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Energy Act 2023

Contents

Part 12: Core Fuel Sector Resilience

Chapter 1: Introduction

Section 267: General objective

  1. This section sets out that the functions of the Secretary of State under this part must be exercised with a view to ensuring that economic activity in the United Kingdom is not adversely affected by disruptions to core fuel sector activities and reducing the risk of emergencies affecting fuel supplies.

Section 268: "Core fuel sector activity" and other key concepts

  1. This section sets out the key concepts used in this part of the Act. "Core fuels" are defined in subsection (4) as either crude oil-based fuels or renewable transport fuels. "Core fuel sector activity", which includes storing of such fuels, amongst other activities, is defined in subsection (2), so far as the activity is carried out in the United Kingdom in the course of a business, and contributes, either directly or indirectly, to the supply of core fuels to consumers or businesses in the UK. Another key concept is that of a "Part 12 facility owner" meaning the owner of a pipeline, terminal or other facility or infrastructure which is used wholly or partly for the purpose of core fuel sector activities.
  2. This section also defines such concepts as continuity of supply of core fuels and core fuel sector resilience which relate to the purposes for which the measures in this part of the Act may be employed.

Chapter 2: Powers for Resilience Purposes

Section 269: Directions to particular core fuel sector participants

  1. This section contains powers to give directions to a person who carries on core fuel sector activities in the course of a business which has capacity in excess of 500,000 tonnes or is a Part 12 facility owner whose owned facility has capacity in excess of 20,000 tonnes and requires them to do anything in relation to their relevant activities or assets for the purposes set out in the section.
  2. Subsections (1) and (2) provide that the Secretary of State may give directions for the purpose of maintaining or improving core fuel sector resilience but may not do so unless the Secretary of State considers that the persons to whom the direction would apply have failed to make sufficient progress with steps the Secretary of State considers necessary for maintaining or improving core fuel sector resilience.
  3. When there is a disruption to or failure of continuity of core fuel supplies, subsection (3) provides that the Secretary of State may give directions for the purpose of restoring continuity of supply of core fuels or counteracting the disruption or failure, or its potential impact.
  4. If the Secretary of State considers that there is a significant risk of disruption to or failure of continuity of core fuel supplies, subsection (4) provides that the Secretary of State may give directions for the purpose of reducing the risk or reducing the potential adverse impact of the disruption or failure.

Section 270: Procedure for giving directions

  1. This section outlines the process for giving directions under section 270. This includes the requirement for the Secretary of State to give notice to the recipient of the proposed direction and consider any representations made by them. The Secretary of State must also consult with relevant bodies, including those in the devolved administrations insofar as a direction relates to relevant activities or assets in aa territory for which they are responsible, before giving a direction and consider any representations made by them.

Section 271: Offence of failure to comply with a direction

  1. Subsection (1) sets out that any person who without reasonable excuse fails to comply with a direction given to them under section 270 commits an offence and is liable on conviction to a fine or imprisonment (or both).

Section 272: Corresponding powers to make regulations

  1. This section contains a power to make regulations which will apply to a class or description of persons who carry on core fuel sector activities in the course of a business which has capacity in excess of 1,000 tonnes or are Part 12 facility owners whose owned facility has capacity in excess of 1,000 tonnes and require them to do anything in relation to their relevant activities or assets for the purposes set out in the section.
  2. Subsections (1) and (2) provide that the Secretary of State may make regulations for the purpose of maintaining or improving core fuel sector resilience but may not do so unless the Secretary of State considers that the persons to whom the regulations would apply have failed to make sufficient progress with steps the Secretary of State considers necessary for maintaining or improving core fuel sector resilience.
  3. When there is a disruption to or failure of continuity of core fuel supplies, subsection (3) provides that the Secretary of State may make regulations for the purpose of restoring continuity of supply of core fuels or counteracting the disruption or failure, or its potential impact.
  4. If the Secretary of State considers that there is a significant risk of disruption to or failure of continuity of core fuel supplies, subsection (4) provides that the Secretary of State may make regulations for the purpose of reducing the risk or reducing the potential adverse impact of the disruption or failure.
  5. Subsection (7) sets out who the Secretary of Statement must consult with before making regulations under this section. This includes that the Secretary of State must consult with bodies in the devolved administrations insofar as the regulations relate to relevant activities or assets in a territory for which they are responsible.

Section 273: Power to require information

  1. This section enables the Secretary of State to give notice to a person carrying on core fuel sector activities in the course of a business which has capacity in excess of 1,000 tonnes or a Part 12 facility owner whose owned facility has capacity in excess of 1,000 tonnes, requiring them to provide information about their relevant activities or assets.
  2. Subsection (2) enables the Secretary of State to give notice to a relevant wetstock manager requiring them to provide information about relevant activities or assets of a person carrying on core fuel sector activities to whom the relevant wetstock manager provides stock management services. A relevant wetstock manager is defined in subsection (3).
  3. Subsection (4) provides that the Secretary of State may only require information under this section for the purposes of maintaining or improving core fuel sector resilience.
  4. Subsection (6) provides that the Secretary of State must notify the person in advance of the proposed notice to provide information and consider any representations made by that person.

Section 274: Duty to report incidents

  1. This section places a duty on persons to notify the Secretary of State where they know or have reason to suspect that an incident affecting their activities or assets in such a way as to create a significant risk of, or cause, disruption or failure to the continuity of core fuel supply, has occurred or is occurring. This duty applies to a person who is carrying on core fuel sector activities in the course of a business which has capacity in excess of 500,000 tonnes; is a Part 12 facility owner in whose case the owned facility has capacity in excess of 500,000 tonnes; or is a person of a class otherwise defined in regulations made under this section.
  2. Subsection (4) also gives the Secretary of State power to seek further information from a person giving notice under this section.
  3. Subsection (5) requires the Secretary of State to notify the person in advance of the proposed notice to provide information under subsection (4) and consider any representations made by that person.

Section 275: Contravention of requirement under section 273 or 274

  1. This section creates offences associated with breach of section 273 or 274. A person who without reasonable excuse, fails to comply with a requirement imposed by a notice to provide information under section 273(1) or (2) or fails to provide additional information about a notified incident under section 274(4) commits an offence and is liable on conviction to a fine or imprisonment (or both) under subsection (3).
  2. This section also creates an offence associated with breach of section 273(1). A person who without reasonable excuse fails to report an incident under section 273(1) commits an offence and is liable on conviction to a fine or imprisonment (or both) under subsection (3).

Section 276: Provision of information at specified intervals

  1. This section provides that the Secretary of State may make regulations requiring a person carrying on core fuel sector activities in the course of a business which has capacity in excess of 1,000 tonnes or a Part 12 facility owner whose owned facility has capacity in excess of 1,000 tonnes, to provide information at prescribed intervals about their relevant activities or assets.
  2. Subsection (2) provides that the Secretary of State may make regulations in respect of a relevant wetstock manager requiring them to provide information at intervals about the relevant activities or assets of a person carrying on core fuel sector activities to whom the relevant wetstock manager provides stock management services.
  3. Subsection (3) states that this power may only be exercised for the purpose of maintaining or improving core fuel sector resilience.

Section 277: Disclosure of information held by the Secretary of State

  1. This section sets out that information obtained under the power to require information (section 273), the duty to report incidents (section 274), or the power to require information at specified intervals (section 276) may be disclosed to other government departments or devolved authorities for the purposes of maintaining or improving core fuel sector resilience, restoring or counteracting a disruption to or failure of continuity of core fuel supply (or potential adverse impact), or if necessary for the purpose of criminal proceedings. There are restrictions on this power where disclosure would contravene data protection legislation or certain parts of the Investigatory Powers Act 2016.

Section 278: Disclosure of information by HMRC

  1. This section gives His Majesty’s Revenue and Customs (HMRC) power to make disclosures to the Secretary of State for the purposes of facilitating the Secretary of State exercising functions relating to core fuel sector resilience. The section provides limitations on such disclosures, including that the information must not be further disclosed without the consent of HMRC.

Section 279: Appeal against notice or direction

  1. This section sets out that a person to whom a direction is given under section 270, or who is given a notice to provide information under section 273, or to provide further information about a notifiable incident under section 274(4), may appeal a direction or notice to the First-tier Tribunal on the grounds which are set out in this section.

Chapter 3: Enforcement

Section 280: False statements etc

  1. This section specifies that a person who makes a statement they know to be false or materially misleading when responding to a notice to provide information (section 273), a notice to provide further information about a notified incident (section 274(4)), in providing information at specified intervals under regulations (section 276), or in otherwise making a statement to the Secretary of State in connection with Part 12, commits an offence and is liable on conviction to a fine or imprisonment (or both).

Section 281: Offences under regulations

  1. This section sets out the parameters for offences that may be created under regulations in section 272 (corresponding powers to make regulations) and section 276 (provision of information at specified intervals).

Section 282: Proceedings for offences

  1. This section sets out the consents required to bring proceedings for an offence under this Part, including those contained in regulations made under sections 272 or 276, if the prosecution is brought in England and Wales, or in Northern Ireland.

Section 283: Liability of officers of entities

  1. This section sets outs that where an offence under this Part that has been committed by a body corporate is proved to have been committed with the consent, connivance, or neglect of an officer of that body corporate, then the officer commits an offence as well as the body corporate. The section also applies to partners of Scottish partnerships.

Section 284: Enforcement undertakings

  1. This section provides that where the Secretary of State has reasonable grounds to suspect that a person has committed an offence which falls within subsection (5), the Secretary of State may choose to accept an enforcement undertaking. An enforcement undertaking is defined in subsection (3) as an undertaking to take action for any purposes specified in subsection (4) or to take action of a description set out in regulations made by the Secretary of State.
  2. A person who has an enforcement undertaking accepted by the Secretary of State may not be convicted of the offence in relation to the relevant act or omission unless they do not comply with the enforcement undertaking (or any part of it) (subsection (2)). If a person gives an undertaking which is accepted by the Secretary of State and fails to fully comply with the undertaking but has complied with part of it, then the Secretary of State must take into account such partial compliance when deciding whether to take any criminal proceedings in respect of the offence (subsection (7)).

Section 285: Guidance: criminal and civil sanctions

  1. This section requires the Secretary of State to issue guidance about sanctions and enforcement of offences under this Part (including in relation to criminal sanctions and enforcement undertakings) and outlines the procedure that the Secretary of State must follow before issuing or revising such guidance.

Section 286: Guidance: Parliamentary scrutiny

  1. This section sets out the parliamentary procedure the Secretary of State must follow before issuing guidance under section 285.

Chapter 4: General

Section 287: Financial assistance for resilience and continuity purposes

  1. This section enables the Secretary of State to provide financial assistance for the purpose of maintaining or improving core fuel sector resilience or for the purpose of securing or maintaining continuity of supply of core fuels. Financial assistance under this section may be given by way of the methods set out in subsection (3).

Section 288: Power to amend thresholds

  1. This section enables the Secretary of State to make regulations to vary the specified threshold capacity values that apply in respect of those provisions listed in subsection (2).

Section 289: Interpretation of Part 12

  1. This section sets out how various terms within this Part are to be interpreted.

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