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Legislation Crest

Gas Act 1986

1986 CHAPTER 44

An Act to provide for the appointment and functions of a Director General of Gas Supply and the establishment and functions of a Gas Consumers’ Council; to abolish the privilege conferred on the British Gas Corporation by section 29 of the Gas Act 1972; to make new provision with respect to the supply of gas through pipes and certain related matters; to provide for the vesting of the property, rights and liabilities of the British Gas Corporation in a company nominated by the Secretary of State and the subsequent dissolution of that Corporation; to make provision with respect to, and to information furnished in connection with, agreements relating to the initial supply of gas won under the authority of a petroleum production licence; and for connected purposes.

[25th July 1986]

Be it enacted by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Extent Information

E1Act, except for specified provisions, does not extend to N.I., see s. 68(6)

Modifications etc. (not altering text)

C1Act applied (8.11.1995) by 1995 c. 45, s. 17(2)

C2Act: references to the Director General of Gas Supply ("the Director") shall be read as references to the Gas and Electricity Markets Authority ("the Authority") (20.12.2000) by virtue of Utilities Act 2000 (c. 27), s. 3(2); S.I. 2000/3343, art. 2, Sch.

C3Act: references to a public gas transporter or to the holder of a licence under section 7 of the 1986 Act shall have effect as if they were references to a gas transporter (1.10.2001) by virtue of Utilities Act 2000 (c. 27), s. 76(7); S.I. 2001/3266, art. 2, Sch. (with arts. 3-20)

C5Act: power to amend conferred (24.5.2024 for specified purposes) by Digital Markets, Competition and Consumers Act 2024 (c. 13), ss. 138(2)-(7), 339(2)(c)

C6Act: power to exclude or modify (including by way of amendment) conferred (26.12.2023) by Energy Act 2023 (c. 52), ss. 155(1)(2), 334(3)(e)

Part IU.K. Gas Supply

Modifications etc. (not altering text)

C7Pt. I: definition of "public gas supplier" applied (E.W.) (1.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 208(3)(b), 225(2) (with ss. 16(6), 179, 222(3), Sch. 22 para. 1, Sch. 23 para. 6)

Pt. I: definition of "public gas supplier" applied (E.W.) (1.12.1991) by Water Resources Act 1991 (c. 57, SIF 130), ss. 178, 225(2), Sch. 22 para. 1(4)(e) (with ss. 16(6), 179, 222(3), Sch. 22 para. 1, Sch. 23 para. 6)

Pt. I applied (1.3.1996) by 1995 c. 45, s. 6(7); S.I. 1996/218, art. 2

Pt. I applied (1.3.1996) by 1995 c. 45, s. 16(1), Sch. 4 para. 1; S.I. 1996/218, art. 2

IntroductoryU.K.

F11. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .U.K.

Textual Amendments

F1S. 1 repealed (7.11.2000) by 2000 c. 27, s. 108, Sch. 8; S.I. 2000/2974, art. 2, Sch. (subject to transitional provisions in arts. 3-12)

F22. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .U.K.

Textual Amendments

F2S. 2 repealed (7.11.2000) by 2000 c. 27, s. 108, Sch. 8; S.I. 2000/2974, art. 2, Sch. (subject to transitional provisions in arts. 3-12)

F33. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

Textual Amendments

F3S. 3 repealed (1.10.2001) by 2000 c. 27, s. 108, Sch. 8; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

[F44AA The principal objective and general duties of the Secretary of State and the Authority.E+W+S

(1)The principal objective of the Secretary of State and the Gas and Electricity Markets Authority (in this Act referred to as “the Authority”) in carrying out their respective functions under this Part is to protect the interests of [F5existing and future] consumers in relation to gas conveyed through pipes F6....

[F7(1A)Those interests of existing and future consumers are their interests taken as a whole, including—

(a)their interests in [F8the Secretary of State’s compliance with the duties in sections 1 and 4(1)(b) of the Climate Change Act 2008 (net zero target for 2050 and five-year carbon budgets)]; F9...

(b)their interests in the security of the supply of gas to them [F10; and

(c)their interests in the fulfilment by the Authority, when carrying out its [F11designated regulatory functions], of the [F12designated regulatory objectives].]

(1B)The Secretary of State and the Authority shall carry out their respective functions under this Part in the manner which the Secretary of State or the Authority (as the case may be) considers is best calculated to further the principal objective, wherever appropriate by promoting effective competition between persons engaged in, or in commercial activities connected with, the shipping, transportation or supply of gas conveyed through pipes.

(1C)Before deciding to carry out functions under this Part in a particular manner with a view to promoting competition as mentioned in subsection (1B), the Secretary of State or the Authority shall consider—

(a)to what extent the interests referred to in subsection (1) of consumers would be protected by that manner of carrying out those functions; and

(b)whether there is any other manner (whether or not it would promote competition as mentioned in subsection (1B)) in which the Secretary of State or the Authority (as the case may be) could carry out those functions which would better protect those interests.]

(2)[F13In performing the duties under subsections (1B) and (1C), the Secretary of State or the Authority shall have regard to]—

(a)the need to secure that, so far as it is economical to meet them, all reasonable demands in Great Britain for gas conveyed through pipes are met; and

(b)the need to secure that licence holders are able to finance the activities which are the subject of obligations imposed by or under this Part [F14, the Utilities Act 2000 [F15, Part 5 of the Energy Act 2008 or section 4, Part 2, [F16, sections 26 to 29 of the Energy Act 2010, or [F17Chapter 1 of Part 2, Chapters 2 and 3 of Part 4 and] sections 245 to 247 of the Energy Act 2023]]] [F18; and

(c)the need to contribute to the achievement of sustainable development.]

(3)In performing [F19the duties under subsections (1B), (1C) and (2)], the Secretary of State or the Authority shall have regard to the interests of—

(a)individuals who are disabled or chronically sick;

(b)individuals of pensionable age;

(c)individuals with low incomes; and

(d)individuals residing in rural areas;

but that is not to be taken as implying that regard may not be had to the interests of other descriptions of consumer.

(4)The Secretary of State and the Authority may, in carrying out any function under this Part, have regard to—

(a)the interests of consumers in relation to electricity conveyed by distribution systems [F20or transmission systems] (within the meaning of the M1Electricity Act 1989); and

(b)any interests of consumers in relation to—

[F21(i)communications services and electronic communications apparatus, or]

(ii)water services or sewerage services (within the meaning of the M2Water Industry Act 1991),

which are affected by the carrying out of that function.

(5)Subject to [F22subsections (1B) and] (2) [F23and to section 132(2) of the Energy Act 2013 (duty to carry out functions in manner best calculated to further delivery of policy outcomes)], the Secretary of State and the Authority shall carry out their respective functions under this Part in the manner which he or it considers is best calculated—

(a)to promote efficiency and economy on the part of persons authorised by licences or exemptions to carry on any activity, and the efficient use of gas conveyed through pipes;

(b)to protect the public from dangers arising from the conveyance of gas through pipes or from the use of gas conveyed through pipes [F24or the provision of a smart meter communication service];

F25(ba). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c)to secure a diverse and viable long-term energy supply,

[F26and F27... shall] have regard, in carrying out those functions, to the effect on the environment of activities connected with the conveyance of gas through pipes [F28or the provision of a smart meter communication service].

[F29(5A)In carrying out their respective functions under this Part in accordance with the preceding provisions of this section the Secretary of State and the Authority must each have regard to—

(a)the principles under which regulatory activities should be transparent, accountable, proportionate, consistent and targeted only at cases in which action is needed; and

(b)any other principles appearing to him or, as the case may be, it to represent the best regulatory practice.]

[F30(5B)In subsection (1A)—

  • [F31“the designated regulatory objectives” means the objectives set out in Article 40(c) to (h) of the Gas Directive but read with the following modifications—

    (a)

    in Article 40(c), for the words from “between” to the end substitute “ , including enabling the development of appropriate cross-border transmission capacities to meet demand; ”,

    (b)

    in Article 40(d), omit “, in line with general energy policy objectives,”,

    (c)

    in Article 40(f), omit “and foster market integration”, and

    (d)

    in Article 40(g), for “their national market” substitute “the energy market in Great Britain”;]

  • F32...

  • F32...

  • F32...]

(6)In [F33subsections [F34(1C),] (3) and (4) references to consumers include] both existing and future consumers.

(7)In this section and sections 4AB and 4A, references to functions of the Secretary of State or the Authority under this Part include a reference to functions under the Utilities Act 2000 which relate to gas conveyed through pipes.

(8)In this Part, unless the context otherwise requires,—

  • “exemption” means an exemption granted under section 6A;

  • “licence” means a licence under section 7 [F35, 7ZA] [F36, 7A [F37, 7AA, 7AB or 7AC]] and “licence holder” shall be construed accordingly.]

Textual Amendments

F4S. 4AA substituted (20.12.2000) for s. 4 by 2000 c. 27, s. 9; S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15)

F5Words in s. 4AA(1) inserted (26.1.2009) by Energy Act 2008 (c. 32), ss. 83(1)(a), 110(2); S.I. 2009/45, art. 2(d)(i)

F6Words in s. 4AA(1) omitted (8.6.2010) by virtue of Energy Act 2010 (c. 27), ss. 16(2), 38(3)

F7Ss. 4AA(1A)-(1C) inserted (8.6.2010) by Energy Act 2010 (c. 27), ss. 16(3), 38(3)

F8Words in s. 4AA(1A)(a) substituted (26.12.2023) by Energy Act 2023 (c. 52), ss. 202(2), 334(3)(f)

F13Words in s. 4AA(2) substituted (8.6.2010) by Energy Act 2010 (c. 27), ss. 16(4)(a), 38(3)

F14Words in s. 4AA(2)(b) substituted (26.11.2008) by Energy Act 2008 (c. 32), ss. 102(3), 110(2)

F15Words in s. 4AA(2)(b) substituted (8.6.2010) by Energy Act 2010 (c. 27), ss. 16(4)(b), 38(3)

F16Words in s. 4AA(2)(b) substituted (11.1.2024) by Energy Act 2023 (c. 52), ss. 248(3), 334(1); S.I. 2024/32, reg. 2(b)(iii)

F18S. 4AA(2)(c) and preceding word inserted (26.1.2009) by Energy Act 2008 (c. 32), ss. 83(1)(b), 110(2); S.I. 2009/45, art. 2(d)(i)

F19Words in s. 4AA(3) substituted (8.6.2010) by Energy Act 2010 (c. 27), ss. 16(5), 38(3)

F20Words in s. 4AA(4)(a) inserted (1.4.2006 for specified purposes, 1.4.2010 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 179(2)(3)(d), 198(2); S.I. 2005/2965, art. 3

F21S. 4AA(4)(b)(i) substituted (25.7.2003 for specified purposes, 29.12.2003 in so far as not already in force) by Communications Act 2003 (c. 21), s. 411(2), Sch. 17 para. 81 (with Sch. 18); S.I. 2003/1900, arts. 1(2), 2(1), Sch. 1 (with art. 3) (as amended by S.I. 2003/3142, art. 1(3)); S.I. 2003/3142, art. 3(2) (with art. 11)

F22Words in s. 4AA(5) substituted (8.6.2010) by Energy Act 2010 (c. 27), ss. 16(6)(a), 38(3)

F23Words in s. 4AA(5) inserted (18.2.2014) by Energy Act 2013 (c. 32), ss. 138(2), 156(2)

F26Words in s. 4AA(5) substituted (5.10.2004) by Energy Act 2004 (c. 20), ss. 83(b), 198(2); S.I. 2004/2575, art. 2(1), Sch. 1

F27Words in s. 4AA(5) omitted (8.6.2010) by virtue of Energy Act 2010 (c. 27), ss. 16(6)(b), 38(3)

F30S. 4AA(5B) inserted (8.6.2010) by Energy Act 2010 (c. 27), ss. 16(7), 38(3)

F32Words in s. 4AA(5B) omitted (26.12.2023) by virtue of Energy Act 2023 (c. 52), ss. 202(3), 334(3)(f)

F33Words in s. 4AA(6) substituted (26.1.2009) by Energy Act 2008 (c. 32), ss. 83(1)(d), 110(2); S.I. 2009/45, art. 2(d)(i)

F34Word in s. 4AA(6) inserted (8.6.2010) by Energy Act 2010 (c. 27), ss. 16(8), 38(3)

F35Words in s. 4AA(8) inserted (1.12.2004) by Energy Act 2004 (c. 20), ss. 149(8)(a), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

Modifications etc. (not altering text)

C8S. 4AA extended by 2000 c. 27, s. 5A(11), (as inserted (30.12.2003) by Sustainable Energy Act 2003 (c. 30), ss. 6, 9(8))

C9Ss. 4AA-4B applied (24.8.2004 for specified purposes, 5.10.2004 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 190(1), 198(2); S.I. 2004/2184, art. 2(1), Sch. 1; S.I. 2004/2575, art. 2(1), Sch. 1

C10Ss. 4AA-4B applied (26.11.2008) by Energy Act 2008 (c. 32), ss. 102(1), 110(2)

C11Ss. 4AA-4A excluded (26.1.2009) (with application in accordance with s. 90 of the amending Act) by Counter-Terrorism Act 2008 (c. 28), ss. 89(3), 100(3) (with s. 101(2))

C12Ss. 4AA-4B applied (8.4.2010) by Energy Act 2010 (c. 27), ss. 30(1), 38(1)

C13Ss. 4AA-4B applied (18.12.2011) by Energy Act 2011 (c. 16), ss. 98(13), 121(3)

C14Ss. 4AA-4B applied (18.12.2011) by Energy Act 2011 (c. 16), ss. 78(1), 121(3)

C15Ss. 4AA-4B applied (21.3.2012) by Energy Act 2011 (c. 16), ss. 22(9), 121(1); S.I. 2012/873, art. 2(a)(v)

C16Ss. 4AA-4B applied (18.2.2014) by Energy Act 2013 (c. 32), ss. 136(1), 156(2)

C17Ss. 4AA-4B applied (18.2.2014) by Energy Act 2013 (c. 32), ss. 141(1), 156(2)

C18Ss. 4AA-4B applied (23.7.2018) by Smart Meters Act 2018 (c. 14), ss. 6(12), 14(5)

C19Ss. 4AA-4B applied (26.10.2023 for specified purposes, 31.1.2024 in so far as not already in force) by Energy Act 2023 (c. 52), ss. 178(3), 334(1)(2)(h); S.I. 2024/32, reg. 3(a)(viii)

C23S. 4AA(2)(b) amended (temp. from 19.12.2000) by S.I. 2000/3343, art. 5 (subject to transitional provisions in arts. 3-15)

Marginal Citations

[F384AB Guidance on social and environmental matters.E+W+S

(1)The Secretary of State shall from time to time issue guidance about the making by the Authority of a contribution towards the attainment of any social or environmental policies set out or referred to in the guidance.

(2)The Authority shall, in carrying out its functions under this Part, have regard to any guidance issued under this section.

(3)Before issuing guidance under this section the Secretary of State shall consult—

(a)the Authority;

[F39(b)Citizens Advice;

(ba) [F40Consumer Scotland];]

(c)licence holders; and

(d)such other persons as the Secretary of State considers it appropriate to consult in relation to the guidance.

(4)A draft of any guidance proposed to be issued under this section shall be laid before each House of Parliament.

(5)Guidance shall not be issued under this section until after the period of forty days beginning with—

(a)the day on which the draft is laid before each House of Parliament; or

(b)if the draft is laid before the House of Lords on one day and the House of Commons on another, the later of those two days.

(6)If, before the end of that period, either House resolves that the guidance should not be issued, the Secretary of State must not issue it.

(7)In reckoning any period of forty days for the purposes of subsection (5) or (6), no account shall be taken of any time during which—

(a)Parliament is dissolved or prorogued; or

(b)both Houses are adjourned for more than four days.

(8)The Secretary of State shall arrange for any guidance issued under this section to be published in such manner as he considers appropriate.]

Textual Amendments

F38S. 4AB inserted (20.12.2000) by 2000 c. 27, s. 10; S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15)

Modifications etc. (not altering text)

C9Ss. 4AA-4B applied (24.8.2004 for specified purposes, 5.10.2004 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 190(1), 198(2); S.I. 2004/2184, art. 2(1), Sch. 1; S.I. 2004/2575, art. 2(1), Sch. 1

C10Ss. 4AA-4B applied (26.11.2008) by Energy Act 2008 (c. 32), ss. 102(1), 110(2)

C11Ss. 4AA-4A excluded (26.1.2009) (with application in accordance with s. 90 of the amending Act) by Counter-Terrorism Act 2008 (c. 28), ss. 89(3), 100(3) (with s. 101(2))

C12Ss. 4AA-4B applied (8.4.2010) by Energy Act 2010 (c. 27), ss. 30(1), 38(1)

C13Ss. 4AA-4B applied (18.12.2011) by Energy Act 2011 (c. 16), ss. 98(13), 121(3)

C14Ss. 4AA-4B applied (18.12.2011) by Energy Act 2011 (c. 16), ss. 78(1), 121(3)

C15Ss. 4AA-4B applied (21.3.2012) by Energy Act 2011 (c. 16), ss. 22(9), 121(1); S.I. 2012/873, art. 2(a)(v)

C16Ss. 4AA-4B applied (18.2.2014) by Energy Act 2013 (c. 32), ss. 136(1), 156(2)

C17Ss. 4AA-4B applied (18.2.2014) by Energy Act 2013 (c. 32), ss. 141(1), 156(2)

C18Ss. 4AA-4B applied (23.7.2018) by Smart Meters Act 2018 (c. 14), ss. 6(12), 14(5)

C19Ss. 4AA-4B applied (26.10.2023 for specified purposes, 31.1.2024 in so far as not already in force) by Energy Act 2023 (c. 52), ss. 178(3), 334(1)(2)(h); S.I. 2024/32, reg. 3(a)(viii)

C24S. 4AB extended by 2000 c. 27, s. 5A(11) (as inserted (30.12.2003) by Sustainable Energy Act 2003 (c. 30), ss. 6, 9(8))

[F414A Health and safety.E+W+S

(1)The Secretary of State and the Authority shall consult [F42the Health and Safety Executive] about all gas safety issues which may be relevant to the carrying out of any of their respective functions under this Part.

(2)The Secretary of State and the Authority shall, in carrying out their respective functions under this Part, take into account any advice given by [F42the Health and Safety Executive] about any gas safety issue (whether or not in response to consultation under subsection (1)).

(3)For the purposes of this section a gas safety issue is anything concerning the conveyance of gas through pipes, or the use of gas conveyed through pipes, which may affect the health and safety of—

(a)members of the public; or

(b)persons employed in connection with the conveyance of gas through pipes or the supply of gas conveyed through pipes.]

Textual Amendments

F41S. 4A substituted (20.12.2000) by 2000 c. 27, s. 11; S.I. 2000/3343, art. 2, Sch.(subject to transitional provisions in arts. 3-15)

Modifications etc. (not altering text)

C9Ss. 4AA-4B applied (24.8.2004 for specified purposes, 5.10.2004 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 190(1), 198(2); S.I. 2004/2184, art. 2(1), Sch. 1; S.I. 2004/2575, art. 2(1), Sch. 1

C10Ss. 4AA-4B applied (26.11.2008) by Energy Act 2008 (c. 32), ss. 102(1), 110(2)

C11Ss. 4AA-4A excluded (26.1.2009) (with application in accordance with s. 90 of the amending Act) by Counter-Terrorism Act 2008 (c. 28), ss. 89(3), 100(3) (with s. 101(2))

C12Ss. 4AA-4B applied (8.4.2010) by Energy Act 2010 (c. 27), ss. 30(1), 38(1)

C13Ss. 4AA-4B applied (18.12.2011) by Energy Act 2011 (c. 16), ss. 98(13), 121(3)

C14Ss. 4AA-4B applied (18.12.2011) by Energy Act 2011 (c. 16), ss. 78(1), 121(3)

C15Ss. 4AA-4B applied (21.3.2012) by Energy Act 2011 (c. 16), ss. 22(9), 121(1); S.I. 2012/873, art. 2(a)(v)

C16Ss. 4AA-4B applied (18.2.2014) by Energy Act 2013 (c. 32), ss. 136(1), 156(2)

C17Ss. 4AA-4B applied (18.2.2014) by Energy Act 2013 (c. 32), ss. 141(1), 156(2)

C18Ss. 4AA-4B applied (23.7.2018) by Smart Meters Act 2018 (c. 14), ss. 6(12), 14(5)

C19Ss. 4AA-4B applied (26.10.2023 for specified purposes, 31.1.2024 in so far as not already in force) by Energy Act 2023 (c. 52), ss. 178(3), 334(1)(2)(h); S.I. 2024/32, reg. 3(a)(viii)

C25S. 4A extended by 2000 c. 27, s. 5A(11) (as inserted (30.12.2003) by Sustainable Energy Act 2003 (c. 30), ss. 6, 9(8))

[F434B Exceptions from sections 4AA to 4A.E+W+S

(1)Section 4AA does not apply in relation to the issuing by the Secretary of State of guidance under section 4AB.

(2)Sections 4AA to 4A do not apply in relation to anything done by the Authority—

(a)in the exercise of functions relating to the determination of disputes; or

(b)in the exercise of functions under section 36A(3).

(3)The Authority may nevertheless, when exercising any function under section 36A(3), have regard to any matter in respect of which a duty is imposed by sections 4AA to 4A if it is a matter to which [F44the CMA] could have regard when exercising that function.

(4)The duties imposed by sections 4AA to 4A do not affect the obligation of the Authority or the Secretary of State to perform or comply with any other duty or requirement (whether arising under this Act or another enactment, by virtue of any [F45assimilated] obligation or otherwise).]

Textual Amendments

F43S. 4B inserted (20.12.2000) by 2000 c. 27, s. 12; S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15)

Modifications etc. (not altering text)

C9Ss. 4AA-4B applied (24.8.2004 for specified purposes, 5.10.2004 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 190(1), 198(2); S.I. 2004/2184, art. 2(1), Sch. 1; S.I. 2004/2575, art. 2(1), Sch. 1

C10Ss. 4AA-4B applied (26.11.2008) by Energy Act 2008 (c. 32), ss. 102(1), 110(2)

C12Ss. 4AA-4B applied (8.4.2010) by Energy Act 2010 (c. 27), ss. 30(1), 38(1)

C13Ss. 4AA-4B applied (18.12.2011) by Energy Act 2011 (c. 16), ss. 98(13), 121(3)

C14Ss. 4AA-4B applied (18.12.2011) by Energy Act 2011 (c. 16), ss. 78(1), 121(3)

C15Ss. 4AA-4B applied (21.3.2012) by Energy Act 2011 (c. 16), ss. 22(9), 121(1); S.I. 2012/873, art. 2(a)(v)

C16Ss. 4AA-4B applied (18.2.2014) by Energy Act 2013 (c. 32), ss. 136(1), 156(2)

C17Ss. 4AA-4B applied (18.2.2014) by Energy Act 2013 (c. 32), ss. 141(1), 156(2)

C18Ss. 4AA-4B applied (23.7.2018) by Smart Meters Act 2018 (c. 14), ss. 6(12), 14(5)

C19Ss. 4AA-4B applied (26.10.2023 for specified purposes, 31.1.2024 in so far as not already in force) by Energy Act 2023 (c. 52), ss. 178(3), 334(1)(2)(h); S.I. 2024/32, reg. 3(a)(viii)

C26S. 4B(3) excluded (20.12.2000) by S.I. 2000/3343, art. 10(1)(b) (subject to transitional provisions in arts. 3-15)

[F464CBinding decisions of the Agency for the Cooperation of Energy Regulators and of the European CommissionU.K.

[F47(1)]The Authority must carry out its functions under this Part in the manner that it considers is best calculated to implement, or to ensure compliance with, any binding decision of the Agency or the European Commission made under the Gas Directive, the Gas Regulation or the Agency Regulation [F48(or the predecessor of the Agency Regulation)] in relation to gas.]

[F49(2)For the purposes of subsection (1), a binding decision does not include a decision that is not, or so much of a decision as is not, [F50assimilated] law.]

Textual Amendments

[F514DAuthority to consult and cooperate with other authoritiesU.K.

(1)When carrying out its [F52designated regulatory functions], the Authority must, wherever it thinks fit—

(a)consult and cooperate with the [F53Northern Ireland Authority];

(b)provide the [F54Northern Ireland Authority] with information [F55it] may require in order to carry out [F56 its designated regulatory functions]; F57...

(c)consult relevant national authorities;

F58(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2)In exercising functions in accordance with subsection (1), the Authority must, wherever it thinks fit, cooperate with the [F59Northern Ireland Authority] with a view F60... to—

F61(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b)the promotion and facilitation of cooperation between transmission system operators;

(c)the optimal management of gas networks;

(d)the promotion of jointly managed [F62trade in gas between Great Britain and Northern Ireland] and the allocation of [F63capacity between Great Britain and Northern Ireland];

(e)ensuring an adequate level of interconnection capacity;

F64(f). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . and

(g)the coordination of the regulation of gas markets, including rules concerning the management of congestion of gas networks.

(3)In this section—

  • F65...

  • F66...

  • “relevant national authority” means any of the following—

    (a)

    F67...

    (b)

    the Office of Communications;

    (c)

    [F68the CMA];

    (d)

    the Water Services Regulation [F69Authority.]

  • F70...]

Textual Amendments

F57Word in s. 4D(1)(b) omitted (14.7.2020) by virtue of The Gas (Internal Markets) Regulations 2020 (S.I. 2020/625), regs. 1(2), 2(2)(a)

F58S. 4D(1)(d) repealed (31.12.2020 immediately before IP completion day) by The Gas (Internal Markets) Regulations 2020 (S.I. 2020/625), regs. 1(2), 10(2)

F69Word in s. 4D(3) substituted (31.12.2020 immediately before IP completion day) by The Gas (Internal Markets) Regulations 2020 (S.I. 2020/625), regs. 1(2), 10(3)(b)

F70Words in s. 4D(3) omitted (31.12.2020 immediately before IP completion day) by virtue of The Gas (Internal Markets) Regulations 2020 (S.I. 2020/625), regs. 1(2), 10(3)(c)

F714EDuty to notify etc. the European Commission: agreements with third countriesU.K.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F71S. 4E repealed (31.12.2020 immediately before IP completion day) by The Gas (Internal Markets) Regulations 2020 (S.I. 2020/625), regs. 1(2), 10(4)

[F72 Licensing of activities relating to gas]E+W+S

Textual Amendments

F72S. 5 and cross-heading preceding it substituted (1.3.1996) by 1995 c. 45, s. 3; S.I. 1996/218, art. 2

[F735Prohibition on unlicensed activitiesE+W+S

(1)Subject to section 6A below and Schedule 2A to this Act, a person who—

(a)[F74otherwise than by means of a gas interconnector] conveys gas through pipes to any premises, or to a pipe-line system operated by a [F75gas transporter];

[F76(aa)participates in the operation of a gas interconnector;]

(b)supplies to any premises gas which has been conveyed to those premises through pipes; F77...

(c)arranges with a [F75gas transporter] for gas to be introduced into, conveyed by means of or taken out of a pipe-line system operated by that transporter [F78; or

(d)provides a smart meter communication service] [F79; or

(e)performs the function of code manager in relation to a designated gas licence document (see further subsections (11A) and (11B)),]

shall be guilty of an offence unless he is authorised to do so by a licence.

(2)The exceptions to subsection (1) above which are contained in Schedule 2A to this Act shall have effect.

(3)A person guilty of an offence under this section shall be liable—

(a)on summary conviction to a fine not exceeding the statutory maximum;

(b)on conviction on indictment, to a fine.

(4)No proceedings shall be instituted in England and Wales in respect of an offence under this section except by or on behalf of the Secretary of State or the Director.

(5)Any reference in this Part to the conveyance by any person of gas through pipes to any premises is a reference to the conveyance by him of gas through pipes to those premises with a view to the gas being supplied to those premises by any person, or being used in those premises by the holder of a licence under section 7A(2) below.

[F80(6)A reference in this Part to participating in the operation of a gas interconnector is a reference to—

(a)co-ordinating and directing the conveyance of gas into or through a gas interconnector; or

(b)making such an interconnector available for use for the conveyance of gas.

(7)For the purposes of subsection (6)(b) a person shall not be regarded as making something available just because he consents to its being made available by another.

(8)In this Part “gas interconnector” means so much of any pipeline system as—

(a)is situated at a place within the jurisdiction of Great Britain; and

(b)subsists wholly or primarily for the purposes of the conveyance of gas (whether in both directions or in only one) between Great Britain and another country or territory.

(9)For the purposes of this section a place is within the jurisdiction of Great Britain if it is in Great Britain, in the territorial sea adjacent to Great Britain or in an area designated under section 1(7) of the Continental Shelf Act 1964.

(10)In this section “pipe-line system” includes the pipes and any associated apparatus comprised in that system.]

[F81(11)A reference in this Part to providing a smart meter communication service is a reference to making arrangements with each domestic supplier to provide a service, for such suppliers, of communicating relevant information to and from smart meters through which gas is supplied to domestic premises.

[F82(11A)A reference in this Part to a person (“P”) performing the function of code manager in relation to a designated gas licence document is a reference to making arrangements, with the persons to whom subsection (11B) applies, under which P is responsible for the governance of the document.

(11B)This subsection applies to the holder of a licence for the purposes of section 5 where a condition of the licence—

(a)requires the holder to comply with, or to enter into arrangements that conform with, the designated gas licence document in question, or

(b)imposes obligations on the holder that do not apply to the holder where the holder complies with that document.]

(12)In this section—

  • [F83“designated gas licence document” means a document that is—

    (a)

    maintained in accordance with the conditions of a licence for the purposes of section 5, and

    (b)

    designated under section 182 of the Energy Act 2023;]

  • “domestic supplier” means a gas supplier—

    (a)

    who is authorised, in accordance with the conditions of a licence, to supply gas to domestic premises; and

    (b)

    who supplies gas to domestic premises in accordance with that licence;

  • “external electronic communications network” means a network which—

    (a)

    is an electronic communications network, within the meaning of section 32 of the Communications Act 2003; and

    (b)

    does not form part of a smart meter;

  • “relevant information” means information relating to the supply of gas; F84...

  • “smart meter” means—

    (a)

    a gas meter which can send and receive information using an external electronic communications network; or

    (b)

    a gas meter and a device which is associated with or ancillary to that meter and which enables information to be sent to and received by the meter using an external electronic communications network.]]

Textual Amendments

F73S. 5 and cross-heading substituted (1.3.1996) by 1995 c. 45, s. 3; S.I. 1996/218, art. 2

F74Words in s. 5(1)(a) inserted (14.8.2006) by Energy Act 2004 (c. 20), ss. 149(2)(a), 198(2); S.I. 2006/1964, art. 2, Sch.

F75Words in s. 5(1)(a)(c) substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6, Pt. I para. 3; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F76S. 5(1)(aa) inserted (14.8.2006) by Energy Act 2004 (c. 20), ss. 149(2)(b), 198(2); S.I. 2006/1964, art. 2, Sch.

F79S. 5(1)(e) and word inserted (10.9.2024) by Energy Act 2023 (c. 52), ss. 185(3), 334(1); S.I. 2024/890, reg. 2(b)(ii)

F82S. 5(11A)(11B) inserted (10.9.2024) by Energy Act 2023 (c. 52), ss. 185(4), 334(1); S.I. 2024/890, reg. 2(b)(ii)

F83Words in s. 5(12) inserted (10.9.2024) by Energy Act 2023 (c. 52), ss. 185(5)(b), 334(1); S.I. 2024/890, reg. 2(b)(ii)

F84Word in s. 5(12) omitted (10.9.2024) by virtue of Energy Act 2023 (c. 52), ss. 185(5)(a), 334(1); S.I. 2024/890, reg. 2(b)(ii)

Modifications etc. (not altering text)

C27S. 5(1)(a) excluded (8.11.1995 with effect as mentioned in Sch. 5 Pt. II para. 16(1) of the amending Act) by 1995 c. 45, s. 17(1), Sch. 5 Pt. II para. 16(1)(a); S.I. 1996/218, art. 2

S. 5(1)(a) excluded (14.10.1999) (temp. to 1.3.2011 unless revoked earlier) by S.I. 1999/2639, arts. 1(2)(3), 3, 4-6, 7(1)

S. 5(1)(a) restricted (9.12.1999) (temp. to 1.3.2011 unless revoked earlier) by S.I. 1999/3089, arts. 1(2)(3), 3, 5(1)

C28S. 5(1)(a)-(c) excluded (8.11.1995 for specified purposes) by 1995 c. 45, s. 17(1), Sch. 5 Pt. II para. 17(1)(a)

C29S. 5(1)(a) excluded (1.12.1996) by S.I. 1996/2795, arts. 3, 4

C30S. 5(1)(a) restricted (conditional) (12.8.2013) by The Gas Act 1986 (Exemption) (Onshore Gas) Order 2013 (S.I. 2013/1726), arts. 1, 3, 4

C31S. 5(1)(b) excluded (8.11.1995) by 1995 c. 45, s. 17(1), Sch. 5 Pt. II para. 16(1)(b); S.I. 1996/218, art. 2

S. 5(1)(b) excluded (14.10.1999) (temp. to 1.3.2011 unless revoked earlier) by S.I. 1999/2639, arts. 1(2)(3), 3, 4-6, 7(2)

S. 5(1)(b) restricted (9.12.1999) (temp. to 1.3.2011 unless revoked earlier) by S.I. 1999/3089, arts. 1(2)(3), 5(2)

C32S. 5(1)(c) modified (8.11.1995) by 1995 c. 45, s. 17(1), Sch. 5 Pt. II paras. 18(1)

F856. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

Textual Amendments

F85S. 6 repealed (1.3.1996) by 1995 c. 45, ss. 3(3), 17(5), Sch. 6; S.I. 1996/218, art. 2

[F866A Exemptions from prohibition.E+W+S

(1)The Secretary of State may, F87... by order grant exemption from paragraph (a)[F88, (aa)], (b) [F89, (c) [F90, (d) or (e)]] of section 5(1) above—

(a)either to a person or to persons of a class;

(b)either generally or to such extent as may be specified in the order; and

(c)either unconditionally or subject to such conditions as may be so specified.

[F91(1A)Before making an order under subsection (1) the Secretary of State shall give notice—

(a)stating that he proposes to make such an order and setting out the terms of the proposed order;

(b)stating the reasons why he proposes to make the order in the terms proposed; and

(c)specifying the time (not being less than 28 days from the date of publication of the notice) within which representations with respect to the proposals may be made,

and shall consider any representations which are duly made in respect of the proposals and not withdrawn.

(1B)The notice required by subsection (1A) shall be given—

(a)by serving a copy of it on the Authority [F92, Citizens Advice and [F93Consumer Scotland]]; and

(b)by publishing it in such manner as the Secretary of State considers appropriate for bringing it to the attention of those likely to be affected by the proposed order.]

[F94(2)Notice of an exemption granted to a person shall be given—

(a)by serving a copy of the exemption on him; and

(b)by publishing the exemption in such manner as the Secretary of State considers appropriate for bringing it to the attention of other persons who may be affected by it.

(2A)Notice of an exemption granted to persons of a class shall be given by publishing the exemption in such manner as the Secretary of State considers appropriate for bringing it to the attention of—

(a)persons of that class; and

(b)other persons who may be affected by it.

(3)An exemption may be granted—

(a)indefinitely; or

(b)for a period specified in, or determined by or under, the exemption.]

(4)Without prejudice to the generality of paragraph (c) of subsection (1) above, conditions included by virtue of that paragraph in an exemption may require any person carrying on any activity in pursuance of the exemption—

(a)to comply with any direction given by the Secretary of State or the Director as to such matters as are specified in the exemption or are of a description so specified;

(b)except in so far as the Secretary of State or the Director consents to his doing or not doing them, not to do or to do such things as are specified in the exemption or are of a description so specified; and

(c)to refer for determination by the Secretary of State or the Director such questions arising under the exemption as are specified in the exemption or are of a description so specified.

[F95(5)The Secretary of State may by order revoke an order by which an exemption was granted to a person or vary an order by which more than one exemption was so granted so as to terminate any of the exemptions—

(a)at the person’s request;

(b)in accordance with any provision of the order by which the exemption was granted; or

(c)if it appears to the Secretary of State inappropriate that the exemption should continue to have effect.

(6)The Secretary of State may by order revoke an order by which an exemption was granted to persons of a class or vary an order by which more than one exemption was so granted so as to terminate any of the exemptions—

(a)in accordance with any provision of the order by which the exemption was granted; or

(b)if it appears to the Secretary of State inappropriate that the exemption should continue to have effect.

(7)The Secretary of State may by direction withdraw an exemption granted to persons of a class from any person of that class—

(a)at the person’s request;

(b)in accordance with any provision of the order by which the exemption was granted; or

(c)if it appears to the Secretary of State inappropriate that the exemption should continue to have effect in the case of the person.

(8)Before—

(a)making an order under subsection (5)(b) or (c) or (6); or

(b)giving a direction under subsection (7)(b) or (c),

the Secretary of State shall consult the Authority and give notice of his proposal to do so (with reasons) and of a period within which representations may be made to him.

(9)The notice under subsection (8) shall be given—

(a)where the Secretary of State is proposing to make an order under subsection (5)(b) or (c), by serving a copy of it on the person to whom the exemption was granted;

(b)where he is proposing to make an order under subsection (6), by publishing it in such manner as the Secretary of State considers appropriate for bringing it to the attention of persons of the class of persons to whom the exemption was granted; and

(c)where he is proposing to give a direction under subsection (7)(b) or (c), by serving a copy of it on the person from whom he proposes to withdraw the exemption.]]

Textual Amendments

F86S. 6A substituted (1.3.1996) by 1995 c. 45, s. 4; S.I. 1996/218, art. 2

F87Words in s. 6A(1) repealed (1.10.2001) by 2000 c. 27, ss. 86(1), 108, Sch. 8; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F88Words in s. 6A(1) inserted (14.8.2006) by Energy Act 2004 (c. 20), ss. 149(4), 198(2); S.I. 2006/1964, art. 2, Sch.

F91S. 6A(1A)(1B) inserted (1.10.2001) by 2000 c. 27, s. 86(2); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F94S. 6A(2)(2A)(3) substituted (1.10.2001) for s. 6A(2)(3) by 2000 c. 27, s. 86(3); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F95S. 6A(5)-(9) substituted (1.10.2001) for s. 6A(5) by 2000 c. 27, s. 86(4); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

[F966BDuties of distribution exemption holdersE+W+S

Schedule 2AA (which relates to the duties of distribution exemption holders) has effect.

Textual Amendments

6CDuties of supply exemption holdersE+W+S

Schedule 2AB (which relates to the duties of supply exemption holders) has effect.]

Textual Amendments

[F977 Licensing of public gas transporters.E+W+S

(1)In this Part “[F98gas transporter]” means the holder of a licence under this section except where the holder is acting otherwise than for purposes connected with—

(a)the carrying on of activities authorised by the licence;

(b)the conveyance of gas through pipes which—

(i)are situated in an authorised area of his; or

(ii)are situated in an area which was an authorised area of his, or an authorised area of a previous holder of the licence, and were so situated at a time when it was such an area; or

(c)the conveyance through pipes of gas which is in the course of being conveyed to or from a country or territory outside Great Britain.

(2)Subject to [F99subsections (3) and (3A)] below, the Director may grant a licence authorising any person to do either or both of the following, namely—

(a)to convey gas through pipes to any premises in an authorised area of his, that is to say, [F100any area specified in the licence as it has effect for the time being;]

(b)to convey gas through pipes either to any pipe-line system operated by another [F101gas transporter], or to any pipe-line system so operated which is specified in the licence or an extension of the licence.

(3)A licence shall not be granted under this section to a person who is the holder of a licence under section [F1027ZA or] 7A below.

[F103(3A)A licence authorising the conveyance of gas through pipes to any premises must not be granted under this section to a person who is a gas producer unless it is a condition of the licence that the person must not convey gas through pipes to 100,000 or more sets of premises.]

(4)[F104Subject to subsection (3A), the] Director may, with the consent of the licence holder, direct that any licence under this section shall have effect—

(a)as if any area or pipe-line system specified in the direction were specified in the licence;

(b)in the case of a licence under subsection (2)(a) above, as if it were also a licence under subsection (2)(b) above and any pipe-line system specified in the direction were specified in the licence; or

(c)in the case of a licence under subsection (2)(b) above, as if it were also a licence under subsection (2)(a) above and any area specified in the direction were specified in the licence;

and references in this Part to, or to the grant of, an extension under this section, or an extension of such a licence, shall be construed as references to, or to the giving of, such a direction.

[F105(4A)The Authority may, with the consent of the licence holder, direct that any licence under this section shall have effect as if any area or pipe-line system specified in the direction were not specified in the licence; and references in this Part to, or to the grant of, a restriction under this section, or a restriction of such a licence, shall be construed as references to, or to the giving of, such a direction.]

(5)Before granting a licence F106. . . under this section, the Director shall give notice—

(a)stating that he proposes to grant the licence F106. . .;

(b)stating the reasons why he proposes to grant the licence F106. . .; and

(c)specifying the time from the date of publication of the notice (not being less than two months F106. . .) within which represent- ations or objections with respect to the proposed licence F106. . . may be made,

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

(6)A notice under subsection (5) above shall be given—

(a)by publishing the notice in such manner as the Director considers appropriate for bringing it to the attention of persons likely to be affected by the grant of the licence F106. . .; and

(b)by sending a copy of the notice to the Secretary of State, to the Health and Safety Executive and to any [F101gas transporter] whose area includes the whole or any part of the area proposed to be specified in the licence F106. . ..

F107(7). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F107(8). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(9)As soon as practicable after the granting of a licence under this section, the [F101gas transporter] shall publish, in such manner as the Director considers appropriate for bringing it to the attention of persons who are likely to do business with the transporter, a notice—

(a)stating that the licence has been granted; and

(b)explaining that, as a result, it might be necessary for those persons to be licensed under section 7A below.

(10)In this section—

[F108(za)“gas producer” means a person who—

(i)gets natural gas from its natural condition in strata otherwise than as an unintended consequence of the storage of gas, and requires a licence under section 3 of the Petroleum Act 1998 (licences to search and bore for and get petroleum) to do so or would require such a licence if getting the gas in Great Britain; or

(ii)produces any other gas, including in particular biomethane, which is suitable for conveyance through pipes to premises in accordance with a licence under section 7;]

(a)“relevant main” has the same meaning as in section 10 below;

(b)references to an area specified in a licence or direction include references to an area included in an area so specified; and

(c)references to a pipe-line system specified in a licence or direction include references to a pipe-line system of a description, or situated in an area, so specified.

F109(11). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

Textual Amendments

F97S. 7 substituted (1.3.1996) by 1995 c. 45, s. 5; S.I. 1996/218, art. 2

F98Words in s. 7(1) substituted (1.10.2001) by 2000 c. 27, s. 76(2); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F100Words in s. 7(2)(a) and word “and”preceding para. (b) substituted (1.10.2001) by 2000 c. 27, s. 76(3); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F101Words in s. 7(2)(b)(6)(b)(9) substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6, Pt. I para. 4; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F102Words in s. 7(3) inserted (1.12.2004) by Energy Act 2004 (c. 20), ss. 149(5), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

F105S. 7(4A) inserted (1.10.2001) by 2000 c. 27, s. 76(4); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F106Words in s. 7(5)(6) repealed (1.10.2001) by 2000 c. 27, ss. 76(5), 108, Sch. 8; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F107S. 7(7)(8) repealed (1.10.2001) by 2000 c. 27, ss. 76(6), 108, Sch. 8; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F109S. 7(11) repealed (1.10.2001) by 2000 c. 27, s. 108, Sch. 8; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

Modifications etc. (not altering text)

C33S. 7 amended (16.5.2001) by 2000 c. 27, s. 81(1); S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10)

S. 7 amended (1.10.2001) by 2000 c. 27, s. 76(1); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

C34S. 7 applied (with modifications) (8.11.1995) by 1995 c. 45, s. 17(1), Sch. 5 Pt. II para. 15(1)(4); S.I. 1996/218, art. 2

C35S. 7 extended (8.11.1995) by 1995 c. 45, s. 17(1), Sch. 5 Pt. I para. 1(1)(a); S,I. 1996/218, art. 2

C36S. 7 modified (26.12.2023) by Energy Act 2023 (c. 52), ss. 134, 334(3)(c)

[F1107ZALicences for operation of gas interconnectorsE+W+S

(1)Subject to subsection (2), the Authority may grant a licence authorising any person to participate in the operation of a gas interconnector.

(2)A licence shall not be granted under this section to a person who is the holder of a licence under section 7 or 7A.

(3)A licence under this section—

(a)must specify the interconnector or interconnectors in relation to which participation is authorised; and

(b)may limit the forms of participation in the operation of an interconnector which are authorised by the licence.]

Textual Amendments

Modifications etc. (not altering text)

[F1117A Licensing of gas suppliers and gas shippers.E+W+S

(1)Subject to subsection (3) below, the Director may grant a licence authorising any person to do either or both of the following, namely—

(a)to supply, to any premises specified in the licence, gas which has been conveyed through pipes to those premises; and

(b)to supply, to any premises at a rate which, at the time when he undertakes to give the supply, he reasonably expects to exceed 2,500 therms a year, gas which has been conveyed through pipes to those premises.

(2)Subject to subsection (3) below, the Director may grant a licence authorising any person to arrange with any [F112gas transporter] for gas to be introduced into, conveyed by means of or taken out of a pipe-line system operated by that transporter, either generally or for purposes connected with the supply of gas to any premises specified in the licence.

(3)A licence shall not be granted under this section to a person who is the holder of a licence under section 7 [F113or 7ZA] above.

(4)The Director may, with the consent of the licence holder, direct that any licence under this section shall have effect—

(a)as if any premises specified in the direction were specified in the licence; or

(b)in the case of a licence under subsection (1)(b) above, as if it were also a licence under subsection (1)(a) above and any premises specified in the direction were specified in the licence,

and references in this Part to, or to the grant of, an extension under this section, or an extension of such a licence, shall be construed as references to, or to the giving of, such a direction.

(5)Subsection (4) above shall not apply in relation to a licence under subsection (1) above which authorises only the supply to premises of gas which has been conveyed to the premises otherwise than by a [F112gas transporter].

(6)The Director may, with the consent of the licence holder, direct that any licence under this section shall have effect as if any premises specified in the direction were not specified in the licence; and references in this Part to, or to the grant of, a restriction under this section, or a restriction of such a licence, shall be construed as references to, or to the giving of, such a direction.

(7)In this section references to premises specified in a licence or direction include references to premises of a description, or situated in an area, so specified.

(8)The Director shall not, in any licence under subsection (1) above, or in any extension or restriction of such a licence, specify any premises by description or area if he is of the opinion that the description or area has been so framed as—

(a)in the case of a licence or extension, artificially to exclude from the licence or extension; or

(b)in the case of a restriction, artificially to include in the restriction,

premises likely to be owned or occupied by persons who are chronically sick, disabled or of pensionable age, or who are likely to default in the payment of charges.

(9)If the holder of a licence under subsection (1) above applies to the Director for a restriction of the licence, or for the revocation of the licence in accordance with any term contained in it, the Director shall, subject to subsection (8) above, accede to the application if he is satisfied that such arrangements have been made as—

(a)will secure continuity of supply for all relevant consumers; and

(b)in the case of each such consumer who is supplied with gas in pursuance of a contract, will secure such continuity on the same terms as nearly as may be as the terms of the contract.

(10)A person is a relevant consumer for the purposes of subsection (9) above if—

(a)immediately before the restriction or revocation takes effect, he is being supplied with gas by the holder of the licence; and

(b)in the case of a restriction, his premises are excluded from the licence by the restriction;

and in that subsection “contract” does not include any contract which, by virtue of paragraph 8 of Schedule 2B to this Act, is deemed to have been made.

(11)In this Part “gas supplier” and “gas shipper” mean respectively the holder of a licence under subsection (1) above, and the holder of a licence under subsection (2) above, except (in either case) where the holder is acting otherwise than for purposes connected with the carrying on of activities authorised by the licence.

(12)Any reference in this Part (however expressed) to activities authorised by a licence under subsection (1) above shall be construed without regard to any exception contained in Schedule 2A to this Act.]

Textual Amendments

F111S. 7A inserted (1.3.1996) by 1995 c. 45, s. 6; S.I. 1996/218, art. 2

F112Words in S. 7A(2)(5) substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F113Words in s. 7A(3) inserted (1.12.2004) by Energy Act 2004 (c. 20), ss. 149(7), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

Modifications etc. (not altering text)

C38S. 7A applied (with modifications) (8.11.1995) by 1995 c. 45, s. 17(1), Sch. 5 Pt. II para. 15(1)(4); S.I. 1996.218, art. 2

S. 7A applied (with modifications) (1.3.1996) by S.I. 1996/399, art. 2(2)

C40S. 7A(1)(2) amended (1.10.2001) by 2000 c. 27, s. 81(1); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

[F1147AALicensing of a person carrying out gas system planner functionsE+W+S

(1)Subject to subsections (3) and (4), the Authority may grant a licence authorising a person to carry out planning and forecasting functions of the Independent System Operator and Planner (“a gas system planner licence”).

(2)Subject to subsection (4), the Secretary of State may grant a gas system planner licence.

(3)The first gas system planner licence may only be granted by the Secretary of State.

(4)A person may not be granted a gas system planner licence unless either of the following paragraphs applies to the person—

(a)the person—

(i)already holds an electricity system operator licence, or

(ii)is treated as holding such a licence by virtue of a direction under section 167 of the Energy Act 2023;

(b)the person is granted an electricity system operator licence, or is treated by virtue of a direction under section 167 of the Energy Act 2023 as having been granted such a licence, at the same time as the person is granted a gas system planner licence.

(5)In this section—

  • “electricity system operator licence” means a licence under section 6(1)(da) of the Electricity Act 1989;

  • “planning and forecasting functions of the Independent System Operator and Planner” has the meaning given by section 5(10A).]

Textual Amendments

[F1157AB.Licensing of a person providing a smart meter communication serviceE+W+S

(1)Subject to subsections (4) and (5), the Authority may grant a licence authorising a person to provide a smart meter communication service (“a smart meter communication licence”).

(2)Subject to subsections (3) and (5), the Secretary of State may grant a smart meter communication licence.

(3)The Secretary of State may not grant a smart meter communication licence after 1 November 2018.

(4)The first smart meter communication licence may only be granted by the Secretary of State.

(5)A person may not be granted a smart meter communication licence unless the same person is at the same time granted a licence under section 6(1)(f) of the Electricity Act 1989.]

Textual Amendments

[F1167ACLicensing of a person performing code manager functionE+W+S

(1)The Authority may grant a licence (“a code manager licence”) authorising a person to perform the function of code manager in respect of a designated gas licence document.

(2)Where a designated gas licence document is also a designated electricity licence document, a person may not be granted a code manager licence in respect of the document unless the same person is at the same time granted a licence under section 6(1)(g) of the Electricity Act 1989.

(3)In this section—

  • “designated electricity licence document” has the same meaning as in section 4 of the Electricity Act 1989;

  • “designated gas licence document” has the same meaning as in section 5.]

Textual Amendments

[F1177B Licences: general.E+W+S

(1)An application for a licence or an extension or restriction of a licence shall be made in such form and manner, and shall contain, or be accompanied by, such information and documents and such fee (if any), as may be prescribed.

(2)Within the prescribed period after the making of an application for a licence or an extension or restriction of a licence, the applicant shall—

(a)publish a notice of the application in the prescribed manner; and

(b)in the case of an application for a licence or extension under section 7 above, give notice of the application to any [F118gas transporters] whose authorised area includes the whole or any part of the area to which the application relates.

[F119(2A)Where the Authority proposes to refuse the application, it shall give to the applicant a notice—

(a)stating that it proposes to refuse the application;

(b)stating the reasons why it proposes to refuse the application; and

(c)specifying the time within which representations with respect to the proposed refusal may be made,

and shall consider any representations which are duly made and not withdrawn.]

[F120(2B)At any time when regulations made under section 41HC are in force, subsections (1) to (2A) do not apply to an application for a smart meter communication licence.]

[F121(2C)Subsections (1) to (2A) do not apply to an application for a code manager licence.]

(3)A licence or an extension or restriction of a licence shall be in writing and, unless revoked or suspended in accordance with any term contained in it [F122and subject to subsection (3A)], a licence shall continue in force for such period as may be specified in or determined by or under the licence.

[F123(3A)If a person who holds a gas system planner licence ceases at any time to hold a licence under section 6(1)(da) of the Electricity Act 1989, the person is to be treated as ceasing to hold the gas system planner licence at the same time.]

(4)A licence may include—

(a)such conditions (whether or not relating to the activities authorised by the licence) as appear to the [F124grantor] to be requisite or expedient having regard to the duties imposed by [F125sections 4AA, 4AB and 4A];

F126(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(c)conditions requiring the rendering to the Director of a payment on the grant of the licence or payments during the currency of the licence or both of such amount or amounts as may be determined by or under the licence; F127. . .

F127(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F128(4A)Without prejudice to the generality of paragraph (a) of subsection (4), conditions included in a licence under section 7 by virtue of that paragraph—

(a)may require the licence holder to enter into agreements with other persons for the use of any pipe-line system of his (wherever situated and whether or not used for the purpose of carrying on the activities authorised by the licence) for such purposes as may be specified in the conditions;

(b)may include provision for determining the terms on which such agreements are to be entered into.]

(5)Without prejudice to the generality of paragraph (a) of subsection (4) above—

(a)conditions included by virtue of that paragraph in a licence may—

(i)require the holder to comply with any direction given by the Director or the Secretary of State as to such matters as are specified in the licence or are of a description so specified;

(ii)require the holder, except in so far as the Director or the Secretary of State consents to his doing or not doing them, not to do or to do such things as are specified in the licence or are of a description so specified; and

(iii)provide for the determination by the Director, the Secretary of State or the Health and Safety Executive of such questions arising under the licence, or under any document [F129referred to] in the licence, as are specified in the licence or are of a description so specified; and

(b)conditions included by virtue of that paragraph in a licence under section 7 [F130or 7AA] above may require the holder, in such circumstances as are specified in the licence—

(i)so to increase [F131the charges payable to the holder in connection with the conveyance of gas, or in connection with the exercise of any other functions under or by virtue of the licence,] as to raise such amounts as may be determined by or under the conditions; and

(ii)to pay the amounts so raised to such holders of [F132licences under this Part or under section 6 of the Electricity Act 1989] as may be so determined.

[F133(5ZA)Without prejudice to the generality of paragraph (a) of subsection (4), conditions for or in connection with the purpose set out in subsection (5ZB) may be included in a licence under section 7AA by virtue of that paragraph.

(5ZB)The purpose is to facilitate or ensure the effective performance (whether in relation to Northern Ireland or any other part of the United Kingdom), at relevant times, of functions of a hydrogen production allocation body under Chapter 1 of Part 2 of the Energy Act 2023.

(5ZC)In subsection (5ZB) “relevant times” means times when the hydrogen production allocation body holds a licence under section 7AA.]

[F134(5A)Without prejudice to the generality of paragraph (a) of subsection (4), conditions which are described in subsection (5B) may be included in a smart meter communication licence [F135or in a code manager licence] by virtue of that paragraph, in respect of circumstances where a person holds such a licence (the “licence holder”), and another person has applied or is considering whether to apply for a [F136a licence of the same type] (“the applicant”).

(5B)The conditions in this subsection are conditions which require the licence holder to comply with a direction given by the [F137relevant authority] requiring the licence holder to provide to the applicant—

(a)information in relation to the activities authorised by the licence; or

(b)such other assistance as may be reasonably required by the applicant, including access to any facilities or equipment being used in connection with the activities authorised by the licence, in order that the applicant can—

(i)determine whether to apply for a licence; or

(ii)take part in a competition for a licence [F138or (in the case of an application for a code manager licence) apply for a licence otherwise than as part of a competition].

(5C)Subject to subsection (5E) and without prejudice to the generality of paragraph (a) of subsection (4), conditions which are described in subsection (5D) may be included in a smart meter communication licence [F139or in a code manager licence] by virtue of that paragraph, in respect of circumstances where such a licence held by a person (the “first licensee”) will cease to have effect, and another such licence is to be granted or has been granted to a different person (the “second licensee”).

(5D)The conditions in this subsection are conditions which require compliance with a direction given by [F140the relevant authority] requiring—

(a)the transfer of property, rights or liabilities from the first licensee to the second licensee;

(b)the creation of rights in relation to property, rights or liabilities in favour of the second licensee;

(c)the creation of other rights and liabilities as between the first and second licensee;

(d)the first or second licensee to enter into a written agreement with each other, or the first licensee to execute an instrument of another kind in favour of the second licensee;

(e)the first or second licensee to pay compensation to the other, or to any third party who is affected by any of the matters referred to in paragraphs (a) to (d).

(5E)Conditions included in a licence by virtue of subsection (5C) must provide that the licensee does not have a duty to comply with a direction of the kind referred to in subsection (5D) unless, in relation to that direction, the following conditions have been satisfied prior to it being given—

(a)the [F141relevant authority] has given written notice to the first licensee, the second licensee and any other person who would potentially be affected by the direction, including a copy of the proposed direction and inviting them to submit written representations, giving a minimum period of 21 days in which those representations can be made; and

(b)after the end of the period set out in the notice under paragraph (a), the [F142relevant authority] has considered those representations and determined that—

(i)it is appropriate in all the circumstances that the proposed direction is given; and

(ii)the arrangements of a type referred to in paragraphs (a) to (d) of subsection (5D) in the direction are necessary or expedient for the operational purposes of the second licensee, or are agreed by the first licensee and the second licensee to be necessary or expedient for those purposes.

(5F)For the purposes of subsection (5E), the operational purposes of the second licensee are the purposes of performing any functions which the second licensee has, or will have—

(a)under or by virtue of the smart meter communication licence which has been, or is to be, granted; or

(b)under or by virtue of any enactment, in the second licensee’s capacity as holder of that licence.]

[F143(5FA)In subsections (5B) to (5E), “the relevant authority” means—

(a)in relation to a smart meter communication licence, the Secretary of State or the Authority;

(b)in relation to a code manager licence, the Authority.]

(6)Conditions included in a licence may—

(a)impose requirements by reference to designation, acceptance or approval by the Director, the Secretary of State or the Health and Safety Executive; and

(b)provide for references in the conditions to any document F144. . . to operate as references to that document as revised or re-issued from time to time.

(7)Conditions included in a licence may contain provision for the conditions to—

(a)have effect or cease to have effect at such times and in such circumstances as may be determined by or under the conditions; or

(b)be modified in such manner as may be specified in the conditions at such times and in such circumstances as may be so determined.

(8)Any provision included in a licence by virtue of subsection (7) above shall have effect in addition to the provision made by this Part with respect to the modification of the conditions of a licence.

(9)As soon as practicable after granting a licence or an extension or restriction of a licence, the Director shall send a copy of the licence or extension or restriction—

(a)to the Health and Safety Executive; F145. . .

(b)in the case of a licence [F146, extension or restriction] under section 7 above, to any public gas transporter whose authorised area [F147includes] the whole or any part of the area specified in the licence [F146, extension or restriction] [F148; and

(c)to any other person who holds a licence and whose interests may, in the opinion of the Authority, be affected by the grant.]

(10)Any sums received by the Director under or by virtue of this section shall be paid into the Consolidated Fund.]

[F149(11)In this section “prescribed” means prescribed in regulations made by the Authority.]

Textual Amendments

F117S. 7B inserted (1.3.1996) by 1995 c. 45, s. 7; S.I. 1996/218, art. 2

F118Words in s. 7B(2)(b)(9)(b) substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F119S. 7B(2A) inserted (1.10.2001) by 2000 c. 27, s. 74(2); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F122Words in s. 7B(3) inserted (31.1.2024) by Energy Act 2023 (c. 52), ss. 168(4)(a), 334(1); S.I. 2024/32, reg. 3(a)(v)

F125Words in s. 7B(4)(a) substituted (20.12.2000) by 2000 c. 27, s. 74(3)(a); S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15)

F126S. 7B(4)(b) omitted (20.12.2000) by virtue of 2000 c. 27, s. 74(3)(b); S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) and repealed (1.10.2001) by 2000 c. 27, s. 108, Sch. 8; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F127S. 7B(4)(d) and word “and”preceding it repealed (7.11.2000) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 5, Sch. 8; S.I. 2000/2974, art. 2, Sch. (subject to transitional provisions in arts. 3-12)

F128S. 7B(4A) inserted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 74(4); S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F129Words s. 7B(5)(a)(iii) substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 74(5); S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F130Words in s. 7B(5)(b) inserted (31.1.2024) by Energy Act 2023 (c. 52), ss. 177(3)(a), 334(1); S.I. 2024/32, reg. 3(a)(vii)

F131Words in s. 7B(5)(b)(i) substituted (31.1.2024) by Energy Act 2023 (c. 52), ss. 177(3)(b), 334(1); S.I. 2024/32, reg. 3(a)(vii)

F132Words in s. 7B(5)(b)(ii) substituted (31.1.2024) by Energy Act 2023 (c. 52), ss. 177(3)(c), 334(1); S.I. 2024/32, reg. 3(a)(vii)

F144Words in s. 7B(6) shall cease to have effect (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 74(6); S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20) and are repealed (1.10.2001) by 2000 c. 27, s. 108, Sch. 8; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F145S. 7B(9): word “and”preceding para. (b) repealed (1.10.2001) by 2000 c. 27, s. 108, Sch. 8; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F146Words in s. 7B(9)(b) substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6, Pt. I para. 6(a)(i); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F147Word in s. 7B(9)(b) substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 6(a)(ii); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F148S. 7B(9)(c) and the word “and”immediately preceding (1.10.2001) by 2000 c. 27, s. 108, Sch. 6, Pt. I para. 6(b); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F149S. 7B(10) inserted (16.5.2001 for certain purposes, otherwise 1.10.2001) by 2000 c. 27, s. 74(7); S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

Modifications etc. (not altering text)

C42S. 7B applied (with modifications) (1.3.1996) by S.I. 1996/399, art. 2(2)

C43S. 7B applied (with modifications) (8.11.1995 ) by 1995 c. 45, s. 17(1), Sch. 5 Pt. II para. 15(1)(4); S.I. 1996/218, art. 2

C44S. 7B applied (with modifications) (1.12.2004) by Energy Act 2004 (c. 20), ss. 152(3), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

C45S. 7B modified (26.12.2023) by Energy Act 2023 (c. 52), ss. 134, 334(3)(c)

[F1508 Standard conditions of licences.E+W+S

(1)Subject to subsections (2) and (3) F151... , each condition which by virtue of [F152section 81(2) of the Utilities Act 2000] [F153or section 150 of the Energy Act 2004] is a standard condition for the purposes of—

(a)licences under section 7 above;

[F154(aa)licences under section 7ZA above;]

(b)licences under subsection (1) of section 7A above; F155...

(c)licences under subsection (2) of that section, [F156or

(d)licences under section 7AC,]

shall be incorporated (that is to say, incorporated by reference) in each licence under that section or, as the case may be, that subsection.

(2)Subsection (1) above shall not apply in relation to a licence under section 7A(1) above which authorises only the supply to premises of gas which has been conveyed to the premises otherwise than by a [F157gas transporter].

(3)Subject to the following provisions of this section, the Director may, in granting a licence, modify any of the standard conditions to such extent as he considers requisite to meet the circumstances of the particular case.

(4)Before making any modifications under subsection (3) above, the Director shall give notice—

(a)stating that he proposes to make the modifications and setting out their effect;

(b)stating the reasons why he proposes to make the modifications; and

(c)specifying the time (not being less than 28 days from the date of publication of the notice) within which representations or objections with respect to the proposed modifications may be made,

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

(5)A notice under subsection (4) above shall be given—

(a)by publishing the notice in such manner as the Director considers appropriate for the purpose of bringing the notice to the attention of persons likely to be affected by the making of the modifications; and

(b)by sending a copy of the notice to the Secretary of State, to the Health and Safety Executive [F158, to Citizens Advice and to [F159Consumer Scotland]].

(6)If, within the time specified in the notice under subsection (4) above, the Secretary of State directs the Director not to make any modification, the Director shall comply with the direction.

[F160(6A)The Authority shall not make any modifications under subsection (3) above of a condition of a licence under section 7ZA unless it is of the opinion that the modifications are such that—

(a)the licence holder would not be unduly disadvantaged in competing with one or more other holders of licences under that section; and

(b)no other holder of a licence under that section would be unduly disadvantaged in competing with the holder of the licence to be modified or with any one or more other holders of licences under that section.]

(7)The Director shall not make any modifications under subsection (3) above of a condition of a licence under subsection (1) or (2) of section 7A above unless he is of the opinion that the modifications are such that.

[F161(a)the licence holder would not be unduly disadvantaged in competing with other holders of a licence under that subsection; and

(b)]no other holder of such a licence would be unduly disadvantaged in competing with other holders of such licences (including the holder of the licence [F161being modified])

(8)The modification under subsection (3) above of a condition of a licence shall not prevent so much of the condition as is not so modified being regarded as a standard condition for the purposes of this Part.

(9)In this section “modify” includes fail to incorporate and “modification” shall be construed accordingly.]

Textual Amendments

F150S. 8 substituted (1.3.1996) by 1995 c. 45, s. 8(1); S.I. 1996/218, art. 2

F151Words in s. 8(1) repealed (1.10.2001) by 2000 c. 27, ss. 81(3)(a), 108, Sch. 8; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F152Words in s. 8(1) substituted (1.10.2001) by 2000 c. 27, s. 81(3)(b); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F153Words in s. 8(1) inserted (1.4.2005) by Energy Act 2004 (c. 20), ss. 150(6)(a), 198(2); S.I. 2005/877, art. 2(1), Sch. 1

F157Words in s. 8 substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F161Words in s. 8(7) inserted (1.10.2001) by 2000 c. 27, s. 82(1); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

Modifications etc. (not altering text)

C47S. 8 applied (with modifications) (1.12.2004) by Energy Act 2004 (c. 20), ss. 152(3), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

C48S. 8 modified (26.12.2023) by Energy Act 2023 (c. 52), ss. 134, 334(3)(c)

C49S. 8(3) restricted (26.12.2023) by Energy Act 2023 (c. 52), ss. 140(4), 334(3)(c)

[F1628AA Transfer of licences.E+W+S

(1)A licence—

(a)shall be capable of being transferred by the licence holder, with the consent of the Authority, in accordance with this section and subject to any term of the licence relating to its transfer;

(b)may include conditions which must be complied with before the licence can be transferred.

(2)A transfer may relate to the whole or any part of the licence.

(3)The reference in subsection (2) to part of a licence is a reference to a part of the activities authorised by the licence (whether described by reference to activities being carried on by the licence holder or to activities which he is authorised to carry on).

(4)Such consent may be given subject to compliance with such modification or other conditions as the Authority considers necessary or expedient.

(5)In the case of a partial transfer, conditions imposed under subsection (4) may make as respects so much of the licence as is proposed to be retained by the transferor provision different from that made as respects so much of the licence as is proposed to be transferred.

(6)In deciding whether to give its consent to a proposed transfer, the Authority shall apply the same criteria as it would apply if the Authority were deciding whether—

(a)in the case of a general transfer, to grant a corresponding licence to the transferee; or

(b)in the case of a partial transfer—

(i)to grant to the transferee a licence corresponding to so much of the licence as is proposed to be transferred; and

(ii)to grant to the transferor a licence corresponding to so much of the licence as is proposed to be retained.

(7)The Authority shall—

(a)give the Health and Safety Executive not less than 28 days’ notice of any proposal to consent to any proposed transfer; and

(b)give that Executive and the Secretary of State not less than 28 days’ notice of any proposal to impose a modification condition.

(8)If, before the expiry of the time specified in a notice given to the Secretary of State under subsection (7)(b), the Secretary of State directs the Authority not to impose the condition, the Authority shall comply with the direction.

(9)Before giving consent to the transfer of a licence, the Authority shall give notice—

(a)stating that it proposes to grant consent to the transfer;

(b)stating the reasons why it proposes to give consent; and

(c)specifying the time from the date of publication of the notice (not being less than two months) within which representations or objections with respect to the transfer may be made,

and shall consider any representations or objections that are duly made and not withdrawn.

(10)A notice under subsection (9) shall be given by publishing the notice in such manner as the Authority considers appropriate for bringing it to the attention of persons likely to be affected by the transfer.

[F163(10A)Subject to subsection (10C), the Authority shall, following consideration of any representations or objections under subsection (9), give the Secretary of State not less than 28 days’ notice of any proposal to give consent to the transfer of the whole or any part of a smart meter communication licence.

(10B)If, before the expiry of the time specified in a notice under subsection (10A), the Secretary of State directs the Authority not to give consent, the Authority shall comply with that direction.

(10C)Where the Secretary of State does not give a direction under subsection (10B), the Authority may give consent to the transfer of the licence after—

(a)the expiry of the time specified in the notice under subsection (10A); or

(b)if earlier than the time in paragraph (a), the time at which the Secretary of State informs the Authority that no direction will be given under subsection (10B) in relation to the notice.

(10D)Subsections (10A) to (10C) do not apply after [F1641 November 2028].]

(11)A purported transfer of a licence shall be void—

(a)if the licence is not capable of transfer or the Authority has not given its consent;

(b)if the purported transfer is in breach of a condition of the licence; or

(c)if there has, before the purported transfer, been a contravention of a condition subject to compliance with which the Authority’s consent is given.

[F165(11ZA)A gas system planner licence may not be transferred to a person unless a licence granted under section 6(1)(da) of the Electricity Act 1989 is also transferred to the same person at the same time.]

[F166(11A)A smart meter communication licence may not be transferred to a person unless a licence granted under section 6(1)(f) of the Electricity Act 1989 is also transferred to the same person at the same time.]

[F167(11B)Where the holder of a code manager licence is also the holder of a licence under section 6(1)(g) of the Electricity Act 1989, the code manager licence may not be transferred to a person unless the licence under section 6(1)(g) of that Act is transferred to the same person at the same time.]

(12)In this section—

  • “transfer” includes any form of transfer or assignment or, in Scotland, assignation;

  • “modification condition” means a condition requiring or otherwise providing for the making of modifications to the conditions of a licence.]

Textual Amendments

F162S. 8AA substituted (1.10.2001) by 2000 c. 27, s. 85; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F164Words in s. 8AA(10D) substituted (26.10.2023) by Energy Act 2023 (c. 52), ss. 215(2)(a), 334(2)(k)

F165S. 8AA(11ZA) inserted (31.1.2024) by Energy Act 2023 (c. 52), ss. 168(5), 334(1); S.I. 2024/32, reg. 3(a)(v)

[8AF168Modification or removal of the 25,000 therm limits.E+W+S

(1)The Secretary of State may by order amend [F169section 10(8) or (12) below, paragraph 4 of Schedule 2A to this Act or paragraph 4, 8 or 16 of Schedule 2B to this Act] by substituting—

(a)where the limit is for the time being expressed by reference to a number of therms—

(i)such lower number of therms as he considers appropriate; or

(ii)such lower limit, expressed by reference to a number of kilowatt hours, as he considers appropriate; or

(b)where the limit is for the time being expressed by reference to a number of kilowatt hours, such lower number of kilowatt hours as he considers appropriate.

(2)An order under subsection (1) above may be made so as to provide for the number specified in one provision to differ from that for the time being specified in any of the other provisions.

F170(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F170(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ]

Textual Amendments

F168S. 8A inserted (30.5.1992) by Competition and Service (Utilities) Act 1992 (c. 43), s. 37; Commencement Order No. 1 made on 29.5.1992, art. 2.

F169Words in s. 8A(1) substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 2(1); S.I. 1996/218, art. 2

F170S. 8A(3)(4) repealed (1.3.1996) by 1995 c. 45, ss. 10(1), 17(5), Sch. 3 para. 2(2), Sch. 6; S.I. 1996/218, art. 2

[F171 The gas code]E+W+S

Textual Amendments

F171S. 8B and cross-heading inserted (1.3.1996) by 1995 c. 45, s. 9; S.I. 1996/218, art. 2

8B[F172 The gas code.]E+W+S

The provisions of Schedule 2B to this Act (which relate to rights and obligations of licence holders and consumers and related matters) shall have effect.

Textual Amendments

F172S. 8B and cross-heading inserted (1.3.1996) by 1995 c. 45, s. 9(1); S.I. 1996/218, art. 2

[F173Gas transmission and the operation of gas interconnectors: independenceU.K.

Textual Amendments

8CRequirement for certain gas transporters and operators of gas interconnectors to be certified as independentU.K.

(1)A person who, for any period on or after the relevant date, holds a licence under section 7 and carries out transmission of gas must ensure that the person is certified by the Authority under section 8F throughout that period.

(2)A person who, for any period on or after the relevant date, holds a licence under section 7ZA and participates in the operation of a gas interconnector must ensure that the person is certified by the Authority under section 8F throughout that period.

(3)In subsections (1) and (2) the “relevant date” in respect of a person is 3 March 2012 or any later date before 4 March 2013 which the Authority specifies under subsection (4) or (5) in respect of the person.

(4)The Authority may specify a later date in respect of a person if—

(a)the person has asked the Authority to specify a later date;

(b)the person is not, and is not part of, a vertically integrated undertaking; and

(c)no senior officer of the person is also a senior officer of a relevant producer or supplier.

(5)The Authority may also specify a later date in respect of a person if the Authority thinks that, for reasons beyond its and the person’s control, the Authority will not reasonably be able to make a final decision before 3 March 2012 as to whether to certify the person.

(6)In this section—

(a)“transmission” has the meaning given by Article 2(3) of the Gas Directive; and

(b)“vertically integrated undertaking” has the meaning given by Article 2(20) of that Directive.

8DApplication for certificationU.K.

(1)Any person may apply for certification.

(2)An application for certification—

(a)must be made in writing to the Authority; and

(b)must be made in such form and contain such information as the Authority may specify.

(3)If the application is made F174... and the applicant is a person from a [F175country outside the United Kingdom] or a person controlled by a person from a [F175country outside the United Kingdom], the Authority must, as soon as is reasonably practicable after receiving the application—

(a)notify the Secretary of State F176... that an application has been made by such a person; and

(b)enclose with the notification F177... any information which, at the time of the notification, the Authority has in its possession and thinks is relevant to the question of whether the security of gas supplies in the United Kingdom F178... would be put at risk by the certification of the applicant.

(4)The Authority may ask an applicant for certification for any further information the Authority thinks is relevant to the application, and the applicant must supply that information if—

(a)it is in the applicant’s possession; or

(b)it is information which the applicant could reasonably be expected to obtain.

(5)The Authority may ask a relevant producer or supplier for any information the Authority thinks is relevant to an application for certification, and the relevant producer or supplier must supply that information if—

(a)it is in the relevant producer or supplier’s possession; or

(b)it is information which the relevant producer or supplier could reasonably be expected to obtain.

(6)A person required to supply information under subsection (4) or (5) must do so by any deadline specified by the Authority.

Textual Amendments

8EReport where applicant connected with a country outside the [F179United Kingdom] U.K.

(1)This section applies if the Secretary of State is notified by the Authority under section 8D(3) that an application has been made by a person from a [F180country outside the United Kingdom] or a person controlled by a person from a [F180country outside the United Kingdom].

(2)The Secretary of State must prepare a report on whether the security of gas supplies in the United Kingdom F181... would be put at risk by the certification of the applicant.

(3)The Secretary of State must prepare the report and send it to the Authority within the 6 weeks beginning with the day on which the notification under section 8D(3) is received.

(4)If, before the Secretary of State sends the report to the Authority, the Authority receives information under section 8D(4) or (5) and thinks that the information is relevant to the preparation of the report, the Authority must supply that information to the Secretary of State as soon as is reasonably practicable.

(5)In preparing the report, the Secretary of State must take into account—

(a)any relevant international law; and

(b)any relevant agreement between the government of the United Kingdom and the government of the F182... country in question.

Textual Amendments

8FCertificationU.K.

(1)Where the Authority receives an application for certification, it must make a F183... decision by the relevant deadline as to whether [F184to] certify the applicant.

(2)The relevant deadline is the end of the 4 months beginning with the day on which the Authority receives the application; but this is subject to any extension under subsection (3).

(3)If, before the deadline mentioned in subsection (2) (or before that deadline as previously extended under this subsection), the Authority asks the applicant or a relevant producer or supplier for information under section 8D(4) or (5), the relevant deadline is the end of the 4 months beginning with the day on which the last of that information is received.

(4)As soon as is reasonably practicable after making the F185... decision the Authority must notify the decision and the reasons for it to—

(a)the applicant; [F186and]

(b)the Secretary of State; F187...

F187(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F188(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F188(6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F188(7). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F188(8). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F189(9)The Authority must publish its decision to certify or to refuse to certify the applicant, together with the reasons for it, in such manner as it considers appropriate.]

Textual Amendments

8GGrounds for certificationU.K.

(1)This section applies to—

(a)a F190... decision under section 8F as to whether [F191to certify an applicant];

F192(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2)The Authority may only F193... decide to certify the applicant, if one of the following F194... grounds (“the certification grounds”) applies.

(3)The first certification ground is that the applicant meets the ownership unbundling requirement in section 8H.

(4)The second certification ground is that the applicant has asked the Authority to exempt it from the ownership unbundling requirement on the grounds in paragraph (9) of Article 9 of the Gas Directive (alternative arrangements for independence), and the Authority thinks the requirements of that paragraph are met.

(5)The third certification ground is that—

(a)the applicant has asked the Authority to exempt it from the ownership unbundling requirement on the grounds in paragraphs (1) and (2) of Article 14 of the Gas Directive (independent system operator);

(b)the applicant has nominated an independent system operator for designation in accordance with those paragraphs; and

(c)the Authority—

(i)thinks that the requirements of those paragraphs are met, and

(ii)is minded to designate the nominated independent system operator.

F195(6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7)The fifth certification ground is that—

(a)the applicant holds a licence under section 7ZA; and

(b)in accordance with the conditions of that licence, the applicant has been granted an exemption from the ownership unbundling [F196requirement—

(i)in accordance with Article 36 of the Gas Directive (new infrastructure) before IP completion day and remains entitled to the benefit of it, or

(ii)on the basis set out in Article 36(1) to (3) and (6) of the Gas Directive and remains entitled to the benefit of it.]

(8)The sixth certification ground is that—

(a)the applicant holds a licence under section 7ZA; and

(b)either—

(i)the applicant has, in accordance with the conditions of that licence, been granted an exemption in accordance with Article 22 of Directive 2003/55/EC of the European Parliament and of the Council of 26 June 2003 on common rules for the internal market in natural gas (new infrastructure) and remains entitled to the benefit of it; or

(ii)another person benefits from such an exemption, and the applicant is in a position which is substantially similar to the position of that person.

(9)But, regardless of whether a certification ground applies, the Authority—

F197(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b)F198... must not decide to certify the applicant, if a report prepared by the Secretary of State under section 8E states that the certification of the applicant would put at risk the security of gas supplies in the United Kingdom F199...;

F200(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F201(10)For the purposes of subsection (4), Article 9(9) of the Gas Directive is to be treated as if the comparison with the provisions of Chapter 4 of the Gas Directive were a comparison with the provisions of Chapter 4 as they applied in relation to a member State immediately before IP completion day.

(11)The references in subsection (5) to Article 14(1) and (2) of the Gas Directive are to be treated as references to those provisions with the following modifications—

(a)Article 14(1) is to be read as if the second and third sentences were omitted;

(b)Article 14(2)(b) is to be read as if after “Article 13” there were inserted—

“as implemented in relation to Great Britain immediately before IP completion day, disregarding for this purpose—

(i)paragraph 2,

(ii)paragraph 3 so far as relating to Article 41(6)(c), and

(iii)paragraph 4 except as it relates to such minimum standards, if any, as apply in Great Britain”;

(c)Article 14(2)(e) is to be read as if—

(i)for “Regulation (EC) No 715/2009” there were substituted “ the Gas Regulation ”, and

(ii)the words from “including” to the end were omitted.]

Textual Amendments

8HThe ownership unbundling requirementU.K.

(1)In section 8G(3) the ownership unbundling requirement is met by an applicant for certification if [F202in relation to each of the five tests below—

(a)the Authority thinks that it is passed, or

(b)it is treated as passed by virtue of subsection (7), (9) or (9A).]

(2)The first test is that the applicant—

(a)does not control a relevant producer or supplier;

(b)does not have a majority shareholding in a relevant producer or supplier; and

(c)will not, on or after the relevant date, exercise shareholder rights in relation to a relevant producer or supplier.

(3)For the purposes of subsection (2)(c), the Authority is entitled to think that the applicant will not exercise shareholder rights if the applicant has given an undertaking not to exercise those shareholder rights.

(4)The second test is that, where the applicant is a company, partnership or other business, none of its senior officers has been, or may be, appointed by a person who—

(a)controls a gas undertaking which is a relevant producer or supplier; or

(b)has a majority shareholding in a gas undertaking which is a relevant producer or supplier.

(5)The third test is that, where the applicant is a company, partnership or other business, none of its senior officers is also a senior officer of a gas undertaking which is a relevant producer or supplier.

(6)The fourth test is that the applicant is not controlled by a person who controls a relevant producer or supplier.

(7)But even where the fourth test is not passed, the Authority may treat it as passed if—

(a)the control over the applicant was gained through the exercise of a right conferred as a condition of the provision of either financial support or a guarantee (or both), in relation to the applicant’s business; or

(b)the control over the relevant producer or supplier was gained through the exercise of such a right conferred in relation to the business of the relevant producer or supplier.

(8)The fifth test is that the applicant is not controlled by a person who has a majority shareholding in a relevant producer or supplier.

(9)But even where the fifth test is not passed, the Authority may treat it as passed if—

(a)the control over the applicant was gained through the exercise of a right conferred as a condition of the provision of either financial support or a guarantee (or both), in relation to the applicant’s business; or

(b)the majority shareholding in the relevant producer or supplier was gained through the exercise of such a right conferred in relation to the business of the relevant producer or supplier.

[F203(9A)The Authority may treat one or more of the five tests in this section as passed if—

(a)the test or tests are not passed in relation to a relevant producer or supplier,

(b)the applicant has demonstrated to the Authority’s satisfaction that the applicant does not have a relationship with the relevant producer or supplier which might lead the applicant to discriminate in favour of the relevant producer or supplier, and

(c)the Authority thinks it appropriate to treat the test or tests as passed.]

(10)In subsection (2)(c) “relevant date” means the relevant date for the purposes of section 8C(1) or (2).

Textual Amendments

8IThe ownership unbundling requirement: supplementaryU.K.

(1)Subsections (2) and (3) apply where—

(a)by virtue of subsection (7) or (9) of section 8H, the Authority treats the fourth or fifth test under section 8H as passed in relation to a person; and

(b)the person is certified in reliance on that treatment.

(2)The Authority must by notice to the certified person specify a period of time at the end of which the Authority will cease to treat that test as passed by virtue of that subsection.

(3)The Authority may by notice to the certified person extend that period if the Authority thinks it necessary or expedient to do so.

(4)In deciding whether to treat a test as passed by virtue of section 8H(7) or (9), and in determining any period or extension under subsection (2) or (3), the Authority—

(a)must take into account—

(i)the period of time for which the test is likely to continue not to be passed, and

(ii)whether the relationship (direct or indirect) between the applicant and the relevant producer or supplier has led or might lead the applicant to discriminate in favour of the relevant producer or supplier; and

(b)may, in particular, take into account any information or undertaking given to the Authority by the applicant, the relevant producer or supplier or the person who controls the applicant and controls or has a majority shareholding in the relevant producer or supplier.

(5)The information and undertakings that may be taken into account under subsection (4)(b) include information and undertakings regarding any measures that have been or will be put in place to ensure the effective separation of the business of the applicant and the business of the relevant producer or supplier.

8JDesignation for the purposes of [F204the Gas Regulation] U.K.

(1)This section applies in relation to any period for which a person—

(a)holds a licence under section 7 or 7ZA; and

(b)is certified.

(2)If the person is certified on the first, second, F205... fifth or sixth certification ground in section 8G, the person is designated as a gas transmission system operator for the purposes of [F206the Gas Regulation].

(3)If the person is certified on the third certification ground in section 8G, the independent system operator nominated in the application for certification is designated as a gas transmission system operator for the purposes of [F207the Gas Regulation].

(4)As soon as is reasonably practicable after a person is designated by virtue of this section, the Authority must notify the designation to—

(a)the person designated; [F208and]

(b)the Secretary of State; F209...

F209(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

8KMonitoring and review of certificationU.K.

(1)The Authority must monitor, in respect of each certified person, whether the basis on which the Authority decided to certify the person, including the certification ground on which the person was certified, (the “certification basis”) continues to apply.

(2)If, F210... as result of information it has received or obtained, the Authority thinks that a person from a [F211country outside the United Kingdom] has taken or may take control of a certified person, the Authority must, as soon as is reasonably practicable—

(a)notify the information to the Secretary of State F212...; and

(b)enclose with the notification to the Secretary of State any further information which, at the time of the notification, the Authority has in its possession and thinks is relevant to the question of whether the security of gas supplies in the United Kingdom F213... would be put at risk by the continued certification of the person.

F214(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F215(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)The Authority may F216... review whether the certification basis in respect of a certified person continues to apply if—

(a)the certified person notifies it of any event or circumstance which may affect that basis; or

(b)the Authority thinks that the basis may no longer apply.

(6)A review under subsection (5) is to be carried out within the 4 months beginning with—

(a)if paragraph (a) of subsection (5) applies, the day on which the Authority receives the notification under that paragraph;

(b)otherwise, the first day on which the Authority thinks that the certification basis may no longer apply.

(7)Subsection (8) applies where—

(a)by virtue of section 8H(7) or (9), the Authority has treated the fourth or fifth test under section 8H as passed;

(b)a person is certified in reliance on that treatment; and

(c)the period specified under section 8I as the period at the end of which that treatment will cease comes to an end.

(8)Where this subsection applies, the Authority must review whether that test is now passed.

(9)A review under subsection (8) is to be carried out within the 4 months beginning with the end of the period mentioned in subsection (7)(c).

[F217(10)If, before any of the deadlines mentioned in subsection F218... (6) or (9) (or before such deadline as previously extended under this subsection), the Authority asks the certified person or a relevant producer or supplier for information under section 8L(2) or (3), the relevant deadline is the end of the 4 months beginning with the day on which the last of that information is received.]

Textual Amendments

8LReview of certification: requirement to provide information etcU.K.

(1)As soon as is reasonably practicable after beginning a review under section 8K, the Authority must notify the certified person that the review is being carried out and of the reasons for it.

(2)The Authority may ask that person for any information the Authority thinks is relevant to the review, and the person must supply the information if—

(a)it is in the person’s possession; or

(b)it is information which the person could reasonably be expected to obtain.

(3)The Authority may ask a relevant producer or supplier for any information the Authority thinks is relevant to a review under section 8K, and the relevant producer or supplier must supply that information if—

(a)it is in the relevant producer or supplier’s possession; or

(b)it is information which the relevant producer or supplier could reasonably be expected to obtain.

(4)A person required to supply information under subsection (2) or (3) must do so by any deadline specified by the Authority.

8MReport as to any connection of certified person with a country [F219outside the United Kingdom] U.K.

(1)This section applies if the Authority notifies information to the Secretary of State under section 8K(2) in respect of a certified person.

(2)The Secretary of State must prepare a report on whether the security of gas supplies in the United Kingdom F220... would be put at risk by the continued certification of the person.

(3)The Secretary of State must prepare the report and send it to the Authority within the 6 weeks beginning with the day on which the notification is received.

(4)If, before the Secretary of State sends the report to the Authority, the Authority receives information under section 8L(2) or (3) and thinks that the information is relevant to the preparation of the report, the Authority must supply that information to the Secretary of State as soon as is reasonably practicable.

(5)In preparing the report, the Secretary of State must take into account—

(a)any relevant international law; and

(b)any relevant agreement between the government of the United Kingdom and the government of the F221... country in question.

Textual Amendments

8NContinuation or withdrawal of certificationU.K.

(1)Where the Authority reviews under section [F2228K(5)] whether the certification basis in respect of a certified person continues to apply, it may, within the 4 months mentioned in section [F2238K(6)] [F224or where relevant the 4 months mentioned in section 8K(10),] either—

(a)make a F225... decision [F226to continue the certification] on the certification ground mentioned in section 8K(1); or

(b)make a F227... decision [F228to withdraw the certification].

(2)If the Authority does not make a decision under subsection (1) within those 4 months, it is to be taken as having made a F229... decision at the end of the 4 months [F230to continue the certification] on the certification ground mentioned in section 8K(1).

(3)Where the Authority reviews under section 8K(8) whether the fourth or fifth test under section 8H is now passed, it may, within the 4 months mentioned in section 8K(9) [F231or where relevant the 4 months mentioned in section 8K(10)], either—

(a)make a F232... decision [F233to continue the certification] on the basis that the test is now passed; or

(b)make a F234... decision [F235to withdraw the certification].

(4)If the Authority does not make a decision under subsection (3) within those 4 months, it is to be taken as having made a F236... decision at the end of the 4 months [F237to continue the certification] on the basis that the test is now passed.

(5)As soon as is reasonably practicable after a F238... decision is made (or taken to be made) under this section, the Authority must—

(a)notify the decision to the certified person and the Secretary of State; F239...

F239(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F240(6). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F240(7). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F240(8). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F240(9). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

[F241(9A)The Authority must publish its decision to continue a certification, or to withdraw a certification, together with the reasons for it, in such manner as it considers appropriate.]

(10)Section [F2428G(9)(b)] applies in relation to a decision mentioned in this section as it applies in relation to a decision mentioned in section 8G(1), but as if—

(a)the references in section [F2438G(9)(b)] to the certification of the applicant were references to the continued certification of the person certified; and

(b)the reference in section 8G(9)(b) to a report prepared under section 8E were a reference to a report prepared under section 8M.

Textual Amendments

8OProhibition on the exercise of certain shareholder rights and rights of appointmentU.K.

(1)A person must not exercise a shareholder right or a right of appointment if—

(a)the right falls within subsection (2), (3), (4) or (5);

(b)the relevant date in respect of the certified person mentioned in that subsection has been reached;

(c)the exercise of the right would or might lead the certified person to discriminate in favour of the relevant producer or supplier mentioned in that subsection; and

(d)the relevant producer or supplier is a person to whom subsection (6) applies.

(2)A right falls within this subsection if—

(a)it is a shareholder right;

(b)it is held by a person who controls a person certified on the certification ground in section 8G(3); and

(c)it is exercisable in relation to a relevant producer or supplier.

(3)A right falls within this subsection if—

(a)it is a shareholder right;

(b)it is exercisable in relation to a person certified on the certification ground in section 8G(3); and

(c)it is held by a person who controls a relevant producer or supplier.

(4)A right falls within this subsection if—

(a)it is a shareholder right;

(b)the person who holds it appointed a senior officer of a person certified on the certification ground in section 8G(3);

(c)the person appointed continues to hold that office; and

(d)the right is exercisable in relation to a gas undertaking which is a relevant producer or supplier.

(5)A right falls within this subsection if—

(a)it is a right to appoint a senior officer of a person certified on the certification ground in section 8G(3); and

(b)the person who holds it has, within the immediately preceding period of 3 years, exercised a shareholder right in relation to a gas undertaking which is a relevant producer or supplier.

(6)This subsection applies to a person if, in order to carry out some or all of the activity by virtue of which the person is a relevant producer or supplier, the person—

(a)requires a licence under section 7A of this Act, section 6 of the Electricity Act 1989 (licences authorising supply, etc), or section 3 of the Petroleum Act 1998 (licences to search and bore for and get petroleum); or

(b)would require such a licence if carrying out the activity in Great Britain.

(7)In this section—

(a)“exercise” means exercise directly or indirectly, and “exercisable” is to be interpreted accordingly; and

(b)“relevant date” means the relevant date for the purposes of section 8C(1) or (2).

8PValidity of acts infringing section 8OU.K.

(1)The following are voidable on an application to the court—

(a)the exercise of a shareholder right in breach of section 8O;

(b)the appointment of a senior officer in breach of that section.

(2)Any person may make an application under subsection (1).

(3)Such an application may not be made after the end of the 5 years beginning with the day on which the shareholder right was exercised or the appointment made.

(4)If, by virtue of this section, the court declares the exercise of a shareholder right or an appointment to be void, it may make an order as to the consequences of its declaration.

(5)In this section, “the court” means—

(a)in relation to England and Wales, the High Court, and

(b)in relation to Scotland, the Court of Session.

8QInterpretationU.K.

(1)In sections 8C to 8P and this section—

  • “control”, in relation to one person having control over another, has the meaning given by Article 2(36) of the Gas Directive (but in determining whether one person (“person A”) has control over another (“person B”) no account is to be taken of any unexercised contractual or other right which would, if exercised, give person A control over person B and which was conferred as a condition of the provision of either financial support or a guarantee (or both), by person A in relation to the business of person B); and references to one person controlling another are to be interpreted accordingly;

  • “certified” means [F244certified by] the Authority under section 8F; and “certify” and “certification” are to be interpreted accordingly;

  • “certification grounds” has the meaning given by section 8G(2);

  • “person from a [F245country outside the United Kingdom]” means a person the Authority thinks is from a [F245country outside the United Kingdom];

  • “shareholder right” means a right, conferred by the holding of a share in the company’s share capital—

    (a)

    to vote at general meetings of the company; or

    (b)

    to appoint or remove a member of the company’s board of directors;

  • F246...

(2)In this Part “gas undertaking” means a person who—

(a)gets natural gas from its natural condition in strata otherwise than as an unintended consequence of the storage of gas, and requires a licence under section 3 of the Petroleum Act 1998 (licences to search and bore for and get petroleum) to do so or would require such a licence if getting the gas in Great Britain;

(b)produces any other gas, including in particular biomethane, which is suitable for conveyance through pipes to premises in accordance with a licence under section 7;

(c)supplies to any premises gas which has been conveyed to those premises through pipes;

(d)arranges with a gas transporter for gas to be introduced into, conveyed by means of or taken out of a pipe-line system operated by that transporter; or

(e)otherwise sells gas.

(3)In this Part “relevant producer or supplier”, in relation to an applicant for certification or a certified person, means a person who falls within each of subsections (4) and (5).

(4)A person falls within this subsection if the person—

(a)is a gas undertaking;

(b)generates electricity for the purpose of giving a supply to any premises or enabling a supply to be so given;

(c)supplies electricity to any premises; or

(d)otherwise generates or sells electricity,

and terms used in paragraphs (b) and (c) of this subsection have the same meanings in those paragraphs as in Part 1 of the Electricity Act 1989.

[F247(5)A person falls within this subsection if—

(a)the person requires a licence under section 7A of this Act or section 6 of the Electricity Act 1989 (licences authorising supply, etc) to carry out the activity by virtue of which the person falls within subsection (4);

(b)where the person does not carry out the activity in Great Britain, the person would, in the Authority’s opinion, require such a licence if carrying out the activity in Great Britain; or

(c)the person has a relationship with the applicant or certified person which the Authority thinks might lead the applicant or certified person to discriminate in favour of the person.]]

Textual Amendments

[F248Storage facilities: independenceU.K.

Textual Amendments

8RIndependence of storage facilitiesU.K.

(1)This section applies to a storage facility unless a minor facility exemption is in force in respect of that facility under section 8S.

(2)The owner of a storage facility to which this section applies must, notwithstanding any licence held by the owner, refrain from producing gas in [F249the United Kingdom].

(3)The owner must also, notwithstanding any licence held by the owner, refrain from carrying out any of the following activities in [F250the United Kingdom] except to the extent that the activity is necessary for the efficient operation of the storage facility or of another facility used by the owner to store gas—

(a)the supply to any premises of gas which has been conveyed to those premises through pipes;

(b)the making of an arrangement with a gas transporter for gas to be introduced into, conveyed by means of or taken out of a pipe-line system operated by that gas transporter;

(c)any other sale of gas.

(4)If an affiliate of the owner carries out in [F251the United Kingdom] an activity which, under subsection (2) or (3), the owner must refrain from carrying out, the owner must operate the storage facility independently of the interests of that affiliate and must, in particular, ensure that—

(a)no senior officer or manager of the owner is a senior officer or manager of the affiliate;

(b)if a senior officer or manager of the owner has an interest in the affiliate that conflicts, or is likely to conflict, with the interests of the storage facility, the owner maintains procedures to ensure that the storage facility is operated independently of that interest in the affiliate;

(c)the owner is entitled to take decisions without the consent of that affiliate in respect of any assets necessary to operate, maintain or develop the storage facility; and

(d)the owner does not take instructions from the affiliate regarding day to day operations or individual decisions concerning the construction or upgrading of the storage facility.

(5)Subsection (4)(c) and (d) does not prevent a parent undertaking of the owner from requiring the owner—

(a)to obtain the parent undertaking’s approval of the owner’s annual financial planning;

(b)to comply with restrictions on the owner’s overall indebtedness.

(6)The owner must establish a programme (the “independence programme”) in relation to the owner’s senior officers, other officers, managers and employees for the purpose of ensuring that they do not cause the owner to—

(a)discriminate against persons who are not affiliates of the owner; or

(b)breach any of the owner’s obligations under section 11C regarding the disclosure or use of information.

(7)The owner must—

(a)ensure that compliance with the independence programme is monitored; and

(b)each year, publish a report setting out the measures taken in accordance with the independence programme and send a copy to the Authority.

(8)For the purposes of this section a person produces gas if the person—

(a)gets natural gas from its natural condition in strata otherwise than as an unintended consequence of the storage of gas, and requires a licence under section 3 of the Petroleum Act 1998 (licences to search and bore for and get petroleum) to do so or would require such a licence if getting the gas in Great Britain; or

(b)produces any other gas, including in particular biomethane, which is suitable for conveyance through pipes to premises in accordance with a licence under section 7.

(9)In this section—

  • “affiliate”, in relation to a person (“person A”), means—

    (a)

    a person who has control of person A; or

    (b)

    a person who is under the control of the same person as person A;

  • “control” has the meaning given by section 8Q(1);

  • “manager”, in relation to the owner of a storage facility or an affiliate of the owner, means a natural person who is responsible, directly or indirectly, for the day to day management of the owner or the affiliate;

  • “parent undertaking” has the meaning given by section 1162 of the Companies Act 2006.

(10)The reference in subsection (4)(b) to a conflict of interests includes a conflict of interest and duty and a conflict of duties.

Textual Amendments

8SIndependence of storage facilities and duty to allow others to use them: exemptions for minor facilitiesU.K.

(1)A person who is or expects to be an owner of a storage facility may apply in writing to the Authority for an exemption from the requirements of sections 8R and 19B in respect of that facility (a “minor facility exemption”).

(2)The Authority must give a minor facility exemption in respect of a facility where it is satisfied that use of the facility by other persons is not technically or economically necessary for the operation of an efficient gas market.

(3)A minor facility exemption—

(a)must be in writing;

(b)may be given—

(i)for an indefinite period or for a period determined under the exemption;

(ii)unconditionally or subject to such conditions as the Authority considers appropriate.

(4)The Authority must publish its decision to give or refuse to give a minor facility exemption together with the reasons for the decision.

(5)A minor facility exemption may be revoked—

(a)in accordance with provisions contained in it;

(b)at any other time, if the Authority considers that the condition in subsection (2) is no longer met.

(6)The Authority must from time to time publish a document setting out how it will determine whether the use of a facility by other persons is technically or economically necessary for the operation of an efficient gas market, including the matters it will take into account when determining this.

(7)Publication under subsection (4) or (6) must be in such manner as the Authority considers appropriate.

(8)Before publishing a document under subsection (6) the Authority must consult—

(a)the Secretary of State; and

(b)such other persons as the Authority considers appropriate.]

[F252 Powers and duties of public gas transporters]E+W+S

Textual Amendments

F252Cross-heading substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 3; S.I. 1996/218, art. 2

9[F253 General powers and duties.]E+W+S

(1)It shall be the duty of a [F254gas transporter] as respects each authorised area of his—

(a)to develop and maintain an efficient and economical pipe-line system for the conveyance of gas; and

(b)subject to paragraph (a) above, to comply, so far as it is economical to do so, with any reasonable request for him [F255—

(i)]

to connect to that system, and convey gas by means of that system to, any premises [F256; or.

(ii)to connect to that system a pipe-line system operated by an authorised transporter.]

[F257(1A)It shall also be the duty of a gas transporter to facilitate competition in the supply of gas.]

(2)It shall also be the duty of a [F254gas transporter] to avoid any undue preference or undue discrimination—

(a)in the connection of premises [F258, or a pipe-line system operated by an authorised transporter,] to any pipe-line system operated by him; or

(b)in the terms on which he undertakes the conveyance of gas by means of such a system.

[F259(2A)The conditions of a licence held by a gas transporter may include a condition requiring the gas transporter, in performing a duty under subsection (1), (1A) or (2), to have regard to the interests of existing and future consumers in relation to electricity conveyed by distribution systems or transmission systems (within the meaning of the Electricity Act 1989).]

(3)The following provisions shall have effect, namely—

(a)Schedule 3 to this Act (which provides for the acquisition of land by [F254gas transporters]); and

(b)Schedule 4 to this Act (which relates to the breaking up of streets and bridges by such transporters).

Textual Amendments

F253S. 9 substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 3; S.I. 1996/218, art. 2

F254Words in s. 9(1)(2)(3)(a) substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F255S. 9(1)(b): “-(i)”inserted (1.10.2001) by 2000 c. 27, s. 79(2)(a); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F256S. 9(1)(b)(ii) and the word “or”immediately preceding it inserted (1.10.2001) by 2000 c. 27, s. 79(2)(b); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F257S. 9(1A) inserted (1.10.2001) by 2000 c. 27, s. 79(3); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F258Words in s. 9(2)(a) inserted (1.10.2001) by 2000 c. 27, s. 79(4); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

Modifications etc. (not altering text)

C50S. 9(1)(b) applied (with modifications) (1.3.1996) by S.I. 1996/399, art. 3(1)

C51S. 9(3)(a) functions exercisable in or as regards Scotland (14.12.2000) by S.I. 2000/3253, art. 2, Sch. 1 para. 6 (with transitional provisions in art. 6)

S. 9(3)(a) functions transferred to Scottish Ministers (15.12.2000) by S.I. 2000/3253, art. 3, Sch. 2 (with transitional provisions in art. 6)

[F26010 Duty to connect certain premises.E+W+S

(1)Subsection (2) below applies to any premises in an authorised area of a [F261gas transporter] which—

(a)are situated within 23 metres from a relevant main of the transporter; or

(b)could be connected to any such main by a pipe supplied and laid, or proposed to be supplied and laid, by the owner or occupier of the premises.

(2)Subject to the provisions of this Part and any regulations made under those provisions, a [F261gas transporter] shall, on being required to do so by the owner or occupier of any premises to which this subsection applies—

(a)in the case of premises falling within paragraph (a) of subsection (1) above, connect the premises to the relevant main, and supply and lay any pipe that may be necessary for that purpose; and

(b)in the case of premises falling within paragraph (b) of that subsection, connect the premises to the relevant main by the pipe there mentioned;

and in the following provisions of this section “connect”, in relation to any premises, means connect to a relevant main of a [F261gas transporter] and “connection” shall be construed accordingly.

(3)Subject to the provisions of this Part and any regulations made under those provisions, where any premises are connected (whether by virtue of subsection (2) above or otherwise), the [F261gas transporter] shall maintain the connection until such time as it is no longer required by the owner or occupier of the premises.

[F262(3A)A gas transporter may require any person who requires a connection under subsection (2)(b) to accept any terms—

(a)indemnifying the transporter in respect of any liability connected with the laying of the pipe;

(b)which it is reasonable in all the circumstances for that person to be required to accept.]

(4)Where any person requires a connection in pursuance of subsection (2) above, he shall serve on the [F261gas transporter] a notice specifying—

(a)the premises in respect of which the connection is required; and

(b)the day (not being earlier than a reasonable time after the service of the notice) upon which the connection is required to be made.

(5)Where any pipe is supplied and laid by a [F261gas transporter] in pursuance of subsection (2)(a) above, the cost of supplying and laying the pipe shall, if and to the extent that the transporter so requires and the conditions of his licence so allow, be defrayed by the person requiring the connection.

[F263(5A)Where in pursuance of subsection (2)(b) a gas transporter connects any premises to a relevant main by a pipe supplied and laid by the owner or occupier of the premises, the cost of making the connection shall, if and to the extent that the transporter so requires and the conditions of his licence so allow, be defrayed by the person supplying and laying the pipe.]

(6)Where at any time a [F261gas transporter] connects any premises under subsection (2)(b) above—

(a)the pipe supplied and laid by the owner or occupier of the premises; and

(b)any rights [F264or liabilities] of the owner or occupier which relate to the laying, maintenance, repair, alteration or removal of the pipe,

shall at that time vest in and become property [F265, rights or liabilities] of the transporter.

(7)The Director may, with the consent of the Secretary of State, make provision by regulations for entitling a [F261gas transporter] to require a person requiring a connection in pursuance of subsection (2) above to pay to the transporter an amount in respect of the expenses of the laying of the main used for the purpose of making that connection if—

(a)the connection is required within the prescribed period after the laying of the main;

(b)a person for the purpose of connecting whose premises the main was laid has made a payment to the transporter in respect of those expenses;

(c)the amount required does not exceed any amount paid in respect of those expenses by such a person or by any person previously required to make a payment under the regulations; and

(d)the transporter has not recovered those expenses in full.

(8)Nothing in subsection (2) or (3) above shall be taken as requiring a [F261gas transporter] to connect, or maintain the connection of, any premises if the supply of gas to those premises is likely to exceed 75,000 therms in any period of twelve months.

(9)Nothing in subsection (2) or (3) above shall be taken as requiring a [F261gas transporter] to connect, or to maintain the connection of, any premises if—

(a)he is prevented from doing so by circumstances not within his control;

(b)circumstances exist by reason of which his doing so would or might involve danger to the public, and he has taken all such steps as it was reasonable to take both to prevent the circumstances from occurring and to prevent them from having that effect; or

(c)in the case of premises falling within paragraph (b) of subsection (1) above, the pipe supplied and laid by the owner or occupier of the premises is not fit for the purpose.

(10)Where—

(a)any person requires a connection to be made or maintained in pursuance of subsection (2) or (3) above;

(b)the making or maintenance of the connection would involve a new or increased supply of gas to the premises in question;

(c)the [F261gas transporter] reasonably expects that, if the connection were made or maintained, gas would be supplied to the premises in question at a rate exceeding 2,500 therms a year; and

(d)the new or increased supply is such that the connection cannot be made or maintained without the laying of a new main, or the enlarging of an existing main, or the construction or enlarging of any other works required for the conveyance of gas,

the transporter may, if he thinks fit, refuse to make or maintain the connection unless that person enters into a written contract with the transporter to make such payments to him as he may reasonably require having regard to the expense to be incurred in laying or enlarging the main or constructing or enlarging the other works and the extent to which it is reasonable to expect that the transporter will recover that expense from elsewhere.

(11)If and to the extent that regulations made by the Director with the consent of the Secretary of State so provide, subsection (10) above shall have effect as if—

(a)the reference in paragraph (d) to the laying of a new main, the enlarging of an existing main or the construction or enlarging of any other works required for the conveyance of gas included a reference to a new main which had previously been laid, an existing main which had previously been enlarged or any other works required for the conveyance of gas which had previously been constructed or enlarged;

(b)the reference to the expense to be incurred in laying or enlarging the main or constructing or enlarging the other works included a reference to the expense which had been so incurred; and

(c)the reference to the extent to which it is reasonable to expect that the transporter will recover that expense from elsewhere included a reference to the extent to which the transporter had been able so to recover that expense.

(12)Subject to subsection (13) below, in this section “relevant main”, in relation to a [F261gas transporter], means any distribution main in [F266an authorised area of his] which is being used for the purpose of giving a supply of gas to any premises in that area at a rate not exceeding 75,000 therms a year.

(13)Any pipe which—

(a)vests in and becomes the property of a [F261gas transporter] by virtue of subsection (6) above; and

(b)apart from this subsection, would be a relevant main for the purposes of this section,

shall be such a main if, and only if, it has been declared to be such a main by the transporter.

(14)A [F261gas transporter] shall make a declaration under subsection (13) above in respect of each pipe falling within that subsection which is fit for the purpose of being a relevant main; and a declaration under that subsection shall not be capable of being revoked.]

Textual Amendments

F260S. 10 substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 4; S.I. 1996/218, art. 2

F261Words in s. 10(1)-(10)(12)-(13) substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F262S. 10(3A) inserted (1.10.2001) by 2000 c. 27, s. 80(2); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F263S. 10(5A) inserted (1.10.2001) by 2000 c. 27, s. 80(3); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F264Words in s. 10(6)(b) inserted (1.10.2001) by 2000 c. 27, s. 80(4); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F265Words in s. 10(6) substituted (1.10.2001) by 2000 c. 27, s. 80(5); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F266Words in s. 10(12) substituted (1.10.2001) by 2000 c. 27, s. 80(6); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

[F26710A Restriction on use of certain pipe-lines for providing a supply.E+W+S

(1)Any pipe-line of a gas transporter—

(a)for the construction of which the execution of works has begun before the commencement of section 76 of the Utilities Act 2000 (abolition of geographical exclusivity of authorised areas of gas transporters); and

(b)which is situated in an area which, immediately before the commencement of that section, is the authorised area of a public gas transporter (the “other transporter”),

shall not be used for the purpose of giving a supply of gas to any premises in that area at a rate less than 2,196,000 kilowatt hours per year unless the other transporter consents in writing to such use.

(2)If the other transporter refuses or fails to give consent under subsection (1) consent may instead be given in writing by the Authority where it considers it appropriate to do so.

(3)Consent given under this section may not be withdrawn.

(4)In this section “pipe-line” has the same meaning as in the M3Pipe-lines Act 1962.]

Textual Amendments

F267S. 10A inserted (1.10.2001) by 2000 c. 27, s. 77(1); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

Marginal Citations

[F26811 Power to require security.E+W+S

(1)Where any person requires a connection in pursuance of paragraph (a) of section 10(2) above and a pipe falls to be supplied and laid by the [F269gas transporter] in pursuance of that paragraph—

(a)the transporter may require that person to give him reasonable security for the payment to him of all money which may become due to him in respect of the supply and laying of the pipe; and

(b)if that person fails to give such security or, where any security given by him has become invalid or insufficient, fails to provide alternative or additional security, the transporter may if he thinks fit refuse to supply and lay the pipe for so long as the failure continues.

(2)Where any amount is deposited with a [F269gas transporter] by way of security in pursuance of this section, the transporter shall pay interest on that amount, at such rate as may from time to time be fixed by the transporter with the approval of the Director, in respect of the period during which it remains in the hands of the transporter.

(3)In this section “connection” shall be construed in accordance with section 10(2) above.]

Textual Amendments

F268S. 11 substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 5; S.I. 1996/218, art. 2

F269Words in s. 11(1)(2) substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

[F270Duties of facility owners and prospective facility ownersU.K.

Textual Amendments

11AGeneral duties of facility ownersU.K.

(1)This section applies to—

(a)a storage facility;

(b)an LNG import or export facility.

(2)The owner of a facility to which this section applies must—

(a)operate, maintain and develop the facility, so far as it is economical to do so, in a manner calculated to ensure that the facility is secure, reliable and efficient;

(b)take any steps required by the Authority to ensure that the owner maintains sufficient financial resources to enable the owner to comply with the owner’s obligations under this Act and under the Gas Regulation.

11BDuty of current and prospective LNG import or export facility owners to provide informationU.K.

A person who is or expects to be the owner of an LNG import or export facility must provide the Authority with such information in such manner and at such times as the Authority may reasonably require to facilitate the performance of its functions under this Act.

11CRestrictions on disclosure of information by facility ownersU.K.

(1)The owner of a storage facility or LNG import or export facility must take all reasonable steps to ensure that commercially sensitive information relating to the operation of the facility is not disclosed—

(a)to a person in a way that discriminates against any other person or description of persons;

(b)to an associated undertaking unless the disclosure is necessary in order to enable a transaction with that associated undertaking to take place.

(2)Information which is obtained by the owner of a storage facility or LNG import or export facility from an associated undertaking for the purpose of, or in the course of, a transaction with that undertaking must not be used by the owner for any other purpose.]

[F271 Gas conveyed by Public Gas Transporters]E+W+S

Textual Amendments

F271S. 12 and preceding cross-heading substituted for s. 12 (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 6; S.I. 1996/218, art. 2

12[F272 Methods of calculating therms.]E+W+S

(1)Except in prescribed cases, the number of therms or kilowatt hours conveyed by a [F273 gas transporter] to premises, or to pipe-line systems operated by other [F273gas transporters], shall be calculated in the prescribed manner—

(a)on the basis of calorific values of the gas determined by the transporter in accordance with regulations under this section, or so determined by another [F273gas transporter] and adopted by the transporter in accordance with such regulations; or

(b)if and to the extent that regulations under this section so provide and the transporter thinks fit, on the basis of declared calorific values of the gas;

and regulations under this section shall be made by the Director with the consent of the Secretary of State.

(2)In this Part—

  • “calorific value”, in relation to any gas, means the number of megajoules (gross) which would be produced by—

    (a)

    the combustion of one cubic metre of the gas measured at a temperature of 15°C and a pressure of 1013.25 millibars; or

    (b)

    if regulations under this section so provide, the combustion of one kilogram of the gas,

    containing in either case, if the Director so determines, such an amount of water vapour as is specified in the determination;

  • “declared calorific value”, in relation to any gas conveyed by a [F273gas transporter], means a calorific value declared by the transporter in accordance with regulations under this section, or so declared by another [F273gas transporter] and adopted by the transporter in accordance with such regulations.

(3)Regulations under this section may make provision as to the manner in which prescribed information with respect to the making of calculations in accordance with the regulations is to be made available to other licence holders and to the public.

(4)Regulations under this section made for the purposes of subsection (1)(a) above may make provision—

(a)for requiring determinations of calorific values of gas conveyed by [F273gas transporters] to be made on the basis of samples of gas taken at such places or premises, at such times and in such manner as the Director may direct;

(b)for requiring such determinations to be made at such places or premises, at such times and in such manner as the Director may direct;

(c)as to the manner in which the results of such determinations are to be made available to other licence holders and to the public;

(d)for requiring such premises, apparatus and equipment as the Director may direct to be provided and maintained by [F273gas transporters] for the purpose of making such determinations;

(e)for requiring [F273gas transporters] to carry out tests of apparatus and equipment so provided and maintained by them; and

(f)for requiring the results of such tests to be notified to the Director or to any person appointed under section 13(1) below, and to be made available to other licence holders and to the public.

(5)Regulations under this section made for the purposes of subsection (1)(b) above may make provision—

(a)for requiring declarations of calorific values of gas conveyed by [F273gas transporters] to be made at such times and in such manner as the Director may direct;

(b)as to the times when such declarations are to take effect, and as to the manner in which the calorific values declared are to be made available to other licence holders and to the public;

(c)for imposing requirements on [F273gas transporters] as to the correlation between—

(i)the calorific values of the gas conveyed by them for any period; and

(ii)the calorific values declared by them for that period;

(d)for requiring [F273gas transporters] to carry out tests of gas for the purpose of ascertaining whether they are complying with the requirements of regulations made by virtue of paragraph (c) above;

(e)for requiring such tests to be carried out at such places or premises, at such times and in such manner as the Director may direct; and

(f)for requiring the results of such tests to be notified to the Director or to any person appointed under section 13(1) below, and to be made available to other licence holders and to the public.

(6)Subject to subsection (7) below, the Director may by notice in writing require a [F273gas transporter] to give to the Director, or to any person appointed by him for the purpose, within such time and at such place as may be specified in the notice, such information as the Director may reasonably require for the purpose of making regulations under this section or section 13 below or of giving directions under such regulations.

(7)A [F273gas transporter] shall not be required under subsection (6) above to give any information which he could not be compelled to give in evidence in civil proceedings before the court; and in this subsection “the court” means—

(a)in relation to England and Wales, the High Court;

(b)in relation to Scotland, the Court of Session.

Textual Amendments

F272S. 12 and preceding cross-heading substituted for s. 12 (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 6; S.I. 1996/218, art. 2

F273Words in s. 12 substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

[F27413 Calorific values: tests of apparatus etc.E+W+S

(1)The Director shall appoint competent and impartial persons—

(a)to carry out tests of apparatus and equipment provided and maintained by [F275gas transporters] in pursuance of regulations made by virtue of subsection (4)(d) of section 12 above for the purpose of ascertaining whether they comply with the regulations;

(b)to carry out tests of gas conveyed by [F275gas transporters] where the number of therms or kilowatt hours falls to be calculated in accordance with subsection (1)(b) of that section for the purpose of ascertaining whether the transporters are complying with the requirements of regulations made by virtue of subsection (5)(c) of that section; and

(c)generally to assist the Director in exercising his functions under, or under regulations made under, this section or that section.

(2)Regulations under this section, which shall be made by the Director with the consent of the Secretary of State, may make provision—

(a)for requiring such tests as are mentioned in subsection (1)(b) above to be carried out at such places or premises as the Director may direct;

(b)for requiring such premises, apparatus and equipment as the Director may direct to be provided and maintained by [F275gas transporters] for the purpose of carrying out such tests;

(c)for requiring samples of gas to be taken by [F275gas transporters] at such places or premises, at such times and in such manner as the Director may direct; and

(d)for requiring samples of gas so taken to be provided by [F275gas transporters], for the purpose of carrying out such tests, at such places or premises, at such times and in such manner as the Director may direct.

(3)Regulations under this section may make provision—

(a)for persons representing the public gas transporter concerned to be present during the carrying out of such tests as are mentioned in subsection (1) above;

(b)as to the manner in which the results of such tests are to be made available to other licence holders and to the public; and

(c)for conferring powers of entry on property owned or occupied by [F275gas transporters] for the purpose of carrying out such tests and otherwise for the purposes of this section or section 12 above.

(4)There shall be paid out of money provided by Parliament to persons appointed under subsection (1) above who are members of the Director’s staff such remuneration and such allowances as may be determined by the Director with the approval of the Treasury, and such pensions as may be so determined may be paid out of money provided by Parliament to or in respect of such persons.

(5)Every person who is a [F275gas transporter] during any period shall pay to the Director such proportion (if any) as the Director may determine of—

(a)any sums paid by him under subsection (4) above in respect of that period; and

(b)such part of his other expenses for that period as he may with the consent of the Treasury determine to be attributable to his functions under section 12 above or this section;

and any liability under this subsection to pay to the Director sums on account of pensions (whether paid by him under subsection (4) above or otherwise) shall, if the Director so determines, be satisfied by way of contributions calculated, at such rate as may be determined by the Treasury, by reference to remuneration.

(6)Any sums received by the Director under this section shall be paid into the Consolidated Fund.]

Textual Amendments

F274S. 13 substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 7; S.I. 1996/218, art. 2

F275Words in s. 13 substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F27614. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

Textual Amendments

F27714A. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

Textual Amendments

F27815. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

Textual Amendments

F278S. 15 repealed (1.3.1996) by 1995 c. 45, ss. 9(3), 17(5), Sch. 6; S.I. 1996/218, art. 2

[F27916 Standards of gas quality.E+W+S

(1)The Authority may, with the consent of the Secretary of State, prescribe—

(a)standards of pressure and purity to be complied with by gas transporters in conveying gas to premises or to pipe-line systems operated by other gas transporters; and

(b)other standards with respect to the properties, condition and composition of gas so conveyed.

(2)Before making any regulations under this section the Authority shall consult such persons and organisations as it considers appropriate and such gas transporters as appear to it to be affected by the regulations.

(3)The Authority shall appoint competent and impartial persons for the purpose of—

(a)carrying out tests of gas, apparatus or equipment in accordance with regulations under this section; and

(b)assisting the Authority in exercising functions under this section and regulations made under it.

(4)Regulations under this section may make provision—

(a)for requiring tests of gas conveyed by gas transporters to be carried out by persons appointed under subsection (3) or by gas transporters for the purpose of ascertaining whether the gas conforms with the standards prescribed by the regulations;

(b)for requiring such tests to be carried out on the basis of samples taken by persons appointed under subsection (3) or by gas transporters; and

(c)for requiring samples of gas taken under paragraph (b) to be provided by gas transporters for the purpose of carrying out such tests.

(5)Regulations under this section may make provision—

(a)for requiring such premises, apparatus and equipment as the Authority may direct to be provided and maintained by gas transporters for the purpose of carrying out tests required under subsection (4)(a);

(b)for requiring tests of apparatus and equipment so provided to be carried out by persons appointed under subsection (3); and

(c)for requiring gas transporters to carry out tests of apparatus and equipment so provided and maintained by them.

(6)Regulations under this section may make provision—

(a)as to the places or premises and the times at which, and the manner in which—

(i)tests under this section are to be carried out;

(ii)samples of gas are to be taken and provided under this section; and

(iii)results of tests under this section are to be notified or made available;

(b)for the Authority to require by direction any matter which may be required by regulations by virtue of paragraph (a);

(c)for persons representing the gas transporter concerned to be present during the carrying out of any tests carried out by persons appointed under subsection (3);

(d)for the results of tests under this section to be made available to other licence holders and to the public;

(e)for requiring gas transporters to notify the results of such tests carried out by them to the Authority or to any person appointed under subsection (3);

(f)for conferring powers of entry on property owned or occupied by gas transporters for the purpose of carrying out tests under this section and otherwise for the purposes of the regulations.

(7)Subject to subsection (8), the Authority may by notice in writing require a gas transporter to give to the Authority, or to any person appointed by it for the purpose, within such time and at such place as may be specified in the notice, such information as the Authority may reasonably require for the purpose of making regulations under this section or of giving directions under such regulations.

(8)A gas transporter shall not be required under subsection (7) to give any information which he could not be compelled to give in evidence in civil proceedings before the High Court or, in Scotland, the Court of Session.

(9)Every person who is a gas transporter during any period shall pay to the Authority such proportion as the Authority may determine of such part of its expenses for that period as the Authority may determine to be attributable to its functions in connection with the testing of gas for the purposes of this section.

(10)It shall be the duty of every gas transporter to conduct his business in such a way as can reasonably be expected to secure compliance with the standards set under subsection (1).]

Textual Amendments

F279S. 16 inserted (1.10.2001) by 2000 c. 27, s. 101; S.I. 2001/3266, arts. 1(2), 2, Sch. (subject to transitional provisions in arts. 3-20)

F28015B. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

Textual Amendments

[F281 Gas conveyed by public gas transporters and others]E+W+S

Textual Amendments

F281S. 16 and cross-heading preceding it substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 12; S.I. 1996/218, art. 2

F28216. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

Textual Amendments

F282S. 16 repealed (1.4.1996) by S.I. 1996/551, reg. 12(1)

[F28317 Meter testing and stamping.E+W+S

(1)No meter shall be used for the purpose of ascertaining the quantity of gas supplied through pipes to any person unless it is stamped either by, or on the authority of, a meter examiner appointed under this section or in such other manner as may be authorised by regulations under this section.

(2)Subject to subsections (3) to (5) below, it shall be the duty of a meter examiner who is [F284employed in the civil service of the State], on being required to do so by any person and on payment of the requisite fee—

(a)to examine any meter used or intended to be used for ascertaining the quantity of gas supplied to any person; and

(b)to stamp, or authorise the stamping of, that meter.

(3)A meter examiner shall not stamp, or authorise the stamping of, any meter unless he is satisfied that it is of such pattern and construction and is marked in such manner as is approved by the Director and that the meter conforms with such standards as may be prescribed for the purposes of this subsection.

(4)A meter examiner may stamp or authorise another person to stamp a meter, notwithstanding that he has not himself examined it, if—

(a)the meter was manufactured or repaired by the person submitting it to the examiner;

(b)that person has obtained the consent of the Director to his submission; and

(c)any conditions subject to which the consent was given have been satisfied.

(5)A meter examiner may authorise another person to stamp a meter, notwithstanding that he has not himself examined it, if—

(a)the meter was manufactured or repaired by that person;

(b)that person has obtained the consent of the Director to his stamping of the meter; and

(c)any conditions subject to which the consent was given have been satisfied.

(6)The Director shall appoint competent and impartial persons as meter examiners for the purposes of this section.

(7)There shall be paid out of money provided by Parliament to meter examiners who are [F285employed in the civil service of the State] such remuneration and such allowances as may be determined by the Director with the approval of the Treasury, and such pensions as may be so determined may be paid out of money provided by Parliament to or in respect of such examiners.

[F286(7A)The Secretary of State may pay, out of money provided by Parliament, to meter examiners who are not employed in the civil service of the State or to any employer of such examiners—

(a)sums in connection with the performance by such examiners of functions conferred by or under this section or gas meter regulations (within the meaning of section 92 of the Energy Act 2008), and

(b)sums in respect of any pension payable to or in respect of such examiners.]

(8)All fees payable to meter examiners who are [F287employed in the civil service of the State] for the performance of functions conferred by or under this section shall be paid to the Director; and any sums received by him under this subsection shall be paid into the Consolidated Fund.

(9)Regulations under this section, which shall be made by the Director F288... , may make provision—

(a)for re-examining meters already stamped, and for the cancellation of stamps in the case of meters which no longer conform with the prescribed standards and in such other circumstances as may be prescribed;

(b)for requiring meters to be periodically overhauled; and

(c)for the revocation of any approval given by the Director to any particular pattern or construction of meter, and for requiring existing meters of that pattern or construction to be replaced within such period as may be prescribed for the purposes of this subsection.

(10)The fees to be paid to meter examiners who are [F289employed in the civil service of the State] for the performance of functions conferred by or under this section, and the persons by whom they are to be paid, shall be such as the Director may, with the approval of the Treasury, from time to time determine; and a determination under this subsection may—

(a)make different provision for different areas or in relation to different cases or different circumstances; and

(b)make such supplementary, incidental or transitional provision as the Director considers necessary or expedient.

(11)If any person supplies gas through a meter which has not been stamped under this section, he shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 3 on the standard scale.

(12)Where the commission by any person of an offence under subsection (11) above is due to the act or default of some other person, that other person shall be guilty of the offence; and a person may be charged with and convicted of the offence by virtue of this subsection whether or not proceedings are taken against the first-mentioned person.

(13)In any proceedings for an offence under subsection (11) above it shall be a defence for the person charged to prove that he took all reasonable steps and exercised all due diligence to avoid committing the offence.

(14)The preceding provisions of this section shall not have effect in relation to the supply of gas to a person under any agreement providing for the quantity of gas supplied to him to be ascertained by a meter designed for rates of flow which, if measured at a temperature of 15°C and a pressure of 1013.25 millibars, would exceed 1600 cubic metres an hour.

(15)Regulations under this section may provide that subsection (14) above shall have effect as if for the number of cubic metres an hour which is for the time being applicable for the purposes of that subsection there were substituted such lower number of cubic metres an hour as the Director considers appropriate.]

Textual Amendments

F283S. 17 substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 13; S.I. 1996/218, art. 2

F284Words in s. 17(2) substituted (1.4.2009) by Energy Act 2008 (c. 32), ss. 93(2), 110(2); S.I. 2009/45, art. 3(b)(i)

F285Words in s. 17(7) substituted (1.4.2009) by Energy Act 2008 (c. 32), ss. 93(3), 110(2); S.I. 2009/45, art. 3(b)(i)

F287Words in s. 17(8) substituted (1.4.2009) by Energy Act 2008 (c. 32), ss. 93(3), 110(2); S.I. 2009/45, art. 3(b)(i)

F288Words in s. 17(9) repealed (1.4.2009) by Energy Act 2008 (c. 32), ss. 93(5), 110(2), Sch. 6; S.I. 2009/45, art. 3(b)(i)

F289Words in s. 17(10) substituted (1.4.2009) by Energy Act 2008 (c. 32), ss. 93(3), 110(2); S.I. 2009/45, art. 3(b)(i)

Modifications etc. (not altering text)

18 Safety regulations.E+W+S

F290(1). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(2)The Secretary of State may by regulations make provision for empowering any officer authorised by the relevant authority—

(a)to enter any premises in which there is a service pipe connected with a gas main, for the purpose of inspecting any gas fitting on the premises, any flue or means of ventilation used in connection with any such gas fitting, or [F291any part of the gas system on the premises, that is to say,]any service pipe or other apparatus (not being a gas fitting) which is on the premises and is used for the [F291conveyance or]supply of gas or is connected with a gas main;

(b)where he so enters any such premises, to examine or apply any test to any such object as is mentioned in paragraph (a) above and (where the object is a gas fitting) to verify what supply of air is available for it; and

(c)where in his opinion it is necessary to do so for the purpose of averting danger to life or property, and notwithstanding any contract previously existing, to disconnect and seal off any gas fitting or any part of the [F292gas system on the premises, or disconnect the premises or, if the premises are not connected, to signify the refusal of the relevant authority to convey gas or, as the case may be, allow gas to be conveyed to the premises].

(3)Where any regulations under subsection (2) above confer any power in accordance with paragraph (c) of that subsection, the regulations shall also include provision—

(a)for securing that, where any such power is exercised, the consumer will be notified as to the nature of the defect or other circumstances in consequence of which it has been exercised;

(b)for enabling any consumer so notified to appeal to the Secretary of State on the grounds that the defect or other circumstances in question did not constitute a danger such as to justify the action taken in the exercise of the power, or did not exist or have ceased to exist; and

(c)for enabling the Secretary of State to give such directions as may in accordance with the regulations be determined by him to be appropriate in consequence of any such appeal.

(4)Regulations made under subsection (2) above may make provision for prohibiting any person, except with the consent of the relevant authority or in pursuance of any directions given by the Secretary of State as mentioned in subsection (3)(c) above, from—

(a)reconnecting any gas fitting or [F293any part of any gas system] which has been disconnected by or on behalf of the relevant authority in exercise of a power conferred by the regulations; or

(b)[F294reconnecting any premises which have been disconnected] by or on behalf of the relevant authority in the exercise of any such power; or

(c)causing gas from a gas main to be [F295conveyed] to any premises where in pursuance of the regulations the refusal of the relevant authority to [F296convey gas or, as the case may be, allow gas to be conveyed] to those premises has been signified and that refusal has not been withdrawn.

(5)Where in pursuance of any powers conferred by regulations made under subsection (2) above, entry is made on any premises by an officer authorised by the relevant authority—

(a)the officer shall ensure that the premises are left no less secure by reason of the entry; and

(b)the relevant authority shall make good, or pay compensation for, any damage caused by the officer, or by any person accompanying him in entering the premises, in taking any action therein authorised by the regulations, or in making the premises secure.

(6)Any officer exercising powers of entry conferred by regulations made under subsection (2) above may be accompanied by such persons as may be necessary or expedient for the purpose for which entry is made, or for the purposes of subsection (5) above.

(7)If any person intentionally obstructs any officer exercising powers of entry conferred by regulations made under subsection (2) above, he shall be guilty of an offence and liable on summary conviction to a fine not exceeding level 3 on the standard scale.

(8)The M4Rights of Entry (Gas and Electricity Boards) Act 1954 (entry under a justice’s warrant) shall apply in relation to any powers of entry conferred by regulations made under subsection (2) above as if [F297any reference to a gas operator were a reference to the relevant authority].

[F298(9)In this section “the relevant authority”—

(a)in relation to dangers arising from the conveyance of gas by a [F299gas transporter], or from the use of gas conveyed by such a transporter, means that transporter; and

(b)in relation to dangers arising from the conveyance of gas by a person other than a [F299gas transporter], or from the use of gas conveyed by such a person, means the Secretary of State.

(10)Where the relevant authority is a [F299gas transporter], any reference in this section to any officer authorised by the authority includes a reference to any officer authorised by another such transporter with whom the authority has made arrangements for officers authorised by the other transporter to discharge any functions of the authority under this section.

(11)Except in cases of emergency, no officer shall be authorised by a [F299gas transporter] to exercise any powers of entry conferred by regulations under this section unless the transporter has taken all reasonable steps to ensure that he is a fit and proper person to exercise those powers.]

Textual Amendments

F290S. 18(1) repealed (6.3.1992) by Offshore Safety Act 1992 (c. 15), ss. 3(3)(a), 7(2), Sch. 2.

F291Words in s. 18(2)(a) inserted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 14(1)(a); S.I. 1996/218, art. 2

F292Words in s. 18(2)(c) substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 14(1)(b); S.I. 1996/218, art. 2

F293Words in s. 18(4)(a) substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 14(2)(a); S.I. 1996/218, art. 2

F294Words in s. 18(4)(b) substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 14(2)(b); S.I. 1996/218, art. 2

F295Word in s. 18(4)(c) substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 14(2)(c); S.I. 1996/218, art. 2

F296Words in s. 18(4)(c) substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 14(2)(c); S.I. 1996/218, art. 2

F297Words in s. 18(8) substituted for s. 18(8)(a)(b) (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 14(3); S.I. 1996/218, art. 2

F298S. 18(9)-(11) substituted for s. 18(9) (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 14(4); S.I. 1996/218, art. 2

F299Words in s. 18 substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

Marginal Citations

[F30018A Gas escape regulations.E+W+S

(1)The Secretary of State may by regulations make provision—

(a)for empowering any officer authorised by a [F301gas transporter], if the transporter has reasonable cause to suspect—

(i)that gas conveyed by the transporter is escaping, or may escape, in any premises; or

(ii)that gas so conveyed which has escaped has entered, or may enter, any premises,

to enter the premises, to carry out any work necessary to prevent the escape of gas and to take any other steps necessary to avert danger to life or property; and

(b)for empowering any officer so authorised, if the transporter has reasonable cause to suspect—

(i)that gas conveyed through pipes by some other person is escaping, or may escape, in any premises; or

(ii)that gas so conveyed which has escaped has entered, or may enter, any premises,

to enter the premises and take any steps necessary to avert danger to life or property.

(2)Subsections (5) to (7) and (11) of section 18 above shall apply for the purposes of this section as if—

(a)any reference to subsection (2) of that section were a reference to subsection (1) above;

(b)any reference to the relevant authority were a reference to a [F301gas transporter];

(c)any reference to subsection (5) of that section were a reference to that subsection as applied by this subsection; and

(d)the reference in subsection (11) of that section to regulations under that section were a reference to regulations under this section.

(3)The M5Rights of Entry (Gas and Electricity Boards) Act 1954 (entry under a justice’s warrant) shall apply in relation to any powers of entry conferred by regulations made under subsection (1) above.

(4)Any reference in this section to any officer authorised by a [F301gas transporter] includes a reference to any officer authorised by another such transporter with whom the transporter has made arrangements for officers authorised by the other transporter to discharge any functions under this section of officers authorised by the transporter.]

Textual Amendments

F300S. 18A inserted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 15; S.I. 1996/218, art. 2

F301Words in s. 18A substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

Marginal Citations

[F302Pipe-line systems, storage facilities and LNG import or export facilities: rights of use etc]E+W+S

Textual Amendments

19[F303Acquisition of rights to use pipe-line systems.]E+W+S

(1)In the case of a pipe-line system operated by a [F304gas transporter], any person may, after giving the transporter not less than 28 days’ notice, apply to the Director for directions under this section which would secure to the applicant a right of a description specified in the application to have conveyed by the system gas which—

(a)is of a kind so specified; and

(b)is of, or of a kind similar to, the kind which the system is designed to convey.

(2)Where an application is made under subsection (1) above, it shall be the duty of the Director—

(a)to decide whether the application is to be adjourned (so as to enable negotiations or further negotiations to take place), considered further or rejected;

(b)to give notice of his decision to the applicant;

(c)in the case of a decision that the application is to be considered further, to give to the transporter, to the Health and Safety Executive and to any person who has a right to have gas conveyed by the pipe-line system, notice that the application is to be so considered and an opportunity of being heard about the matter.

(3)Where, after further considering an application under subsection (1) above, the Director is satisfied that the giving of directions under this section would not prejudice the efficient operation of the pipe-line system, or the conveyance by the system of—

(a)the quantities of gas which the [F304gas transporter] requires or may reasonably be expected to require to be conveyed by the system to enable the transporter to comply with the conditions of his licence and to perform his contractual obligations;

(b)the quantities of gas which any person who has a right to have gas conveyed by the system is entitled to require to be so conveyed in the exercise of that right,

the Director may give such directions to the transporter.

(4)Directions under this section may—

(a)specify the terms on which the Director considers the [F304gas transporter] should enter into an agreement with the applicant for all or any of the following purposes—

(i)for securing to the applicant the right to have conveyed by the pipe-line system, for the period specified in the directions and in the quantities so specified or determined by or under the directions, gas which is of a kind so specified;

(ii)for securing that the exercise of that right is not prevented or impeded;

(iii)for regulating the charges which may be made for the conveyance of gas by virtue of that right;

(iv)for securing to the applicant such ancillary or incidental rights as the Director considers necessary or expedient, which may include the right to have a pipe-line of his connected to the pipe-line system by the transporter;

(b)specify the sums or the method of determining the sums which the Director considers should be paid by way of consideration for any such right; and

(c)require the transporter, if the applicant pays or agrees to pay those sums within a period specified in that behalf in the directions, to enter into an agreement with him on the terms so specified.

(5)In giving any directions under this section, the Director shall apply the principle that the [F304gas transporter] should be entitled to receive by way of charges for the conveyance of gas by virtue of the right—

(a)the appropriate proportion of the costs incurred by the transporter in administering, maintaining and operating his pipe-line system; and

(b)a return equal to the appropriate proportion of the return received by the transporter (otherwise than by virtue of the right) on the capital value of the system (including so much of that return as is set aside to meet the need from time to time to renew the system).

(6)In subsection (5) above “the appropriate proportion” means such proportion as properly—

(a)reflects the use made of the [F304gas transporter’s] pipe-line system by virtue of the right as compared with the use made of that system for other purposes; and

(b)takes into account the sums paid by way of consideration for the right and any sums paid in respect of the pipe-line system (whether by the applicant or by any other person) in pursuance of directions under section 21(1) below.

(7)Any reference in this section to a right to have gas of any kind conveyed by a pipe-line system includes a reference to a right to introduce into, or take out of, such a system gas of that kind.

Textual Amendments

F303S. 19 and preceding cross-heading substituted (1.3.1996) by 1995 c. 45, s. 10(1), Sch. 3 para. 16; S.I. 1996/218, art. 2

F304Words in s. 19 substituted (1.10.2001) by 2000 c. 27, s. 108, Sch. 6 Pt. I para. 2(1)(2); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

Modifications etc. (not altering text)

C55S. 19 applied (with modifications) (1.3.1996) by S.I. 1996/399, art. 4(2)

C56S. 19(2)(c) applied (with modifications) (1.3.1996) by S.I. 1996/399, art. 4(4)(c)

[F30519AApplication of section 19B to storage facilities.E+W+S

[F306(1)Section 19B applies to a storage facility, except as provided in subsections (1A) and (1B).

(1A)Section 19B does not apply to a storage facility if it is subject to a minor facility exemption under section 8S.

(1B)Section 19B does not apply to a storage facility if, or to the extent that, it is exempt under this section.

(1C)The Authority must maintain on its website a list of the facilities to which section 19B applies.

(1D)If only part of the capacity of a storage facility is exempt under this section, the list under subsection (1C) must specify the extent to which section 19B applies to the facility.]

(2)[F307A person who is or expects to be an owner] of a storage facility may apply in writing to the Director for an exemption [F308under this section] [F309 with respect to the facility].

[F310(2A)An application under subsection (2) must relate to—

(a)a storage facility (or proposed storage facility) which is not yet operational; or

(b)a modification (or proposed modification) which falls within subsection (2B) and is not yet operational.

(2B)A modification (or proposed modification) falls within this subsection if it is—

(a)a modification of a storage facility to provide for a significant increase in the capacity of the facility; or

(b)a modification of a storage facility to enable the development of new sources of gas supply.

F311(2C). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .]

[F312(3)An exemption under this section must be given in writing and on the following terms—

(a)a term specifying the period of the exemption, or specifying how that period is to be determined;

(b)a term as to whether the exemption applies to all of the capacity of the facility or part of that capacity only;

(c)a term that the owner must comply with the capacity allocation mechanism approved in accordance with section 19DB; and

(d)such other terms regarding non-discriminatory access to the facility or any other matter as the Authority considers appropriate.

(3A)When determining a term under subsection (3) the Authority must take into account—

(a)the capacity of the facility or (as the case may be) the increase in capacity of the facility;

(b)the length of time required to recover the investment in the facility or (as the case may be) the investment in the modification;

(c)the implications of the exemption for the operation of the gas market in Great Britain.]

F313(4). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F313[F314(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6)[F315Where the Authority receives an application under subsection (2) in relation to a facility or modification, it must give an exemption if it is satisfied that] —

F316(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b)the requirements of subsection (8) are met.

[F317(6A)An exemption given in accordance with subsection (6) may apply to all of the capacity of the facility concerned or to part of that capacity only, regardless of the extent of the exemption applied for; but this is subject to subsection (7).]

(7)In respect of a facility which is or is to be modified to provide for a significant increase in its capacity, an exemption by virtue of subsection (6)(b) may only be given in relation to that increase in its capacity [F318or part of that increase in its capacity].

[F319(7A)When deciding whether the requirements of subsection (8)(a), (d) and (e) are met, the Authority must take into account the way in which capacity is to be allocated under the capacity allocation mechanism approved in accordance with section 19DB.]

(8)The requirements of this subsection are that—

(a)the facility or (as the case may be) the [F320modification] will promote security of supply;

(b)the level of risk is such that the investment to construct the facility or (as the case may be) to modify the facility F321... would not be or would not have been made without the exemption;

(c)the facility is or is to be owned by a person other than the gas transporter who operates or will operate the pipeline system connected or to be connected to the facility;

(d)charges will be levied on users of the facility or (as the case