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Chamber and committees

Subordinate Legislation Committee, 26 Feb 2002

Meeting date: Tuesday, February 26, 2002


Contents


Draft Instruments Subject to Approval


Renewables Obligation (Scotland) Order 2002 (Draft)

The Convener:

We have invited Neal Rafferty and Linda Sneddon today because last week's recess has meant that this is the committee's only opportunity to ask questions on this order. I thank the witnesses for coming.

We would like clarification on a couple of points. Will you explain the differences between this draft order and the equivalent English order? Would you like me to detail the differences?

Neal Rafferty (Scottish Executive Enterprise and Lifelong Learning Department):

If you went through the differences that you have identified, that might be more useful than my rambling on about them.

The Convener:

Article 2(1) of the English order has a definition of "particulars". Article 2(2) refers to the purposes of the definition of "hydro generating station". In relation to article 2(4), there appears to be a difference between the two orders. We were not sure whether article 4(13) represents a policy change. There also appears to be a difference in relation to article 5(1)(d).

Linda Sneddon (Office of the Solicitor to the Scottish Executive):

I will go through some of the technical changes. When we considered the definition of "particulars" in article 2(1), we felt that it was defined in paragraph 2 of schedule 2, although not quite in a way that would fit our usual drafting practice. We could not see the purpose of having the definition. The definition in paragraph 2 is not actually a definition as such: it explains what the particulars are and what a renewables obligation certificate comprises.

Please bear with us. The issues are technical.

Linda Sneddon:

Absolutely.

I have not the faintest idea why you should have decided what you did.

Linda Sneddon:

The term "particulars" is not used much in the order, and the particulars are described. My understanding is that the order is likely to be amended, probably in the next six months to a year, to implement further policy. If the committee felt strongly about having the definition included, we could consider making an amendment at that time. The definition was felt to serve no purpose, which is why it was removed, but if the committee feels strongly, we can reconsider that in the next order.

That offer seems reasonable, and it gives us six months to recover from this order.

Linda Sneddon:

The second order will not be as substantial as the first.

That covers article 2(1).

Article 2(2) omits the words:

"For the purposes of the definition of ‘hydro generating station'".

Those words are in the equivalent English order and do not appear in the Scottish order.

Linda Sneddon:

We deleted those words because they added nothing. The definition of civil works is technical. The provisions on civil works relate only to hydro generating stations, so it was considered that the words that the convener mentioned added nothing, which is why they were deleted.

The committee is concerned that the phrase "generating station" is rather wide and that "hydro generating station" is a bit more specific.

Linda Sneddon:

What the order regards as civil works relates only to hydro generating stations and not to any other type of generating station. The order mentions man-made weirs and holding water. Only a hydro generating station deals with water.

I believe you.

Linda Sneddon:

The wording is specific. Hydro generating stations are mainly in Scotland; only a few are elsewhere.

You are saying that because only Scotland has hydro generation and the order is Scottish, the order does not need to say "hydro generation".

Linda Sneddon:

We felt that the words added nothing to the definition. We tried to be as precise as possible, so that people know what civil works are. People in the industry will know what civil works are.

I am minded to accept that explanation.

We mentioned the omission of article 2(4), but we are not too concerned by that.

Linda Sneddon:

We omitted that paragraph to follow Scottish practice. Such a provision is not considered one that we should put in Scottish statutory instruments.

I am advised that, in this instance, the omission does not matter, but we are pernickety, and sometimes such an omission matters. That is why we drew it to your attention.

Linda Sneddon:

It is accepted that, sometimes, such a provision is important. However, it would have made no difference to the order, because it does not refer to schedules outwith itself. If we produce an amendment order, the situation may be different.

We were not sure whether article 4(13) in the English order was omitted from the Scottish order because of a policy change.

Neal Rafferty:

The Department of Trade and Industry added articles 4(13) and 5(1)(d) to the England and Wales order after we had laid our order. In England and Wales and in Scotland, we worked from a draft that we had identified as the final version. We proceeded to work with that; our colleagues in the DTI proceeded to amend it. Articles 4(13) and 5(1)(d) are examples of what they did.

Article 4(13) does not add anything that was not in the order or was not taken care of by article 4(12)(a)—I beg your pardon. Article 5(1)(d) is taken care of by article 4(12)(a). Article 5(1)(d) allows the Office of Gas and Electricity Markets to freeze meter readings from renewables stations.

I am also trying to juggle two orders. You have my sympathy for what has happened.

Linda Sneddon:

The DTI raised queries with us and we were suddenly left in a situation. The additions to the England and Wales order may add clarity for people who work in the system, because they provide separate definitions, but we think that article 4(12)(a) covers the intention, so there is no practical difference. We will consider that when the amendment order is produced, when we are likely to include those provisions.

The practical effect for the industry is that no ROCs or SROCs will be issued until six months after the order comes into force. We cannot guarantee it, but we may have amended the order by that time. Article 4(12)(a) will allow us to instruct Ofgem to act in the same manner as it would if articles 4(13) and 5(1)(d) were included, although perhaps the position is less clear. We can operate the system as it is. At the next opportunity to bring it into line, we will fix it so that there is no doubt that the treatment in Scotland is the same as that in England.

We put on record our sympathy for you. The committee hopes that such a problem does not recur. If it does, you must tell somebody about it.

Linda Sneddon:

We have made our feelings clear to the DTI.

Neal Rafferty:

We have done that in the most diplomatic terms.

The Convener:

We have no time to go into the matter either. I accept what you say about the mop-up operation, but article 5(1)(d) of the England and Wales order seems to come perilously close to policy making. I thank you for your explanation, and we look forward to seeing whether there will be an amendment order.

Neal Rafferty:

Just for clarification, ROCs will not be issued until four months after the order comes into force as intended on 1 April, subject to parliamentary approval. As a result, we have plenty of time to make amendments. All the DTI has done—very helpfully—is to clarify the measures that our order will introduce; its revisions do not make any material change nor do they add anything that we did not already have. They simply bring matters out into the open and add a little clarity. Once we introduce amendments—which is likely to happen in the coming months—we will update our own order to ensure that it carries the same clarity.

The Convener:

I am sure that people in the industry will be glad about that. We certainly are. However, we have another wee question for you. Will you clarify the meaning of the words "aspects" and "respects" in paragraph 7 of schedule 2? It looks as though it is a wee typo.

Linda Sneddon:

It is a wee typo. As the committee has brought the matter to our attention, we seek its consent to deal with the matter when the draft order comes back to us, if passed by Parliament. If it is not possible to change the word "aspects" to "respects" through a manuscript amendment, we will seek to make that change through the amendment order.

So you are sticking with the word "respects".

Linda Sneddon:

As that is the word in the English order, we will stick with it here.

We have no further questions. Thank you very much; your responses have been most illuminating.

Neal Rafferty:

It is an easy order to shed light on.