The Electricity and Gas (Internal Markets) Regulations 2011 No. 2704

PART 10 E+W+S Miscellaneous provisions

Amendment of section 19E of the Gas Act 1986 E+W+S

46.  In section 19E of the Gas Act 1986 (sections 19A to 19D: supplemental) M1 —

(a) omit the definitions of “LNG import facility”, “main commercial conditions”, “new facility”, “owner”, “storage”, “storage facility” and “treatment”;

(b) in the definition of “significant transaction”, in paragraph (a) for “liquid gas treated in an LNG import facility” substitute “ treated in an LNG import or export facility ”; and

(c) omit subsection (4).

Marginal Citations

M1 1986 c. 44. Section 19E was inserted by regulation 2(2) of, and paragraph 1 of Schedule 2 to, S.I. 2000/1937. Relevant amendments have been made by section 3(2) of the Utilities Act 2000 (c. 27); section 1177 of, and paragraph 202 of Part 2 of Schedule 1 to, the Corporation Tax Act 2010 (c. 4); and regulation 2(2) of, and paragraph 6(b) to (k) of Schedule 2 to, S.I. 2004/2043.

Amendment of section 48 of the Gas Act 1986 E+W+S

47.—(1) Section 48 of the Gas Act 1986 (interpretation of Part 1 and savings) M2 is amended as follows.

(2) In subsection (1)—

(a) for the definition of “owner” substitute—

““owner”—

(a)

in relation to any premises or other property, includes a lessee;

(b)

in relation to a storage facility or an LNG import or export facility, includes a person occupying or having control of the facility,

and cognate expressions shall be construed accordingly;;”;

(b) insert at the appropriate places—

““the 2010 Amending Decision” means Commission Decision 2010/685/EU of 10 November 2010 amending Chapter 3 of Annex I to Regulation 2009/715/EC of the European Parliament and of the Council on conditions for access to the natural gas transmission networks M3 ;”;

““the Agency” means the Agency for the Cooperation of Energy Regulators established under the Agency Regulation;”;

““the Agency Regulation” means Regulation 2009/713/EC of the European Parliament and of the Council of 13 July 2009 establishing an Agency for the Cooperation of Energy Regulators M4 ;”;

““associated undertaking”, in relation to a person (“person A”), means a person who—

(a)

has control of person A; or

(b)

is under the control of a person who controls person A,

and sections 450 and 451(1) to (3) of the Corporation Tax Act 2010 M5 (meaning of “control”) apply, with any necessary modifications, for the purposes of this definition as they apply for the purposes of Part 10 of that Act;;”;

““designated regulatory authority” means an authority designated in accordance with Article 39 of the Gas Directive;”;

““designated regulatory authority for Great Britain” means the authority designated by virtue of section 3A of the Utilities Act 2000 M6 ;”;

““distribution exemption holder” means a person who—

(a)

is carrying on an activity such as is mentioned in section 5(1)(a), the whole or part of which is also an activity of distribution within the meaning given by Article 2(5) of the Gas Directive; and

(b)

is authorised to carry on that activity by an exemption;”;

““exempt distribution system” means a distribution system operated or controlled by a distribution exemption holder who is covered by an exemption granted to it in relation to that system;”

““the Gas Directive” means Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC M7 ;”;

““the Gas Regulation” means Regulation 2009/715/EC of the European Parliament and of the Council of 13 July 2009 on conditions for access to the natural gas transmission networks and repealing Regulation 2005/1775/EC M8 , as amended by the 2010 Amending Decision;”;

““gas undertaking” has the meaning given by section 8Q M9 ;”;

““LNG import or export facility” means a facility in Great Britain (including the territorial sea adjacent to Great Britain and the sea in any area designated under section 1(7) of the Continental Shelf Act 1964) M10 for—

(a)

the importation into Great Britain and regasification of liquid gas prior to its conveyance to a pipeline system operated by the holder of a licence under section 7 or section 7ZA, or the liquefaction of gas for the purpose of its export from Great Britain; and

(b)

any activity, including temporary storage of gas or liquid gas, which is necessary for that importation, regasification or liquefaction;”;

““main commercial conditions” means—

(a)

in the case of a storage facility, such information as would enable a potential applicant for a right to have gas or liquid gas stored in the facility to make a reasonable assessment of the cost of, or the method of calculating the cost of, acquiring that right;

(b)

in the case of an LNG import or export facility, the terms setting out the cost or the method of determining the cost of acquiring the right to have gas or liquid gas treated in the facility;

(c)

the other significant terms on which such a right as is mentioned in paragraph (a) or (b) would be granted; and

(d)

such additional information as the Authority may from time to time specify by notice;”;

““relevant producer or supplier” has the meaning given by section 8Q;”;

““senior officer” means—

(a)

in relation to a company, a director;

(b)

in relation to a partnership, a partner;

(c)

in any other case, a person holding a position equivalent to that of a director or partner;”;

““storage”, in relation to liquid gas in a storage facility, includes any liquefaction of gas or regasification of liquid gas ancillary to the storage of liquid gas, and “stored”, in relation to liquid gas in a storage facility, shall be construed accordingly;”;

““storage facility” means a facility in Great Britain (including the territorial sea adjacent to Great Britain and the sea in any area designated under section 1(7) of the Continental Shelf Act 1964) for either or both of the following—

(a)

the storage in porous strata, or in cavities in strata, of gas which has been, or will be, conveyed in a pipeline system operated by the holder of a licence under section 7 or 7ZA;

(b)

the storage of liquid gas which, if regasified, would be suitable for conveyance through pipes to premises in accordance with a licence under section 7,

but the reference in paragraph (b) to the storage of liquid gas does not include such temporary storage as is mentioned in the definition of “LNG import or export facility”;;”;

““supply exemption holder” means a person who—

(a)

is carrying on the activity mentioned in section 5(1)(b); and

(b)

is authorised to carry on that activity by an exemption;”;

““treatment”, in relation to gas or liquid gas in an LNG import or export facility, includes importation, regasification, liquefaction and temporary storage, and “treat” shall be construed accordingly;”.

(3) After subsection (1) insert—

“(1ZA) Until section 75 of the Utilities Act 2000 comes into force the references to an exemption in the definitions in subsection (1) above of “distribution exemption holder”, “exempt distribution system” and “supply exemption holder” to an exemption include an exception under Schedule 2A M11 .”.

Marginal Citations

M2 Relevant amendments to section 48 of the Gas Act 1986 were made by section 10(1) of, and paragraph 54(1)(f) of Schedule 3 to, the Gas Act 1995 (c. 45). Other amendments have been made that are not relevant for these purposes.

M3 OJ No L 293, 11.11.2010, p. 67.

M4 OJ No L 211, 14.08.2009, p. 1.

M5 2010 c. 4.

M6 2000 c. 27.

M7 OJ No L 211, 14.08.2009, p. 94.

M8 OJ No L 211, 14.08.2009, p. 36.

M9 Inserted by regulation 4 of these Regulations.

M10 1964 c. 29. Areas have been designated under this section by S.I. 1987/1265, 2000/3062 and 2001/3670.

M11 1986 c. 44. Schedule 2A was inserted by section 3(2) of, and Schedule 1 to, the Gas Act 1995; and subsequently repealed by section 75 of the Utilities Act 2000 (c. 27) (the commencement date for section 75 is yet to be appointed in accordance with section 110(2) of the Utilities Act 2000).

Amendment of section 64 of the Electricity Act 1989 E+W+S

48.  In section 64(1) of the Electricity Act 1989 (interpretation of Part 1) insert at the appropriate places—

““the Agency” means the Agency for the Cooperation of Energy Regulators established under the Agency Regulation;”;

““the Agency Regulation” means Regulation 2009/713/EC of the European Parliament and of the Council of 13 July 2009 establishing an Agency for the Cooperation of Energy Regulators;”;

““designated regulatory authority” means an authority designated in accordance with Article 35 of the Electricity Directive;”;

““designated regulatory authority for Great Britain” means the authority designated by virtue of section 3A of the Utilities Act 2000;”;

““distribution exemption holder” means a person who—

(a)

is distributing electricity for the purpose mentioned in section 4(1)(bb); and

(b)

is authorised to do so by an exemption;”;

““the Electricity Directive” means Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC M12 ;”;

““the Electricity Regulation” means Regulation 2009/714/EC of the European Parliament and of the Council of 13 July 2009 on conditions for access to the network for cross-border exchanges in electricity and repealing Regulation 2003/1228/EC M13 ;”;

““electricity undertaking” has the meaning given by section 10O;”;

““exempt distribution system” means a distribution system operated or controlled by a distribution exemption holder who is covered by an exemption granted to it in relation to that system;”;

““senior officer” means—

(a)

in relation to a company, a director;

(b)

in relation to a partnership, a partner;

(c)

in any other case, a person holding a position equivalent to that of a director or partner;”;

““supply exemption holder” means a person who—

(a)

is carrying on the activity mentioned in section 4(1)(c); and

(b)

is authorised to do so by an exemption;”;

““regulated person” has the meaning given by section 25(8);”;

““relevant producer or supplier” has the meaning given by section 10O;”.

Marginal Citations

M12 OJ No L 211, 14.08.2009, p. 55.

M13 OJ No L 211, 14.08.2009, p. 15.

Modifications of standard conditions of gas licences E+W+S

49.—(1) Schedule 7 to these Regulations (which modifies the standard conditions of transporter, interconnector and supply licences granted under Part 1 of the Gas Act 1986 M14 ) has effect.

(2) In section 81(2) of the Utilities Act 2000 (standard conditions of gas transporter, supply and shipping licences) M15 , after “made” insert “ under section 2(2) of the European Communities Act 1972, ”.

(3) In section 150(5) of the Energy Act 2004 (standard conditions of gas interconnector licences) M16 , after “made” insert “ under section 2(2) of the European Communities Act 1972, ”.

Marginal Citations

M14 Section 7 was substituted by section 5 of the Gas Act 1995 (c. 45). Relevant amendments were made by sections 3(2), 76(1) and (3) and 108 of, and paragraphs 1 and 4 of Part 1 of Schedule 6 to, the Utilities Act 2000 (c. 27). Section 7ZA was inserted by section 149(1) and (6) of the Energy Act 2004 (c. 20). Section 7A(1) was inserted by section 6(1) of the Gas Act 1995 and a relevant amendment made by section 3(2) of the Utilities Act 2000.

M15 2000 c. 27. Section 81(2) was amended by sections 107 and 168(10) of, and paragraphs 12 and 14 of Schedule 5 to, the Energy Act 2004 (c. 20); and was subsequently amended by section 35 of, and paragraphs 11 and 14 of the Schedule to, the Energy Act 2010 (c. 27).

M16 2004 c. 20.

Modifications of standard conditions of electricity licences E+W+S

50.—(1) Schedule 8 to these Regulations (which modifies the standard conditions of transmission, distribution, supply and interconnector licences granted under Part 1 of the Electricity Act 1989 M17 ) has effect.

(2) In section 33(1) of the Utilities Act 2000 (standard conditions of electricity generation, distribution and supply licences) M18 , before paragraph (a) insert—

“(za) under section 2(2) of the European Communities Act 1972,”.

(3) In section 137(3) of the Energy Act 2004 (standard conditions of electricity transmission licences), before paragraph (a) insert—

“(za) under section 2(2) of the European Communities Act 1972,”.

(4) In section 146(5) of the Energy Act 2004 (standard conditions of electricity interconnector licences), after “made” insert “ under section 2(2) of the European Communities Act 1972, ”.

Marginal Citations

M17 1989 c. 29. Section 6 was substituted by section 30 of the Utilities Act 2000 (c. 27) and a relevant amendment was made by section 197(9) of, and Part 1 of Schedule 23 to, the Energy Act 2004 (c. 20). Section 8A was inserted by section 33 of the Utilities Act 2000 and amended by section 137(5) and (6) and section 146(6) of the Energy Act 2004.

M18 Section 33(1) was amended by sections 143(1) and 197(9) of, paragraphs 20(a) and (c) of Schedule 19 to, and paragraph 20(b) of part 1 of Schedule 23 to, the Energy Act 2004 (c. 20). Subsection (1) was subsequently amended by section 7(7) of the Climate Change and Sustainable Energy Act 2006 (c. 19); section 107 and 108 of, paragraphs 12 and 13(b) of Schedule 5 to, and paragraphs 12 and 13(b) of Schedule 6 to, the Energy Act 2008 (c. 32); and section 35 of, and paragraphs 11 and 12 of the Schedule to, the Energy Act 2010 (c. 27).

Review E+W+S

51.—(1) Before the end of each review period, the Secretary of State must—

(a) carry out a review of [F1 the Internal Markets Regulations],

(b) set out the conclusions of the review in a report, and

(c) publish the report.

(2) In carrying out the review the Secretary of State must, so far as is reasonable, have regard to how the Third Package [F2 , ITC Regulation and CACM Regulation] (relevant provisions of which are implemented by means of [F3 the Internal Markets Regulations]) are implemented in other Member States.

(3) The report must in particular—

(a) set out the objectives intended to be achieved by [F4 the Internal Markets Regulations],

(b) assess the extent to which those objectives are achieved, and

(c) assess whether those objectives remain appropriate and, if so, the extent to which they could be achieved with a system that imposes less regulation.

(4) “Review period” means—

(a) the period of five years beginning with the day on which these Regulations come into force, and

(b) subject to paragraph (5), each successive period of five years.

(5) If a report under this regulation is published before the last day of the review period to which it relates, the following review period is to begin with the day on which that report is published.

(6) In this regulation—

“2010 Amending Decision” means Commission Decision 2010/685/EU of 10 November 2010 amending Chapter 3 of Annex I to Regulation 2009/715/EC of the European Parliament and of the Council on conditions for access to the natural gas network M19 ;

[F5 “the 2012 Amending Decision” means Commission Decision 2012/490/EU of 24 August 2012 amending Annex I to Regulation 2009/715/EC of the European Parliament and of the Council on conditions for access to the natural gas transmission networks;]

[F5 “the 2013 Amending Regulation” means Regulation 2013/347/EU of the European Parliament and of the Council of 17 April 2013 on guidelines for trans-European energy infrastructure and repealing Decision 2006/1364/EC and amending Regulations 2009/713/EC, 2009/714/EC and 2009/715/EC;]

[F6 “CACM Regulation” means Commission Regulation (EU) No 2015/1222 of 24 July 2015 establishing a guideline on capacity allocation and congestion management;]

[F5 “Internal Markets Regulations” means—

(a)

these Regulations;

(b)

the Electricity and Gas (Internal Markets) Regulations 2014;]

(c)

[F7 the Electricity and Gas (Ownership Unbundling) Regulations 2014;]

(d)

[F8 the Electricity and Gas (Internal Markets) Regulations 2017;]

“ITC Regulation” means Commission Regulation 2010/838/EU of 23 September 2010 on laying down guidelines relating to the inter-transmission system operator compensation mechanism and a common regulatory approach to transmission charging M20 ;

“Third Package” means—

(a)

Regulation 2009/713/EC of the European Parliament and of the Council of 13 July 2009 establishing an Agency for the Cooperation of Energy Regulators M21 ;

(b)

Regulation 2009/714/EC of the European Parliament and of the Council of 13 July 2009 on conditions for access to the network for cross-border exchanges in electricity and repealing Regulation 2003/1228/EC M22 [F9 , as amended by the 2013 Amending Regulation];

(c)

Regulation 2009/715/EC of the European Parliament and of the Council of 13 July 2009 on conditions for access to the natural gas transmission networks and repealing Regulation 2005/1775/EC M23 , as amended by the 2010 Amending Decision [F10 , the 2012 Amending Decision and the 2013 Amending Regulation];

(d)

Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC M24 ;

(e)

Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC M25 .

Textual Amendments

F1 Words in reg. 51(1)(a) substituted (14.1.2015) by The Electricity and Gas (Internal Markets) Regulations 2014 (S.I. 2014/3332), regs. 1(1), 8(a)

F2 Words in reg. 51(2) substituted (24.4.2017) by The Electricity and Gas (Internal Markets) Regulations 2017 (S.I. 2017/493), regs. 1(1), 8(2)

F3 Words in reg. 51(2) substituted (14.1.2015) by The Electricity and Gas (Internal Markets) Regulations 2014 (S.I. 2014/3332), regs. 1(1), 8(a)

F4 Words in reg. 51(3)(a) substituted (14.1.2015) by The Electricity and Gas (Internal Markets) Regulations 2014 (S.I. 2014/3332), regs. 1(1), 8(a)

F5 Words in reg. 51(6) inserted (14.1.2015) by The Electricity and Gas (Internal Markets) Regulations 2014 (S.I. 2014/3332), regs. 1(1), 8(b)(i)

F6 Words in reg. 51(6) inserted (24.4.2017) by The Electricity and Gas (Internal Markets) Regulations 2017 (S.I. 2017/493), regs. 1(1), 8(3)(a)

F7 Words in reg. 51(6) inserted (15.1.2015) by The Electricity and Gas (Ownership Unbundling) Regulations 2014 (S.I. 2014/3333), regs. 1(1), 5(2) (with reg. 4)

F8 Words in reg. 51(6) inserted (24.4.2017) by virtue of The Electricity and Gas (Internal Markets) Regulations 2017 (S.I. 2017/493), regs. 1(1), 8(3)(b)

F9 Words in reg. 51(6) inserted (14.1.2015) by The Electricity and Gas (Internal Markets) Regulations 2014 (S.I. 2014/3332), regs. 1(1), 8(b)(ii)

F10 Words in reg. 51(6) inserted (14.1.2015) by The Electricity and Gas (Internal Markets) Regulations 2014 (S.I. 2014/3332), regs. 1(1), 8(b)(iii)

Marginal Citations

M19 OJ No L 293, 11.11.2010, p. 67.

M20 OJ No L 250, 24.09.2010, p. 5.

M21 OJ No L 211, 14.08.2009, p. 1.

M22 OJ No L 211, 14.08.2009, p. 15.

M23 OJ No L 211, 14.08.2009, p. 36.

M24 OJ No L 211, 14.08.2009, p. 55.

M25 OJ No L 211, 14.08.2009, p. 94.