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Energy Act 2008

Overview

3.The Act is implementing legislative aspects of: Meeting the Energy Challenge: A White Paper on Energy (May 2007) and Meeting the Energy Challenge: A White Paper on Nuclear Power (January 2008). It covers the following main areas: offshore gas infrastructure, carbon dioxide storage, Renewables Obligation, feed-in tariffs for small scale low carbon electricity generation, renewable heat incentives, decommissioning of energy installations (nuclear, offshore renewables, and offshore oil & gas), offshore transmission, smart meters as well as several other areas. A number of the policy areas covered have been preceded by full public consultations.

4.The principal objective of the Act is to update the legislative framework to make it more appropriate for today’s energy market.

5.The Act is in six Parts with six Schedules:

Part 1: Gas Importation and Storage: This contains provisions designed to cover the offshore storage of natural gas and the offshore unloading of Liquefied Natural Gas (LNG), as well as the offshore storage of carbon dioxide for the purpose of its permanent disposal.

Part 2: Electricity from Renewable Sources: This makes a number of changes to the Renewables Obligation to increase its efficiency and increase the deployment of renewables in the UK.

It will also amend the existing powers under the Electricity Act 1989 for the Gas and Electricity Markets Authority to run tender exercises to select offshore transmission owners to manage the conveying at high voltage of electricity generated by offshore generating stations.

It will introduce a power enabling Government to introduce feed-in tariffs for small-scale low-carbon electricity generation with a maximum capacity cap of 5 megawatts.

Part 3: Decommissioning of Energy Installations: This contains provisions to ensure the person with such an obligation meets the costs of decommissioning energy installations in three sectors: nuclear, offshore renewables and oil and gas.

Part 4: Provisions Relating to Oil and Gas: This makes some changes to the regime for petroleum licences under the Petroleum Act 1998. It also makes a number of changes to the existing third party access dispute resolution procedures in relation to upstream oil and gas infrastructure under the Petroleum Act 1998, the Gas Act 1995 and the Pipe-lines Act 1962 and introduces a similar procedure in relation to oil processing facilities.

Part 5: Miscellaneous: This contains various provisions covering reporting on energy requirements, smart meters, renewable heat incentives, the duties of the Authority, transmission access powers and costs relating to network connections, gives effect in legislation to earlier administrative transfer of responsibilities for certain aspects of energy regulation, and contains provision relating to nuclear security.

Part 6: General

Annex A is a glossary of terms used in the Act and these explanatory notes.

In the commentary on sections below, explanatory notes to cover each Schedule are included with the section which introduces the Schedule.

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Explanatory Notes

Text created by the government department responsible for the subject matter of the Act to explain what the Act sets out to achieve and to make the Act accessible to readers who are not legally qualified. Explanatory Notes were introduced in 1999 and accompany all Public Acts except Appropriation, Consolidated Fund, Finance and Consolidation Acts.

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