The Electricity (Non-Fossil Fuel Sources) (England and Wales) Order 1994

Made: 15th December 1994

Laid before Parliament: 20th December 1994

Coming into force: 21st December 1994

Now, therefore, the Secretary of State, in exercise of the powers conferred on him by section 32(1) and (2) of the said Act of 1989, and of all other powers enabling him in that behalf, after consultation in accordance with the requirements of the said section 32(1), hereby makes the following Order:

Citation, commencement, application and interpretation

1

• (1) This Order may be cited as the Electricity (Non-Fossil Fuel Sources) (England and Wales) Order 1994 and shall come into force on 21st December 1994.

• (2) This Order does not apply to Scotland.

• (3) In this Order, unless the context otherwise requires—

• “the Act” means the Electricity Act 1989;

• “biomass generating stations” means generating stations which are fuelled wholly or partially by any one or more of the following— crops grown for the purpose of providing a source of energy; agricultural waste; forestry waste; and fuel derived from any one or more of the types of crop or waste mentioned in sub-paragraphs (a) to (c) above, but excluding any such station as is partially fuelled by any one or more of the following— gas derived from landfill sites of any description; municipal waste; industrial waste; gas or waste, derived from human sewage; and fuel derived from either or both of municipal and industrial waste;

• “biomass GPC generating stations” means generating stations which— are fuelled wholly or partially by any one or more of the following— crops grown for the purpose of providing a source of energy; forestry waste; and fuel derived from either or both of the types of crop or waste mentioned in sub-paragraphs (i) and (ii) above, but excluding any such station as is partially fuelled by any one or more of the following— gas derived from landfill sites of any description; municipal waste; industrial waste; agricultural waste; gas or waste, derived from human sewage; and fuel derived from any one or more of the types of waste mentioned in sub-paragraphs (ii) to (iv) above; and are driven wholly by an engine, or a gas turbine, fuelled directly by gas produced by partial combustion or partly by an engine, or gas turbine, so fuelled and partly by an engine, or any turbine, utilising steam produced using heat from the first engine or gas turbine;

• “commissioning process” means the process consisting of such procedures and tests as from time to time constitute usual industry standards and practices for commissioning a non-fossil fuel generating station of any description specified in the heading to any of Tables A to G in Schedule 1 to this Order in order— to demonstrate that such a non-fossil fuel generating station is— capable of commercial operation; or in the case of a non-fossil fuel generating station which is the subject of relevant arrangements, capable of commercial operation for the purpose of such arrangements; to establish the external physical conditions outside the control of the operator which are necessary for the operation of such station or which control the amount of electricity produced by the station; and to establish the operating parameters within which such station can be operated in accordance with practices, methods and procedures which are or should be adopted by a person exercising that degree of judgement, skill, diligence and foresight which would ordinarily and reasonably be expected from a skilled and experienced operator engaged in the business of operating such a station lawfully;

• “connection agreement” means an agreement providing for the connection of any relevant non-fossil fuel generating station to a system of electric lines and electrical plant operated by the public electricity supplier in whose authorised area the station is or will be located;

• “declared net capacity”, in the case of a wind generating station, means the declared net capacity ascertained by the application to such a station of the formula specified in subsection (8A) of section 32 of the Act as inserted by regulation 2 of the Electricity Act 1989 (Modifications of Section 32(5) to (8)) Regulations 1990[^f00003];

• “hydro generating stations” means generating stations which are driven by any form of water power other than tidal or wave power;

• “landfill gas generating stations” means generating stations which are fuelled wholly or partially by gas derived from landfill sites on which, at any time before 22nd July 1993, activities were carried on in pursuance of a licence issued under section 5 of the Control of Pollution Act 1974[^f00004] or in accordance with conditions specified in a resolution passed by the relevant disposal authority pursuant to section 11(3)(e) of the said Act of 1974, but excluding any such station as is partially fuelled by any one or more of the following— gas derived from landfill sites of any other description; municipal waste; industrial waste; gas or waste, derived from human sewage; and fuel derived from either or both of the types of waste mentioned in sub-paragraphs (b) and (c) above;

• “municipal and industrial waste generating stations” means generating stations which are fuelled wholly or partially by any one or more of the following— municipal waste; industrial waste; and fuel derived from either or both of the types of waste mentioned in sub-paragraphs (a) and (b) above, but excluding any such station as is partially fuelled by either or both of the following— gas or waste, derived from human sewage; and gas derived from any landfill site which was not a landfill site on which, at any time before 22nd July 1993, activities were carried on in pursuance of a licence issued under section 5 of the Control of Pollution Act 1974 or in accordance with conditions specified in a resolution passed by the relevant disposal authority pursuant to section 11(3)(e) of the said Act of 1974;

• “operator” means an operator of any relevant non-fossil fuel generating station;

• “the pooling and settlement agreement” means the pooling and settlement agreement to which an operator may be required to become a party by the licence (if any) granted to him under section 6 of the Act;

• “premium price arrangement” means an arrangement made before the day on which this Order is made under which a public electricity supplier or a person on behalf of a public electricity supplier agrees to purchase electricity generated by a non-fossil fuel generating station at any time in the period commencing on 21st July 1993 and ending on 31st December 1998 (whether or not the agreement covers other periods) for a fixed price per kilowatt-hour (kWh) and for this purpose— where the operator of the generating station in question is a party to the pooling and settlement agreement, an arrangement between that operator and a public electricity supplier or person on behalf of a public electricity supplier shall be treated as if it is an arrangement to purchase electricity at a fixed price per kilowatt-hour (kWh) if it provides for such payments to be made by either party to the other as shall ensure that the aggregate price receivable by the operator in question under the arrangement and the pooling and settlement agreement for electricity generated in specified periods is equal to a fixed amount specified in the said arrangement; and any provision for adjustment of the price by reference to any measure of inflation shall be disregarded;

• “relevant arrangements” means arrangements evidence of the making of which is produced to the Director in accordance with paragraph (1) of article 2 of this Order;

• “relevant non-fossil fuel generating station” means a generating station of a description specified in the heading to any of Tables A to G in Schedule 1 to this Order and falling within the description of non-fossil fuel generating station specified in paragraph (2) of article 2 of this Order;

• “wind generating stations” means generating stations which are driven by wind;

• “wind generating stations exceeding 1.6 MW” means wind generating stations each of which has a declared net capacity exceeding 1.6 megawatts and none of which is operated by a person who operates more than 9 other wind generating stations which are the subject of relevant arrangements and for this purpose— a person, being a body corporate, shall be treated as operating any generating station operated by a body corporate which is associated with him; and a body corporate shall be treated as associated with another body corporate if— one of them is a subsidiary of the other; or both of them are subsidiaries of the same holding company, and “holding company” and “subsidiary” shall have the same meaning as in section 736 of the Companies Act 1985[^f00005];

• “wind generating stations not exceeding 1.6 MW” means wind generating stations each of which has a declared net capacity not exceeding 1.6 megawatts.

Requirement to make arrangements etc.

2

• (1) Each public electricity supplier in England and Wales shall, before 20th January 1995, make (in so far as he has not already done so) and produce to the Director evidence showing that he has made such additional arrangements as will secure that for each period shown in Tables A to G in Schedule 1 (specified aggregate amounts of generating capacity) to this Order the aggregate amount of generating capacity available to him from non-fossil fuel generating stations of the description specified in the heading to each particular Table and falling within the description of non-fossil fuel generating station specified in paragraph (2) of this article will not be less than the amount specified in that Table in relation to him for that period.

• (2) The description of non-fossil fuel generating station specified in this paragraph is a non-fossil fuel generating station in respect of which—

• (a) the commissioning process was not satisfactorily completed before 22nd July 1993 disregarding for this purpose the completion of the commissioning process before that date in respect of structures or works for holding or channelling water which have not been used in the period commencing on 1st January 1989 and ending on 21st July 1993 for a purpose directly related to the generation of electricity by a generating station wholly or mainly driven by water; and

• (b) there is not and has not been a premium price arrangement (other than a relevant arrangement) under which any payment has been or may be made in respect of electricity generated before 1st January 1999 by such station.

3

• (1) Where any relevant arrangements—

• (a) provide that the availability to a public electricity supplier of some or all of the capacity of the non-fossil fuel generating station in question is conditional upon the satisfaction of any such requirement as is mentioned in Schedule 2 (conditions precedent) to this Order (whether the requirement in question is described in the terms of that Schedule or in terms to the like effect); and

• (b) result, on the first day of any specified period, in some or all of that capacity not being available to that supplier, by reason of any such requirement not being satisfied as was then due, or had previously been due on or prior to such date, under those arrangements to have been satisfied,

then, in relation to any day during that or any subsequent specified period ascertained in accordance with paragraph (3) of this article, this Order shall have effect as if the relevant aggregate amount specified in relation to that period were the amount specified in relation to that supplier for the period which includes that day in the Table in question in Schedule 1 to this Order, less (subject to the following proviso) an amount equal to the sum of any capacity whose availability is at that time conditional upon the satisfaction of such requirement or requirements and any capacity which has ceased to be available at that time by reason of the occurrence of any such event or events as are referred to in paragraph (2) of this article:

• Provided that the amount so specified shall not be reduced so as to be less than the relevant aggregate amount actually available to that supplier under the relevant arrangements during the period in question.

• (2) Where any relevant arrangements—

• (a) provide that some or all of the generating capacity in question may reduce or cease to be available following the occurrence of any such event as is mentioned in Schedule 3 (termination events) to this Order (whether the event in question is described in the terms of that Schedule or in terms to the like effect); and

• (b) result in some or all of that capacity not being available to that supplier, on any day during any specified period, by reason of the occurrence of any such event,

then the specified period then current shall forthwith terminate and, in relation to any day during any subsequent specified period ascertained in accordance with paragraph (3) of this article, this Order shall have effect as if the relevant aggregate amount specified in relation to that period were the amount specified in relation to that supplier for the period which includes that day in the Table in question in Schedule 1 to this Order, less an amount equal to the sum of any capacity which has ceased to be available at that time by reason of the occurrence of any such event or events and any capacity whose availability is at that time conditional upon the satisfaction of any such requirement or requirements as are referred to in paragraph (1) of this article, but subject to the proviso contained in that paragraph.

• (3) In this article “specified period” means, in relation to any public electricity supplier, each successive period commencing and ending on the dates specified in a Table in Schedule 1 to this Order but so that—

• (a) the first such period shall commence on 1st April 1995 or, where all the arrangements made by the supplier make provision as mentioned in paragraph (1)(a) of this article, on the date on which all applicable requirements mentioned in paragraphs (1) to (6) of Schedule 2 to this Order have been satisfied in respect of any such arrangements;

• (b) on any such day as is mentioned in paragraph (1)(b) of this article there shall be substituted, in place of any specified period that would otherwise have commenced on that day, a period commencing on such day and expiring (subject to paragraphs (3)(d) and (3)(e) of this article) on the day on which the relevant requirement is satisfied either wholly or in part;

• (c) upon the expiry of any specified period ascertained in accordance with this sub-paragraph or with paragraph (3)(b) of this article, the next specified period shall commence on the following day and shall continue, subject to paragraphs (3)(d) and (3)(e) of this article, until the day on which the relevant requirement is either wholly satisfied or further satisfied in part;

• (d) on any such day as is mentioned in paragraph (2)(b) of this article, the then current specified period shall forthwith terminate and shall be followed by a new period commencing immediately upon such termination; and

• (e) any specified period which is current on any of the period end dates specified in the Table shall expire on that date.

SCHEDULE 1 — SPECIFIED AGGREGATE AMOUNTS OF GENERATING CAPACITY