ELIZABETH II

Decarbonisation Act 2020

2020 CHAPTER 22

An Act to bring about the full decarbonisation of the British economy by 2045 through the use of an energy market, nuclear energy, renewable energy, and sustainable transport, while ensuring that displaced workers are able to transition into new jobs or retirement.
Changelog
Bill ID LB017
Author(s) The Rt Hon Dustin Crowe cbe pc, 3rd Baron Strathclyde
The Rt Hon Michal Delvoski pc, 1st Baron Hove
(on behalf of HM Government VIII)
Amended by The Rt Hon Michal Devolski pc, 1st Baron Hove
First reading 2020 September 11
Royal assent 2020 November 14
Commencement 2021 March 1
Affected legislation N/A

1 Decarbonisation Timeline

  1. The United Kingdom will reduce its carbon emissions by 80% by 2035 and become carbon neutral by 2045.

2 Energy Market

  1. All mentions of "The National Grid" in this bill refer to the National Grid plc or any successor company, which is to say, a company who operates the electric infrastructure of the United Kingdom.
  2. A Power Station Group is defined as any number of power stations more than one, of the same design, that are owned by the same company or group of investors.
  3. An electricity supplier is defined as a company that sells electricity directly to the public and has been approved by the government as a public electricity supplier.
  4. A carbon credit is defined as an emission allowance to emit 1 tonne of CO2 or equivalent, under the European Union Emissions Trading Scheme.
  5. Renewable energy is defined as energy that is collected from renewable resources, which are naturally replenished on a human timescale, such as sunlight and wind.
  6. The National Grid, under instruction from the government, must set up an energy market where power stations or power stations groups are able to sell electricity at a price they wish. Electricity suppliers are able to buy the power generated at the price sold plus a 5% commission which goes to the national grid to pay for electricity infrastructure.
  7. This energy market system will be electronic and build off current national grid infrastructure to automatically accept power from generators that have been paid.
  8. In case of a cyberattack on the network, manual operation will take over the electrical systems and for that period of time, no supplier or provider is paid until the attack is over.
  9. The electronic market system will be developed by the National Grid alongside GCHQ, MI5 and Defence Intelligence to reduce the chance that a successful espionage attack could occur on the network.
  10. The National Grid and the government are to keep records of all transactions between energy providers and energy suppliers for up to 1 year.
  11. The National Grid, in this new energy market, is able to:
    1. Take the previously mentioned 5% commission on every energy sale.
    2. Stop the sale of any electricity by a power station or power station group if that producer is found to have breached any working or safety practices created by the Department for Business, Energy & Industrial Strategy.
    3. Stop the sale of any electricity by a power station or power station group if that producer is found to not have enough carbon credits to cover the amount of carbon dioxide they are producing.
    4. Pay an electricity generator 95% of their sale cost of electricity to have the power plant run in standby mode when the grid may experience spikes in electricity usage. If electricity suppliers do use this excess power, they will have to pay the national grid the cost of that electricity.
    5. Add an additional charge to any sale of electricity, either for carbon taxing or for the flat charge mechanism. The revenue from this additional charge will be given to the treasury.

3 Electricity Carbon Taxing

  1. Any power plant that generates Carbon Dioxide will have a carbon tax added to their electricity sale price by the National Grid, on behalf of the Government.
  2. This carbon tax will be equivalent to £40 per tonne of CO2 generated and the exact price of the carbon tax will be set by the Department for Business, Energy & Industrial Strategy.
  3. The Department for Business, Energy & Industrial Strategy must also create a 2035 carbon tax value. This value is what the department believes the tax should be in the year 2035. The carbon tax value will automatically increase by a linear amount each year so that the carbon tax is the same as the 2035 carbon tax value in the year 2035.
  4. The Department for Business, Energy & Industrial Strategy has the right to change the 2035 carbon tax value at any time in order to keep pricing fair for the consumer or to reduce carbon emissions.

4 Flat Charge Mechanism

  1. In the event that a power station or power station group is selling electricity at a price lower than the flat charge, the National Grid will impose an extra charge on the sale to bring it up to the value of the flat charge. This extra money is collected on behalf of the government.
  2. The flat charge will start at 14.4 pence per kilowatt hour and can be changed at any time by the Department for Business, Energy & Industrial Strategy.
  3. The flat charge shall never be increased by more than 1 penny per kilowatt hour in a single financial year.

5 Government Nuclear Programme

  1. Upon the passage of this bill the government should search for 5 sites for nuclear power plants, to be determined in consultation with the relevant devolved governments and local authorities.
  2. The Department for Business, Energy & Industrial Strategy shall purchase all the sites recommended with the intention to build nuclear power plants for UK energy generation.
  3. Four of these sites will contain 4 pressurised water reactors. The UK Atomic Energy Authority will provide recommendations on reactor design either from other companies or from the UK’s own inhouse reactor development.
  4. Construction of these reactors will be scheduled to start in 2022 with the aim of having all sites finished by 2035 or sooner.
  5. All sites will be policed by the civil nuclear constabulary.
  6. Any other locations needed for nuclear waste reprocessing, fuel enrichment, or any other function directly related to the new power plants will be constructed by the government within the same time frame as the reactors.
  7. The government will be able to sell the energy generated from these plants to the National Grid to help its stability. The price of such electricity will be either a break even cost for the government or the median cost of all renewable energy being sold at the present time on the market.
  8. The fifth Nuclear site will have one Pressurised water reactor with the rest of the space being used for the development of other nuclear power plants which the UK may adopt in the future, in particular thorium reactors and Helium or Sodium cooled reactors. This research will be undertaken by the UK Atomic Energy Authority.

6 Renewable Energy

  1. All funding policies meant to promote the production, importation, or use of fossil fuels by the government shall be ended, with funding reallocated at the discretion of the Department for Business, Energy, and Industrial Strategy towards research and development into renewable energy technologies and the installation of renewable energy generating capacity.
  2. A microgeneration grant shall be established under the administration of the Department for Business, Energy, and Industrial Strategy which will provide grants of up to 4000 pounds to support the installation of small-scale renewable energy generation capacity on residential and office buildings
    1. For residential installation, buildings must be owned by the individual seeking the grant and may only be approved after an inspection by local officials determines that the building the grant is being sought for is able to generate at least enough electricity to power the entire building
      1. Businesses which apply must employ a total of less than 200 workers to be eligible to receive the grant, in addition to meeting the requirements for residential installation

7 Sustainable Transport

  1. A Sustainable Transport Fund shall be established under the administration of the Department for Transport which will provide funding to projects meant to decarbonise the transport sector.
    1. Projects included in this include the adoption of electric buses, the creation of bus lanes, the creation of bike lanes or paths, the installation of charging ports for electric vehicles, the construction or expansion of light rail systems, and the construction or expansion of heavy rail systems.
    2. The Sustainable Transport Fund shall be funded at a rate of 2 billion pounds per year.
      1. Devolved government and local authorities may make applications to the Department for Transport to receive funding from the Sustainable Transport Fund for specified projects.
  2. A series of seed grants shall be made available to electric vehicle developers within the next five years.
  3. Each resident of the United Kingdom of at least 14 years of age shall be eligible for a grant of up to 500 pounds to encourage the purchase of electric bicycles.

8 Worker Displacement

  1. The Department for Work and Pensions is tasked with creating a programme which will provide the following services in support of workers who lose their jobs due to the ecological transition.
    1. Substantial skills-based training in sectors and positions that have growing demand.
    2. Full income supplementation for the period covering the training programme and six months after.
    3. Employer-based pensions of displaced workers will be guaranteed by the state in full.
    4. Workers who are 58 years of age or older will be given the option for early retirement with full access to income supplementation for a period of one year in addition to having early access to state and employer-based pensions.
    5. Participation in the programmes outlined in this section will be offered automatically to workers once they are reported to have lost their jobs.
  2. In industries that the Department for Business, Energy, and Industrial Strategy identifies as being put at risk of contraction or extinction by the ecological transition, employers shall be required to provide notice of at least one month of any planned layoffs.
    1. Employers will be required to notify those workers subjected to layoffs as well as the Department for Work and Pensions.
    2. The obligations in this subsection will not apply in the event of a business shutting down completely.
  3. Workers identified as having been displaced by the ecological transition will be given priority for hiring on all projects authorized or funded under this act.
    1. The Department for Work and Pensions will be tasked with developing a criteria for determining which workers have been displaced by the ecological transition.

9 Short title and extent

  1. This Act may be cited as the Decarbonisation Act 2020.
  2. This Act extends to the entire United Kingdom of Great Britain and Northern Ireland.
  3. This Act extends to the United Kingdom of Great Britain and Northern Ireland.

10 Commencement

  1. This Act comes into force on the 1st of March, 2021.
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