of State considers appropriate.
(6) A person appointed under subsection (1) is called a “hydrogen levy administrator”.
(1) Revenue support regulations may make provision for relevant market participants (see subsection (8)) to make payments to a hydrogen levy administrator for the purpose of enabling—
(a) a hydrogen transport counterparty to make payments under a hydrogen transport revenue support contract or in respect of liabilities incurred in connection with hydrogen transport revenue support contracts;
(b) a hydrogen storage counterparty to make payments under a hydrogen storage revenue support contract or in respect of liabilities incurred in connection with hydrogen storage revenue support contracts;
(c) a hydrogen production counterparty to make payments under a hydrogen production revenue support contract or in respect of liabilities incurred in connection with the contract;
(d) a counterparty to a carbon dioxide transport and storage revenue support contract to make payments under that contract, or in respect of liabilities incurred in connection with that contract, for a purpose connected with hydrogen production revenue support contracts.
(2) Revenue support regulations may make provision for relevant market participants to make payments to a hydrogen levy administrator for the purpose of enabling the hydrogen levy administrator—
(a) to meet or reimburse such descriptions of relevant costs (whether of the hydrogen levy administrator or another person) as the Secretary of State considers appropriate;
(b) to hold sums in reserve;
(c) to cover losses in the case of insolvency or default of a relevant market participant.
(3) Revenue support regulations may make provision about the method of calculating or determining amounts that are to be paid by a hydrogen levy administrator for a purpose mentioned in subsection (1) or (2), including provision for adjustments or apportionments in cases where an amount required to be paid by a hydrogen levy administrator for such a purpose has not been paid in full.
(4) Revenue support regulations may make provision to require relevant market participants to provide financial collateral to a hydrogen levy administrator (whether in cash, securities or any other form).
(5) Revenue support regulations that make provision by virtue of subsection (1) for the payment of sums by relevant market participants must impose on a hydrogen levy administrator a duty in relation to the collection of such sums.
(6) In subsection (1) a reference to liabilities incurred in connection with a revenue support contract includes liabilities incurred in connection with a contract entered into by the counterparty concerned for a purpose related to that contract.
(7) In subsection (2) “relevant costs” means any costs in connection with the performance of any function conferred by or by virtue of this Chapter.
(8) In this Chapter “relevant market participants” means one or more descriptions of persons specified in revenue support regulations, but a description so specified may not include persons other than—
(a) GB gas shippers;
(b) Northern Ireland gas shippers.
(9) Revenue support regulations may make provision about eligibility for exemptions from obligations imposed on relevant market participants by regulations within subsections (1) to (4).
(1) Revenue support regulations may make provision about amounts which must be paid—
(a) by a hydrogen levy administrator to relevant market participants, or
(b) by a relevant counterparty—
(i) to relevant market participants, or
(ii) to a hydrogen levy administrator for the purpose of enabling payments to be made to relevant market participants.
(2) Regulations by virtue of subsection (1) may make provision—
(a) for a hydrogen levy administrator to calculate or determine, in accordance with such criteria as may be provided for by or under the regulations, amounts which are owed by—
(i) the hydrogen levy administrator, or
(ii) a relevant counterparty;
(b) for a relevant counterparty to calculate or determine, in accordance with such criteria as may be provided for by or under the regulations, amounts which are owed by—
(i) the relevant counterparty, or
(ii) a hydrogen levy administrator;
(c) for the issuing of notices by a hydrogen levy administrator to require the payment by a relevant counterparty of amounts calculated or determined by the hydrogen levy administrator in accordance with paragraph (a)(ii);
(d) for the issuing of notices by a relevant counterparty to require the payment by a hydrogen levy administrator of amounts calculated or determined by the relevant counterparty in accordance with paragraph (b)(ii);
(e) for the provision of copies of notices such as are mentioned in paragraph (c) or (d) to persons specified in the regulations, or the publication of such notices.
(3) Revenue support regulations may make provision imposing on a relevant market participant who receives a payment from a hydrogen levy administrator or a relevant counterparty a requirement to secure that customers of the relevant market participant receive, by a time specified in the regulations, such benefit from the payment as may be specified in or determined in accordance with the regulations.
(4) In this section “relevant counterparty” means any of the following—
(a) a hydrogen transport counterparty;
(b) a hydrogen storage counterparty;
(c) a hydrogen production counterparty.
(1) Revenue support regulations may make provision—
(a) specifying things that a hydrogen levy administrator may or must do, or things that a hydrogen levy administrator may not do;
(b) conferring on the Secretary of State powers to direct a hydrogen levy administrator to do, or not to do, things specified in the regulations or the direction.
(2) The following provisions of this section are without prejudice to the generality of subsection (1)(a).
(3) Revenue support regulations may make provision—
(a) for a hydrogen levy administrator to calculate or determine, in accordance with such criteria as may be provided for by or under the regulations, amounts that are owed by a relevant market participant or are to be provided as financial collateral by a relevant market participant;
(b) for the issuing of notices by a hydrogen levy administrator to require the payment or provision of such amounts;
(c) for the provision of copies of such notices to persons specified in the regulations or the publication of such notices;
(d) for the enforcement of obligations imposed by or under the regulations (including provision about interest on late payments and imposing financial penalties);
(e) about the resolution of disputes, including provision about arbitration or appeals (which may in particular include provision for the person conducting an arbitration or determining an appeal to order the payment of costs or expenses or compensation);
(f) for a hydrogen levy administrator to determine the form and terms of any financial collateral;
(g) for a hydrogen levy administrator to hold sums in reserve.
(4) Provision made by virtue of subsection (3)(a) or section 70(3) or (9) or 71(2) or (3) may provide for anything that is to be calculated or determined under the regulations to be calculated or determined—
(a) by such persons,
(b) in accordance with such procedure, and
(c) by reference to such matters and to the opinion of such persons,
as may be specified in the regulations.
(5) Provision made by virtue of subsection (3)(d) for the imposition of a financial penalty must include provision for a right of appeal against the imposition of the penalty.
(6) Any sum that—
(a) a relevant market participant is required by virtue of revenue support regulations to pay to a hydrogen levy administrator, and
(b) has not been paid by the date on which it is required by virtue of revenue support regulations to be paid,
may be recovered from the relevant market participant by the hydrogen levy administrator as a civil debt due to it.
(7) Revenue support regulations may make provision about the application of sums held by a hydrogen levy administrator.
(8) The provision that may be made by virtue of subsection (7) includes provision that sums are to be paid, or not to be paid, into the Consolidated Fund.
(1) The Secretary of State may by regulations appoint—
(a) a person to carry out functions in connection with the allocation of hydrogen production revenue support contracts;
(b) a person to carry out functions in connection with the allocation of carbon capture revenue support contracts.
(2) The power under each paragraph of subsection (1) may be exercised so that more than one appointment has effect under that paragraph at the same time.
(3) An appointment may be made only with the consent of the person appointed (except where that person is the Secretary of State).
(4) An appointment ceases to have effect if—
(a) the Secretary of State by regulations revokes the appointment, or
(b) the person withdraws consent.
(5) Regulations under subsection (1) may make provision with regard to the cessation of an appointment, including—
(a) provision requiring a person appointed under subsection (1) to give a period of notice no shorter than a period specified in the regulations when withdrawing their consent to appointment, or otherwise restricting or subjecting to conditions a person’s power under subsection (4) to withdraw consent;
(b) provision enabling a person who has ceased to be appointed under subsection (1) to continue to be treated as if they were so appointed, including provision about the purposes for which, the circumstances in which, and the period for which, such a person may be so treated.
(6) In this Chapter—
(a) a person appointed under subsection (1)(a) is called a “hydrogen production allocation body”;
(b) a person appointed under subsection (1)(b) is called a “carbon capture allocation body”;
(c) references to “allocating” a hydrogen production revenue support contract or carbon capture revenue support contract to a person are to specifying the person in a notification under section 75(1) or (2) (and references to the “allocation” of such a contract are to be interpreted accordingly);
(d) “allocation body” means a hydrogen production allocation body or a carbon capture allocation body.
(7) Regulations under this section, other than regulations under subsection (4)(a), are subject to the negative procedure.
(1) The Secretary of State may issue standard terms and conditions (“standard terms”) of—
(a) hydrogen production revenue support contracts;
(b) carbon capture revenue support contracts.
(2) The Secretary of State may from time to time revise standard terms.
(3) Standard terms issued or revised under this section must be in accordance with provision made in revenue support regulations.
(4) The Secretary of State must publish standard terms as issued or revised under this section.
(5) In publishing standard terms the Secretary of State may designate particular standard terms as terms that may not be modified under section 78.
(6) Different standard terms may be issued for different categories of hydrogen production revenue support contract or carbon capture revenue support contract.
(1) A hydrogen production allocation body may, in accordance with provision made by revenue support regulations, give a notification to a hydrogen production counterparty specifying—
(a) an eligible low carbon hydrogen producer, and
(b) such other information as may be required for the purpose of making an offer under section 77 to contract with that low carbon hydrogen producer.
(2) A carbon capture allocation body may, in accordance with provision made by revenue support regulations, give a notification to a carbon capture counterparty specifying—
(a) an eligible carbon capture entity, and
(b) such other information as may be required for the purpose of making an offer under section 77 to contract with that carbon capture entity.
(3) A notification given under subsection (1) or (2) is called an “allocation notification”.
(4) Revenue support regulations may make further provision about allocation notifications and in particular provision about—
(a) the circumstances in which an allocation notification may or must be given;
(b) the kinds of information that must be specified in an allocation notification in accordance with subsection (1)(b) or (2)(b);
(c) appeals against decisions not to give allocation notifications.
(1) Provision that may be made in revenue support regulations for the purposes of section 75(1) and (2) includes provision about how determinations are to be made as regards—
(a) which eligible low carbon hydrogen producer a hydrogen production revenue support contract is to be allocated to;
(b) which eligible carbon capture entity a carbon capture revenue support contract is to be allocated to.
(2) Provision made by revenue support regulations falling within subsection (1) may include—
(a) provision conferring power on the Secretary of State to make rules (an “allocation framework”) about the allocation of hydrogen production revenue support contracts or carbon capture revenue support contracts;
(b) provision for different periods within which hydrogen production revenue support contracts or carbon capture revenue support contracts are to be allocated (“allocation rounds”);
(c) provision for different allocation frameworks to apply in respect of different allocation rounds;
(d) provision for the publication of allocation frameworks;
(e) provision about matters in relation to which provision may or must be made in an allocation framework.
(3) Provision made by revenue support regulations falling within subsection (2) may impose requirements on the Secretary of State, including in particular—
(a) requirements as to the giving of notice before an allocation round is commenced;
(b) restrictions on the circumstances in which amendments may be made during an allocation round to an allocation framework or to any other matter relevant to an allocation round (including any amount by reference to which a limit on the contracts allocated during the round is to be determined).
(4) An allocation framework may—
(a) confer functions on an allocation body with respect to the allocation of hydrogen production revenue support contracts or carbon capture revenue support contracts;
(b) specify targets to be met or taken into account by an allocation body in giving allocation notifications by virtue of section 75, including targets relating to—
(i) the process used for producing hydrogen or for capturing carbon dioxide;
(ii) outputs or capacity (whether in respect of hydrogen production or capture of carbon dioxide);
(iii) the geographical location of an applicant’s activities;
(c) make provision by reference to standards or other published documents (as they have effect from time to time);
(d) make any provision that may be made by regulations by virtue of subsection (3).
(5) An allocation framework may include provision for—
(a) the determination of a matter on a competitive basis;
(b) calculations or determinations to be made under the framework, including by such persons, in accordance with such procedure and by reference to such matters and to the opinion of such persons, as may be specified in the framework.
(6) An allocation framework may—
(a) include incidental, supplementary and consequential provision;
(b) make transitory or transitional provision and savings;
(c) make different provision for different cases or circumstances or for different purposes;
(d) make provision subject to exceptions.
(7) Any power conferred by virtue of subsection (2) to make an allocation framework includes a power to amend, add to or remove an allocation framework.
(8) Subsections (4) to (7) are subject to any provision contained in revenue support regulations.
(1) Where an allocation notification is given to a hydrogen production counterparty under section 75(1), the counterparty must, in accordance with provision made by revenue support regulations, offer to contract with the eligible low carbon hydrogen producer specified in the notification on—
(a) standard terms, or
(b) standard terms as modified in accordance with any modification agreement entered into between the counterparty and the eligible low carbon hydrogen producer for the purposes of the allocation notification (see section 78).
(2) Where an allocation notification is given to a carbon capture counterparty under section 75(2), the counterparty must, in accordance with provision made by revenue support regulations, offer to contract with the eligible carbon capture entity specified in the notification on—
(a) standard terms, or
(b) standard terms as modified in accordance with any modification agreement entered into between the counterparty and the eligible carbon capture entity for the purposes of the allocation notification (see section 78).
(3) Revenue support regulations may make further provision about an offer to contract made under this section, including provision about—
(a) how a hydrogen production counterparty or carbon capture counterparty is to apply or complete standard terms in relation to the offer in accordance with information specified in an allocation notification;
(b) the time within which the offer must be made;
(c) how the eligible low carbon hydrogen producer or eligible carbon capture entity to whom the offer is made may enter into a hydrogen production revenue support contract or (as the case may be) carbon capture revenue support contract as a result of the offer;
(d) what is to happen if the eligible low carbon hydrogen producer or eligible carbon capture entity does not enter into such a contract as a result of the offer.
(4) In this section, “standard terms”, in relation to an allocation notification, means standard terms published under section 74, determined in accordance with revenue support regulations as the standard terms that are to apply in relation to the allocation notification.
(1) This section applies where a person wishes to be specified as an eligible low carbon hydrogen producer, or an eligible carbon capture entity, in an allocation notification (“the potential allocation notification”).
(2) A hydrogen production counterparty or (as the case requires) carbon capture counterparty and the person may, in accordance with provision made by revenue support regulations, agree to modify standard terms for the purposes of any offer that would be required under section 77 if the potential allocation notification is given (a “modification agreement”).
(3) A hydrogen production counterparty or carbon capture counterparty may enter into a modification agreement providing for the modification of any particular standard term only if—
(a) the counterparty is satisfied that—
(i) the effect of the modification is minor, and
(ii) the modification is necessary; and
(b) the standard term has not been designated under section 74(5) as a term that may not be modified under this section.
(4) Revenue support regulations may make further provision about modification agreements, including—
(a) the circumstances in which a person may make an application for a modification agreement;
(b) the time by which an application must be made;
(c) the procedure to be followed, and the information to be given, by the person in making an application;
(d) how a hydrogen production counterparty or carbon capture counterparty is to determine an application (including how it is to determine whether the effect of a modification is minor and whether it is necessary);
(e) the time by which determinations must be made;
(f) the form of modification agreements.
(5) Provision made by virtue of subsection (4)(d) may include provision under which the counterparty may make alternative proposals for modifications in response to an application.
(6) In this section “modify” includes add to, alter or omit, and “modification” is to be read accordingly.
Provision made by regulations by virtue of any of sections 75 to 78 may include provision for—
(a) the determination of a matter on a competitive basis;
(b) calculations or determinations to be made under the regulations, including by such persons, in accordance with such procedure and by reference to such matters and to the opinion of such persons, as may be specified in the regulations.