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ELECTRICITY ACT 1989

UK Public General Acts

Version 01/03/2005

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
    • Duties of electricity distributors]
    • 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
    • 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.)
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  • Version 01/02/1991

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) applied (1.10.2001) by S.I. 2001/3264, regs. 4(2), 5(2)

C4 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)

Pt. I (ss. 1-64) amended (E.W.) (1.10.2001) by S.I. 2000/2727, art. 10 (as substituted (1.10.2001) by S.I. 2001/3268, art. 2(13))


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


F1 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (E+W+S+N.I.)

Annotations:

Amendments (Textual)

F1 S. 1 repealed (1.10.2001) by 2000 c. 27, s. 108, Sch. 8; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)


F2 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (E+W+S+N.I.)

Annotations:

Amendments (Textual)

F2 S. 2 repealed (7.11.2000) by 2000 c. 27, s. 108, Sch. 8; S.I. 2000/2974, art. 2, Sch. (subject to transitional provisions in arts. 3-12)


[F3 3A The principal objective and general duties of the Secretary of State and the Authority.

(1) The principal objective of the Secretary of State and the Gas and Electricity Markets Authority (in this Act referred to as “the Authority”) in carrying out their respective functions under this Part is to protect the interests of consumers in relation to electricity conveyed by distribution systems, wherever appropriate by promoting effective competition between persons engaged in, or in commercial activities connected with, the generation, transmission, distribution or supply of electricity.

(2) The Secretary of State and the Authority shall carry out those functions in the manner which he or it considers is best calculated to further the principal objective, having regard to—

(a) the need to secure that all reasonable demands for electricity are met; and
(b) the need to secure that licence holders are able to finance the activities which are the subject of obligations imposed by or under this Part or the Utilities Act 2000.
(3) In performing that duty, the Secretary of State or the Authority shall have regard to the interests of—

(a) individuals who are disabled or chronically sick;
(b) individuals of pensionable age;
(c) individuals with low incomes; and
(d) individuals residing in rural areas;
but that is not to be taken as implying that regard may not be had to the interests of other descriptions of consumer.
(4) The Secretary of State and the Authority may, in carrying out any function under this Part, have regard to—

(a) the interests of consumers in relation to gas conveyed through pipes (within the meaning of the M1 Gas Act 1986) ; and
(b) any interests of consumers in relation to—
(i) telecommunication services and telecommunication apparatus (within the meaning of the M2 Telecommunications Act 1984) ; or
(ii) water services or sewerage services (within the meaning of the M3 Water Industry Act 1991) ,
which are affected by the carrying out of that function.
(5) Subject to subsection (2) , the Secretary of State and the Authority shall carry out their respective functions under this Part in the manner which he or it considers is best calculated—

(a) to promote efficiency and economy on the part of persons authorised by licences or exemptions to transmit, distribute or supply electricity and the efficient use of electricity conveyed by distribution systems;
(b) to protect the public from dangers arising from the generation, transmission, distribution or supply of electricity; and
(c) to secure a diverse and viable long-term energy supply,
and shall, in carrying out those functions, have regard to the effect on the environment of activities connected with the generation, transmission, distribution or supply of electricity.
(6) In this section “consumers” includes both existing and future consumers.

(7) In this section and sections 3B and 3C, references to functions of the Secretary of State or the Authority under this Part include a reference to functions under the Utilities Act 2000 which relate to electricity conveyed by distribution systems.

(8) In this Part, unless the context otherwise requires— “exemption” means an exemption granted under section 5; “licence” means a licence under section 6 and “licence holder” shall be construed accordingly.]

Annotations:

Amendments (Textual)

F3 S. 3A substituted for s. 3 (20.12.2000) by 2000 c. 27, s. 13; S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) (as amended by S.I. 2001/1780, art. 2)

Marginal Citations

M1 1986 c. 44.

M2 1984 c. 12.

M3 1991 c. 56.


[F4 3B Guidance on social and environmental matters.

(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.

(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.

(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
[F7 (bb) distributes electricity for that purpose;]
(c) supplies electricity to any premises,
shall be guilty of an offence unless he is authorised to do so by a licence F8 . . ..
(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— [F9 “distribute”, in relation to electricity, means distribute by means of a distribution system, that is to say, a system which consists (wholly or mainly) of low voltage lines and electrical plant and is used for conveying electricity to any premises or to any other distribution system;] [F10 “supply”, in relation to electricity, means supply of electric conveyed by a distribution system to premises other than 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:

Amendments (Textual)

F7 S. 4(1)(bb) inserted (1.10.2001) by 2000 c. 27, s. 28(2); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F8 Words in s. 4(1) repealed (1.10.2001) by 2000 c. 27, s. 108, Sch. 8; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F9 S. 4(4): definition of “distribute” inserted (7.11.2000 for specified purposes, 20.12.2000 for further specified purposes and otherwise 1.10.2001) by 2000 c. 27, s. 28(3)(a); S.I. 2000/2974, art. 2, Sch. (subject to transitional provisions in arts. 3-12); S.I. 2000/3343, art. 2, Sch. (subject to transitional provisions in arts. 3-15) (as amended by S.I. 2001/1780, art. 2); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

F10 S. 4(4): definition of “supply” substituted (1.10.2001) by 2000 c. 27, s. 28(3)(b); S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

Modifications etc. (not altering text)

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

C7 S. 4(1)(a) excluded (1.10.2001) by S.I. 2001/3270, art. 3(1)(a) (with art. 4(1)(2), Sch. 2)

C8 S. 4(1)(bb) excluded (1.10.2001) by S.I. 2001/3270, art. 3(1)(b) (with art. 4(3)(4), Sch. 3)

C9 S. 4(1)(c) excluded (1.10.2001) by S.I. 2001/3270, art. 3(1)(c) (with art. 4(5)(8), Sch. 4)


[F11 5 Exemptions from prohibition.

(1) The Secretary of State may by order grant exemption from paragraph (a) , (b) , (bb) or (c) of section 4(1) —

(a) either to a person or to persons of a class;
(b) either generally or to such extent as may be specified in the order; and
(c) either unconditionally or subject to such conditions as may be so specified.
(2) Before making an order under subsection (1) the Secretary of State shall give notice—

(a) stating that he proposes to make such an order and setting out the terms of the proposed order;
(b) stating the reasons why he proposes to make the order in the terms proposed; and
(c) specifying the time (not being less than 28 days from the date of publication of the notice) within which representations with respect to the proposals may be made,
and shall consider any representations which are duly made in respect of the proposals and not withdrawn.
(3) The notice required by subsection (2) shall be given—

(a) by serving a copy of it on the Authority and the Council; and
(b) by publishing it in such manner as the Secretary of State considers appropriate for bringing it to the attention of those likely to be affected by the proposed order.
(4) Notice of an exemption granted to a person shall be given—

(a) by serving a copy of the exemption on him; and
(b) by publishing the exemption in such manner as the Secretary of State considers appropriate for bringing it to the attention of other persons who may be affected by it.
(5) Notice of an exemption granted to persons of a class shall be given by publishing the exemption in such manner as the Secretary of State considers appropriate for bringing it to the attention of—

(a) persons of that class; and
(b) other persons who may be affected by it.
(6) An exemption may be granted—

(a) indefinitely; or
(b) for a period specified in, or determined by or under, the exemption.
(7) Conditions subject to which an exemption is granted may (in particular) require any person carrying on any activity in pursuance of the exemption—

(a) to comply with any direction given by the Secretary of State or the Authority as to such matters as are specified in the exemption or are of a description so specified;
(b) except in so far as the Secretary of State or the Authority consents to his doing or not doing them, not to do or to do such things as are specified in the exemption or are of a description so specified; and
(c) to refer for determination by the Secretary of State or the Authority such questions arising under the exemption as are specified in the exemption or are of a description so specified.
(8) The Secretary of State may by order revoke an order by which an exemption was granted to a person or vary an order by which more than one exemption was so granted so as to terminate any of the exemptions—

(a) at the person’s request;
(b) in accordance with any provision of the order by which the exemption was granted; or
(c) if it appears to the Secretary of State inappropriate that the exemption should continue to have effect.
(9) The Secretary of State may by order revoke an order by which an exemption was granted to persons of a class or vary an order by which more than one exemption was so granted so as to terminate any of the exemptions—

(a) in accordance with any provision of the order by which the exemption was granted; or
(b) if it appears to the Secretary of State inappropriate that the exemption should continue to have effect.
(10) The Secretary of State may by direction withdraw an exemption granted to persons of a class from any person of that class—

(a) at the person’s request;
(b) in accordance with any provision of the order by which the exemption was granted; or
(c) if it appears to the Secretary of State inappropriate that the exemption should continue to have effect in the case of the person.
(11) Before—

(a) making an order under subsection (8) (b) or (c) or (9) ; or
(b) giving a direction under subsection (10) (b) or (c) ,
the Secretary of State shall consult the Authority and give notice of his proposal to do so (with reasons) and of a period within which representations may be made to him.
(12) The notice under subsection (11) shall be given—

(a) where the Secretary of State is proposing to make an order under subsection (8) (b) or (c) , by serving a copy of it on the person to whom the exemption was granted;
(b) where he is proposing to make an order under subsection (9) , by publishing it in such manner as the Secretary of State considers appropriate for bringing it to the attention of persons of the class of persons to whom the exemption was granted; and
(c) where he is proposing to give a direction under subsection (10) (b) or (c) , by serving a copy of it on the person from whom he proposes to withdraw the exemption.]
Annotations:

Amendments (Textual)

F11 S. 5 substituted (1.10.2001) by 2000 c. 27, s. 29; S.I. 2001/3266, art. 2, Sch. (subject to transitional provisions in arts. 3-20)

Modifications etc. (not altering text)

C10 S. 5: functions transferred to Scottish Ministers (S.) (14.12.2000) by virtue of S.I. 2000/3253, arts. 1(1), 2, Sch. (with art. 6)


[F12 6 Licences authorising supply, etc.

(1) The Authority may grant any of the following licences—

(a) a licence authorising a person to generate electricity for the purpose of giving a supply to any premises or enabling a supply to be so given (“a generation licence”) ;
(b) a licence authorising a person to transmit electricity for that purpose in that person’s authorised area (“a transmission licence”) ;
(c) a licence authorising a person to distribute electricity for that purpose (“a distribution licence”) ; or
(d) a licence authorising a person to supply electricity to premises (“a supply licence”).
(2) The same person may not be the holder of both a distribution licence and a supply licence.

(3) A supply licence may authorise the holder to supply electricity—

(a) to any premises;
(b) only to premises specified in the licence, or to premises of a description so specified; or
(c) only to any premises situated in a specified area, or to premises of a specified description which are so situated.
(4) The Authority may, with the consent of the holder of a supply licence, modify terms included in the licence in pursuance of subsection (3) so as to extend or restrict the premises to which the licence holder may give a supply of electricity.

(5) A distribution licence may authorise the holder to distribute electricity in any area, or only in an area specified in the licence.

(6) The Authority may, with the consent of the holder of a distribution licence, modify terms included in the licence in pursuance of subsection (5) so as to extend or restrict the area within which the licence holder may distribute electricity.

(7) A licence and any extension or restriction of a licence under subsection (4) or (6) shall be in writing.

(8) A licence shall, unless previously revoked in accordance with any term of the licence, continue in force for such period as may be specified in or determined by or under the licence.

(9) In this Part— “authorised area”, in relation to the holder of a transmission licence, means so much of the area designated as such in the licence as is not for the time being designated in a subsequent transmission licence; “electricity distributor” means any person who is authorised by a distribution licence to distribute electricity except where he is acting otherwise than for purposes connected with the carrying on of activities authorised by the licence; “electricity supplier” means any person who is authorised by a supply licence to supply electricity except where he is acting otherwise than for purposes connected with the carrying on of activities authorised by the licence.]

Annotations:

Amendments (Textual)

F12 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)

Modifications etc. (not altering text)

C11 S. 6 applied (1.10.2001) by S.I. 2001/3266, art. 3(3)

C12 S. 6(1) modified (16.5.2001) by 2000 c. 27, s. 33(1); S.I. 2001/1781, art. 2, Sch. (subject to transitional provisions in arts. 3-10)


[F13 6A Procedure for licence applications.

(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)

F13 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)


[F14 6B Applications for transmission licences.

(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)

F14 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)