Commentary on provisions of the Act Section 7: Licence conditions to secure funding of smart meter communication licensee administration
This Section specifies the modifications that the Secretary of State can make to gas and electricity licences to secure funding of smart meter communication licensee administration.
	Subsections (1) and (2) state the modifications that may be made under Section 6 include requiring the holder of the licence to raise the charges imposed on its customers or users so as to raise such amounts as may be determined by the Secretary of State and to pay the amounts raised to specified persons for the purpose of making good a shortfall in the property of a smart meter communication licensee available to meet the expenses of smart meter communication licensee administration. This will allow the costs of smart meter communication licensee administration to be recouped via the licence mechanism from the industry.
	Subsection (3) defines a ‘shortfall’ in meeting the expenses of smart meter communication licensee administration as the property of the company being insufficient to meet the costs of smart meter communication licensee administration. It also defines making payment to make good the shortfall as discharging ‘relevant debts’ which cannot otherwise be met out of the available property.
	Subsection (4) defines relevant debts and includes obligations to repay the grants, loans, sums paid out under an indemnity, and sums paid out under guarantees under sections 165, 166 and 167 of the Energy Act 2004 as applied by Section 4.