Office of Public Sector Information
(1) The Secretary of State shall appoint an officer to be known as the Director General of Electricity Supply (in this Act referred to as “the Director”) for the purpose of carrying out the functions assigned or transferred to him by this Act.
(2) An appointment of a person to hold office as the Director shall be for a term not exceeding five years; but previous appointment to that office shall not affect eligibility for re-appointment.
(3) The Secretary of State may remove any person from office as the Director on the ground of incapacity or misbehaviour.
(4) Subject to subsections (2) and (3) above, the Director shall hold and vacate office as such in accordance with the terms of his appointment.
(5) The provisions of Schedule 1 to this Act shall have effect with respect to the Director.
(1) The Director shall establish committees, to be known as consumers' committees, for the purposes of this Part.
(2) Each consumers' committee shall be appointed for an area consisting of—
(a) the authorised area of a public electricity supplier; or
(b) if the Secretary of State so determines, the authorised areas of two or more such suppliers;
and any reference in this Part to the allocation of a public electricity supplier to a consumers' committee shall be construed accordingly.
(3) Each consumers' committee shall consist of—
(a) a chairman appointed by the Director after consultation with the Secretary of State; and
(b) such other members, not being less than ten or more than twenty, as the Director after consultation with the chairman may from time to time appoint.
(4) An appointment of a person to hold office as the chairman of a consumers' committee shall be for a term not exceeding four years.
(5) Subject to subsection (4) above, the chairman and other members of a consumers' committee shall hold and vacate office in accordance with the terms of the instruments appointing them and shall, on ceasing to hold office, be eligible for re-appointment.
(6) The provisions of Schedule 2 to this Act shall have effect with respect to each of the consumers' committees.
(7) In this Part “public electricity supplier” and “authorised area”, in relation to such a supplier, have the meanings given by section 6(9) below.
(1) The Secretary of State and the Director shall each have a duty to exercise the functions assigned or transferred to him by this Part in the manner which he considers is best calculated—
(a) to secure that all reasonable demands for electricity are satisfied;
(b) to secure that licence holders are able to finance the carrying on of the activities which they are authorised by their licences to carry on; and
(c) subject to subsection (2) below, to promote competition in the generation and supply of electricity.
(2) The Secretary of State and the Director shall each have a duty to exercise the functions assigned or transferred to him by this Part in the manner which he considers is best calculated to secure—
(a) that the prices charged to tariff customers by public electricity suppliers for electricity supplied in pursuance of section 16(1) below to premises in any area of Scotland specified in an order made by the Secretary of State are in accordance with tariffs which do not distinguish (whether directly or indirectly) between different parts of that area; and
(b) that public electricity suppliers are not thereby disadvantaged in competing with persons authorised by a licence or exemption to supply electricity to such premises.
(3) Subject to subsections (1) and (2) above, the Secretary of State and the Director shall each have a duty to exercise the functions assigned or transferred to him by this Part in the manner which he considers is best calculated—
(a) to protect the interests of consumers of electricity supplied by persons authorised by licences to supply electricity in respect of—
(i) the prices charged and the other terms of supply;
(ii) the continuity of supply; and
(iii) the quality of the electricity supply services provided;
(b) to promote efficiency and economy on the part of persons authorised by licences to supply or transmit electricity and the efficient use of electricity supplied to consumers;
(c) to promote research into, and the development and use of, new techniques by or on behalf of persons authorised by a licence to generate, transmit or supply electricity;
(d) to protect the public from dangers arising from the generation, transmission or supply of electricity; and
(e) to secure the establishment and maintenance of machinery for promoting the health and safety of persons employed in the generation, transmission or supply of electricity;
and a duty to take into account, in exercising those functions, the effect on the physical environment of activities connected with the generation, transmission or supply of electricity.
(4) In performing his duty under subsection (3)(a)(i) above, the Secretary of State or the Director shall take into account, in particular, the protection of the interests of consumers of electricity in rural areas.
(5) In performing his duty under subsection (3)(a)(iii) above, the Secretary of State or the Director shall take into account, in particular, the interests of those who are disabled or of pensionable age.
(6) In this section references to the functions assigned to the Secretary of State by this Part do not include references to functions under section 36 or 37 below and references to the functions so assigned to the Director do not include references to functions relating to the determination of disputes.
(7) In this Part, unless the context otherwise requires—
“exemption” means an exemption under section 5 below;
“licence” means a licence under section 6 below and “licence holder” shall be construed accordingly.
(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;
(b) transmits electricity for that purpose; or
(c) supplies electricity to any premises,
shall be guilty of an offence unless he is authorised to do so by a licence or exemption.
(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.
(4) In this Part, unless the context otherwise requires—
“supply”, in relation to electricity, means supply through electric lines otherwise than to premises occupied by a licence holder for the purpose of carrying on the activities which he is authorised by his licence to carry on;
“transmit”, in relation to electricity, means transmit by means of a transmission system, that is to say, a system which consists (wholly or mainly) of high voltage lines and electrical plant and is used for conveying electricity from a generating station to a substation, from one generating station to another or from one substation to another.
(1) The Secretary of State may, after consultation with the Director, by order grant exemption from paragraph (a) or (c) of section 4(1) above, but subject to compliance with such conditions (if any) as may be specified in the order.
(2) An exemption may be granted either—
(a) to persons of a particular class; or
(b) to a particular person;
and an exemption granted to persons of a particular class shall be published in such manner as the Secretary of State considers appropriate for bringing it to the attention of persons of that class.
(3) An exemption, unless previously revoked in accordance with any term contained in the exemption, shall continue in force for such period as may be specified in or determined by or under the exemption.
(4) The requirement to consult imposed by subsection (1) above shall not apply to the granting of any exemptions which, having regard to the provisions of section 4 above, need to be granted before the commencement of that section.
(1) The Secretary of State after consultation with the Director, or the Director with the consent of, or in accordance with a general authority given by, the Secretary of State, may grant a licence authorising any person—
(a) to generate electricity for the purpose of giving a supply to any premises or enabling a supply to be so given;
(b) to transmit electricity for that purpose in that person’s authorised area; or
(c) to supply electricity to any premises in that person’s authorised area.
(2) The Secretary of State after consultation with the Director, or the Director with the consent of, or in accordance with a general authority given by, the Secretary of State, may—
(a) grant a licence authorising any person to supply electricity to any premises specified or of a description specified in the licence; or
(b) extend such a licence by adding to the premises or descriptions of premises specified in the licence.
(3) An application for a licence or extension shall be made in the prescribed manner and shall be accompanied by such fee (if any) as may be prescribed; and within 14 days after the making of such an application, the applicant shall publish a copy of the application in the prescribed manner.
(4) Before granting a licence under subsection (1)(b) or (c) above, the Secretary of State or the Director shall give notice—
(a) stating that he proposes to grant the licence;
(b) stating the reasons why he 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.
(5) A notice under subsection (4) above shall be given by publishing the notice in such manner as the Secretary of State or the Director considers appropriate for bringing it to the attention of persons likely to be affected by the grant of the licence.
(6) A licence shall be in writing and, unless previously revoked in accordance with any term contained in the licence, shall continue in force for such period as may be specified in or determined by or under the licence.
(7) As soon as practicable after granting a licence, the Secretary of State shall send a copy of the licence to the Director and—
(a) in the case of a licence under paragraph (b) of subsection (1) above, to any licence holder under that paragraph whose authorised area previously included the whole or any part of the area designated in the licence;
(b) in the case of a licence under paragraph (c) of that subsection, to any public electricity supplier whose authorised area previously included the whole or any part of the area designated in the licence;
(c) in the case of a licence or extension under subsection (2) above, to any public electricity supplier whose authorised area includes any premises specified or described in the licence or extension.
(8) As soon as practicable after granting any licence or extension falling within paragraph (a), (b) or (c) of subsection (7) above, the Director shall send a copy of the licence or extension to any such person as is mentioned in that paragraph.
(9) In this Part—
“authorised area”, in relation to a person authorised by a licence under paragraph (b) or (c) of subsection (1) above to transmit or supply electricity, means so much of the area designated as such in the licence as is not for the time being designated in a subsequent licence under that paragraph;
“public electricity supplier” means any person who is authorised by a licence under subsection (1)(c) above to supply electricity except where he is acting otherwise than for purposes connected with the supply of electricity to premises in his authorised area.
(10) Neither the requirement to consult imposed by subsection (1) or (2) above nor subsections (3) and (4) above shall apply to the granting of any licences which, having regard to the provisions of section 4 above, need to be granted before the commencement of that section.
(11) Any sums received by the Secretary of State or the Director under this section shall be paid into the Consolidated Fund.
(1) A licence may include—
(a) such conditions (whether or not relating to the activities authorised by the licence) as appear to the grantor to be requisite or expedient having regard to the duties imposed by section 3 above; and
(b) conditions requiring the rendering to the grantor 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 a 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.
(3) Conditions included in a licence by virtue of subsection (1)(a) above may require the licence holder—
(a) to comply with any direction given by the Director as to such matters as are specified in the licence or are of a description so specified;
(b) except in so far as the Director 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 Director such questions arising under the licence as are specified in the licence or are of a description so specified; and
(d) to refer for approval by the Director 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.
(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.
(5) Conditions included in a licence may contain provision for the conditions to cease to have effect or be modified at such times, in such manner and in such circumstances as may be specified in or determined by or under the conditions.
(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.
(7) Any sums received by the Secretary of State or the Director in consequence of the provisions of any condition of a licence shall be paid into the Consolidated Fund.
(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 [1985 c. 6.] 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.
(1) It shall be the duty of a public electricity supplier to develop and maintain an efficient, co-ordinated and economical system of electricity supply.
(2) It shall be the duty of the holder of a licence authorising him to transmit electricity—
(a) to develop and maintain an efficient, co-ordinated and economical system of electricity transmission; and
(b) subject to subsection (3) below, to facilitate competition in the supply and generation of electricity.
(3) Subsection (2)(b) above shall apply in Scotland in relation to a person who is also the holder of a licence authorising him to supply or generate electricity as if the duty to facilitate competition in the supply or, as the case may be, the generation of electricity were a duty to make his transmission system available to his competitors on terms which neither prevent nor restrict such competition.
(4) For the purposes of subsection (3) above a person’s competitors are any other persons authorised (whether by a licence or exemption) to supply or, as the case may be, generate electricity.
(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 a public electricity supplier or a person authorised by a licence to transmit electricity; and
(b) to the extent that his licence so provides, in relation to 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) A licence under section 6(1)(a) above 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.
(4) A licence under paragraph (b) or (c) of section 6(1) above may provide that, where any part of the licence holder’s authorised area is designated in a subsequent licence under that paragraph, Schedule 4 to this Act shall have effect in relation to the licence holder 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.
(1) Subject to the following provisions of this section, the Director may modify the conditions of a licence if the holder of the licence consents to the modifications.
(2) Before making modifications under this section, the Director shall give notice—
(a) stating that he proposes to make the modifications and setting out their effect;
(b) stating the reasons why he proposes to make the modifications; and
(c) specifying the period (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.
(3) A notice under subsection (2) above shall be given—
(a) by publishing the notice in such manner as the Director 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 serving a copy of the notice on the holder of the licence.
(4) The Director shall also send a copy of a notice under subsection (2) above to the Secretary of State; and if, within the period specified in the notice, the Secretary of State directs the Director not to make any modifications, the Director shall comply with the direction.
(1) The Director may make to the Monopolies and Mergers Commission (in this Part referred to as “the Monopolies Commission”) a reference which is so framed as to require the Commission to investigate and report on the questions—
(a) whether any matters which—
(i) relate to the generation, transmission or supply of electricity in pursuance of a licence; and
(ii) are specified in the reference,
operate, or may be expected to operate, against the public interest; and
(b) if so, whether the effects adverse to the public interest which those matters have or may be expected to have could be remedied or prevented by modifications of the conditions of the licence.
(2) The Director may, at any time, by notice given to the Monopolies Commission vary a reference under this section by adding to the matters specified in the reference or by excluding from the reference some or all of the matters so specified; and on receipt of any such notice the Commission shall give effect to the variation.
(3) The Director may specify in a reference under this section, or a variation of such a reference, for the purpose of assisting the Monopolies Commission in carrying out the investigation on the reference—
(a) any effects adverse to the public interest which, in his opinion, the matters specified in the reference or variation have or may be expected to have; and
(b) any modifications of the conditions of the licence by which, in his opinion, those effects could be remedied or prevented.
(4) As soon as practicable after making a reference under this section or a variation of such a reference, the Director—
(a) shall serve a copy of the reference or variation on the holder of the licence; and
(b) shall publish particulars of the reference or variation in such manner as he considers appropriate for the purpose of bringing the reference or variation to the attention of persons likely to be affected by it.
(5) The Director shall also send a copy of a reference under this section, or a variation of such a reference, to the Secretary of State; and if, before the end of the period of 28 days beginning with the day on which the Secretary of State receives the copy of the reference or variation, the Secretary of State directs the Monopolies Commission not to proceed with the reference or, as the case may require, not to give effect to the variation, the Commission shall comply with the direction.
(6) It shall be the duty of the Director, for the purpose of assisting the Monopolies Commission in carrying out an investigation on a reference under this section, to give to the Commission—
(a) any information in his possession which relates to matters falling within the scope of the investigation and—
(i) is requested by the Commission for that purpose; or
(ii) is information which, in his opinion, it would be appropriate for that purpose to give to the Commission without any such request; and
(b) any other assistance which the Commission may require, and which it is within his power to give, in relation to any such matters;
and the Commission, for the purpose of carrying out any such investigation, shall take account of any information given to them for that purpose under this subsection.
(7) In determining for the purposes of this section whether any particular matter operates, or may be expected to operate, against the public interest, the Monopolies Commission shall have regard to the matters as respects which duties are imposed on the Secretary of State and the Director by section 3 above.
(8) Sections 70 (time limit for report on merger reference), 81 (procedure in carrying out investigations) and 85 (attendance of witnesses and production of documents) of the 1973 Act, Part II of Schedule 3 to that Act (performance of functions of the Monopolies Commission) and section 24 of the 1980 Act (modifications of provisions about performance of such functions) shall apply in relation to references under this section as if—
(a) the functions of the Commission in relation to those references were functions under the 1973 Act;
(b) the expression “merger reference” included a reference under this section;
(c) in the said section 70, references to the Secretary of State were references to the Director and the reference to three months were a reference to six months;
(d) in paragraph 11 of the said Schedule 3, the reference to section 71 of the 1973 Act were a reference to subsection (2) above; and
(e) paragraph 16(2) of that Schedule were omitted;
and in this Part “the 1973 Act” means the [1973 c. 41.] Fair Trading Act 1973 and “the 1980 Act” means the [1980 c. 21.] Competition Act 1980.
(9) For the purposes of references under this section the Secretary of State shall appoint not less than eight additional members of the Monopolies Commission; and if any functions of the Commission in relation to any such reference are performed by a group—
(a) the chairman of the Commission shall select one, two or three of those additional members to be members of the group; and
(b) the number of regular members to be selected by him under paragraph 10 of Schedule 3 to the 1973 Act shall be reduced accordingly.
(1) In making a report on a reference under section 12 above, the Monopolies Commission—
(a) shall include in the report definite conclusions on the questions comprised in the reference together with such an account of their reasons for those conclusions as in their opinion is expedient for facilitating a proper understanding of those questions and of their conclusions;
(b) where they conclude that any of the matters specified in the reference operate, or may be expected to operate, against the public interest, shall specify in the report the effects adverse to the public interest which those matters have or may be expected to have; and
(c) where they conclude that any adverse effects so specified could be remedied or prevented by modifications of the conditions of the licence, shall specify in the report modifications by which those effects could be remedied or prevented.
(2) Where, on a reference under section 12 above, the Monopolies Commission conclude that the holder of the licence is a party to an agreement to which the [1976 c. 34.] Restrictive Trade Practices Act 1976 applies, the Commission, in making their report on that reference, shall exclude from their consideration the question whether the provisions of that agreement, in so far as they are provisions by virtue of which it is an agreement to which that Act applies, operate, or may be expected to operate, against the public interest; and paragraph (b) of subsection (1) above shall have effect subject to the provisions of this subsection.
(3) Section 82 of the 1973 Act (general provisions as to reports) shall apply in relation to reports of the Monopolies Commission on references under section 12 above as it applies to reports of the Commission under that Act.
(4) A report of the Monopolies Commission on a reference under section 12 above shall be made to the Director.
(5) Subject to subsection (6) below, the Director—
(a) shall, on receiving such a report, send a copy of it to the holder of the licence to which the report relates and to the Secretary of State; and
(b) shall, not less than 14 days after that copy is received by the Secretary of State, publish the report in such manner as he considers appropriate for bringing the report to the attention of persons likely to be affected by it.
(6) If it appears to the Secretary of State that the publication of any matter in such a report would be against the public interest or the commercial interests of any person, he may, before the end of the period of 14 days mentioned in paragraph (b) of subsection (5) above, direct the Director to exclude that matter from every copy of the report to be published by virtue of that paragraph.
(1) Where a report of the Monopolies Commission on a reference under section 12 above—
(a) includes conclusions to the effect that any of the matters specified in the reference operate, or may be expected to operate, against the public interest;
(b) specifies effects adverse to the public interest which those matters have or may be expected to have;
(c) includes conclusions to the effect that those effects could be remedied or prevented by modifications of the conditions of the licence; and
(d) specifies modifications by which those effects could be remedied or prevented,
the Director shall, subject to the following provisions of this section, make such modifications of the conditions of that licence as appear to him requisite for the purpose of remedying or preventing the adverse effects specified in the report.
(2) Before making modifications under this section, the Director shall have regard to the modifications specified in the report.
(3) Before making modifications under this section, the Director shall give notice—
(a) stating that he proposes to make the modifications and setting out their effect;
(b) stating the reasons why he proposes to make the modifications; and
(c) specifying the period (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) above shall be given—
(a) by publishing the notice in such manner as the Director considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by the making of the modifications; and
(b) by serving a copy of the notice on the holder of the licence.
(1) Where in the circumstances mentioned in subsection (2) below the Secretary of State by order exercises any of the powers specified in—
(a) Parts I and II of Schedule 8 to the 1973 Act; or
(b) section 10(2)(a) of the 1980 Act,
the order may also provide for the modification of the conditions of a licence to such extent as may appear to him to be requisite or expedient for the purpose of giving effect to or of taking account of any provision made by the order.
(2) Subsection (1) above shall have effect where—
(a) the circumstances are as mentioned in section 56(1) of the 1973 Act (order on report on monopoly reference) and the monopoly situation exists in relation to the generation, transmission or supply of electricity;
(b) the circumstances are as mentioned in section 73(1) of that Act (order on report on merger reference) and the two or more enterprises which ceased to be distinct enterprises were both engaged in the generation, transmission or supply of electricity; or
(c) the circumstances are as mentioned in section 10(1) of the 1980 Act (order on report on competition reference) and the anti-competitive practice relates to the generation, transmission or supply of electricity.
(3) In this section expressions which are also used in the 1973 Act or the 1980 Act have the same meanings as in that Act.
Electricity Act 1989