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ELECTRICITY ACT 1989

UK Public General Acts

Version 01/12/1996

1989 CHAPTER 29

Default Geographical Extent: E+W+S


  • Part I (E+W+S+N.I.). ELECTRICITY SUPPLY
    • Introductory (E+W+S+N.I.)
    • Licensing of supply etc.
    • Modification of licences
    • Supply by public electricity suppliers
    • Enforcement of preceding provisions
    • Provisions with respect to supply generally
    • Protection of public interest
    • Consumer protection: standards of performance
    • Consumer protection: miscellaneous
    • Investigation of complaints
    • Other functions of Director
    • Provisions with respect to committees
    • Provisions with respect to Consumers’ etc. Councils
    • Alteration of activities requiring licence (P)
    • Miscellaneous
    • Supplemental
  • PART II (E+W+S+N.I.). REORGANISATION OF THE INDUSTRY
    • Transfers to successor companies (E+W+S+N.I.)
    • Ownership of successor companies
    • Finances of successor companies
    • Provisions with respect to floatation (E+W+S+N.I.)
    • Provisions with respect to existing bodies
    • Miscellaneous (E+W+S+N.I.)
    • Supplemental (E+W+S+N.I.)
  • Part III (E+W+S+N.I.). MISCELLANEOUS AND SUPPLEMENTAL
    • Miscellaneous
    • Amendment of enactments (E+W+S+N.I.)
    • Amendment etc. of pension schemes
    • Supplemental (E+W+S+N.I.)

Introductory Text

Electricity Act 1989

1989 CHAPTER 29

An Act to provide for the appointment and functions of a Director General of Electricity Supply and of consumers’ committees for the electricity supply industry; to make new provision with respect to the supply of electricity through electric lines and the generation and transmission of electricity for such supply; to abolish the Electricity Consumers’ Council and the Consultative Councils established under the Electricity Act 1947; to provide for the vesting of the property, rights and liabilities of the Electricity Boards and the Electricity Council in companies nominated by the Secretary of State and the subsequent dissolution of those Boards and that Council; to provide for the giving of financial assistance in connection with the storage and reprocessing of nuclear fuel, the treatment, storage and disposal of radioactive waste and the decommissioning of nuclear installations; to amend the Rights of Entry (Gas and Electricity Boards) Act 1954 and the Local Government (Scotland) Act 1973; and for connected purposes.

[27th July 1989]

BE IT ENACTED by the Queen’s most Excellent Majesty, by and with the advice and consent of the Lords Spiritual and Temporal, and Commons, in this present Parliament assembled, and by the authority of the same, as follows:—

Part I (E+W+S+N.I.)
ELECTRICITY SUPPLY



Annotations:

Modifications etc. (not altering text)

C1 Pt. I (ss. 1-64): definition of "electric line" applied (E.W.) (14.7.1992) by New Roads and Street Works Act 1991 (c. 22, SIF 59), ss. 63(1), Sch. 4 para. 7(4); S.I. 1992/1686, art. 3,Sch.

C2 Pt. I (ss. 1-64): definition of "electric line" applied (S.) (14.7.1992) by New Roads and Street Works Act 1991 (c. 22, SIF 108), ss. 122(1), Sch. 6 para. 7(4); S.I. 1992/1671, art.2,Sch.

C3 Pt. I (ss. 1-64) amended (E.W.) (27.10.2000) by S.I. 2000/2727, art. 10

Pt. I (ss. 1-64) amended (7.11.2000) by 2000 c. 27, s. 105(1)(a); S.I. 2000/2974, art. 2, Sch. (subject to transitional provisions in arts. 3-12)


Introductory (E+W+S+N.I.)


1 The Director General of Electricity Supply. (E+W+S+N.I.)

(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.

2 Consumers’ committees. (E+W+S+N.I.)

(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.

Annotations:

Modifications etc. (not altering text)

C4 S. 2(2)(b)(3)(a): transfer of certain functions (S.) (1.7.1999) by S.I. 1999/1750, arts. 1, 2, Sch. 1 (with art. 7)


3 General duties of Secretary of State and Director.

(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 [F1 subsections (2) and (2A) ] 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.
[F2 (2A) If an order under section 32(1) below requires a public electricity supplier to make, or produce evidence showing that he has made, arrangements or additional arrangements which will secure the result mentioned in subsection (2B) below, the order, so far as relating to any such requirement, may be made for the purpose of, or for purposes which include, promoting the supply to any premises of—

(a) heat produced in association with electricity, or
(b) steam produced from, or air or water heated by, such heat.
(2B) The result referred to in subsection (2A) above is that, for a period specified in the order, there will be available to the public electricity supplier—

(a) from combined heat and power stations; or
(b) from combined heat and power stations of any particular description,
an aggregate amount of generating capacity which is not less than that specified in relation to him in the order.
(2C) In subsection (2B) above, “combined heat and power station” has the meaning given by section 32(8) below.]

(3) Subject to subsections (1) [F3 , (2) and (2A) ] 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.

Annotations:

Amendments (Textual)

F1 Words in s. 3(1)(c) substituted (21.9.1995) by 1995 c. 25, s. 120(1), Sch. 22 para. 38(2) (with ss. 7(6), 115, 117); S.I. 1995/1983, art. 3(a)

F2 S. 3(2A)-(2C) inserted (21.9.1995) by 1995 c. 25, s. 120(1), Sch. 22 para. 38(3) (with ss. 7(6), 115, 117); S.I. 1995/1983, art. 3(a)

F3 Words in s. 3(3) substituted (21.9.1995) by 1995 c. 25, s. 120(1), Sch. 22 para. 38(4) (with ss. 7(6), 115, 117); S.I. 1995/1983, art. 3(a)


[F4 3B Guidance on social and environmental matters. (PROSPECTIVE)

(1) The Secretary of State shall from time to time issue guidance about the making by the Authority of a contribution towards the attainment of any social or environmental policies set out or referred to in the guidance.

(2) The Authority shall, in carrying out its functions under this Part, have regard to any guidance issued under this section.

(3) Before issuing guidance under this section the Secretary of State shall consult—

(a) the Authority;
(b) the Gas and Electricity Consumer Council (in this Act referred to as “the Council”) ;
(c) licence holders; and
(d) such other persons as the Secretary of State considers it appropriate to consult in relation to the guidance.
(4) A draft of any guidance proposed to be issued under this section shall be laid before each House of Parliament.

(5) Guidance shall not be issued under this section until after the period of forty days beginning with—

(a) the day on which the draft is laid before each House of Parliament; or
(b) if the draft is laid before the House of Lords on one day and the House of Commons on another, the later of those two days.
(6) If, before the end of that period, either House resolves that the guidance should not be issued, the Secretary of State must not issue it.

(7) In reckoning any period of forty days for the purposes of subsection (5) or (6) , no account shall be taken of any time during which—

(a) Parliament is dissolved or prorogued; or
(b) both Houses are adjourned for more than four days.
(8) The Secretary of State shall arrange for any guidance issued under this section to be published in such manner as he considers appropriate.]

Annotations:

Amendments (Textual)

F4 S. 3B inserted (20.12.2000) by 2000 c. 27, s. 14; S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) (as amended by S.I. 2001/1780, art. 2)


[F5 3C Health and safety. (PROSPECTIVE)

(1) The Secretary of State and the Authority shall consult the Health and Safety Commission about all electricity safety issues which may be relevant to the carrying out of any of their respective functions under this Part.

(2) The Secretary of State may require the Authority also to consult him about electricity safety issues of particular descriptions.

(3) The Secretary of State and the Authority shall, in carrying out their respective functions under this Part, take into account any advice given by the Health and Safety Commission about any electricity safety issue (whether or not in response to consultation under subsection (1) ).

(4) The Authority shall, in carrying out its functions under this Part, take into account any advice given by the Secretary of State about any electricity safety issue (whether or not in response to consultation under subsection (2) ).

(5) For the purposes of this section an electricity safety issue is anything concerning the generation, transmission, distribution or supply of electricity which may affect the health and safety of—

(a) members of the public; or
(b) persons employed in connection with any of those activities.]
Annotations:

Amendments (Textual)

F5 S. 3C inserted (20.12.2000) by 2000 c. 27, s. 15; S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) (as amended by S.I. 2001/1780, art. 2)


[F6 3D Exceptions from sections 3A to 3C. (PROSPECTIVE)

(1) Section 3A does not apply in relation to the issuing by the Secretary of State of guidance under section 3B.

(2) Sections 3A to 3C do not apply in relation to functions of the Secretary of State under section 36 or 37.

(3) Sections 3A to 3C do not apply in relation to anything done by the Authority—

(a) in the exercise of functions relating to the determination of disputes;
(b) in the exercise of functions under section 43(3).
(4) The Authority may nevertheless, when exercising any function under section 43(3) , have regard to any matter in respect of which a duty is imposed by sections 3A to 3C (“a general matter”) , if it is a matter to which the Director General of Fair Trading could have regard when exercising that function (but that is not to be taken as implying that, in relation to functions mentioned in subsection (2) , regard may not be had to any general matter).

(5) The duties imposed by sections 3A to 3C do not affect the obligation of the Authority or the Secretary of State to perform or comply with any other duty or requirement (whether arising under this Act or another enactment, by virtue of any Community obligation or otherwise).]

Annotations:

Amendments (Textual)

F6 S. 3D inserted (20.12.2000) by 2000 c. 27, s. 16; S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) (as amended by S.I. 2001/1780, art. 2)

Modifications etc. (not altering text)

C5 S. 3D(4) excluded (20.12.2000) by S.I. 2000/3343, art. 10(1)(b) (subject to transitional provisions in arts. 3-15)


Licensing of supply etc.


4 Prohibition on unlicensed supply etc.

(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.

Annotations:

Modifications etc. (not altering text)

C6 S. 4(1)(a)(c) excluded by S.I. 1990/193, art. 3(1)


5 Exemptions from section 4.

(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.

Annotations:

Modifications etc. (not altering text)

C7 S. 5(1): functions shall be exercisable only after consultation with the Scottish Minster (S.) (1.7.1999) by S.I. 1999/1750, arts. 1, 4, Sch. 3 (with art. 7)


6 Licences authorising supply etc.

(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.

Annotations:

Modifications etc. (not altering text)

C8 S. 6(1)(2): functions shall be exercisable only after consultation with the Scottish Minster (S.) (1.7.1999) by S.I. 1999/1750, arts. 1, 4, Sch. 3 (with art. 7)


[F7 6A Procedure for licence applications. (PROSPECTIVE)

(1) This section applies to any application—

(a) for a licence; or
(b) for the extension or restriction of a licence under section 6(4) or (6).
(2) The application shall be made in such form and manner, and shall contain, or be accompanied by, such information and documents and such fee (if any) , as may be prescribed.

(3) Within the prescribed period after the making of the application the applicant shall publish a notice of the application in the prescribed manner.

(4) Where the Authority proposes to refuse the application, it shall give to the applicant a notice—

(a) stating that it proposes to refuse the application;
(b) stating the reasons why it proposes to refuse the application; and
(c) specifying the time within which representations with respect to the proposed refusal may be made,
and shall consider any representations which are duly made and not withdrawn.
(5) Where the Authority grants the licence, extension or restriction applied for, it shall as soon as practicable thereafter send a notice of the grant to any person who holds a licence and whose interests may, in the opinion of the Authority, be affected by the grant.

(6) In this section “prescribed” means prescribed in regulations made by the Authority.

(7) Any sums received by the Authority under this section shall be paid into the Consolidated Fund.]

Annotations:

Amendments (Textual)

F7 Ss. 6, 6A, 6B substituted for s. 6 (16.5.2001 for certain purposes and otherwise 1.10.2001) by 2000 c. 27, s. 30; S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)


[F8 6B Applications for transmission licences. (PROSPECTIVE)

(1) This section applies to applications for a transmission licence (in addition to the requirements of section 6A).

(2) The applicant shall give notice of the application to any person who holds a transmission licence and whose authorised area includes the whole or any part of the area to which the application relates.

(3) Before granting the transmission licence applied for, the Authority shall give notice—

(a) stating that it proposes to grant the licence;
(b) stating the reasons why it 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.
(4) A notice under subsection (3) shall be given by publication in such manner as the Authority considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them.

(5) The Authority shall send a copy of a notice under subsection (3) to—

(a) the applicant;
(b) the Secretary of State; and
(c) any person who holds a transmission licence and whose authorised area includes the whole or any part of the area to which the application relates.]
Annotations:

Amendments (Textual)

F8 Ss. 6, 6A, 6B substituted (16.5.2001 for certain purposes and otherwise 1.10.2001) for s. 6 by 2000 c. 27, s. 30; S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)