Electricity Act 1989

Licensing of supply etc. E+W+S

4 Prohibition on unlicensed supply etc. E+W+S

(1) A person who—

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

[F1 (b) participates in the transmission of electricity for that purpose;]

[F2 (bb) distributes electricity for that purpose;]

(c) supplies electricity to any premises, F3 ...

[F4 (d) participates in the operation of an electricity interconnector][F5 ; or

(e) provides a smart meter communication service,]

F6 shall be guilty of an offence unless he is authorised to do so by a licence ... .

(2) 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.

(3) 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.

[F7 (3A) In subsection (1)(b) above, the reference to a person who participates in the transmission of electricity is to a person who—

(a) co-ordinates, and directs, the flow of electricity onto and over a transmission system by means of which the transmission of electricity takes place, or

(b) makes available for use for the purposes of such a transmission system anything which forms part of it.

[F8 (3AA) Subsection (3A) is subject to section 6F (offshore transmission during commissioning period).]

(3B) For the purposes of subsection (3A)(b), a person shall not be regarded as making something available just because he consents to its being made available by another.]

[F9 (3C) A reference in this Part to participating in the operation of an electricity interconnector is a reference to—

(a) co-ordinating and directing the flow of electricity into or through an electricity interconnector; or

(b) making such an interconnector available for use for the conveyance of electricity;

and a person is not to be regarded as participating in the transmission of electricity by reason only of activities constituting participation in the operation of an electricity interconnector.

(3D) For the purposes of subsection (3C)(b), a person shall not be regarded as making something available just because he consents to its being made available by another.

(3E) In this Part “electricity interconnector” means so much of an electric line or other electrical plant 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 electricity (whether in both directions or in only one) between Great Britain and a place within the jurisdiction of another country or territory.

(3F) For the purposes of this section—

(a) 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; and

(b) a place is within the jurisdiction of another country or territory if it is in that country or territory or in waters in relation to which authorities of that country or territory exercise jurisdiction.]

[F10 (3G) 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 electricity is supplied to domestic premises.]

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

• [F11 “distribute”, in relation to electricity, means distribute by means of a distribution system, that is to say, a system which consists (wholly or mainly) of low voltage lines and electrical plant and is used for conveying electricity to any premises or to any other distribution system;]

• [F12 “generate”, in relation to electricity, means generate at a relevant place;]

• [F13 “supply”, in relation to electricity, means its supply to premises in cases where—

  (a)

  it is conveyed to the premises wholly or partly by means of a distribution system, or

  (b)

  (without being so conveyed) it is supplied to the premises from a substation to which it has been conveyed by means of a transmission system,

  but does not include its supply to premises occupied by a licence holder for the purpose of carrying on activities which he is authorised by his licence to carry on;]

• [F14 “transmission”, in relation to electricity, means transmission by means of a transmission system;

• “transmission system” means a system which—

  (a)

  consists (wholly or mainly) of high voltage lines and electrical plant, and

  (b)

  is used for conveying electricity from a generating station to a substation, from one generating station to another or from one substation to another.]

[F15 (5) In this section—

• “relevant place” means a place in Great Britain, in the territorial sea adjacent to Great Britain or in a Renewable Energy Zone; and

• “system” means a system the whole or a part of which is at a relevant place;

and references in this section to premises are references to premises situated at a relevant place, or at a place that is not in a Renewable Energy Zone but is in an area designated under section 1(7) of the Continental Shelf Act 1964.]

[F16 (6) In this section—

• “domestic supplier” means an electricity supplier—

  (a)

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

  (b)

  who supplies electricity 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 electricity; and

• “smart meter” means—

  (a)

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

  (b)

  an electricity 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

F1 S. 4(1)(b) substituted (24.8.2004 for specified purposes, 1.9.2004 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 135(2), 198(2); S.I. 2004/2184, art. 2(1)(2), Sch. 1, Sch. 2

F2 S. 4(1)(bb) inserted (1.10.2001) by 2000 c. 27, s. 28(2); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F3 Word in s. 4(1) omitted (19.9.2012) by virtue of The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 4(2)(a) (with art. 38(1)-(3))

F4 S. 4(1)(d) and preceding word inserted (14.8.2006) by Energy Act 2004 (c. 20), ss. 145(2), 198(2); S.I. 2006/1964, art. 2, Sch.

F5 S. 4(1)(e) and preceding word inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 4(2)(b) (with art. 38(1)-(3))

F6 Words in s. 4(1) 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)

F7 S. 4(3A)(3B) inserted (24.8.2004 for specified purposes, 1.9.2004 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 135(3), 198(2); S.I. 2004/2184, art. 2(1)(2), Sch. 1, Sch. 2

F8 S. 4(3AA) inserted (18.2.2014) by Energy Act 2013 (c. 32), ss. 147(2), 156(2)

F9 S. 4(3C)-(3F) inserted (1.12.2004) by Energy Act 2004 (c. 20), ss. 145(3), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

F10 S. 4(3G) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 4(3)

F11 S. 4(4): definition of “distribute” inserted (7.11.2000 for specified purposes, 20.12.2000 for further specified purposes and otherwise 1.10.2001) by 2000 c. 27, s. 28(3)(a); S.I. 2000/2974, art. 2, Sch. (subject to transitional provisions in arts. 3-12); S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) (as amended by S.I. 2001/1780, art. 2); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F12 Words in s. 4(4) inserted (1.3.2005 for specified purposes, 29.7.2010 for specified purposes, 10.6.2014 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 89(1), 198(2); S.I. 2005/442, art. 2(1), Sch. 1; S.I. 2010/1889, art. 2; S.I. 2014/1460, art. 2

F13 Words in s. 4(4) substituted (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(1), 198(2); S.I. 2005/2965, art. 3

F14 Words in s. 4(4) substituted (24.8.2004 for specified purposes, 1.9.2004 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 135(4), 198(2); S.I. 2004/2184, art. 2(1)(2), Sch. 1, Sch. 2

F15 S. 4(5) inserted (1.3.2005 for specified purposes, 29.7.2010 for specified purposes, 10.6.2014 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 89(2), 198(2); S.I. 2005/442, art. 2(1), Sch. 1; S.I. 2010/1889, art. 2; S.I. 2014/1460, art. 2

F16 S. 4(6) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 4(4)

Modifications etc. (not altering text)

C1 S. 4(1)(a)(c) excluded by S.I. 1990/193, art. 3(1)

C2 S. 4(1)(a) excluded (1.10.2001) by S.I. 2001/3270, art. 3(1)(a), Sch. 2 (with art. 4(1)(2))

C3 S. 4(1)(a) excluded (5.6.2020) by The Electricity (Individual Exemptions from the Requirement for a Generation Licence) (England) Order 2020 (S.I. 2020/509), arts. 1, 3 (with arts. 4, 5)

C4 S. 4(1)(bb) excluded (1.10.2001) by S.I. 2001/3270, art. 3(1)(b), Sch. 3 (with art. 4(3)(4)) (as amended (16.8.2024) by S.I. 2024/819, art. 1(1), Sch. para. 3)

C5 S. 4(1)(c) excluded (1.10.2001) by S.I. 2001/3270, art. 3(1)(c), Sch. 4 (with art. 4(5)(8))

[F17 5 Exemptions from prohibition. E+W+S

(1) The Secretary of State may by order grant exemption from paragraph (a), (b), (bb), [F18 (c), (d) or (e)] of section 4(1)—

(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.

(2) 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.

(3) The notice required by subsection (2) shall be given—

(a) by serving a copy of it on the Authority [F19 , Citizens Advice and Citizens Advice 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.

(4) 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.

(5) 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.

(6) An exemption may be granted—

(a) indefinitely; or

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

(7) Conditions subject to which an exemption is granted may (in particular) 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 Authority 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 Authority 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 Authority such questions arising under the exemption as are specified in the exemption or are of a description so specified.

(8) 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.

(9) 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.

(10) 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.

(11) Before—

(a) making an order under subsection (8)(b) or (c) or (9); or

(b) giving a direction under subsection (10)(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.

(12) The notice under subsection (11) shall be given—

(a) where the Secretary of State is proposing to make an order under subsection (8)(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 (9), 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 (10)(b) or (c), by serving a copy of it on the person from whom he proposes to withdraw the exemption.]

Textual Amendments

F17 S. 5 substituted (1.10.2001) by 2000 c. 27, s. 29; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F18 Words in s. 5(1) substituted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 5

F19 Words in s. 5(3)(a) substituted (1.4.2014) by The Public Bodies (Abolition of the National Consumer Council and Transfer of the Office of Fair Trading’s Functions in relation to Estate Agents etc) Order 2014 (S.I. 2014/631), art. 1(3), Sch. 1 para. 5(3) (with Sch. 1 para. 28, Sch. 2 paras. 13-15)

Modifications etc. (not altering text)

C6 S. 5: functions transferred to Scottish Ministers (S.) (14.12.2000) by virtue of S.I. 2000/3253, arts. 1(1), 2, Sch. (with art. 6)

[F20 5A Duties of distribution exemption holders E+W+S

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

Textual Amendments

F20 Ss. 5A, 5B inserted (10.11.2011) by The Electricity and Gas (Internal Markets) Regulations 2011 (S.I. 2011/2704), regs. 1(1), 21(2)

5B Duties of supply exemption holders E+W+S

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

Textual Amendments

F20 Ss. 5A, 5B inserted (10.11.2011) by The Electricity and Gas (Internal Markets) Regulations 2011 (S.I. 2011/2704), regs. 1(1), 21(2)

[F21 6 Licences authorising supply, etc. E+W+S

(1) The Authority may grant any of the following licences—

(a) a licence authorising a person to generate electricity for the purpose of giving a supply to any premises or enabling a supply to be so given (“a generation licence”);

[F22 (b) a licence authorising a person to participate in the transmission of electricity for that purpose (“a transmission licence”);]

(c) a licence authorising a person to distribute electricity for that purpose (“a distribution licence”); F23 ...

(d) a licence authorising a person to supply electricity to premises (“a supply licence”) F24 ...

[F25 (e) a licence authorising a person to participate in the operation of an electricity interconnector (“an interconnector licence”)][F26 ; or

(f) subject to subsection (1C), a licence authorising a person to provide a smart meter communication service (“a smart meter communication licence”).]

[F27 (1A) Subject to subsection (1B), the Secretary of State may grant a smart meter communication licence.

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

(1C) The first smart meter communication licence may only be granted by the Secretary of State.]

(2) The same person may not be the holder of both a distribution licence and [F28 —

(a) a generation licence; or

(b) a supply licence.]

[F29 (2A) The same person may not be the holder of an interconnector licence and the holder of a licence falling within any of paragraphs (a) to (d) of subsection (1).]

[F30 (2B) 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 7AB of the Gas Act 1986.]

(3) A supply licence may authorise the holder to supply electricity—

(a) to any premises;

(b) only to premises specified in the licence, or to premises of a description so specified; or

(c) only to any premises situated in a specified area, or to premises of a specified description which are so situated.

(4) The Authority may, with the consent of the holder of a supply licence, modify terms included in the licence in pursuance of subsection (3) so as to extend or restrict the premises to which the licence holder may give a supply of electricity.

(5) A distribution licence may authorise the holder to distribute electricity in any area, or only in an area specified in the licence.

(6) The Authority may, with the consent of the holder of a distribution licence, modify terms included in the licence in pursuance of subsection (5) so as to extend or restrict the area within which the licence holder may distribute electricity.

[F31 (6A) A transmission licence may authorise the holder to participate in the transmission of electricity in any area, or only in an area specified in the licence.

(6B) The Authority may, with the consent of the holder of a transmission licence, modify terms included in the licence in pursuance of subsection (6A) above.]

[F32 (6C) An interconnector licence authorising participation in the operation of an electricity interconnector—

(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.]

[F33 (7) A licence, and any modification of a licence under subsection (4), (6) or (6B), shall be in writing.]

(8) A licence shall, unless previously revoked in accordance with any term of the licence, continue in force for such period as may be specified in or determined by or under the licence.

(9) In this Part—

• F34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• “electricity distributor” means any person who is authorised by a distribution licence to distribute electricity except where he is acting otherwise than for purposes connected with the carrying on of activities authorised by the licence;

• F35 ...

• “electricity supplier” means any person who is authorised by a supply licence to supply electricity except where he is acting otherwise than for purposes connected with the carrying on of activities authorised by the licence.

[F36 (10) In this section “premises” has the same meaning as in section 4.]]

Textual Amendments

F21 Ss. 6, 6A, 6B substituted for s. 6 (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 30; 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)

F22 S. 6(1)(b) substituted (1.9.2004) by Energy Act 2004 (c. 20), ss. 136(1), 198(2); S.I. 2004/2184, art. 2(2), Sch. 2

F23 Word in s. 6(1)(c) repealed (1.12.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 23 Pt. 1; S.I. 2004/2575, art. 2(2), Sch. 2

F24 Word in s. 6(1) omitted (19.9.2012) by virtue of The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 6(2)(a)

F25 S. 6(1)(e) and preceding word inserted (1.12.2004) by Energy Act 2004 (c. 20), ss. 145(5), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

F26 S. 6(1)(f) and preceding word inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 6(2)(b)

F27 S. 6(1A)-(1C) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 6(3)

F28 Words in s. 6(2) substituted (10.11.2011) by The Electricity and Gas (Internal Markets) Regulations 2011 (S.I. 2011/2704), regs. 1(1), 19

F29 S. 6(2A) inserted (1.12.2004) by Energy Act 2004 (c. 20), ss. 145(6), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

F30 S. 6(2B) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 6(4)

F31 S. 6(6A)(6B) inserted (1.9.2004) by Energy Act 2004 (c. 20), ss. 136(2), 198(2); S.I. 2004/2184, art. 2(2), Sch. 2

F32 S. 6(6C) inserted (1.12.2004) by Energy Act 2004 (c. 20), ss. 145(7), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

F33 S. 6(7) substituted (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 19 para. 5; S.I. 2004/2184, art. 2(2), Sch. 2

F34 Words in s. 6(9) repealed (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 23 Pt. 1; S.I. 2004/2184, art. 2(2), Sch. 2

F35 Words in s. 6(9) omitted (6.4.2014) by virtue of Energy Act 2011 (c. 16), s. 121(5)(c), Sch. 1 para. 3

F36 S. 6(10) inserted (1.3.2005 for specified purposes, 29.7.2010 for specified purposes, 10.6.2014 in so far as not already in force) by Energy Act 2004 (c. 20), ss. 89(3), 198(2); S.I. 2005/442, art. 2(1), Sch. 1; S.I. 2010/1889, art. 2; S.I. 2014/1460, art. 2

Modifications etc. (not altering text)

C7 S. 6 applied (1.10.2001) by S.I. 2001/3266, art. 3(3)

C8 S. 6 modified (1.12.2004) by Energy Act 2004 (c. 20), ss. 148(2), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

C9 S. 6 applied (2.10.2014) by The Clocaenog Forest Wind Farm Order 2014 (S.I. 2014/2441), arts. 1, 4(2) (with art. 33)

C10 S. 6(1) modified (16.5.2001) by 2000 c. 27, s. 33(1); S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10)

C11 S. 6(1)(f) applied (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 38(2)

[F37 6A Procedure for licence applications. E+W+S

(1) This section applies to any application—

(a) for a licence [F38 (but this is subject to subsection (1A))]; or

[F39 (b) for the modification of a licence under section 6(4), (6) or (6B).]

[F40 (1A) At any time when regulations made under section 56FC are in force, this section does not apply to an application for a smart meter communication licence.]

(2) The application 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.

(3) Within the prescribed period after the making of the application the applicant shall publish a notice of the application in the prescribed manner.

(4) 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.

(5) Where the Authority grants the licence, extension or restriction applied for, it shall as soon as practicable thereafter send a notice of the grant to any person who holds a licence and whose interests may, in the opinion of the Authority, be affected by the grant.

(6) In this section “prescribed” means prescribed in regulations made by the Authority.

(7) Any sums received by the Authority under this section shall be paid into the Consolidated Fund.]

Textual Amendments

F37 Ss. 6, 6A, 6B substituted for s. 6 (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 30; 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)

F38 Words in s. 6A(1)(a) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 7(2)

F39 S. 6A(1)(b) substituted (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 19 para. 6; S.I. 2004/2184, art. 2(2), Sch. 2

F40 S. 6A(1A) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 7(3)

Modifications etc. (not altering text)

C12 S. 6A excluded (2.6.2009) by The Electricity (Competitive Tenders for Offshore Transmission Licences) Regulations 2009 (S.I. 2009/1340), regs. 1, 28(2)

C13 S. 6A disapplied (29.7.2010) by The Electricity (Competitive Tenders for Offshore Transmission Licences) Regulations 2010 (S.I. 2010/1903), regs. 1, 30(2) (with reg. 31)

C14 Ss. 6A, 6B excluded (22.2.2013) by The Electricity (Competitive Tenders for Offshore Transmission Licences) Regulations 2013 (S.I. 2013/175), regs. 1(1), 34(2)

C15 Ss. 6A, 6B restricted (3.8.2015) by The Electricity (Competitive Tenders for Offshore Transmission Licences) Regulations 2015 (S.I. 2015/1555), regs. 1(1), 35(2) (with reg. 2)

C16 S. 6A(5) applied (with modifications) (1.12.2004) by Energy Act 2004 (c. 20), ss. 148(3), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

[F41 6B Applications for transmission licences. E+W+S

(1) This section applies to applications for a transmission licence (in addition to the requirements of section 6A).

[F42 (2) The applicant shall give notice of the application to any person who holds a transmission licence and whose interests may be affected if the licence applied for is granted.]

(3) Before granting the transmission licence applied for, the Authority shall give notice—

(a) stating that it proposes to grant the licence;

(b) stating the reasons why it proposes to grant the licence; 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 licence may be made,

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

(4) A notice under subsection (3) shall be given by publication in such manner as the Authority considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them.

(5) The Authority shall send a copy of a notice under subsection (3) to—

(a) the applicant;

(b) the Secretary of State; and

(c) any person who holds a transmission licence and whose [F43 interests may be affected by the grant of the licence] to which the application relates.]

Textual Amendments

F41 Ss. 6, 6A, 6B substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) for s. 6 by 2000 c. 27, s. 30; 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)

F42 S. 6B(2) substituted (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 19 para. 7(2); S.I. 2004/2184, art. 2(2), Sch. 2

F43 Words in s. 6B(5)(c) substituted (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 19 para. 7(3); S.I. 2004/2184, art. 2(2), Sch. 2

Modifications etc. (not altering text)

C14 Ss. 6A, 6B excluded (22.2.2013) by The Electricity (Competitive Tenders for Offshore Transmission Licences) Regulations 2013 (S.I. 2013/175), regs. 1(1), 34(2)

C15 Ss. 6A, 6B restricted (3.8.2015) by The Electricity (Competitive Tenders for Offshore Transmission Licences) Regulations 2015 (S.I. 2015/1555), regs. 1(1), 35(2) (with reg. 2)

C17 S. 6B excluded (2.6.2009) by The Electricity (Competitive Tenders for Offshore Transmission Licences) Regulations 2009 (S.I. 2009/1340), regs. 1, 28(2)

C18 S. 6B disapplied (29.7.2010) by The Electricity (Competitive Tenders for Offshore Transmission Licences) Regulations 2010 (S.I. 2010/1903), regs. 1, 30(2) (with reg. 31)

[F44 6C Competitive tenders for offshore transmission licences E+W+S

(1) The Authority may by regulations make such provision as appears to it to be appropriate for facilitating the making, in prescribed cases, of a determination on a competitive basis of the person to whom an offshore transmission licence is to be granted.

(2) That provision may include—

(a) provision, in prescribed cases, for the publication of a proposal to grant an offshore transmission licence;

(b) provision for the inclusion in such a proposal of an invitation to apply for such a licence;

(c) provision restricting the making of applications for offshore transmission licences and imposing requirements as to the period within which they must be made;

(d) provision for regulating the manner in which applications are considered and determined.

(3) Regulations under this section—

(a) may make provision by reference to a determination by the Authority or to the opinion of the Authority as to any matter; and

(b) may dispense with or supplement provision made in relation to applications for transmission licences by or under section 6A or 6B above.

(4) The approval of the Secretary of State is required for the making of regulations under this section.

(5) In this section—

• “offshore transmission licence” means a transmission licence authorising anything that forms part of a transmission system to be used for purposes connected with offshore transmission; and

• “prescribed” means prescribed in or determined under regulations made by the Authority.

(6) In subsection (5) “offshore transmission” means the transmission within an area of offshore waters of electricity generated by a generating station in such an area.

(7) In subsection (6) “offshore waters” means—

(a) waters in or adjacent to Great Britain which are between the mean low water mark and the seaward limits of the territorial sea; and

(b) waters within an area designated under section 1(7) of the Continental Shelf Act 1964.]

Textual Amendments

F44 S. 6C inserted (E.W.S.) (20.5.2009) by Energy Act 2004 (c. 20), ss. 92, 198(2); S.I. 2009/1269, art. 2

[F45 6D Section 6C: supplemental provision E+W+S

(1) The provision made by regulations under section 6C(1) may also include—

(a) provision requiring a person within subsection (2), in relation to a tender exercise, to make payments to the Authority, in prescribed circumstances, in respect of the Authority's tender costs in relation to the exercise;

(b) provision requiring a person within subsection (2)(a) (“the relevant person”) in prescribed circumstances—

(i) to pay a deposit of a prescribed amount to the Authority, or to provide the Authority with security in a form approved by it, or

(ii) to make arrangements for a person approved by the Authority to pay to the Authority such a deposit or provide it with such security,

in respect of any liability which the relevant person has, or may in future have, by virtue of paragraph (a);

(c) provision requiring the owner of a regulated asset, in a case where a transitional tender exercise has been held, to make a payment of a prescribed amount to the Authority in respect of any costs incurred by the Authority in connection with any assessment of the costs which have been, or ought to have been, incurred in connection with that asset;

(d) provision about the times at which payments are to be made under regulations made by virtue of paragraph (a) or (c) or deposits or other forms of security are to be provided under regulations made by virtue of paragraph (b);

(e) provision about—

(i) the circumstances in which a payment made in accordance with regulations made by virtue of paragraph (a) is to be repaid (wholly or in part);

(ii) the circumstances in which such a repayment is to include an amount representing interest accrued on the whole or part of the payment;

(iii) the circumstances in which a deposit (including any interest accrued on it) or other security provided in accordance with regulations made by virtue of paragraph (b) is to be released or forfeited (wholly or in part);

(f) provision about the effect on a person's participation in the tender exercise of a failure to comply with a requirement imposed by virtue of this subsection, and the circumstances in which the tender exercise is to stop as a result of such a failure.

(2) The persons within this subsection, in relation to a tender exercise, are—

(a) the person who made the connection request for the purposes of which the tender exercise has been, is being or is to be, held;

(b) any person who submits an application for the offshore transmission licence to which the tender exercise relates.

(3) For the purposes of subsection (2)(a) a person makes a connection request when the person—

(a) makes an application to the holder of a co-ordination licence (in accordance with any provision made by the licence) for an offer of connection to and use of a transmission system, or

(b) before the coming into force of section 180 of the Energy Act 2004 (meaning of “high voltage line”), makes an application to the holder of a distribution licence (in accordance with any provision made by the licence) for an offer of connection to and use of a system in circumstances where the application is for connection to and use of that system by a system—

(i) which was a distribution system at the time the application was made (or would have been had it been in existence at that time), and

(ii) which consists (wholly or mainly) of electric lines of a nominal voltage of 132 kilovolts.

(4) A person (“P”) is to be treated as within subsection (2)(a) if—

(a) P would have made the connection request, but for the fact that another person had already made an application within subsection (3)(a) or (b), and

(b) the benefit of that application, or any agreement resulting from it, is vested in P.

(5) Where regulations are made by virtue of subsection (1)(a) or (b), regulations made by virtue of subsection (1)(e) must ensure that, as soon as reasonably practicable after a tender exercise is finished, steps are taken by the Authority, in accordance with the regulations, to ensure that the aggregate of—

(a) any fees under section 6A(2) in respect of applications for the offshore transmission licence to which the tender exercise relates,

(b) any payments made in accordance with regulations made by virtue of subsection (1)(a) and not repaid, and

(c) the value of any security forfeited in accordance with regulations made by virtue of subsection (1)(e)(iii),

does not exceed the Authority's tender costs.

(6) Where regulations under section 6C—

(a) restrict the making of applications for offshore transmission licences, or

(b) operate so as to prevent an application from being considered or further considered, if the applicant does not meet one or more prescribed requirements,

such regulations may make provision enabling a person to apply to the Authority for a decision as to the effect of any such restriction or requirement if the person were to make an application for such a licence.

(7) Regulations made by virtue of subsection (6) may enable the Authority to charge a person who makes such an application a prescribed fee for any decision given in response to it.

(8) In this section—

• “co-ordination licence” means a transmission licence which authorises a person to co-ordinate and direct the flow of electricity onto and over a transmission system—

  (a)

  by means of which the transmission of electricity takes place, and

  (b)

  the whole or a part of which is at a relevant place (within the meaning of section 4(5));

• “offshore transmission licence” has the same meaning as in section 6C;

• “prescribed” has the same meaning as in that section;

• “regulated asset”, in relation to a tender exercise, means an asset which the person granted the offshore transmission licence requires in order to enable that person to comply with the obligations under the licence;

• “successful bidder”, in relation to a tender exercise, means the person to whom, as a result of that exercise, the offshore transmission licence has been, or is to be, granted;

• “tender costs”, in relation to a tender exercise, means—

  (a)

  any costs incurred or likely to be incurred by the Authority for the purposes of the exercise, and

  (b)

  such proportion as the Authority considers appropriate of the costs which—

  (i)

  have been, or are likely to be, incurred by it under or for the purposes of section 6C or of regulations under that section, and

  (ii)

  are not directly attributable to a particular tender exercise;

• “tender exercise” means the steps taken in accordance with regulations under section 6C with a view to determining to whom a particular offshore transmission licence is to be granted;

• “transitional tender exercise” means a tender exercise in relation to which paragraph 1(1) of Schedule 2A applies.

(9) Any sums received by the Authority under regulations made by virtue of this section are to be paid into the Consolidated Fund.

Textual Amendments

F45 Ss. 6D, 6E inserted (20.5.2009) by Energy Act 2008 (c. 32), ss. 44(2), 110(2); S.I. 2009/1270, art. 2

6E Property schemes in respect of offshore transmission licences E+W+S

Schedule 2A (which provides for property schemes in connection with grants of offshore transmission licences) shall have effect.]

Textual Amendments

F45 Ss. 6D, 6E inserted (20.5.2009) by Energy Act 2008 (c. 32), ss. 44(2), 110(2); S.I. 2009/1270, art. 2

[F46 6F Offshore transmission during commissioning period E+W+S

(1) For the purposes of this Part a person is not to be regarded as participating in the transmission of electricity if the following four conditions are met.

(2) The first condition is that the transmission takes place over an offshore transmission system (“the system”) or anything forming part of it.

(3) The second condition is that the transmission takes place during a commissioning period (see section 6G).

(4) The third condition is that—

(a) a request has been made to the Authority in accordance with the tender regulations for a tender exercise to be held for the granting of an offshore transmission licence in respect of the system,

(b) the Authority has determined in accordance with those regulations that the request relates to a qualifying project, and

(c) the system, or anything forming part of it, has not been transferred as a result of the exercise to the successful bidder.

(5) The fourth condition is that—

(a) the person who is the developer in relation to the tender exercise is also the operator of a relevant generating station, and

(b) the construction or installation of the system is being or has been carried out by or on behalf of, or by or on behalf of a combination of, any of the following—

(i) the person mentioned in paragraph (a);

(ii) a body corporate associated with that person at any time during the period of construction or installation;

(iii) a previous developer;

(iv) a body corporate associated with a previous developer at any time during the period of construction or installation.

(6) For the purposes of subsection (1), it does not matter whether or not the person mentioned in that subsection is the developer in relation to the tender exercise.

(7) For the purposes of subsection (5)(b)(iii) and (iv), a person is a “previous developer” in relation to the system if—

(a) the person does not fall within subsection (5)(a), but

(b) at any time during the period of construction or installation, the person was the developer in relation to the tender exercise.

(8) In this section—

• “associated”, in relation to a body corporate, is to be construed in accordance with paragraph 37 of Schedule 2A;

• “developer”, in relation to a tender exercise, means any person within section 6D(2)(a) (person who makes the connection request, including any person who is to be so treated by virtue of section 6D(4));

• “offshore transmission” has the meaning given by section 6C(6);

• “offshore transmission licence” has the meaning given by section 6C(5);

• “offshore transmission system” means a transmission system used for purposes connected with offshore transmission;

• “operator”, in relation to a generating station, means the person who is authorised to generate electricity from that station—

  (a)

  by a generation licence granted under section 6(1)(a), or

  (b)

  in accordance with an exemption granted under section 5(1);

• “qualifying project” is to be construed in accordance with the tender regulations;

• “successful bidder” and “tender exercise” have the same meanings as in section 6D;

• “relevant generating station”, in relation to an offshore transmission system, means a generating station that generates electricity transmitted over the system;

• “the tender regulations” means regulations made under section 6C.

Textual Amendments

F46 Ss. 6F-6H inserted (E.W.S.) (18.2.2014) by Energy Act 2013 (c. 32), ss. 147(3), 156(2)

6G Section 6F: meaning of “commissioning period” E+W+S

(1) For the purposes of section 6F(3), transmission over an offshore transmission system (or anything forming part of it) takes place during a “commissioning period” if it takes place at any time—

(a) before a completion notice is given in respect of the system, or

(b) during the period of 18 months beginning with the day on which such a notice is given.

(2) A “completion notice”, in relation to a transmission system, is a notice which—

(a) is given to the Authority by the relevant co-ordination licence holder in accordance with the co-ordination licence, and

(b) states that it would be possible to carry on an activity to which section 4(1)(b) applies by making available for use that system.

(3) The Secretary of State may by order amend subsection (1) so as to specify a period of 12 months in place of the period of 18 months.

(4) An order under subsection (3) may be made only so as to come into force during the period—

(a) beginning 2 years after the day on which section 147 of the Energy Act 2013 comes into force, and

(b) ending 5 years after that day.

(5) An amendment made by an order under subsection (3) does not apply in relation to any transmission of electricity over a transmission system if—

(a) but for the making of the order, the person participating in the transmission would, by virtue of section 6F, have been regarded as not participating in the transmission, and

(b) the determination mentioned in subsection (4)(b) of that section in relation to the system was made on or before the day on which the order is made.

(6) In this section—

• “co-ordination licence” has the same meaning as in Schedule 2A (see paragraph 38(1) of that Schedule);

• “relevant co-ordination licence-holder” has the meaning given by paragraph 13(4) of Schedule 2A.

Textual Amendments

F46 Ss. 6F-6H inserted (E.W.S.) (18.2.2014) by Energy Act 2013 (c. 32), ss. 147(3), 156(2)

6H Sections 6F and 6G: modification of codes or agreements E+W+S

(1) The Authority may—

(a) modify a code maintained in accordance with the conditions of a transmission licence or a distribution licence;

(b) modify an agreement that gives effect to a code so maintained.

(2) The Authority may make a modification under subsection (1) only if it considers it necessary or desirable for the purpose of implementing or facilitating the operation of section 6F or 6G.

(3) The power to make modifications under subsection (1) includes a power to make incidental, supplemental, consequential or transitional modifications.

(4) The Authority must consult such persons as the Authority considers appropriate before making a modification under subsection (1).

(5) Subsection (4) may be satisfied by consultation before, as well as consultation after, the passing of the Energy Act 2013.

(6) As soon as reasonably practicable after making a modification under subsection (1), the Authority must publish a notice stating its reasons for making it.

(7) A notice under subsection (6) is to be published in such manner as the Authority considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by it.

(8) A modification under subsection (1) may not be made after the end of the period of 7 years beginning with the day on which section 147 of the Energy Act 2013 comes into force.]

Textual Amendments

F46 Ss. 6F-6H inserted (E.W.S.) (18.2.2014) by Energy Act 2013 (c. 32), ss. 147(3), 156(2)

7 Conditions of licences: general. E+W+S

(1) A licence may include—

(a) such conditions (whether or not relating to the activities authorised by the licence) as appear to the [F47 grantor] to be requisite or expedient having regard to the duties imposed by [F48 section 3 above]; and

(b) conditions requiring the rendering to the [F49 Authority] 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.

(2) Without prejudice to the generality of paragraph (a) of subsection (1) above, conditions included in [F50 a transmission licence or distribution licence] by virtue of that paragraph—

(a) may require the licence holder to enter into agreements with other persons for the use of any electric lines and electrical plant 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; and

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

[F51 (2A) Without prejudice to the generality of paragraph (a) of subsection (1), conditions included in a transmission licence by virtue of that paragraph may—

(a) require the licence holder not to carry on an activity which he would otherwise be authorised by the licence to carry on, or

(b) restrict where he may carry on an activity which he is authorised by the licence to carry on.]

(3) [F52 Without prejudice to the generality of paragraph (a) of subsection (1), conditions included in a licence by virtue of that paragraph] may require the licence holder—

(a) to comply with any direction given by the [F53 Authority or Secretary of State] as to such matters as are specified in the licence or are of a description so specified;

(b) except in so far as the [F53 Authority or 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;

(c) to refer for determination by the [F53 Authority or Secretary of State] such questions arising under the licence[F54 , or under any document referred to in the licence,] as are specified in the licence or are of a description so specified; and

(d) to refer for approval by the [F53 Authority or Secretary of State] such things falling to be done under the licence, and such contracts or agreements made before the grant of the licence, as are specified in the licence or are of a description so specified.

[F55 (3A) Conditions included in a transmission licence or a distribution licence by virtue of subsection (1)(a) may require the holder, in such circumstances as are specified in the licence—

(a) so to increase his charges for the transmission or distribution of electricity as to raise such amounts as may be determined by or under the conditions; and

(b) to pay the amounts so raised to such licence holders as may be so determined.]

[F56 (3B) Without prejudice to the generality of paragraph (a) of subsection (1), conditions which are described in subsection (3C) may be included in a smart meter communication 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 smart meter communication licence (“the applicant”).

(3C) The conditions in this subsection are conditions which require the licence holder to comply with a direction given by the Secretary of State or the 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.

(3D) Subject to subsection (3F) and without prejudice to the generality of paragraph (a) of subsection (1), conditions which are described in subsection (3E) may be included in a smart meter communication 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”).

(3E) The conditions in this subsection are conditions which require compliance with a direction given by the Secretary of State or the 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).

(3F)  Conditions included in a licence by virtue of subsection (3D) must provide that the licensee does not have a duty to comply with a direction of the kind referred to in subsection (3E) unless, in relation to that direction, the following conditions have been satisfied prior to it being given—

(a) the Secretary of State or the Authority (as appropriate) 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 Secretary of State or the Authority (as appropriate) 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 (3E) 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.

(3G) For the purposes of subsection (3F), 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.]

(4) Conditions included in a licence by virtue of subsection (1)(a) above may—

(a) instead of specifying or describing any contracts or agreements to which they apply, refer to contracts or agreements designated (whether before or after the imposition of the conditions) by the Secretary of State or the Director; and

(b) instead of containing any provisions which fall to be made, refer to provisions set out in documents so designated and direct that those provisions shall have such effect as may be specified in the conditions.

[F57 (5) Conditions included in a licence may contain provision for the conditions—

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

(6) Any provision included by virtue of subsection (5) above in a licence shall have effect in addition to the provision made by this Part with respect to the modification of the conditions of a licence.

[F58 (6A) Conditions included in a licence may provide for references in the conditions to any document to operate as references to that document as revised or re-issued from time to time.]

(7) Any sums received by the [F59 Authority] in consequence of the provisions of any condition of a licence shall be paid into the Consolidated Fund.

Textual Amendments

F47 Word in s. 7(1)(a) substituted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 8(2)

F48 Words in s. 7(1)(a) substituted (20.12.2000) by 2000 c. 27, s. 32(2); S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) (as amended by S.I. 2001/1780, art. 2)

F49 Words in s. 7(1) substituted (20.12.2000) by 2000 c. 27, s. 32(2); S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) (as amended by S.I. 2001/1780, art. 2)

F50 Words in s. 7(2) substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 32(3); 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)

F51 S. 7(2A) inserted (1.9.2004) by Energy Act 2004 (c. 20), ss. 136(3), 198(2); S.I. 2004/2184, art. 2(2), Sch. 2

F52 Words in s. 7(3) substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 32(4)(a); 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)

F53 Words in s. 7(3) substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 32(4)(b); 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)

F54 Words in s. 7(3)(c) inserted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 32(4)(c); 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)

F55 S. 7(3A) inserted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 32(5); 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)

F56 S. 7(3B)-(3G) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 8(3)

F57 S. 7(5) substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 32(6); 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)

F58 S. 7(6A) inserted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 32(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)

F59 Words in s. 7(7) substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 32(8); 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)

C19 S. 7 applied (1.10.2001) by S.I. 2001/3266, art. 3(3)

C20 S. 7 applied (with modifications) (1.12.2004) by Energy Act 2004 (c. 20), ss. 148(3), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

[F60 7A Transfer of licences. E+W+S

(1) A licence—

(a) is capable of being transferred by the licence holder, with the consent of the Authority, in accordance with this section but subject to any term as to transfer contained in the licence;

(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 by the licence to carry on).

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

(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 give 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 under subsection (7), 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.

[F61 (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 [F62 1 November 2023].]

(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.

[F63 (11A) A smart meter communication licence may not be transferred to a person unless a licence granted under section 7AB of the Gas Act 1986 is also 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

F60 S. 7A inserted (1.10.2001) by 2000 c. 27, s. 41; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F61 Ss. 7A(10A)-(10D) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 9(2)

F62 Words in s. 7A(10D) substituted (23.5.2018) by Smart Meters Act 2018 (c. 14), ss. 1(2)(a), 14(2)

F63 S. 7A(11A) inserted (19.9.2012) by The Electricity and Gas (Smart Meters Licensable Activity) Order 2012 (S.I. 2012/2400), arts. 1, 9(3)

[F64 7B Uniform prices etc. in certain areas of Scotland. E+W+S

(1) The Secretary of State may, by an order made under this section, require the holder of—

(a) a transmission licence; or

(b) a distribution licence,

to apply in respect of the use of the transmission or, as the case may be, distribution system, or any part of the system, in a specified area charges which do not distinguish (whether directly or indirectly) between users in different parts of the area.

(2) The Secretary of State may, by such an order, require the holder of a supply licence—

(a) to charge prices; or

(b) to offer conditions of contract,

in respect of a comparable supply of electricity in a specified area which do not distinguish (whether directly or indirectly) between consumers in different parts of the area.

(3) The Secretary of State shall not specify in such an order any particular or maximum charge or price or any particular condition of contract.

(4) Such an order may make different provision for different cases or descriptions of case.

(5) For the purposes of this section—

(a) a specified area is an area of Scotland specified in such an order; and

(b) supplies of electricity are comparable if they are—

(i) at the same or similar voltages; and

(ii) are in accordance with the same or similar demand characteristics.]

Textual Amendments

F64 S. 7B inserted (1.10.2001) by 2000 c. 27, s. 72; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

8 Conditions for funding certain companies engaged in nuclear generation in Scotland. E+W+S

(1) Without prejudice to section 7(1)(a) above, it may be a condition of a licence granted to a company (“the licence holder”) that it shall from time to time provide any company to which subsection (2) below applies, comes to apply or has at any time applied with such funds as may be determined by or under the condition in respect of such of that company’s liabilities as may be so determined.

(2) This subsection applies to any company engaging in the operation of a nuclear generating station in Scotland while—

(a) deemed for the purposes of the M1 Companies Act 1985 to be a subsidiary of the licence holder; or

(b) a related company of the licence holder (as defined in paragraph 92 of Schedule 4 to that Act).

(3) Subsection (3) of section 7 above applies in respect of a condition included in a licence by virtue of this section as it applies in respect of a condition so included by virtue of subsection (1)(a) of that section.

Marginal Citations

M1 1985 c. 6.

[F65 8A Standard conditions of licences. E+W+S

(1) Subject to subsection (2), each condition which by virtue of section 33(1) of the Utilities Act 2000 is a standard condition for the purposes of any of the types of licence mentioned in [F66 section 6(1)(a), (c) or (d) (that is to say, generation licences, distribution licences or supply licences)] shall be incorporated by reference in each licence of that type granted after the commencement of this section.

[F67 (1A) Subject to subsection (2), each condition which by virtue of section 137(3) of the Energy Act 2004 is a standard condition for the purposes of transmission licences shall be incorporated by reference in each transmission licence granted on or after the day on which section 137(6) of that Act comes into force.]

[F68 (1B) Subject to subsection (2), each condition which by virtue of section 146 of the Energy Act 2004 is a standard condition for the purposes of interconnector licences shall be incorporated, by reference, in each interconnector licence granted on or after the commencement of subsection (6) of that section.]

(2) Subject to the following provisions of this section, the Authority may, in granting a licence of any type, modify any of the standard conditions for licences of that type in its application to the licence to such extent as it considers requisite to meet the circumstances of the particular case.

(3) Before making any modifications under subsection (2), the Authority shall give notice—

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

(b) stating the reasons why it 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.

(4) A notice under subsection (3) shall be given—

(a) by publishing the notice in such manner as the Authority 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 [F69 , Citizens Advice and Citizens Advice Scotland].

(5) If, within the time specified in the notice under subsection (3), the Secretary of State directs the Authority not to make any modification, the Authority shall comply with the direction.

(6) The Authority shall not under subsection (2) make any modifications of a condition of a licence of any type unless it is of the opinion that the modifications are such that—

(a) the licence holder would not be unduly disadvantaged in competing with other holders of licences of that type; and

(b) no other holder of a licence of the same type would be unduly disadvantaged in competing with other holders of such licences (including the holder of the licence being modified).

(7) The modification under subsection (2) of part of a condition of a licence shall not prevent any other part of the condition which is not so modified being regarded as a standard condition for the purposes of this Part.

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

Textual Amendments

F65 S. 8A inserted (1.10.2001) by 2000 c. 27, s. 33(3); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F66 Words in s. 8A(1) substituted (1.9.2004) by Energy Act 2004 (c. 20), ss. 137(5), 198(2); S.I. 2004/2184, art. 2(2), Sch. 2

F67 S. 8A(1A) inserted (1.9.2004) by Energy Act 2004 (c. 20), ss. 137(6), 198(2); S.I. 2004/2184, art. 2(2), Sch. 2

F68 S. 8A(1B) inserted (1.4.2005) by Energy Act 2004 (c. 20), ss. 146(6), 198(2); S.I. 2005/877, art. 2(1), Sch. 1

F69 Words in s. 8A(4)(b) substituted (1.4.2014) by The Public Bodies (Abolition of the National Consumer Council and Transfer of the Office of Fair Trading’s Functions in relation to Estate Agents etc) Order 2014 (S.I. 2014/631), art. 1(3), Sch. 1 para. 5(4) (with Sch. 1 para. 28, Sch. 2 paras. 13-15)

Modifications etc. (not altering text)

C21 S. 8A applied (with modifications) (1.12.2004) by Energy Act 2004 (c. 20), ss. 148(3), 198(2); S.I. 2004/2575, art. 2(2), Sch. 2

9 General duties of licence holders. E+W+S

[F70 (1) It shall be the duty of an electricity distributor—

(a) to develop and maintain an efficient, co-ordinated and economical system of electricity distribution;

(b) to facilitate competition in the supply and generation of electricity.]

(2) It shall be the duty of the holder of a licence authorising him to [F71 participate in the transmission of] electricity—

(a) to develop and maintain an efficient, co-ordinated and economical system of electricity transmission; and

(b) F72 . . ., to facilitate competition in the supply and generation of electricity.

[F73 (2A) Subsection (2)(a) shall not have effect to require the holder of a transmission licence which is subject to a condition of the kind mentioned in section 7(2A)(a) to carry on an activity which he would be authorised by the licence to carry on apart from the condition.]

F74 (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F74 (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F70 S. 9(1) substituted (1.10.2001) by 2000 c. 27, s. 50; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F71 Words in s. 9(2) substituted (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 19 para. 8(2); S.I. 2004/2184, art. 2(2), Sch. 2

F72 Words in s. 9(2)(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)

F73 S. 9(2A) inserted (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 19 para. 8(3); S.I. 2004/2184, art. 2(2), Sch. 2

F74 S. 9(3)(4) repealed (1.10.2001) by 2000 c. 27, ss. 71, 108, Sch. 8; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

Modifications etc. (not altering text)

C22 S. 9(1)(b): functions transferred to Scottish Ministers (S.) (14.12.2000) by virtue of S.I. 2000/3253, arts. 1(1), 2, Sch. (with art. 6)

10 Powers etc. of licence holders. E+W+S

(1) Subject to subsection (2) below, Schedule 3 to this Act (which provides for the compulsory acquisition of land) and Schedule 4 to this Act (which confers other powers and makes other provision) shall have effect—

(a) in relation to F75 ... [F76 the holder of a transmission licence]; and

(b) to the extent that his licence so provides, in relation to [F77 an electricity distributor or] any other licence holder;

and references in those Schedules to a licence holder shall be construed accordingly.

(2) Where any provision of either of the Schedules mentioned in subsection (1) above is applied to a licence holder by his licence, it shall have effect subject to such restrictions, exceptions and conditions as may be included in the licence for the purpose of qualifying that provision as so applied or any power or right conferred by or under it.

(3) [F78 A generation licence] may provide that Schedule 4 to this Act shall have effect in relation to the licence holder as if—

(a) any reference to any purpose connected with the carrying on of the activities which he is authorised by his licence to carry on included a reference to any purpose connected with the supply to any premises of heat produced in association with electricity and steam produced from and air and water heated by such heat; and

(b) any reference to electric lines or electrical plant included a reference to pipes and associated works used or intended to be used for conveying heat so produced, and steam produced from and air and water heated by such heat;

and in this subsection “associated works”, in relation to pipes, means any of the following connected with the pipes, namely, any valve, filter, stopcock, pump, meter, inspection chamber and manhole and such other works as may be prescribed.

[F79 (3A) Subsection (3) applies in relation to any purpose connected with the supply to any premises of any gas or liquid subjected to a cooling effect produced in association with electricity as it applies to a purpose mentioned in that subsection.]

[F80 (4) A transmission licence may provide that, where the licence is modified under section 6(6B)F81 ... or 11A above so as to reduce in any respect the area in which the licence holder may carry on activities, Schedule 4 to this Act shall have effect in relation to him as if any reference to the activities which he is authorised by his licence to carry on included a reference to the activities which he was previously so authorised to carry on.]

(5) The provisions of Schedule 5 to this Act (which provide for the acquisition of water rights for hydro-electric stations in Scotland) shall have effect.

Textual Amendments

F75 Words in s. 10(1)(a) repealed (1.10.2001) by 2000 c. 27, s. 53(2); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F76 Words in s. 10(1)(a) substituted (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 19 para. 9(2); S.I. 2004/2184, art. 2(2), Sch. 2

F77 Words in s. 10(1)(b) inserted (1.10.2001) by 2000 c. 27, s. 53(2); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F78 Words in s. 10(3) substituted (1.10.2001) by 2000 c. 27, s. 53(3); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F79 S. 10(3A) inserted (1.10.2001) by 2000 c. 27, s. 53(4); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F80 S. 10(4) substituted (1.9.2004) by Energy Act 2004 (c. 20), s. 198(2), Sch. 19 para. 9(3); S.I. 2004/2184, art. 2(2), Sch. 2

F81 Word in s. 10(4) omitted (10.11.2011) by virtue of The Electricity and Gas (Internal Markets) Regulations 2011 (S.I. 2011/2704), regs. 1(1), 45(1)

Modifications etc. (not altering text)

C23 S. 10(1)(a)(2): functions transferred to Scottish Ministers (S.) (14.12.2000) by virtue of S.I. 2000/3253, arts. 1(1), 2, Sch. (with art. 6)