Marine Scotland – Licensing Operations Team (MS-LOT) performs functions under Chapter 3 of the Energy Act 2004 on behalf of the Scottish Ministers to recommend approval or rejection of Decommissioning Programmes within Scottish inshore or offshore waters.
A Decommissioning Programme is a detailed document which outlines measures that an operator will take in order to remove a relevant object from the sea. A relevant object is defined as an offshore renewable energy installation or a related electric line. A Decommissioning Programme should be submitted to MS-LOT and approved by the Scottish Ministers prior to the construction of a relevant object. All infrastructure that is part of a relevant object should be fully removed unless compelling evidence (which must be in line with the current guidance) not to remove has been provided.
The requirement to prepare a Decommissioning Programme comes from s.105 of the Energy Act 2004 and begins when the person responsible for a relevant object (the responsible person) has been issued with a notice under that section, referred to as a s.105 notice, by MS-LOT. A s.105 notice may only be issued if the Scottish Ministers are satisfied that at least one of the statutory consents required to construct the proposed works has been granted, or has been applied for and is likely to be granted.
S.105 notices require the recipient to submit a draft Decommissioning Programme to MS-LOT for review. MS-LOT will then direct the recipient to consult with relevant stakeholders, as outlined in the S.105 notice. All representations must be addressed, and the Decommissioning Programme updated where necessary, prior to the submission of a final Decommissioning Programme to MS-LOT for approval.
During the approval process for Decommissioning Programmes, MS-LOT will commission a financial sustainability assessment to ensure that the provider of a financial security for a Decommissioning Programme has the capability to do so. MS-LOT will utilise powers available to the Scottish Ministers under s.112A of the Energy Act 2004 to request relevant financial information in order to inform this assessment. A notice issued under s.112A must be complied with.
Further guidance on decommissioning programmes
No statutory timescales apply for the approval or rejection of a Decommissioning Programme. Full approval could take up to 18 months but, as a guide, each stage of approval has the following timescales:
MS-LOT review of draft Decommissioning Programme
No set timescale. Any representations made at this stage must be addressed before consultation.
Consultation carried out by responsible person
Timescale = 30 days. MS-LOT will direct the responsible person to consult with relevant stakeholders, as outlined in the s. 105 notice. The Decommissioning Programme should be made publicly available during this period on the responsible person’s website.
MS-LOT consults other government departments and Crown Estate Scotland
Timescale = 30 days. MS-LOT aims to carry out internal consultation at the same time as the responsible person carries out consultation with stakeholders. Meeting this timescale will require all financial information to be submitted.
Responsible person undertakes gap analysis and updates the Decommissioning Programme following consultation
Timescale dependent on the responsible person and complexity of representations made during consultation. MS-LOT expects the final submitted Decommissioning Programme to have addressed all representations made.
Timescale = three months.
Scottish Ministers come to a decision on whether to approve or reject the Decommissioning Programme
No set timescale but can be dependent on the scale and complexity of the Decommissioning Programme.
Decommissioning Programme reviews
The provisions of the Energy Act require the Scottish Ministers to review approved Decommissioning Programmes from time to time. For projects proposed for 15 years or more, the following review points should be assumed as a minimum:
Within one year of completion of construction
Post-construction report must be provided to MS-LOT, which should outline the following:
- summaries of issues raised during construction which may impact on the eventual decommissioning methods and costs
12 to 18 months before first security provision is due
To identify any changes in assumptions on costs and risks where these might affect the size or timings of financial securities.
From payment of first security onward on an annual basis
The responsible person should review their Decommissioning Programme to make sure the financial security provision is on track to meet the expected costs of decommissioning.
Any revisions to a Decommissioning Programme resulting from changes in costs, securities or environmental issues must be submitted to MS-LOT for approval.
3 years in advance of decommissioning
The responsible person should start consultation on the Environmental Impact Assessment that will inform the actual decommissioning.
2 years in advance of decommissioning
A final and comprehensive review of the Decommissioning Programme should be conducted. During this period the operator should consider whether they would require a separate marine licence to carry out the decommissioning works on the relevant object.
Review periods for shorter term projects will be considered on a case-by-case basis. However, for all projects exceeding 12 months, the Scottish Ministers would expect a report/summary of issues discovered during construction which might impact on the decommissioning (this should be provided within six months of completion of construction for the Scottish Ministers to review), and a review prior to the actual decommissioning of the installation, to finalise the decommissioning measures envisaged.
For all projects, the Scottish Ministers reserve the right to require reviews and if necessary modify programmes if significant unexpected events occur (this list is not exhaustive but examples include: changes to the timings of financial securities might be required in the event of a significant failure in performance of the infrastructure, a change in ownership or a significant change in the financial position of the company).
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