Part I Gas Supply

Introductory

F11. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F22. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F33. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F44AA The principal objective and general duties of the Secretary of State and the Authority.

(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 sections 245 to 247 of the Energy Act 2023 F17; and

(c)

the need to contribute to the achievement of sustainable development.

(3)

In performing F18the 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 F19or transmission systems (within the meaning of the M1Electricity Act 1989); and

(b)

any interests of consumers in relation to—

F20(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 F21subsections (1B) and (2) F22and 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 F23or the provision of a smart meter communication service;

F24(ba)

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

(c)

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

F25and F26... shall have regard, in carrying out those functions, to the effect on the environment of activities connected with the conveyance of gas through pipes F27or the provision of a smart meter communication service.

F28(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.

F29(5B)

In subsection (1A)—

F30the designated regulatory objectives” means the objectives set out in Article 40(c) to (h) of the Gas Directive but read with the following modifications—

  1. (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; ”,

  2. (b)

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

  3. (c)

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

  4. (d)

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

F31...

F31...

F31...

(6)

In F32subsections F33(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 F34, 7ZA F35, 7A or 7AB and “licence holder” shall be construed accordingly.

F364AB Guidance on social and environmental matters.

(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;

F37(b)

Citizens Advice;

(ba)

F38Consumer 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.

F394A Health and safety.

(1)

The Secretary of State and the Authority shall consult F40the 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 F40the 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.

F414B Exceptions from sections 4AA to 4A.

(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 F42the 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 F43assimilated obligation or otherwise).

F444CBinding decisions of the Agency for the Cooperation of Energy Regulators and of the European Commission

F45(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 F46(or the predecessor of the Agency Regulation) in relation to gas.

F47(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, F48assimilated law.

F494DAuthority to consult and cooperate with other authorities

(1)

When carrying out its F50designated regulatory functions, the Authority must, wherever it thinks fit—

(a)

consult and cooperate with the F51Northern Ireland Authority;

(b)

provide the F52Northern Ireland Authority with information F53it may require in order to carry out F54 its designated regulatory functions; F55...

(c)

consult relevant national authorities;

F56(d)

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

(2)

In exercising functions in accordance with subsection (1), the Authority must, wherever it thinks fit, cooperate with the F57Northern Ireland Authority with a view F58... to—

F59(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 F60trade in gas between Great Britain and Northern Ireland and the allocation of F61capacity between Great Britain and Northern Ireland;

(e)

ensuring an adequate level of interconnection capacity;

F62(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—

F63...

F64...

“relevant national authority” means any of the following—

(a)

F65...

(b)

the Office of Communications;

(c)

F66the CMA;

(d)

the Water Services Regulation F67Authority.

F68...

F694EDuty to notify etc. the European Commission: agreements with third countries

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