Overview

The Energy Act 2010 is a UK law focused on three main areas: supporting carbon capture and storage (CCS) technology, reducing fuel poverty, and regulating gas and electricity markets. It introduces financial assistance schemes for CCS, creates mechanisms to help vulnerable households afford energy, and updates regulations to ensure fair competition and consumer protection within the energy industry.

Description

Part 1: Carbon Capture and Storage (CCS) This part establishes financial assistance schemes for CCS demonstration projects and their subsequent wider use. The Secretary of State is given powers to create these schemes, amend them, and levy charges on electricity supplies to fund them. Regular reports on decarbonisation progress and CCS technology development are mandated.

Part 2: Reducing Fuel Poverty This part empowers the Secretary of State to create schemes requiring energy suppliers to provide benefits to customers identified as being at risk of fuel poverty. These benefits can take various forms, including direct payments, reduced energy charges, or goods and services. Mechanisms for equitable distribution of these benefits across suppliers are included. The Gas and Electricity Markets Authority (GEMA) is tasked with overseeing these schemes.

Part 3: Regulation of Gas and Electricity Markets This part amends existing Acts (Gas Act 1986 and Electricity Act 1989) to strengthen consumer protection and promote competition. It introduces further duties on the Secretary of State and the Authority to consider consumer interests, including the reduction of emissions and security of supply, when regulating the markets. It addresses electricity trading and transmission arrangements, aiming to prevent suppliers from exploiting the system for excessive profit, and providing a framework for appeals against penalties and orders. It also mandates notice to customers about unilateral contract changes, especially affecting domestic energy prices.

Part 4: Final Provisions This part contains general duties for GEMA and the Secretary of State, procedures for making orders and regulations, and details on commencement and short title.

Government Spending

The act doesn't specify exact figures for government spending. However, it authorises substantial financial assistance for CCS projects and mechanisms for reducing fuel poverty, implying significant expenditure from public funds. The level of spending depends on the specific schemes designed and implemented under the act’s provisions.

Groups Affected

• Energy Companies: Affected by new regulations, reporting requirements, levies, and obligations to participate in fuel poverty reduction schemes, potentially impacting profits and operational costs.
• Electricity Consumers: May experience a levy on electricity bills to fund CCS development. Some consumers may also benefit from schemes to reduce fuel poverty, experiencing lower energy bills.
• Gas Consumers: Similar to electricity consumers, some may see lower energy bills through fuel poverty reduction schemes.
• Vulnerable Households: Directly benefit from schemes designed to reduce fuel poverty, potentially leading to improved access to affordable heating and energy.
• CCS Developers: May receive substantial financial assistance, fostering investment and development in CCS technology.
• Government: Responsible for significant financial outlay for CCS and fuel poverty reduction, and for overseeing the implementation and monitoring of various schemes.

Powered by nyModel