Statutory Instruments
ELECTRICITY, ENGLAND AND WALES
Made
28th March 2007
Coming into force
1st April 2007
This Order is made in exercise of the powers conferred by sections 32 to 32C of the Electricity Act 1989(1).
The Secretary of State has consulted the Gas and Electricity Markets Authority, the Gas and Electricity Consumer Council, electricity suppliers to whom this Order applies and such generators of electricity from renewable sources and other persons as he considers appropriate.
A draft of this Instrument has been laid before and approved by a resolution of each House of Parliament pursuant to section 32(9) of that Act.
Accordingly, the Secretary of State makes the following Order:
1.—(1) This Order may be cited as the Renewables Obligation Order 2006 (Amendment) Order 2007 and shall come into force on 1st April 2007.
(2) This Order extends to England and Wales only.
2. References in this Order to “the 2006 Order” are to the Renewables Obligation Order 2006(2).
3.—(1) Article 2 of the 2006 Order (interpretation) is amended as follows.
(2) In paragraph (1), in the definition of “energy crops”—
(a)for “and” substitute “which is”; and
(b)at the end insert—
“or which is one of the following—
miscanthus giganteus;
salix (also known as short rotation coppice willow);
populus (also known as short rotation coppice poplar);”.
(3) After paragraph (1) insert—
“(1A) For the purposes of this Order, any fuel used in a generating station (not being biomass) shall be treated as biomass if—
(a)it is one of at least two fuels (not being fossil fuels within the meaning of article 8) used to fuel that generating station (whether or not those fuels are the only ones so used); and
(b)at least 90 per cent of the total energy content of those fuels (measured over such period and with such frequency as the Authority deems appropriate) is derived from material which is of such a nature that, if 90 per cent of the energy content of a single fuel was so derived, that fuel would constitute biomass.
(1B) Accordingly, any reference in this Order to biomass shall be construed as a reference to biomass or fuel which is treated as biomass.”.
4.—(1) Article 3 of the 2006 Order (the renewables obligation) is amended as follows.
(2) In paragraph (1), after “13” insert “, 13A”.
(3) In paragraph (2)—
(a)after “under” insert “and certifying the matters in”; and
(b)after “32B(2)” insert “or (2ZA)”.
5. In article 7 of the 2006 Order (eligible renewable sources: other fuels), omit paragraphs (3) and (4).
6. In article 9(5) of the 2006 Order (calculation of amount of electricity generated from eligible renewable sources), after the words “generating station”, where first appearing, insert “(or, where ROCs relating to electricity generated in whole or in part by that generating station are issued to an agent by virtue of article 15A, that agent and not the operator)”.
7. Omit article 10 of the 2006 Order (calculation of amount of electricity supplied to customers).
8. In article 11(2) of the 2006 Order (alternative way of discharging renewables obligation: payments), for “article 3 or article 13” substitute “article 3, 13 or 13A”.
9. In article 13(1) of the 2006 Order (alternative way of discharging renewables obligation: certificates certifying the matters in section 32B(2A) of the Act), after “32B(2A)” insert “or (2AA)”.
10. After article 13 of the 2006 Order insert—
13A.—(1) Subject to article 14, instead of producing certificates pursuant to article 3, a designated electricity supplier may discharge (in whole or in part) its renewables obligation in relation to a particular obligation period by producing to the Authority in accordance with this article certificates issued by the Authority and certifying the matters in section 32B(2AB) or (2AC) of the Act.
(2) A certificate referred to in paragraph (1) shall be regarded as produced to the Authority in respect of an obligation period where before the specified day relating to that period the Authority receives from the designated electricity supplier which holds the certificate a notification in writing identifying the certificate to be produced for that purpose and, in the case of a ROC, the ROC identifier.
(3) Without prejudice to paragraph (2), the Authority may draw up procedural guidelines for the production of certificates under this article.
(4) For the purposes of section 32B(2AB) and (2AC) of the Act, electricity generated by any generating station is used in a permitted way if it is used in one of the ways mentioned in section 32B(2AE) of the Act.”.
11.—(1) Article 14 of the 2006 Order (further provision in relation to production of certificates and NIROCs) is amended as follows.
(2) At the beginning of paragraph (2) for “In” substitute “Subject to paragraph (2A), in”.
(3) After paragraph (2) insert—
“(2A) In the case of certificates or NIROCs issued in respect of a generating station which, during the month to which those certificates or NIROCs relate, has been fuelled partly by fossil fuel (as defined in article 8) and partly by biomass consisting in whole or in part of energy crops (and no other fuel), the limits set out in paragraph (2) shall not apply to the production of those certificates or NIROCs if and to the extent that they state the amount of electricity which is attributable to the energy crops.”.
12.—(1) Article 15 of the 2006 Order (obligation to issue ROCs) is amended as follows.
(2) In paragraph (1)—
(a)for “article 17” substitute “articles 17 and 17A”; and
(b)at the end omit “to the persons specified below”.
(3) In paragraph (2), after “(5)” insert “and article 15A”.
13. After article 15 of the 2006 Order insert—
15A.—(1) Subject to article 15(3) to (5), an operator of a generating station with a declared net capacity of 50 kilowatts or less may appoint an agent to receive any ROC which relates to electricity generated, in whole or in part, by that generating station (a “relevant ROC”).
(2) Where he does so, he shall notify the Authority in writing of the agent’s name and address.
(3) Once the Authority has received such a notification, it shall issue any relevant ROC to that agent.
(4) Where the operator or agent wishes to terminate the agent’s appointment, the operator or, as the case may be, agent must give written notice of the intended termination to the Authority.
(5) Where notice is given under paragraph (4) and received by the Authority, the termination shall take effect (subject to paragraph (6)) at the end of the obligation period during which it is given; until the expiration of that obligation period, the Authority shall continue to issue any relevant ROCs to the agent.
(6) Notwithstanding paragraph (5), after the expiration of that obligation period the Authority shall continue to issue relevant ROCs to the agent where those ROCs relate to electricity generated during that obligation period.
(7) Paragraphs (5) and (6) do not apply in any case where the Authority is satisfied, by evidence produced to it, that owing to exceptional circumstances the termination should take effect on a date before the end of the obligation period during which the notice is given; in which case the termination shall take effect on that date.
(8) Where any provision of this Order requires or permits something to be done by, to or in respect of an agent appointed under this article and the agent’s appointment is terminated before that thing is done, references to that agent (however framed) are to be construed—
(a)where a successor to him has been appointed under this article, as references to that successor;
(b)in any other case, to the operator of the generating station for whom he acted before his appointment was terminated.”.
14.—(1) Article 16 of the 2006 Order (criteria for issue of ROCs) is amended as follows.
(2) In paragraph (2)—
(a)after “writing to” insert “either”; and
(b)after “relates” insert “or, where the ROC is to be issued to an agent by virtue of article 15A, that agent”.
(3) In paragraph (4)—
(a)after “is that” insert “, in the case of a ROC certifying the matters within section 32B(2), (2ZA), (2A) or (2AA) of the Act,”;
(b)in sub-paragraph (a)—
(i)at the beginning, for “he” substitute “the operator”;
(ii)after “supplied” insert “, in the case of a ROC certifying the matters within section 32B(2) or (2ZA) of the Act,”; and
(iii)after “32B(2A)” insert “or (2AA)”;
(c)omit sub-paragraph (b); and
(d)in sub-paragraph (c), for “he” substitute “the operator”.
(4) In paragraphs (7) and (8), after “32B(2A)” insert “or (2AA)”.
(5) After paragraph (8) insert—
“(8A) The eighth criterion is that, in the case of a ROC certifying the matters within section 32B(2ZA), (2AA) or (2AC) of the Act—
(a)each of the generating stations in relation to which the ROC is to be issued—
(i)has a declared net capacity of 50 kilowatts or less,
(ii)is accredited as a generating station capable of generating electricity from the same eligible renewable source, and
(iii)is located in England or Wales;
(b)the ROC is to be issued to an agent by virtue of article 15A; and
(c)the operators of the generating stations in relation to which the ROC is to be issued have each appointed the same person to act as agent to receive the ROC.
(8B) The ninth criterion is that, in the case of a ROC certifying the matters within section 32B(2AB) or (2AC) of the Act, the operator of the generating station has provided the Authority with a declaration (which the Authority shall be entitled to accept as sufficient evidence of its contents, and which the operator need only provide once during every obligation period) that the electricity generated by the generating station has been used in a permitted way.”.
(6) For paragraph (9) substitute—
“(9) The tenth criterion is that the electricity in respect of which the ROC is to be issued is not or does not include electricity in respect of which a ROC has already been issued and not revoked.”.
(7) After paragraph (9) insert—
“(9A) The eleventh criterion is that the electricity in respect of which the ROC is to be issued has been measured accurately using a meter which if used for ascertaining the quantity of electricity supplied by an authorised supplier to a customer would be approved for the purposes of paragraph 2 of Schedule 7 to the Act.”.
(8) In paragraph (10), for “ninth” substitute “twelfth”.
15.—(1) Article 17 of the 2006 Order (criteria for issue of ROCs: supplemental) is amended as follows.
(2) In paragraph (2)(b)—
(a)after “32B(2A)” insert “or (2AA)”; and
(b)after “satisfied that” insert “all of”.
(3) In paragraph (3)—
(a)in sub-paragraph (a)—
(i)after “32B(2A)” insert “or (2AA)”; and
(ii)after “to” insert “all or part of”;
(b)in sub-paragraph (b)—
(i)after “32B(2A)” insert “, (2AA), (2AB) or (2AC)”; and
(ii)after “resulted in” insert “all or part of”; and
(c)in sub-paragraph (c), for “the operator of the generating station” substitute “the operator of any generating station to which the ROC relates”.
(4) In paragraph (4), for “used by the generating station” substitute “used by any generating station to which the ROC relates”.
16. After article 17 of the 2006 Order insert—
17A.—(1) Where a ROC is to be issued to an agent by virtue of article 15A, the following provisions of this article shall apply.
(2) Subject to paragraph (3), in articles 16(4) to (8) and (8B) and 18(3)(b) and (4)—
(a)references to the operator of the generating station shall be treated as references to the agent who acts in relation to that generating station; and
(b)any obligation imposed on the operator in relation to that generating station shall be treated as imposed on the agent instead.
(3) Paragraph (2) shall not apply to sub-paragraphs (a) and (c) of article 16(4).
(4) Where the ROC relates to more than one generating station—
(a)in article 16(2) the written confirmation referred to shall be required in relation to each of the generating stations to which the ROC relates;
(b)in article 16(4) and (8B) the declaration referred to shall be required in relation to the electricity generated by each of the generating stations to which the ROC relates;
(c)in article 16(4)(a) and (c) references to the operator shall be treated as references to the operator of each of the generating stations to which the ROC relates;
(d)in article 16(7) the evidence referred to shall be required in respect of each generating station—
(i)which, at the time the electricity was generated, was not directly and exclusively connected to a transmission or distribution network in Northern Ireland, and
(ii)to which the ROC relates; and
(e)in article 16(8) the evidence referred to shall be required in respect of each generating station—
(i)which, at the time the electricity was generated, was directly and exclusively connected to a transmission or distribution network in Northern Ireland, and
(ii)to which the ROC relates.
17B.—(1) Where two or more generating stations constitute a group for the purposes of this article, the Authority shall be entitled to issue a ROC in respect of electricity generated by those generating stations if, and only if—
(a)the amount of electricity generated by each of them (calculated in accordance with article 18(2)(a) and (b)) is added together and rounded (in accordance with article 18(2)(c)),
(b)that rounded amount is stated in the ROC, and
(c)the ROC certifies the matters within section 32B(2ZA), (2AA) or (2AC) of the Act.
(2) Where an agent appointed under article 15A acts for two or more generating stations which constitute a group for the purposes of this article, he shall provide the Authority with—
(a)a figure representing the amount of electricity which he believes should be stated in any ROC to be issued in respect of that group, and
(b)the data which led him to arrive at that figure.
(3) Two or more generating stations constitute a group for the purposes of this article where—
(a)they have been accredited as generating stations capable of generating electricity from the same eligible renewable source;
(b)in respect of each of them the same person has been appointed to act as agent under article 15A; and
(c)in respect of electricity generated by them, entitlement to ROCs is determined in the same way (either on a monthly basis or on an annual basis, depending on whether a notice has been given to the Authority under article 21(2) or not).”.
17.—(1) Article 18 of the 2006 Order (procedure and calculations for issue of ROCs) is amended as follows.
(2) In paragraph (1)—
(a)after “replacement ROCs” insert “certifying the matters within section 32B(2), (2A) or (2AB) of the Act,”; and
(b)in sub-paragraph (b), after “order” insert—
“—
(i)where the ROCs are to be issued in respect of electricity generated from eligible renewable sources by two or more generating stations which constitute a group for the purposes of article 17B, to all the ROCs issued in respect of that group in a particular month;
(ii)in all other cases,”.
(3) In paragraph (2)—
(a)in sub-paragraph (c), after “determine” insert—
“—
(i)where any ROC to be issued will certify the matters within section 32B(2ZA), (2AA) or (2AC) of the Act, the amount of electricity which results from the calculations in sub-paragraphs (a) and (b) in respect of each of the generating stations to which the ROC relates, add the amounts so determined together, and round the sum of those amounts to the nearest megawatt hour (with any exact half megawatt hour being rounded upwards);
(ii)in all other cases,”; and
(b)in sub-paragraph (e)—
(i)for “the operator of the generating station or to the electricity supplier as specified in” substitute “whomever it is required to issue them by virtue of”; and
(ii)at the end insert “or 15A”.
18. In article 19(4)(a) of the 2006 Order (ROC register), for “article 3 or article 13” substitute “article 3, 13 or 13A”.
19.—(1) Article 20 of the 2006 Order (revocation of ROCs) is amended as follows.
(2) In paragraph (1)—
(a)in sub-paragraph (a), after “any connected person” insert “or, where ROCs are issued to an agent by virtue of article 15A, that agent”; and
(b)in sub-paragraph (b)—
(i)after “32B(2A)” insert “or (2AA)”; and
(ii)after “satisfied that” insert “all of”.
(3) In paragraph (3)(a), omit “respect of the generating station in respect of”.
(4) In paragraph (4)(b)—
(a)for “other than when a ROC has been revoked in accordance with paragraph (1)(a)” substitute “subject to paragraph (4A)”;
(b)after “(5)” insert “or, as the case may be, (6)”;
(c)for “article 17” substitute “articles 17 and 17A”; and
(d)at the end insert “or, as the case may be, 15A”.
(5) After paragraph (4) insert—
“(4A) Where the revoked ROC was revoked in accordance with paragraph (1)(a), paragraph (4)(b) shall not apply unless—
(a)the revoked ROC certified the matters within section 32B(2ZA), (2AA) or (2AC) of the Act; and
(b)the reason for its revocation is unrelated to the generating station or stations in respect of which the replacement ROC is to be issued.”.
(6) In paragraph (5), after the words “replacement ROC”, where first appearing, insert “certifying the matters within section 32B(2), (2A) or (2AB) of the Act”.
(7) After paragraph (5) insert—
“(6) Where pursuant to paragraph (4)(b) the Authority issues a replacement ROC certifying the matters within section 32B(2ZA), (2AA) or (2AC) of the Act it shall do so in accordance with article 18.”.
20.—(1) Article 21 of the 2006 Order (small generators) is amended as follows.
(2) In paragraph (2)—
(a)after “sub-50 kilowatt station” insert “or, where ROCs relating to electricity generated by a sub-50 kilowatt station are to be issued to an agent by virtue of article 15A, that agent and not the operator of the station”;
(b)for sub-paragraph (a) substitute—
“(a)where ROCs have not yet been issued in respect of any electricity generated during the course of an obligation period by that station (“the relevant station”), during the course of that obligation period; or”;
(c)for “its” substitute “the operator’s”; and
(d)for “that station (“the relevant station”)” substitute “the relevant station”.
(3) In paragraph (3)—
(a)after “operator” in each place where it occurs insert “or, as the case may be, agent”; and
(b)for “relevant month falls” substitute “notice was given”.
(4) In paragraph (5)—
(a)after “operator” insert “or, as the case may be, agent”; and
(b)for “relevant month falls” substitute “notice was given”.
(5) In paragraph (6), after “operator” in each place where it occurs insert “or, as the case may be, agent”.
(6) After paragraph (6) insert—
“(7) Where any ROC to be issued will certify the matters within section 32B(2ZA), (2AA) or (2AC) of the Act, the foregoing provisions of this article shall have effect subject to the following modifications—
(a)references to the relevant station shall be treated as references to the generating stations to which the ROC relates;
(b)references to the operator of the relevant station shall be treated as references to the operators of those generating stations,
and cognate expressions shall be construed accordingly.”.
21.—(1) Article 28 of the 2006 Order (provision of information to the authority) is amended as follows.
(2) After paragraph (2) insert—
“(3) In paragraph (2) the reference to any person who generates electricity in relation to which a ROC has been or may be issued shall be taken to include a reference to any agent to whom any such ROC has been or may be issued by virtue of article 15A.”.
22. In article 29(3) of the 2006 Order (exchange of information with the Northern Ireland Authority), after “32B(2A)” insert “or (2AA)”.
23.—(1) Article 30 of the 2006 Order (functions of the Authority) is amended as follows.
(2) In paragraph (f)(i), for “article 3 or article 13” substitute “article 3, 13 or 13A”.
(3) In paragraph (f)(iii)—
(a)after “15” insert “, 15A”; and
(b)after “13” insert “or 13A”.
(4) In paragraph (f)(iv), after “15” insert “, 15A”.
(5) In paragraph (g)(iii), at the end insert “(including the transfer and holding of ROCs issued to agents by virtue of article 15A)”.
24. In article 31(3) of the 2006 Order (preliminary accreditation and accreditation of generating stations), after “operator” insert “(or, where ROCs relating to electricity generated in whole or in part by that generating station will be issued to an agent by virtue of article 15A, that agent)”.
25.—(1) Schedule 2 to the 2006 Order (the register) is amended as follows.
(2) In paragraph 2—
(a)in sub-paragraph (b)(ii), at the end insert “or, where the ROC certifies the matters within section 32B(2ZA), (2AA) or (2AC) of the Act, the location of the agent to whom, by virtue of article 15A, the ROC was issued”; and
(b)in sub-paragraph (b)(iii)—
(i)for “the generating station” substitute “that generating station or, where the ROC certifies the matters within section 32B(2ZA), (2AA) or (2AC) of the Act, the generating stations to which the ROC relates,”;
(ii)after “used” insert “by it or them”; and
(iii)at the end omit “by that generating station”.
(3) In paragraph 3(b)—
(a)at the beginning, for “details of” substitute “where”;
(b)after “persons” insert “are”; and
(c)at the end insert “, details of those persons”.
(4) In paragraph 5(b), for “article 3(3) or article 13” substitute “article 3(3), 13 or 13A”.
(5) In paragraph 8, after “15” insert “(and, where it applies, article 15A)”.
26. In Schedule 3 to the 2006 Order (conditions of eligibility for NIROCs), omit paragraphs 9 and 10.
Truscott
Parliamentary Under Secretary of State for Energy
Department of Trade and Industry
28th March 2007
(This note is not part of the Order)
This Order amends the Renewables Obligation Order 2006 (“the 2006 Order”).
By virtue of the amendments made to the 2006 Order by this Order, an electricity supplier in England or Wales may now discharge its renewables obligation (within the meaning of the 2006 Order) by producing certificates (known as renewables obligation certificates or ROCs) which certify the matters within section 32B(2ZA), (2AA), (2AB) or (2AC) of the Electricity Act 1989. (Subsections (2ZA), (2AA), (2AB) and (2AC) were inserted into section 32B of the Electricity Act 1989 by the Climate Change and Sustainable Energy Act 2006.)
In relation to ROCs certifying the matters within section 32B(2ZA) or (2AA), this change is achieved by amending articles 3(2) and 13(1) of the 2006 Order: see articles 4(3) and 9 of this Order. In relation to ROCs certifying the matters within section 32B(2AB) or (2AC), this change is achieved by inserting a new article – article 13A – into the 2006 Order: see article 10 of this Order.
The 2006 Order has also been amended so as to allow an operator of a small generating station (that is to say, a generating station with a declared net capacity of no more than 50 kilowatts) to appoint an agent to receive ROCs on his (the operator’s) behalf. This is achieved by the new article 15A, which is inserted into the 2006 Order by article 13 of this Order.
In light of the changes discussed in the previous paragraphs, ‘consequential’ amendments have been made to articles 3, 9, 11, 15 to 21, and 28 to 31 of, and paragraphs 2, 5 and 8 of Schedule 2 to, the 2006 Order: see articles 4, 6, 8, 12, 14, 15, and 17 to 25 of this Order. In addition, two new articles – articles 17A and 17B – have been inserted into the 2006 Order: see article 16 of this Order.
The key consequential amendments concern ROCs which relate to electricity generated by more than one generating station. By virtue of article 16(8A) of the 2006 Order (inserted by article 14(5) of this Order) and new article 17B of the 2006 Order (inserted, as noted above, by article 16 of this Order), a ROC may relate to electricity generated by two or more generating stations where (in a nutshell)—
(a)each of the generating stations is a small one, located in England or Wales, generating electricity from the same renewable energy source;
(b)the operators of those generating stations have each appointed the same person to act as their agent for the purpose of receiving ROCs; and
(c)ROC-entitlement in relation to each of those generating stations is determined in the same way (either on a monthly basis or on an annual basis).
A number of other amendments, unrelated to the foregoing changes, have been made to the 2006 Order. The key ones are as follows—
(a)the definition of “energy crops” in article 2(1) has been expanded to ensure that certain (named) crops, if planted after 31st December 1989, are covered. The crops in question are miscanthus giganteus, short rotation coppice willow, and short rotation coppice poplar (see article 3(2) of this Order);
(b)two new paragraphs – paragraphs (1A) and (1B) – have been inserted into article 2 of the 2006 Order so as to enable a non-fossil fuel which is not biomass to be treated as biomass if it is used with at least one other non-fossil fuel by a generating station and 90% or more of the total energy content of those fuels is derived from biomass (see article 3(3) of this Order);
(c)the caps set out in article 14(2) of the 2006 Order (which mean that an electricity supplier can discharge only a limited percentage of its renewables obligation by the production of ROCs which relate to electricity generated by a generating station which is fuelled partly by fossil fuel and partly by biomass) have been disapplied in relation to the production of ROCs if and to the extent that those ROCs relate to electricity generated by energy crops (see article 11 of this Order);
(d)the notice period set out in article 21(2)(a) of the 2006 Order (which means that the operator of a small generating station must give at least one month’s notice to the Authority, Ofgem, if his entitlement to ROCs is to be determined on the basis set out in article 21) has been removed (see article 20(2)(b) of this Order); and
(e)articles 7(3) and (4) and 10 of, and paragraphs 9 and 10 of Schedule 3 to, the 2006 Order have been omitted: see articles 5, 7 and 26 of this Order.
A regulatory impact assessment is available and can be obtained from the Energy Markets Unit, Department of Trade and Industry, 1 Victoria Street, London, SW1H 0ET. Copies have been placed in the libraries of both Houses of Parliament.
1989 c.29. Sections 62 to 65 of the Utilities Act 2000 (c.27) substituted new sections 32, 32A, 32B and 32C of the Electricity Act 1989. Those provisions of the Electricity Act 1989 have subsequently been amended by sections 115, 116, 118 and 119 of the Energy Act 2004 (c.20) and by sections 23 and 24 of the Climate Change and Sustainable Energy Act 2006 (c.19). Section 32BA of the Electricity Act 1989 was inserted by section 117 of the Energy Act 2004.