214Payment as alternative to complying with certain energy company obligations
(1)In section 33BC of the Gas Act 1986 (promotion of reductions in carbon emissions: gas transporters and gas suppliers), after subsection (7B) insert—
“(7C)The order may make provision as to circumstances in which a transporter or supplier may meet the whole or any part of a carbon emissions reduction target by making a buy-out payment.
(7D)In this section, “buy-out payment” means a payment—
(a)of an amount (“the buy-out price”) determined by the Secretary of State,
(b)to a person approved by the Administrator (an “approved person”),
(c)for a purpose approved by the Administrator (an “approved purpose”).
(7E)Provision made by virtue of subsection (7C) may include provision about the determination by the Secretary of State of the buy-out price, including provision—
(a)enabling the Secretary of State to set different buy-out prices—
(i)for different parts of the period to which the order relates;
(ii)for different cases (including different buy-out prices for different transporters or suppliers);
(b)requiring the Secretary of State to publish the buy-out price.
(7F)If the order makes provision by virtue of subsection (7C), the order may also make provision—
(a)as to the procedure to be followed by the Administrator in approving a person as an approved person or a purpose as an approved purpose;
(b)specifying criteria by reference to which the Administrator is to determine whether to approve a person or purpose.
(7G)Provision made by virtue of subsection (7C) may include further provision about buy-out payments, including in particular provision—
(a)as to the procedure to be followed by a transporter or supplier who proposes to make a buy-out payment, including provision—
(i)requiring a transporter or supplier to notify the Administrator of specified matters by a specified time;
(ii)as to circumstances in which a transporter or supplier must make the buy-out payment to which notification given to the Administrator relates;
(iii)about the process for seeking approval of a person as an approved person, or of a purpose as an approved purpose;
(b)preventing a transporter or supplier from treating a buy-out payment as a payment pursuant to any other obligation (whether statutory or contractual), or vice versa;
(c)setting out circumstances in which a requirement imposed on a transporter or supplier by provision made by virtue of subsection (5)(ba) or (bb) may be—
(i)met, in whole or in part, by the making of a buy-out payment;
(ii)varied as a result of a buy-out payment;
(d)about the effect of provision included in the order by virtue of subsection (7)(c) to (e) on a person’s ability to meet the whole or any part of a carbon emissions reduction target by making a buy-out payment.
(7H)Where an order includes provision for the making of a buy-out payment, the references in subsections (5)(be) and (7)(b) to action include a reference to the making of a buy-out payment.”
(2)In section 33BCA of the Gas Act 1986 (Scottish Ministers’ promotion of reductions in carbon emissions: gas suppliers)—
(a)in subsection (3)—
(i)in paragraph (b), after “(7)(a)” insert “, (7C), (7E)”;
(ii)after paragraph (c) insert—
“(ca)in subsection (7F), for “order makes” is substituted “Secretary of State has made”;
(cb)in subsection (7G), for “(7C)” is substituted “(7F)”;
(cc)in subsection (7H), for “an order includes” is substituted “the Secretary of State has made”;”;
(iii)in paragraph (g), after “place” insert “other than in subsection (7D)(a)”;
(b)in subsection (9)(a), for “or (7)(a)” substitute “, (7)(a), (7C) or (7E)”.
(3)In section 33BDA of the Gas Act 1986 (Scottish Ministers’ promotion of reductions in home-heating costs: gas suppliers)—
(a)in subsection (3)—
(i)in paragraph (c), after “(7)(a)” insert “, (7C), (7E)”;
(ii)after paragraph (d) insert—
“(da)in section 33BC(7F) as applied by subsection (4), for “order makes” is substituted “Secretary of State has made”;
(db)in section 33BC(7G) as applied by subsection (4), for “(7C)” is substituted “(7F)”;
(dc)in section 33BC(7H) as applied by subsection (4), for “an order includes” is substituted “the Secretary of State has made”;”;
(iii)in paragraph (h), after “subsection (4)” insert “other than in section 33BC(7D)(a)”;
(b)in subsection (9)(b), for “or (7)(a)” substitute “(7)(a), (7C) or (7E)”.
(4)In section 41A of the Electricity Act 1989 (promotion of reductions in carbon emissions: electricity distributors and electricity suppliers), after subsection (7B) insert—
“(7C)The order may make provision as to circumstances in which a distributor or supplier may meet the whole or any part of a carbon emissions reduction target by making a buy-out payment.
(7D)In this section, “buy-out payment” means a payment—
(a)of an amount (“the buy-out price”) determined by the Secretary of State,
(b)to a person approved by the Administrator (an “approved person”),
(c)for a purpose approved by the Administrator (an “approved purpose”).
(7E)Provision made by virtue of subsection (7C) may include provision about the determination by the Secretary of State of the buy-out price, including provision—
(a)enabling the Secretary of State to set different buy-out prices—
(i)for different parts of the period to which the order relates;
(ii)for different cases (including different buy-out prices for different distributors or suppliers);
(b)requiring the Secretary of State to publish the buy-out price.
(7F)If the order makes provision by virtue of subsection (7C), the order may also make provision—
(a)as to the procedure to be followed by the Administrator in approving a person as an approved person or a purpose as an approved purpose;
(b)specifying criteria by reference to which the Administrator is to determine whether to approve a person or purpose.
(7G)Provision made by virtue of subsection (7C) may include further provision about buy-out payments, including in particular provision—
(a)as to the procedure to be followed by a distributor or supplier who proposes to make a buy-out payment, including provision—
(i)requiring a distributor or supplier to notify the Administrator of specified matters by a specified time;
(ii)as to circumstances in which a distributor or supplier must make the buy-out payment to which notification given to the Administrator relates;
(iii)about the process for seeking approval of a person as an approved person, or of a purpose as an approved purpose;
(b)preventing a distributor or supplier from treating a buy-out payment as a payment pursuant to any other obligation (whether statutory or contractual), or vice versa;
(c)setting out circumstances in which a requirement imposed on a distributor or supplier by provision made by virtue of subsection (5)(ba) or (bb) may be—
(i)met, in whole or in part, by the making of a buy-out payment;
(ii)varied as a result of a buy-out payment;
(d)about the effect of provision included in the order by virtue of subsection (7)(c) to (e) on a person’s ability to meet the whole or any part of a carbon emissions reduction target by making a buy-out payment.
(7H)Where an order includes provision for the making of a buy-out payment, the references in subsections (5)(be) and (7)(b) to action include a reference to the making of a buy-out payment.”
(5)In section 41AA of the Electricity Act 1989 (Scottish Ministers’ promotion of reductions in carbon emissions: electricity suppliers)—
(a)in subsection (3)—
(i)in paragraph (b), after “(7)(a)” insert “, (7C), (7E)”;
(ii)after paragraph (c) insert—
“(ca)in subsection (7F), for “order makes” is substituted “Secretary of State has made”;
(cb)in subsection (7G), for “(7C)” is substituted “(7F)”;
(cc)in subsection (7H), for “an order includes” is substituted “the Secretary of State has made”;”;
(iii)in paragraph (g), after “place” insert “other than in subsection (7D)(a)”;
(b)in subsection (9)(a), for “or (7)(a)” substitute “, (7)(a), (7C) or (7E)”.
(6)In subsection 41BA of the Electricity Act 1989 (Scottish Ministers’ promotion of reductions in home-heating costs: electricity suppliers)—
(a)in subsection (3)—
(i)in paragraph (c), after “(7)(a)” insert “, (7C), (7E)”;
(ii)after paragraph (d) insert—
“(da)in section 41A(7F) as applied by subsection (4), for “order makes” is substituted “Secretary of State has made”;
(db)in section 41A(7G) as applied by subsection (4), for “(7C)” is substituted “(7F)”;
(dc)in section 41A(7H) as applied by subsection (4), for “an order includes” is substituted “the Secretary of State has made”;”;
(iii)in paragraph (h), after “subsection (4)” insert “other than in section 41A(7D)(a)”;
(b)in subsection (9)(b), for “or (7)(a)” substitute “, (7)(a), (7C) or (7E)”.