Energy Act 2023

• (1) The economic regulator may, for the purpose of exercising its functions under subsections (1) and (2) of section 28, serve a notice under subsection (2) on any licence holder.

• (2) A notice under this subsection is a notice which—

• (a) requires the person on whom it is served to produce, at a time and place specified in the notice, to the economic regulator any documents which are specified or described in the notice and are in that person’s custody or under their control, or

• (b) requires that person, if they are carrying on a business, to provide to the economic regulator in the form and manner, and within the period, specified in the notice, the information specified or described in the notice.

• (3) In paragraphs (a) and (b) of subsection (2) the reference to the economic regulator includes a person appointed by the economic regulator for the purpose of exercising the function in question.

• (4) A person who intentionally alters, suppresses or destroys any document or record of information which that person has been required to produce by a notice under subsection (2) is guilty of an offence liable—

• (a) on summary conviction in England and Wales, to a fine;

• (b) on summary conviction in Scotland or Northern Ireland, to a fine not exceeding the statutory maximum;

• (c) on conviction on indictment, to a fine.

• (5) Except as provided by subsection (6), 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).

• (6) 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, a requirement imposed by virtue of subsection (2) is to be taken into account).

Duty to carry out impact assessment

30

• (1) This section applies where—

• (a) the economic regulator is proposing to do anything for the purposes of, or in connection with, the carrying out of any function exercisable by it under or by virtue of this Part, and

• (b) it appears to the economic regulator that the proposal is important;

but this section does not apply if it appears to the economic regulator that the urgency of the matter makes it impracticable or inappropriate for the economic regulator to comply with the requirements of this section.

• (2) A proposal is important for the purposes of this section only if its implementation would be likely to do one or more of the following—

• (a) involve a major change in the activities carried on by the economic regulator;

• (b) have a significant impact on persons engaged in the capture, transportation or storage of carbon dioxide;

• (c) have a significant impact on persons engaged in commercial activities connected with the capture, transportation or storage of carbon dioxide;

• (d) have a significant impact on the general public in the United Kingdom or in a part of the United Kingdom;

• (e) have significant effects on the environment.

• (3) Before implementing its proposal, the economic regulator must either—

• (a) carry out and publish an assessment of the likely impact of implementing the proposal, or

• (b) publish a statement setting out its reasons for thinking that it is unnecessary for it to carry out an assessment.

• (4) An assessment carried out under this section must—

• (a) include an assessment of the likely effects on the environment of implementing the proposal, and

• (b) relate to such other matters as the economic regulator considers appropriate.

• (5) In determining the matters to which an assessment under this section should relate, the economic regulator must have regard to such general guidance relating to the carrying out of impact assessments as it considers appropriate.

• (6) An assessment carried out under this section may take such form as the economic regulator considers appropriate.

• (7) Where the economic regulator publishes an assessment under this section—

• (a) it must provide an opportunity of making representations to the economic regulator about its proposal to members of the public and other persons who, in the economic regulator’s opinion, are likely to be affected to a significant extent by the proposal’s implementation,

• (b) the published assessment must be accompanied by a statement setting out how representations may be made, and

• (c) the economic regulator must not implement its proposal unless the period for making representations about the proposal has expired and it has considered all the representations that were made in that period.

• (8) Where the economic regulator is required (apart from this section)—

• (a) to consult about a proposal to which this section applies, or

• (b) to give a person an opportunity of making representations about it,

the requirements of this section are in addition to, but may be performed contemporaneously with, the other requirements.

• (9) Every report under section 41 (annual reports on transport and storage licensing functions) must set out—

• (a) a list of the assessments under this section carried out during the financial year to which the report relates, and

• (b) a summary of the decisions taken during that year in relation to proposals to which assessments carried out in that year or previous financial years relate.

• (10) The publication of anything under this section must be in such manner as the economic regulator considers appropriate for bringing it to the attention of the persons who, in the economic regulator’s opinion, are likely to be affected if its proposal is implemented.

Reasons for decisions

31

• (1) This section applies to the following decisions of the economic regulator or the Secretary of State—

• (a) the revocation of a licence;

• (b) the modification of the conditions of a licence;

• (c) the giving of any directions or consent in pursuance of a condition included in a licence by virtue of section 11(2)(a) or (c);

• (d) the determination of a question referred in pursuance of a condition included in a licence by virtue of section 11(2)(d);

• (e) the making of a final order, the making or confirmation of a provisional order or the revocation of a final order or of a provisional order which has been confirmed.

• (2) As soon as reasonably practicable after making such a decision the economic regulator or the Secretary of State (“the decision maker”) must—

• (a) publish a notice stating the reasons for the decision in such manner as the decision maker considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be interested, and

• (b) send a copy of the notice to the licence holder to whose licence, or to whom, the decision relates.

• (3) In preparing a notice under subsection (2) the decision maker must have regard to the need for excluding, so far as that is practicable, any matter which relates to the affairs of a particular individual or body of persons (corporate or unincorporate), where the decision maker considers that publication of that matter would or might seriously and prejudicially affect the interests of that individual or body.

• (4) In this Part “final order” and “provisional order” have the same meaning as in Schedule 3 (see paragraph 1(12) of that Schedule).

Enforcement

Enforcement of obligations of licence holders

32

Schedule 3makes provision for the enforcement of conditions of licences and of other requirements imposed on licence holders by or under this Part.

False statements

Making of false statements etc

33

• (1) A person who, in giving any information or making any application for the purposes of any provision of this Part, or of any regulation made under any provision of this Part, makes any statement which the person knows to be false in a material particular, or recklessly makes any statement which is false in a material particular, is guilty of an offence and liable—

• (a) on summary conviction in England and Wales, to a fine;

• (b) on summary conviction in Scotland or Northern Ireland, to a fine not exceeding the statutory maximum;

• (c) on conviction on indictment, to a fine.

• (2) Proceedings for an offence under subsection (1) must not in England and Wales be instituted except by or with the consent of the Secretary of State or the Director of Public Prosecutions.

• (3) Proceedings for an offence under subsection (1) must not in Northern Ireland be instituted except by or with the consent of the Director of Public Prosecutions for Northern Ireland.

Criminal liability and procedure

Liability of officers of entities

34

• (1) Where an offence under this Part committed by a body corporate is proved—

• (a) to have been committed with the consent or connivance of an officer of the body corporate, or

• (b) to be attributable to neglect on the part of an officer of the body corporate,

that officer (as well as the body corporate) commits the offence and is liable to be proceeded against and dealt with accordingly.

• (2) In subsection (1) “officer”, in relation to a body corporate, means—

• (a) any director, manager, secretary or other similar officer of the body corporate, or

• (b) any person purporting to act in any such capacity.

• (3) In subsection (2) “director”, in relation to a body corporate whose affairs are managed by its members, means a member of the body corporate.

• (4) Where an offence under this Part is committed by a Scottish partnership and is proved to have been committed with the consent or connivance of a partner, or to be attributable to any neglect on the part of a partner, that partner (as well as the partnership) commits the offence and is liable to be proceeded against and dealt with accordingly.

Criminal proceedings

35

• (1) Proceedings for an offence under this Part may be taken, and the offence may for all incidental purposes be treated as having been committed, in any place in the United Kingdom.

• (2) Section 3 of the Territorial Waters Jurisdiction Act 1878 (restriction on prosecutions) does not apply to any proceedings for an offence under this Part.

• (3) Proceedings for an offence under this Part alleged to have been committed in an offshore place may not be instituted in England and Wales except—

• (a) by the Secretary of State or a person authorised by the Secretary of State, or

• (b) by or with the consent of the Director of Public Prosecutions.

• (4) Proceedings for an offence under this Part alleged to have been committed in an offshore place may not be instituted in Northern Ireland except—

• (a) by the Secretary of State or a person authorised by the Secretary of State, or

• (b) by or with the consent of the Director of Public Prosecutions for Northern Ireland.

• (5) In this section “offshore place” means a place in, under or over—

• (a) the territorial sea adjacent to the United Kingdom, or

• (b) waters in a Gas Importation and Storage Zone (within the meaning given by section 1 of the Energy Act 2008).

Chapter 2 — Functions with respect to competition

Functions under the Enterprise Act 2002

36

• (1) The functions to which subsection (2) applies are to be concurrent functions of the economic regulator and the CMA.

• (2) This subsection applies to the functions of the CMA under Part 4 of the Enterprise Act 2002 (other than sections 166, 171 and 174E) so far as those functions are exercisable by the CMA Board (within the meaning of Schedule 4 to the Enterprise and Regulatory Reform Act 2013) and relate to commercial activities connected with relevant storage and transport activities.

• (3) So far as necessary for the purposes of, or in connection with, subsections (1) and (2)—

• (a) references in Part 4 of the Enterprise Act 2002 to the CMA (including references in provisions of that Act applied by that Part) are to be construed as including references to the economic regulator (except in sections 166, 171 and 174E of that Act and in any other provision of that Act where the context otherwise requires);

• (b) references in that Part to section 5 of that Act are to be construed as including references to section 28(1) and (2) of this Act.

• (4) Section 130A of the Enterprise Act 2002 is to have effect in its application in relation to the economic regulator by virtue of subsections (1) and (2)—

• (a) as if for subsection (1) of that section there were substituted—

(1) Where the Gas and Electricity Markets Authority— (a) is proposing to carry out its functions under section 28(1) or (2) of the Energy Act 2023 in relation to a matter for the purposes mentioned in subsection (2), and (b) considers that the matter is one in respect of which it would be appropriate for the Gas and Electricity Markets Authority to exercise its powers under section 174 (investigation) in connection with deciding whether to make a reference under section 131, the Gas and Electricity Markets Authority must publish a notice under this section (referred to in this Part as a “market study notice”).

, and

• (b) as if in subsection (2)(a) of that section, for “the acquisition or supply of goods or services of one or more than one description in the United Kingdom” there were substituted “commercial activities connected with activities to which section 36(2) of the Energy Act 2023 applies”.

• (5) It is to be the duty of the economic regulator, for the purpose of assisting a CMA group in carrying out an investigation on a market investigation reference made by the economic regulator (under section 131 of the Enterprise Act 2002) by virtue of subsection (1), to give to the group—

• (a) any information which is in the economic regulator’s possession and which relates to matters falling within the scope of the investigation and—

• (i) is requested by the group for that purpose, or

• (ii) is information which, in the economic regulator’s opinion, it would be appropriate for that purpose to give to the group without any such request, and

• (b) any other assistance which the group may require and which it is within the economic regulator’s power to give, in relation to any such matters,

and the group must, for the purposes of carrying out any such investigation, take into account any information given to them for that purpose under this subsection.

• (6) In subsection (5) “CMA group” has the same meaning as in Schedule 4 to the Enterprise and Regulatory Reform Act 2013.

Functions under the Competition Act 1998

37

• (1) The economic regulator is to be entitled to exercise, concurrently with the CMA, the functions of the CMA under the provisions of Part 1 of the Competition Act 1998 (other than sections 31D(1) to (6), 38(1) to (6), 40B(1) to (4) and 51), so far as relating to—

• (a) agreements, decisions or concerted practices of the kind mentioned in section 2(1) of that Act, or

• (b) conduct of the kind mentioned in section 18(1) of that Act, or

which relate to the carrying on of relevant transport and storage activities.

• (2) So far as necessary for the purposes of, or in connection with, the provisions of subsection (1), references in Part 1 of the Competition Act 1998 to the CMA are to be read as including a reference to the economic regulator (except in sections 31D(1) to (6), 38(1) to (6), 40B(1) to (4), 51, 52(6) and (8) and 54 of that Act and in any other provision of that Act where the context otherwise requires).

Sections 36 and 37: supplementary

38

• (1) Before the CMA or the economic regulator first exercises in relation to any matter functions which are exercisable concurrently by virtue of section 36(1) or 37(1), it must consult the other.

• (2) Neither the CMA nor the economic regulator is to exercise in relation to any matter functions which are exercisable concurrently by virtue of section 36(1) or 37(1) if functions which are so exercisable have been exercised in relation to that matter by the other.

• (3) If any question arises as to whether section 36(1) or 37(1) applies to any particular case, that question is to be referred to and determined by the Secretary of State, and no objection may be taken to anything done under—

• (a) Part 4 of the Enterprise Act 2002, or

• (b) Part 1 of the Competition Act 1998 (other than sections 31D(1) to (6), 38(1) to (6), 40B(1) to (4) and 51),

by or in relation to the economic regulator on the ground that it should have been done by or in relation to the CMA.

• (4) In sections 36 and 37 “relevant storage and transport activities” means—

• (a) activities such as are mentioned in section 2(2), and

• (b) activities ancillary to such activities.

Chapter 3 — Reporting requirements

Forward work programmes

39

• (1) The economic regulator must, before each financial year, publish a document (the “transport and storage forward work programme”) containing a general description of the relevant projects, other than those comprising routine activities in the exercise of its functions, which it plans to undertake during the year.

• (2) That description must include the objectives of each relevant project.

• (3) The forward work programme for any year must also include an estimate of the overall expenditure which the economic regulator expects to incur during the year in the exercise of its relevant functions.

• (4) Before publishing the forward work programme for any year, the economic regulator must give notice—

• (a) containing a draft of the transport and storage forward work programme, and

• (b) specifying the time within which representations or objections to the proposals contained in it may be made,

and must consider any representations or objections which are duly made and not withdrawn.

• (5) The notice under subsection (4) must be published by the economic regulator in such manner as it considers appropriate for the purpose of bringing the matters contained in it to the attention of persons likely to be affected by them.

• (6) The economic regulator must send a copy of any notice given by it under subsection (4) to—

• (a) the Welsh Ministers,

• (b) the Scottish Ministers, and

• (c) the Department for the Economy in Northern Ireland.

• (7) In this section—

• “relevant functions” means functions of the economic regulator under this Part;

• “relevant project” means a project relating to the economic regulator’s functions under this Part.

Information in relation to CCUS strategy and policy statement

40

• (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.

Annual report on transport and storage licensing functions

41

• (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.

Chapter 4 — Special administration regime

Transport and storage administration orders

Transport and storage administration orders

42

• (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.

Objective of a transport and storage administration

43

• (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.

Application and amendment of the Energy Act 2004

Application of certain provisions of the Energy Act 2004

44

• (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.

Conduct of administration, transfer schemes etc

45

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”.

Licence modifications

Modification of conditions of licences

46

• (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.

Powers to modify enactments

Modification under the Enterprise Act 2002

47

• (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”.

Power to make further modifications of insolvency legislation

48

• (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.

Interpretation

Interpretation of Chapter 4

49

• (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.

Chapter 5 — Transfer schemes

Transfer schemes

50

• (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.

Consultation in relation to transfers

51

• (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.

Conduct of transfer schemes

52

Schedule 4 contains further provision about transfer schemes under section 50.

Chapter 6 — Miscellaneous and general

Cooperation of storage licensing authority with economic regulator

53

• (1) In Chapter 3 of Part 1 of the Energy Act 2008 (storage of carbon dioxide), after section 34 insert—

(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). (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,”.

Amendments related to Part 1

54

Schedule 5 contains amendments related to this Part.

Interpretation of Part 1

55

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.

Part 2 — Carbon dioxide capture, storage etc and hydrogen production, transport and storage

Chapter 1 — Revenue support contracts

Key definitions

Revenue support contracts

56

• (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).

Provision of revenue support under certain contracts

Revenue support contracts

57

• (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;