A Bill to Make provision about sustainable aviation fuel.
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This is not the latest version of the Bill
Available Versions
| Date | Debate |
|---|---|
| Wednesday 15th October 2025 | Report stage |
| Date | Debate |
|---|---|
| Tuesday 15th July 2025 | Committee stage: 2nd sitting |
| Tuesday 15th July 2025 | Committee stage: 1st sitting |
Relevant Documents
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Page 1
Revenue certainty contracts
Source Bill 240 EN 2024-25
33. This clause enables the Secretary of State to direct a designated counterparty to enter into a revenue certainty contract with a SAF producer on terms determined by the Secretary of State. In addition to setting out the terms of the revenue certainty contract, a direction must be in writing and contain the information set out in subsection (4). The period during which the Secretary of State may direct the designated counterparty is initially limited to 10 years under subsection (5), but that period may be extend by regulations made under subsection (6).
34. Subsection (2) defines “revenue certainty contract” as a contract that provides for payments between the designated counterparty and the SAF producer: when the strike price is higher than the market reference price, the counterparty will pay the difference to the SAF producer; when the market reference price is higher than the strike price the SAF producer will pay the difference to the counterparty. Definitions of “market reference price" and "strike price” are set out in subsection (3).
Page 2
Source Bill 240 EN 2024-25
35. Where the Secretary of State directs the designated counterparty to enter into a revenue certainty contract with a SAF producer, this clause requires the Secretary of State to provide the SAF producer with a copy of the direction. This clause also enables the Secretary of State to revoke a direction to enter into a revenue certainty contract by giving written notice to the designated counterparty and the SAF producer.
Source Bill 240 EN 2024-25
36. This clause enables the Secretary of State to make regulations requiring the designated counterparty to maintain a register of revenue certainty contracts and setting out the information that the counterparty must be include in the register. It also enables the Secretary of State to make regulations requiring the counterparty to publish revenue certainty contracts, subject to any redactions permitted by the regulations.
Designated counterparty
Source Bill 240 EN 2024-25
37. This clause enables the Secretary of State to designate a company wholly owned by the government, with their consent, to be the counterparty for revenue certainty contracts. The counterparty enters into revenue certainty contracts on the direction of the Secretary of State (clause 1) and is responsible for performing contractual obligations under those contracts.
38. The Secretary of State may revoke a designation by giving notice to the designated counterparty but must designate a new counterparty to ensure one is always in place. The counterparty may withdraw its consent to a designation by giving notice but remains the counterparty until the Secretary of State has designated a replacement.
Page 3
Source Bill 240 EN 2024-25
39. This clause enables the Secretary of State to make schemes transferring property, rights or liabilities of a company whose designation has been revoked to the new designated counterparty. This may prove necessary if, for some reason, it is no longer appropriate for the designated counterparty to continue as the counterparty. A scheme may provide for compensation to any person adversely affected by the scheme.
Page 4
Levy funding
Source Bill 240 EN 2024-25
40. This clause enables the Secretary of State to make regulations requiring relevant suppliers of aviation fuel to pay a levy to the counterparty (levy regulations) to meet the costs of the scheme. Costs include payments to the counterparty and other costs incurred by virtue of the Bill, including those incurred by the counterparty in administering the scheme.
41. Relevant suppliers of aviation fuel are those suppliers subject to an obligation to supply SAF under the 2024 Order (see section on Legal Background).
42. This clause also enables the Secretary of State to set out in regulations how the amount of the levy is to be determined and how it is to be paid by relevant suppliers of the aviation fuel. In particular, regulations may enable the counterparty to hold sums of account and require those suppliers to make payments on account. The Secretary of State must consult appropriate persons before making the regulations.
Page 5
Source Bill 240 EN 2024-25
43. This clause enables the levy regulations to require a person liable to pay the levy to provide financial collateral to the counterparty, as a financial security to ensure payment of the levy.
Source Bill 240 EN 2024-25
44. This clause makes provision for levy regulations to confer functions on the designated counterparty in connection with the administration and enforcement of levy regulations, including provision for resolving disputes.
Source Bill 240 EN 2024-25
45. This clause makes provision for the levy regulations to delegate to specified persons anything which is to be calculated or determined under the levy regulations.
Surpluses
Source Bill 240 EN 2024-25
46. This clause enables the Secretary of State to make regulations to require the designated counterparty to make payments of any surplus to suppliers of aviation fuel who have paid the levy and how the surplus and payments are to be determined. A surplus may arise where the SAF producers are making payments to the counterparty when the market reference price exceeds the strike price.
47. This clause also provides that regulations may require suppliers who receive such payment to ensure their customers will receive such benefits from the payment in accordance with those regulations.
48. Subsection (4) requires the Secretary of State to consult Welsh Ministers, Scottish Ministers, the Department for the Economy in Northern Ireland and any other persons the Secretary of State considers appropriate before making such regulations.
Page 6
Financial penalties
Source Bill 240 EN 2024-25
49. This clause enables the Secretary of State to enforce certain provisions under the Bill by imposing financial penalties. The Secretary of State may impose a financial penalty on a person that fails to comply with levy regulations or fails to comply with requirements under regulations made under clause 10. The amount of such a penalty must not exceed the lesser of £100,000 or an amount equal to 10% of a person's turnover. The procedures for issuing, appealing and recovering a financial penalty are set out in the Schedule, and all penalties received must be paid into the Consolidated Fund. Regulations may increase the maximum penalty amount in line with inflation and set out how a person's turnover is determined.
Page 7
Directions, information and advice
Source Bill 240 EN 2024-25
50. Subsection (1) allows the Secretary of State to give the counterparty directions as to the exercise of its functions under this Act. The directions must be published by the Secretary of State.
Source Bill 240 EN 2024-25
51. This clause requires the counterparty to comply with a requirement imposed by the Secretary of State to provide information or advice to the Secretary of State in connection with the exercise of its functions under the Bill. It is not intended to require the counterparty to provide information that would breach their common law duty of confidence.
Financial assistance
Source Bill 240 EN 2024-25
52. This clause allows the Secretary of State to provide financial assistance (in any form) to the counterparty, subject to any conditions considered appropriate by the Secretary of State. The intention of the clause is to enable the Secretary of State to support the designated counterparty financially to ensure that it is able to meet its liabilities under the revenue certainty contracts and effectively administer those contracts.
General
Source Bill 240 EN 2024-25
53. This section provides that regulations are to be made by statutory instrument and that they may make different provision for different purposes and supplementary, incidental, transitional or saving provision. Subsection (3) and (4) set out the Parliamentary procedure to followed for regulations under the Bill, which will follow either the negative resolution Parliamentary procedure or the affirmative resolution Parliamentary procedure. Regulations made under the negative resolution Parliamentary procedure are subject to annulment in pursuance of a resolution of either House of Parliament. Where regulations are subject to the affirmative resolution Parliamentary procedure, a draft of the regulations must be laid before Parliament and approved by a resolution of each House of Parliament.
Page 8
Source Bill 240 EN 2024-25
54. This clause provides information on how terms which are used throughout the Bill should be interpreted in the Bill.
Source Bill 240 EN 2024-25
55. This clause is self-explanatory
Source Bill 240 EN 2024-25
56. This clause sets out when the provisions of the Bill come into force. Clause 1 comes into force at the end of the period of two months beginning on the day that the Bill is passed. The remaining provisions of the Bill come into force on the day on which the Bill is passed.
Source Bill 240 EN 2024-25
57. This clause is self-explanatory.
Page 9
Source Bill 240 EN 2024-25
58. This schedule makes further provision in connection with financial penalties under clause 11. This includes how the Secretary of State must notify a person before imposing a financial penalty, that person's right to appeal and make representations, how the Secretary of State issues a final notice, how unpaid financial penalties are recovered and that any sums received must be paid into the Consolidated Fund.
Financial penalties for failure to comply with levy regulations
Introduction
Notices of intent
Right to make representations
Final notices
Page 10
Appeals
Recovery
Payment of proceeds into Consolidated Fund
No amendments available.