The Independent System Operator and Planner Transfer Scheme Compensation Regulations 2024

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations, which apply in Great Britain, make provision regarding the compensation determination by an independent valuer under a transfer scheme relating to the establishment or functioning of the Independent System Operator and Planner established under Part 5 of the Energy Act 2023 (c. 52, the “Act”).

Regulations 3, 4 and 5, define when there is absence of agreement between the Secretary of State and the transferor regarding compensation under a transfer scheme. This occurs when the Secretary of State has made a draft offer and a transfer offer, and has proposed arrangements to discuss, and the transfer offer is not accepted within 10 days by the transferor. Under the Act, where there is absence of agreement regarding compensation, the compensation is determined by an independent valuer.

Regulations 6 and 7 set out the conditions that have to be met before there is absence of agreement regarding the appointment of a valuer, and the matters to have regard to when appointing a valuer. Where there is absence of agreement regarding a valuer, the Act provides for the Secretary of State to appoint a valuer on behalf of both the Secretary of State and the transferor.

Regulation 8 sets out procedures that apply and steps to be followed when the valuer is making a compensation determination. For example, the valuation must be made on a market value basis. It also provides for the Secretary of State and the transferor to make representations to the valuer regarding the compensation.

Regulation 9 lists the matters the valuer must have regard to in reaching a compensation determination, as well as the assumptions the valuer must apply.

Regulation 10 specifies the information, documents, and assistance available to the valuer.

Regulation 11 entitles the transferor to the level of compensation specified in the compensation determination, if the Secretary of State makes a transfer scheme within six months of the valuer’s compensation determination which is materially the same as the scheme covered in the determination.

Regulation 12 deals with the valuer’s renumeration and expenses.

A full Impact Assessment has not been published in support of this instrument, as no significant impact on the private, voluntary or public sector is foreseen.