I hope I have not detained the legislative side of the Upper House. I commend the Energy (Miscellaneous Provisions) Bill 2011 to the House and I am pleased to commence the debate on the Bill in this House. As I have previously stated, while this is an important Bill, it is not controversial. It is the result of a review by my Department of various Acts.
Before addressing its main provisions, I remind Senators of the purpose of the legislation. It is a Bill designed to revise, consolidate and expand existing energy legislation in areas such as the theft of electricity and gas and LPG safety to reflect the current structure of the market. It is also proposed to restate energy efficiency and other provisions that are currently provided for in secondary legislation. The Bill, the enactment of which will result in more robust energy legislation, was broadly welcomed in the other House.
Energy efficiency is an area of increasing investment and innovation. The Bill proposes to provide for the establishment of an energy efficiency fund which may be funded through contributions from energy suppliers, subject to an energy saving obligation. The fund's objectives will be to support the delivery of energy efficiency programmes and measures and promote the development of a robust market for energy services. This will be an important element of future funding mechanisms as we transition from State supports to a pay-as-one-saves framework, which is under development.
To facilitate concerns raised by Deputies on Committee Stage, a Government amendment was proposed and accepted on Report Stage in the Dáil. The amendment provides that the proposed energy efficiency fund may be used for the alleviation of energy poverty. I was pleased to reach an accommodation in regard to the suggestions on energy poverty proposed by Deputies on the opposite side, which ultimately strengthen the provisions in the Bill.
On actions to mitigate energy poverty, it should be noted that the Better Energy: Warmer Homes scheme remains open to eligible applicants. My Department is introducing changes in the structure and eligibility criteria of the programme to reflect the Government's affordable energy strategy which was published at the end of November. Priority will be given to households considered to be in extreme energy poverty, namely, those which spend more than 20% of their disposable income on energy. This initiative will ensure that those most in need will be the first to receive the benefit of energy efficiency measures.
In this regard, the interdepartmental group on affordable energy will work quickly with community based organisations and other relevant parties to finalise new eligibility criteria which ensure State resources are directed where they can deliver the greatest good. Demand for the Better Energy: Warmer Homes programme has grown to exceed available resources and it is necessary to innovate to ensure the resources available are directed at those who can benefit most.
Since 2006, some €81 million has been expended on providing energy efficiency improvements in more than 80,000 homes under the Better Energy: Warmer Homes programme, which is administered by the Sustainable Energy Authority of Ireland, SEAI, on behalf of my Department. My Department and the SEAI had a target of 20,000 homes in 2011. By year end, a total of 20,388 were completed, which equates to energy savings for recipients of approximately €2.62 million. The SEAI advises that more than 5,800 full-time jobs were being supported in 2011 and we expect to support 4,500 full-time jobs this year. Energy efficiency is an area of increasing investment and innovation in Ireland. Improving energy efficiency will pay dividends for the environment, energy security and competitiveness while also contributing towards meeting our European target of 20% energy efficiency savings by 2020.
The Bill proposes to further expand the functions of the Commission for Energy Regulation, CER. Since its establishment in 1999 with responsibility for electricity regulation, the remit of the energy regulator has expanded considerably. This is partly a consequence of European Union Internal Market legislation. We now have a strong, independent energy regulator. Most recently, the Petroleum (Exploration and Extraction) Safety Act 2010 gave the regulator responsibility for upstream gas safety.
The enactment of the Energy (Miscellaneous Provisions) Act 2006 gave the Commission for Energy Regulation responsibility for downstream gas, LPG and electrical safety. While the electrical and gas safety regime is now fully operational, it was found necessary to amend the 2006 Act to ensure LPG provisions adequately addressed the safety regulation of LPG and did not result in duplication of Health and Safety Authority and Commission for Energy Regulation functions. A two phase approach was undertaken. Amending legislation was enacted last year through the Energy (Biofuel Obligation and Miscellaneous Provisions) Act, which provided for the extension of the natural gas safety framework to LPG installers. As of June 2011, it is an offence for anyone to carry out LPG works unless he or she is a registered installer.
The LPG provisions in this Bill constitute the second phase of LPG safety legislation. In summary, it is proposed that the regulator will regulate the activities, from a safety perspective, of those LPG undertakings which make LPG available to domestic consumers via a piped distribution network. These entities supply LPG to housing estates and are generally located in areas not served by the natural gas network. The regulator will also have responsibility for promoting LPG safety. The proposals in this Bill, if enacted, will result in all aspects of the LPG chain being regulated from a safety perspective.
I will now outline the provisions of the Bill. For the convenience of the House, a detailed explanatory memorandum has been published and this provides a synopsis of the provisions. The Bill consists of 22 sections. Section 1 contains standard provisions concerning the Short Title and commencement. Section 2 provides for a number of definitions for ease of reference.
Sections 3 and 4 propose, following legal advice from the Attorney General, to restate in primary legislation superannuation provisions relating to certain employees of the ESB and BGE who transferred to EirGrid, ESB Networks Limited and Gaslink Limited. The proposals do not go beyond provisions set out in four sets of ministerial regulations made since 2000.
Section 3 proposes that an employee of the ESB whose employment was transferred to EirGrid and who was immediately before the transfer a member of a superannuation scheme can continue to have his or her superannuation benefits and the contributions payable in respect of his or her superannuation scheme membership paid out of, or into, the ESB fund into which that person was before the transfer paying superannuation contributions. An employee of the ESB who transferred to ESB Networks Limited and who was immediately before the transfer a member of an ESB superannuation scheme may continue to be a member of that scheme. Section 4 proposes that former employees of Bord Gáis Éireann who were members of a BGE superannuation scheme and who transferred to Gaslink Limited may remain in the BGE superannuation scheme.
Section 5 proposes to amend sections 15 and 16 of the Energy (Miscellaneous Provisions) Act 1995 by extending existing theft of electricity and gas provisions to independent suppliers and to the customers of those suppliers. This provision is required to reflect the current structure of the marketplace where a number of independent energy suppliers are operating in a competitive market. Irrespective of the energy supplier, it will become an offence for a person to interfere with an electricity or gas meter. The section also includes a new provision in respect of deemed contracts of supply, subject to safeguards. The aim is to provide, subject to strict criteria applying, for the recovery of debts by energy suppliers from the owner or occupier of a premise that has been consuming gas in the absence of a contract to supply energy being in place.
Sections 6 to 8, inclusive, propose a number of amendments to the Electricity Regulation Act 1999. The objective is to strengthen the enforcement powers of the regulator in regard to electrical and gas safety. Section 6 proposes to give powers to the regulator to appoint electrical investigation officers who will have powers to investigate unregistered electrical contractors and to also investigate designated electrical works from a safety perspective. Section 7 proposes to give powers to the regulator to require electricity undertakings to provide information on electrical safety to their customers and to the public.
Section 8 proposes, for the avoidance of doubt, to clarify the investigative powers of gas safety officers in regard to the investigation of gas works carried out by gas installers. Section 9 is a minor technical amendment relating to sections 9L, 9M and 9N of the 1999 Act. It restates sections 9L and 9M of the Act which provide powers to the regulator to require energy undertakings to ensure that tariffs are energy efficient. The provision also obliges energy suppliers to provide clear, easily understandable and informative details in consumer bills. These obligations are set out in the European Communities (Energy End-use Efficiency and Energy Services) Regulation 2009. The provision does not go beyond the 2009 regulations. The section also includes a second minor technical amendment relating to section 9N and Part IIA of the same Act.
Sections 10 to 16, inclusive, relate to energy efficiency. They provide for the restatement in primary legislation of provisions set out in the European Communities (Energy End-use Efficiency and Energy Services) Regulations 2009. The proposals in this Bill concern Part 5 of the regulations which relate to an energy efficiency obligation scheme for energy suppliers and distributors. I have referred to the fact that the proposals will provide a legal framework for the setting of energy efficiency targets to be met by energy suppliers and distributors. This will be achieved through the provision and promotion to customers of energy services and energy efficiency improvement measures. An energy efficiency fund may be set up which will be managed by my Department or an agent of the Department.
Sections 17 to 19, inclusive, propose a number of amendments to the Electricity Regulation Act 1999 relating to LPG and natural gas safety. The proposals in this Bill aim to address remaining safety gaps in the LPG chain that are not already regulated by the Health and Safety Authority or any other agency. The LPG proposals of the Bill extend the regulator's safety function to the safety regulation of LPG undertakings that make LPG available via a piped LPG distribution network to domestic customers.
As part of the enforcement regime, it is proposed to provide for a safety licensing regime to be administered by the regulator. The regulator will also have responsibility for promoting LPG safety. Gas emergency officers appointed by LPG undertakings will be provided with powers to investigate LPG leaks and defects to fittings.
Section 18 sets out enforcement provisions where a natural gas or an LPG undertaking is not operating in accordance with the safety framework or has contravened or failed to comply with safety requirements. The approach is based on the model applying to upstream gas safety as provided for in the Petroleum (Exploration and Extraction) Safety Act 2010.
Where a natural gas or LPG undertaking is not operating in accordance with the regulator's safety framework, the Commission for Energy Regulation may issue directions to an LPG undertaking requiring it to submit improvement plans. Where more serious safety issues arise, the regulator may serve improvement notices and prohibition notices.
The regulator may deem the activities of an undertaking to be so serious as to involve a risk to safety of human life, the safety of gas or LPG infrastructure or of property. In such cases, the regulator may make an application to the High Court for an order prohibiting the undertaking of activities by the LPG or gas undertaking until specified measures have been taken to reduce the risk to a low level.
It is also proposed that the regulator will be given powers to make regulations relating to the reporting and investigation of LPG incidents involving death or injury to persons or loss or damage to property resulting from the use, misuse, abuse, leakage, combustion or explosion of LPG. Section 19 proposes that the regulator may impose an annual levy on the holder of an LPG safety licence for the purpose of meeting expenses incurred by it.
Section 20 was introduced by way of a Government amendment on Committee Stage in the Dáil. It enables the Minister for Communications, Energy and Natural Resources to, by order, dissolve certain non trading statutory subsidiaries of Bord Gáis Éireann. The non-trading subsidiaries concerned are City of Waterford Gas Company, Clonmel Gas Company, Cork Gas Company and Limerick Gas Company. All of these subsidiaries were established pursuant to statute and as the establishing statute did not provide for a winding up mechanism, they may only be dissolved by means of statute. None of the companies is trading nor has employees. All the property rights and liabilities of the four companies were vested in Bord Gáis Éireann in 1997. BGE does not anticipate that the subsidiaries will have any assets or liabilities at the time of dissolution. However, as a safeguard, it is deemed prudent to include in the legislation standard transitional provisions regarding the transfer of any assets and liabilities to BGE. The winding-up of the four non-trading subsidiaries is in the interest of the good corporate administration of the BGE group, and will remove an unnecessary administrative and corporate compliance burden.
Section 21 of the Bill provides for an amendment to the National Oil Reserves Agency Act 2007. The amendment is in regard to the time limits set out in that Act in order to allow the agency to perform its functions more effectively with respect to biofuel certificates, and to facilitate co-operation and the provision of information by oil companies in respect of oil contingency planning.
Subsection (6) of this section proposes to insert a new section into the NORA Act of 2007 to ensure that the Minister has the vires to develop a contingency plan to allow a national response to an oil supply disruption. It also imposes a general duty on oil companies to work with the Minister and the National Oil Reserves Agency and other relevant public bodies in the development of national oil supply disruption contingency plans. Oil companies will be required to provide information to assist in the preparation of contingency plans and the response to an oil supply disruption.
Section 22 of the Bill provides for the correction of minor typographical errors in energy legislation. It also provides for the repeal of section 11 of the Electricity (Supply) Act 1927, and of section 17(2) of the Gas Act 1976. The latter repeals are proposed on the grounds that they are obsolete provisions which have been superseded by more up-to-date provisions.
This Bill is an important measure in delivering on our targets for energy efficiency. Furthermore, the Bill's safety provisions will deliver benefits to consumers and to the public in general. I look forward to working closely with the regulator on ensuring the speedy implementation of the Bill's provisions, following enactment.