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Page 30, line 37, at end insert:
("and in the case of an assignment other than a general assignment, modification conditions may make as respects so much of the licence as is proposed to be retained by the assignor provision different from that made as respects so much of the licence as is proposed to be assigned").

28 Jun 1995 : Column 805

The noble Earl said: In moving Amendment No. 96B, I shall speak also to Amendment No. 96C. These are drafting amendments which clarify an existing provision. I beg to move.

On Question, amendment agreed to.

Earl Ferrers moved Amendment No. 96C:


Page 31, leave out lines 18 to 20.

On Question, amendment agreed to.

Lord Haskel moved Amendment No. 97:


Page 31, leave out lines 36 and 37 and insert:
("(a) to establish and maintain an efficient and economical system for the conveyance of gas by—
(i) using his existing pipe-line system within the area;
(ii) identifying and linking with the pipe-line systems of other public gas transporters within the area; and
(iii) subject to section 20 below, constructing new pipe-lines;").

The noble Lord said: In moving Amendment No. 96C, I shall speak also to Amendment No. 110. The amendments are grouped with Amendment No. 111, which stands in the name of the Minister. I am not sure whether I am the right person to speak to it.

The provisions in Amendments Nos. 97 and 110 were brought to our attention by the Country Landowners' Association. That may give some comfort to Members of the Committee opposite. It is unusual for the Labour Party to support amendments from that source but they relate to a sensible environmental matter.

The purpose of Amendment No. 97 is to restrict the proliferation of new pipes where pipelines already exist and there is capacity within them for the conveyancing of gas to meet the needs of other gas suppliers and gas shippers. For existing or new capacity to be used only in part is wasteful, expensive and, to a considerable extent where the new works affect the environment and farming, it is disruptive.

Each transporter does not need to have a complete system under his control. He should contribute as necessary to an integrated system for the shipping of gas and link up with other tranporters where necessary. The creation of a separate system will require investment, cause environmental harm and, through the duplication, conflict with the principles of sustainability, to which the Government subscribe.

In another place, the Government stated that they were drafting regulations for an environmental impact assessment in such cases. Has that been done? I beg to move.

Earl Ferrers: The noble Lord, Lord Haskel, said that he would speak to Amendments Nos. 97 and 110 but that he did not feel that he ought to speak to Amendment No. 111. He is very modest. I should have been entirely happy had he done so. However, as he did not do so I shall do so myself.

The noble Lord said that the amendments were suggested by the Country Landowners' Association, which he thought might be of interest to some Members of the Committee on this side of the Chamber. Perhaps I should declare an interest, and also do so on behalf of my noble friend Lord Inglewood, as we both happen to be members of the Country Landowners' Association.

28 Jun 1995 : Column 806

However, as the noble Lord will see, that has not had too much influence on my views on the amendment, so I cannot be accused of being biased in favour of an association of which I happen to be a member.

The duty on public gas transporters to develop and maintain an efficient and economical system for the conveyance of gas is carried forward (with consequential changes) from the 1986 Act. To specify certain ways in which that duty is to be performed could detract from, rather than improve, its effectiveness. We propose to enhance the duty for a public gas transporter to consult when he is proposing to construct a pipeline in another public gas transporter's authorised area. That is set out in Amendment No. 111. There are already regulatory powers to force interconnection between the pipelines of public gas transporters in certain specific cases. Those are in Section 21 of the 1986 Act.

In addition, as my noble friend Lord Inglewood said on 22nd June, regulations are being brought forward which would require an environmental impact assessment to be carried out before pipes above a certain size can be built; and standard condition 6 of the public gas transporter licence puts in place procedures to deal with the routing of high pressure pipelines. The necessary steps in these important areas are therefore dealt with.

Commercial pressures will in themselves ensure that pipelines will not be built unless there is a need for them. Laying a pipe is, after all, an expensive business, and a public gas transporter will not make money out of his pipe unless shippers and suppliers use it to get gas to customers. A public gas transporter will therefore have to ensure that there is a real need for a pipeline before he proceeds to lay one.

In reviewing price controls, the Director General of Gas Supply may well take a dim view of pipelines built by public gas transporters but which were not properly utilised without a reasonable excuse. No further involvement by the director is called for.

As for the proposal in Amendment No. 110 to insert a new Section 20, I should explain that Section 20 in the 1986 Act was designed to address the problem of a public gas supplier who sized his pipelines too small to carry gas for other people. Public gas transporters, who make their money from carrying gas for others, will never have an incentive to act in that way. That is why Section 20 serves no useful purpose in the new regime and is to be repealed.

Amendment No. 111 has been drafted in response to concern expressed by some people hoping to become independent public gas transporters about the need for transporters to co-operate where pipes may be laid, for instance, in the same street. It will oblige a public gas transporter wishing to lay pipelines in the authorised area of another public gas transporter, to consult the incumbent about the precise location of the pipes.

I believe that that is reasonable, and I hope that it meets the concerns of the noble Lord, Lord Haskel. I hope that he will consider that that is the best way forward.

Lord Haskel: I thank the Minister for that response. I was not sure from his response whether the regulations covering environmental impact assessment are or are not in place.

Earl Ferrers: They are being brought forward.

28 Jun 1995 : Column 807

Lord Haskel: I thank the Minister for that information. When they are available we shall consider them.

I thank the Minister for pointing out that his Amendment No. 111 covers some of the points raised in my amendment. Bearing that in mind, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Ezra moved Amendment No. 97A:


Page 31, line 41, at end insert ("; and
(c) subject to paragraph (a) above and safety requirements, to minimise charges for connections to that system; and
(d) to provide on request to the Director and to the Council in pursuance of a representation under section 32 of this Act, a statement as to the costs to him to comply with any reasonable request in paragraph (b) above.").

The noble Lord said: Amendment No. 97A deals with the charges that can be made for gas connections. It would follow on from Section 9(1) (b) on page 31 of the Bill, which includes among the powers and duties of public gas transporters that, so far as it is economical to do so, they should comply with any reasonable request to connect their system to any premises. That does not go far enough because it is obviously necessary that such connections should be made at minimal cost. The amendment therefore makes that point.

The gas transporter should not be in a position to charge prohibitively if, for whatever reason, he did not want to make a connection. That has been known to happen. We need an assurance that connections will be made at minimal cost and that the cost of such connections will be kept down as far as possible. Furthermore, it is desirable that the details of those costs should be made known to the regulator and to the Gas Consumers Council if required.

I am sure that the Committee will agree that with a natural product as important as gas, which brings benefits to millions in this country, those who are unfortunate enough to live in areas not yet connected should be given every opportunity for connection and that they should not be inhibited from being connected by charges which could, in certain circumstances, be unjustified.

Therefore, the purpose of the amendment is to ensure that there will be a duty to provide connections at minimal charges and that that would, if necessary, have to be demonstrated to the regulator and to the Gas Consumers Council. I beg to move.

Lord Clinton-Davis: I rise to support the amendment ably moved by the noble Lord, Lord Ezra. We believe that it is conducive to the interests of consumers that the two elements that he seeks to introduce into the Bill should be properly regarded statutorily. In my judgment, the noble Lord is right to recognise that some consumers, particularly those living in remote areas where there may be no great attraction in installing gas supplies, may well be vulnerable to high charges. Consequently, a provision requiring minimal cost to be one of the considerations, and above all transparency, should be invoked and included in the Bill.

My landlord and tenant law is very rusty these days. But in the recesses of my mind, I believe that a landlord who imposes service charges in respect of services carried out on behalf of tenants is required to offer that degree of transparency we are now contemplating in relation to this

28 Jun 1995 : Column 808

Bill. Certainly, so far as I can recall, a tenant is entitled to details of the service charges. I cannot recall whether that information should come from the landlord in the first instance or whether it is made available on request. However, the principle is clear. It should be clear here as well. This is a serious omission from the Bill. I hope that the Minister will say that there is absolutely no reason why the omission should not be rectified.

6.30 p.m.

Earl Ferrers: The noble Lord, Lord Clinton-Davis, almost always asks for the impossible and I would love to grant him the impossible. However, when I explain the position to him, I believe that he will realise that my natural desire to assist him is there, even though I cannot actually accept the proposal of the noble Lord, Lord Ezra. I understand and share the desire that the costs of making connections to new customers should be as low as possible. I agree that the principles upon which the connection charges are made should be, as the noble Lord, Lord Clinton-Davis, said, clear and transparent. However, I believe that that is already provided for in the Bill, in the licences and, indeed, in the 1986 Act.


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