Part 3Energy Regulation
Chapter 4Further provisions about regulation
Areas with high distribution or transmission costs
I1184Assistance for areas with high distribution costs
1
If it appears to the Secretary of State—
a
that the costs of distributing electricity within a particular area of Great Britain are significantly higher (when calculated on a per customer basis) than in other areas of Great Britain, and
b
that within that area there are at least 100,000 premises that are connected to the same distribution system,
he may make an order under this section.
2
An order under this section is one that establishes a scheme which—
a
requires authorised transmitters to make a payment each year to relevant distributors distributing electricity in that area of Great Britain of such amount as may be determined in accordance with provision contained in the scheme;
b
requires the charges imposed by the authorised transmitters on authorised suppliers to be adjusted in accordance with the scheme for the purpose of enabling the transmitters to make that payment; and
c
requires relevant distributors in receipt of a payment under the order to secure, in accordance with the order, that the benefit of the payment is passed to the authorised suppliers supplying electricity in the area of Great Britain in question.
3
An order under this section establishing a scheme in relation to the distribution of electricity within a particular area must specify the area.
4
For the purpose of facilitating the implementation of a scheme for which an order under this section provides, such an order may make such modifications as the Secretary of State considers appropriate of the conditions of the licences of authorised suppliers, of authorised transmitters and of authorised distributors.
5
For the purpose of carrying out the functions conferred on him by or under this section the Secretary of State may require—
a
an authorised supplier,
b
an authorised distributor, or
c
an authorised transmitter,
to supply him, in a specified form and within a specified time, with information of a specified description.
6
No person may be required under this section to supply information he could not be compelled to give in evidence in civil proceedings in the High Court or the Court of Session.
7
Before making an order under this section, the Secretary of State must consult such persons as he considers appropriate.
8
Subsection (7) may be satisfied by consultation that took place wholly or partly before the commencement of this section.
9
An order under this section is subject to the negative resolution procedure.
10
Where a scheme established under this section in relation to the distribution of electricity within a particular area is in force, no scheme shall be established under this section in relation to the distribution of electricity outside that area.
11
Where a scheme is established under this section, it shall be the duty of the Secretary of State to carry out a review of that scheme—
a
three years after its establishment; and
b
thereafter at three yearly intervals.
12
Part 1 of the 1989 Act shall have effect as if every requirement or other duty imposed on a licence holder under this section were a relevant requirement within the meaning of that Part (see section 25(8) of that Act).
13
In this section—
“authorised distributor” and “authorised supplier” have the same meanings as in Part 1 of the 1989 Act;
“authorised transmitter” means a person authorised by a licence under section 6(1)(b) of that Act to participate in the transmission of electricity;
“distributing”, “distribution” and “distribution system” have the same meanings as in Part 1 of that Act;
“licence” means a licence for the purposes of section 4 of that Act;
“licence holder” has the same meaning as in Part 1 of that Act;
“premises” has the same meaning as in Part 1 of that Act;
“relevant distributor” means an authorised distributor who distributes electricity by means of a distribution system to which at least 100,000 premises are connected.