UK: Energy Update - 4 June 2013

Last Updated: 12 June 2013
Article by Publications Field Fisher Waterhouse

Welcome to this edition of Field Fisher Waterhouse's Energy Update.  The last couple of weeks in the sector has seen the European Commission spring surprise inspections on several companies in the sector, reform of the UK competition regime and an Ofgem consultation on the proposed scope and review of a review of interest during construction (IDC) for the offshore transmission and interconnector regulatory regime. In addition a report has been issued by the UK government's Climate Change Committee on the future electricity market.

EC energy price-fixing probe

The European Commission has begun an investigation into the possible manipulation of energy price benchmarks. Several companies in the energy sector had surprise inspections carried out by the European Commission for alleged infringement of European antitrust law, namely the manipulation of the reference price for oil and bio fuel products. This investigation will most likely have very significant implications for the whole oil industry and its customers as well as the any banks, trading houses, utilities or major users who buy oil products or trade oil based commodities. The effects of the investigation will not be limited to Europe.

Decisions taken in the early stages of a cartel investigation or immediately upon discovering evidence of wrongdoing can have very significant consequences.  The cost of non-compliance including financial penalties, litigation, reputational damage, and unenforceable agreements can be so great that identifying and assessing competition compliance risk factors is business critical. Please consider if you have contacts in your company or clients that might be interested in our services. We have excellent competition law and energy teams in Europe and the US that can address any issues your company or clients may have in this context.

For more information click here

Reform of the UK Competition Regime – The competition provisions of the Enterprise and Regulatory Reform Act

The Enterprise and Regulatory Reform Bill received Royal Assent on 25 April 2013. The changes brought on by the Enterprise and Regulatory Reform Act (the "Act") are wide ranging. It is possibly the single most substantive reform of UK's competition regime. The Act is expected to fully come into force by April 2014.

For our article summarising the reform please click here

Ofgem consults on the review of interest during construction for interconnectors and offshore electricity transmission and interconnectors

On 24 May 2013, Ofgem issued a consultation on the proposed scope and review of a review of interest during construction (IDC) for the offshore transmission and interconnector regulatory regime.

IDC is the allowance for the cost of financing the development and construction of electricity transmission assets. An allowance, in the form of an explicit or implicit rate, is provided for IDC by Ofgem in all three electricity transmission regulatory regimes: offshore transmission, regulated electricity interconnectors and onshore transmission.

For more information click here

How to save £100 billion

Chaired by Lord Debden, the UK government's Climate Change Committee has reported on future electricity market reform.  A key message is that energy from wind farms, nuclear power and other greener energy sources may be costly in the short term but could save the country up to £100 billion in the long run.  The report also recommends the introduction of long-term contracts, providing revenue certainty for low-carbon projects and which would be essential in making them financially viable.

For the full text of the report click here

Field Fisher Waterhouse obtains positive ECJ opinion for RWE Essent in Brussels
Our Brussels Energy team has recently obtained a positive opinion from the Advocate-General at the European Court of Justice (ECJ) for RWE Essent in a case relating to the circulation of electricity guarantees of origin and green certificates.  Advocate-General Yves Bot has ruled that regulators' decisions that refuse to accept guarantees of origin from other European Union (EU) member states for a quota obligation violate the principles of free circulation of goods within the EU.  It will depend on the ECJ's final decision as to how this opinion will affect the European trade of green certificates and guarantees of origin.
For further information please contact Energy Regulatory partner David Haverbeke

Field Fisher Waterhouse attends All Party Parliamentary Group for Unconventional Gas & Oil (APPG)

Field Fisher Waterhouse attended the inaugural meeting of this APPG, a government established advisory panel on all aspects of unconventional oil and gas exploration, development and potential impact.  The meeting was chaired by Dan Byles (MP) and there was a speech by Michael Fallon (MP) a minister at the Department for Energy and Climate Change (DECC).

The Government's message is that it is creating the framework to accelerate shale gas development in a responsible way. The Government's view is that fracking can resume with robust regulation in place and there is nothing stopping licensees from bringing on new exploration plans and engaging with local communities.  The British Geological Survey is currently examining whether the geological formations we have in the UK, which are similar to those in the US contain similar shale gas reserves to the US.
For more information on the APPG please click here

Is "Good faith" implied into English law commercial contracts in the energy sector?

A recent decision of the High Court seems to show a thawing of the traditional reluctance of English courts to imply "good faith" as a term in commercial contracts.  In Yam Seng Pte Ltd v International Trade Corp Ltd (2013) EWHC 111 (QB) a term of good faith and fair dealing based on the presumed intention of the parties was implied into a distributorship agreement for "Manchester United" fragrances and products.

While not a case focusing on the energy sector, the case has wide spread implications.  Many of those in the energy sector deal under English law contracts in overseas jurisdictions and this case therefore shows a softening of approach which brings English law more into line with the approach already adopted in the civil code systems of much of Europe.

To view the full text of the judgment (see particular paragraphs 119 to 154) please click here

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Publications Field Fisher Waterhouse
In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.