Commentary on Sections Other infrastructure provisions Section 19: Conditions of licences under Gas Act 1986: payments to other licence-holders
89.Section 19 amends section 7B of the Gas Act 1986 (“the 1986 Act”), specifically subsection (5)(b)(ii). Section 7B was inserted by the Gas Act 1995, and has subsequently been amended by the Utilities Act 2000. The purpose of section 19 is to clarify that conditions included in a licence granted under section 7 of the 1986 Act may require such a licensee to increase his charges for the conveyance of gas and to pay the amounts so raised to holders of any licences under the 1986 Act (not just gas shippers or suppliers).
90.The legislation as currently drafted lacks transparency, as section 7B(5)(b)(ii) (prior to amendment) states that such licence conditions may require the licensee to increase his charges for the conveyance of gas and to pay the amounts so raised to holders of licences under section 7A of the 1986 Act (gas shippers or suppliers), although this is expressed to be without prejudice to the Authority’s general power to include licence conditions under section 7B(4) of the 1986 Act.
91.The amendment in section 19 puts the issue beyond doubt and allows for the proposed gas Network Innovation Competition, and other policies requiring gas transporters to pay monies raised to other licensees other than gas shippers or suppliers, to proceed on a clear statutory footing.