Part of the debate – in the House of Commons am 11:59 am ar 24 Mai 2024.

Danfonwch hysbysiad imi am ddadleuon fel hyn

Photo of Robert Largan Robert Largan Assistant Whip 11:59, 24 Mai 2024

I beg to move,

That the draft Energy Act 2023 (Consequential Amendments) Regulations 2024, which were laid before this House on 13 May, be approved.

This instrument is technical in nature. It uses the power in section 330 of the Energy Act 2023 to make various amendments as a consequence of the passing of that Act. The majority of the amendments relate to the independent system operator and planner, or ISOP, while most others relate to the governance of the gas and electricity codes. There are other minor amendments to the provisions relating to the hydrogen levy, competition in onshore electricity projects, and heat networks.

The ISOP will be an expert and impartial body, with responsibilities across the electricity and gas systems, to provide progress towards net zero while maintaining energy security and minimising costs for consumers. With roles across the energy system, the ISOP will help to plan and deliver the integrated system needed to ensure our energy security, net zero and affordability goals. It will be independent not only of other commercial energy interests, but from the operational control of the Government, meaning that it will be in a position to use its expertise to advice the Government and Ofgem on the critical decisions ahead.

Two types of amendments are needed to give the ISOP a stable legislative footing. The first is to reflect its public nature—a shift from the current ownership by National Grid—by, for example, adding the ISOP to the list of organisations to which the Freedom of Information and Public Record Acts apply. The second reflects the fact that, unlike the current electricity systems operator, which holds a transmission licence, the ISOP will hold an electricity system operator licence and a gas system planner licence. That will require updates in energy legislation to ensure that reference is made to the new ISOP licences, which will ensure continuity. Examples include updating the Energy Act 2013 so that the ISOP can continue the ESO’s current work as the contract for difference counter party. It is worth noting that none of these changes will come into effect until the ISOP is created, and current legislative reference will remain whilst the ESO continues to operate the electricity system.

Changes will also be made in legislation in relation to code governance reform. The Competition and Markets Authority has previously highlighted concerns regarding certain aspects of code governance. Under the new system, the existing code administrators and industry planners will be replaced by code managers, who will be selected and licensed by Ofgem. Those code managers will be directly accountable to Ofgem, and their responsibilities will include making recommendations and, in some cases, decisions on modifications to the codes.

This statutory instrument enacts the necessary consequential changes across legislation to reflect the new governance framework and licensing regime. An amendment to the Gas (Northern Ireland) Order 1996 is made to ensure that the right primary legislation is in place should the Government decide to introduce the hydrogen gas shipper levy in Northern Ireland. I commend the regulations to the House.