Energy Act 2008

The Energy Act 2008 was given Royal Assent on 26 November 2008.
The Act implements the legislative aspects of the 2007 Energy White Paper: meeting the energy challenge.

The Energy Act updates the legislative framework by putting in place new legislation to:

• Reflect the availability of new technologies (such as Carbon Capture & Storage (CCS) and emerging renewable technologies

• Correspond with our changing requirements for security of supply infrastructure (such as offshore gas storage)

• Ensure adequate protections for the environment and the tax payer as our energy market changes.

The Energy Act, alongside the Planning Act 2008 and Climate Change Act 2008, ensures that our legislation underpins the long term delivery of our energy and climate change strategy.

The content of the Act is as follows:

• Offshore gas supply infrastructure: strengthening the regulatory framework to enable private sector investment in order to help maintain reliable supplies of energy given we expect to rely on imported gas to meet up to 80% demand by 2020

• Carbon Capture and Storage: creating a regulatory framework to enable private sector investment in CCS projects. CCS has the potential to reduce the carbon emissions from fossil fuel power stations by up to 90%

• Renewables: Strengthening the Renewables Obligation to drive greater and more rapid deployment of renewables in the UK. This will increase the diversity of the UK’s electricity mix, thereby improving the reliability of our energy supplies and help lower the carbon emissions from the electricity sector

• Feed-in Tariffs: enabling the Government to introduce a tailor-made scheme to financially support low carbon generation of electricity in projects up to 5MW. The aim is that generators will receive a guaranteed payment for generating low carbon electricity

• Decommissioning of offshore renewables and oil and gas installations: strengthen statutory decommissioning provisions to minimise the risk of liabilities falling to the Government

• Improving offshore oil and gas licensing: to improve the licensing regime in response to changes in the commercial environment and enable DECC to carry out its regulatory functions more effectively

• Nuclear waste and decommissioning financing: ensuring the operators of new nuclear power stations accumulate funds to meet the full costs of decommissioning and their full share of waste management costs

• Offshore electricity transmission: amending powers such that Ofgem is able to run the offshore transmission licensing regime more effectively

• Smart Metering: allowing the Secretary of State to modify electricity and gas distribution and supply licences to require the licence holder to install, or facilitate the installation of, smart meters to different customer segments, including the domestic sector

• Renewable Heat Incentive: allowing the Secretary of State to establish a financial support mechanism for renewable heat, from large industrial sites down to the household level. The aim is to introduce a ‘banded’ system, similar to that for the Renewables Obligation

• Housekeeping: Various provisions covering nuclear security and transfer of various regulatory functions to/from DECC

• View the Energy Act 2008 Full Article (pdf 735kb)
• View the Energy White Paper Executive Summary (pdf 439kb)
• View the full Energy White Paper (pdf 6.7MB)