Section 56 — Finance Act 2014: Exclusion of incentivised electricity or heat generation activities

Exclusion of incentivised electricity or heat generation activities 56 1 ITA 2007 is amended as follows.

2 In section 192 ( EIS : meaning of “excluded activities”)—

a in subsection (1), omit the “and” at the end of paragraph (ka) and after that paragraph insert—

kb the subsidised generation of heat or subsidised production of gas or fuel, and , and b in subsection (2), omit the “and” at the end of paragraph (f) and after paragraph (g) insert , and h section 198B (subsidised generation of heat and subsidised production of gas or fuel).

3 In section 198A (excluded activities: subsidised generation or export of electricity)—

a for subsection (3) substitute— 3 The generation of electricity is “subsidised” if—

a a person receives a FIT subsidy in respect of the electricity generated, b a renewables obligation certificate is issued in connection with the generation of the electricity, or c a scheme established in a territory outside the United Kingdom, and corresponding to that set out in a renewables obligation order under section 32 of the Electricity Act 1989, operates to incentivise the generation of the electricity. , b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . c in subsection (9), at the end insert— “ renewables obligation certificate ” means a certificate issued under section 32B of the Electricity Act 1989 or Article 54 of the Energy (Northern Ireland) Order 2003.

4 After that section insert— Excluded activities: subsidised generation of heat and subsidised production of gas or fuel 198B 1 This section supplements section 192(1)(kb).

2 The generation of heat, or production of gas or fuel, is “subsidised” if a payment is made, or another incentive is given, under—

a a scheme established by regulations under section 100 of the Energy Act 2008 or section 113 of the Energy Act 2011 (renewable heat incentives), or b a similar scheme established in a territory outside the United Kingdom, in respect of the heat generated, or gas or fuel produced.

3 But the generation of heat, or production of gas or fuel, is not to be taken to fall within section 192(1)(kb) if Condition A or B is met.

4 Condition A is that the generation or production is carried on by—

a a community interest company, b a co-operative society, c a community benefit society, d a NI industrial and provident society, or e an SCE formed in accordance with Council Regulation ( on the Statute for a European Cooperative Society. EC ) No 1435/2003 5 Condition B is that the plant used for the generation of the heat, or production of the gas or fuel, relies wholly or mainly on anaerobic digestion.

6 Section 198A(9) (definitions) applies for the purposes of this section as for the purposes of section 198A.

5 In section 303 (VCTs: meaning of “excluded activities”)—

a in subsection (1), omit the “and” at the end of paragraph (ka) and after that paragraph insert—

kb the subsidised generation of heat or subsidised production of gas or fuel, and , and b in subsection (2), omit the “and” at the end of paragraph (f) and after paragraph (g) insert , and h section 309B (subsidised generation of heat and subsidised production of gas and fuel).

6 In section 309A (excluded activities: subsidised generation or export of electricity)—

a for subsection (3) substitute— 3 The generation of electricity is “subsidised” if—

a a person receives a FIT subsidy in respect of the electricity generated, b a renewables obligation certificate is issued in connection with the generation of the electricity, or c a scheme established in a territory outside the United Kingdom, and corresponding to that set out in a renewables obligation order under section 32 of the Electricity Act 1989, operates to incentivise the generation of the electricity. , b . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . c in subsection (9), at the end insert— “ renewables obligation certificate ” means a certificate issued under section 32B of the Electricity Act 1989 or Article 54 of the Energy (Northern Ireland) Order 2003.

7 After that section insert— Excluded activities: subsidised generation of heat and subsidised production of gas or fuel 309B 1 This section supplements section 303(1)(kb).

2 The generation of heat, or production of gas or fuel, is “subsidised” if a payment is made, or another incentive is given, under—

a a scheme established by regulations under section 100 of the Energy Act 2008 or section 113 of the Energy Act 2011 (renewable heat incentives), or b a similar scheme established in a territory outside the United Kingdom, in respect of the heat generated or gas or fuel produced.

3 But the generation of heat, or production of gas or fuel, is not to be taken to fall within section 303(1)(kb) if Condition A or B is met.

4 Condition A is that the generation or production is carried on by—

a a community interest company, b a co-operative society, c a community benefit society, d a NI industrial and provident society, or e an SCE formed in accordance with Council Regulation (EC) No 1435/2003 on the Statute for a European Cooperative Society.

5 Condition B is that the plant used for the generation of the heat, or production of the gas or fuel, relies wholly or mainly on anaerobic digestion.

6 Section 309A(9) (definitions) applies for the purposes of this section as for the purposes of section 309A.

8 The amendments made by subsections (2) to (4) have effect in relation to shares issued on or after the day on which this Act is passed.

9 The amendments made by subsections (5) to (7) have effect in relation to a relevant holding issued on or after the day on which this Act is passed.