The Gas and Electricity Markets Authority v Infinis Plc & Infinis (Re-Gen) Ltd & Anor

For exclusion from accreditation under the Renewables Obligation Order 2006 and Renewables Obligation Order 2009, the relevant qualifying or NFFO arrangement must remain extant and provide for the building of a generating station. A surviving obligation to commission a facility does not preserve a separate installation obligation that has ceased to have force and effect. Contractual headings cannot displace the ordinary meaning of operative words such as install. The statutory background may inform construction but cannot create obligations absent from the surviving agreement. A statutory entitlement to accreditation is a pecuniary benefit and a legitimate expectation protected as a possession under Article 1 of the First Protocol; a legal provision alone suffices. Where unlawful refusal causes readily calculable pecuniary loss, restitutio in integrum is ordinarily appropriate.

The Authority refused Infinis accreditation and Renewables Obligation Certificates for the Candles and Welbeck landfill-gas generating stations under the 2006 and 2009 Orders. Lindblom J quashed the decision, ordered accreditation and the issue of certificates, and awarded £94,393.62 under Article 1 of the First Protocol.

The Authority appealed. The principal issue was whether the Replacement Power Purchase Agreements remained extant arrangements providing for the building of a generating station after clause 2.3 rendered them of no force and effect, except for specified provisions. Further issues concerned the protection of Infinis’s statutory entitlement under Article 1 and the appropriate measure of just satisfaction.

1. Appeal dismissed. The exclusion provisions in the Renewables Obligation Order 2006 and the Renewables Obligation Order 2009 required an extant qualifying or NFFO arrangement which provided for the building of a generating station at the specified location.
2. On the proper construction of the RPPAs, clause 3.5 imposed a distinct obligation to use Reasonable Endeavours to install the Facility. In this context, the Facility was the generating station. The ordinary meaning of install was decisive. Clause 3 was not confined to post-commissioning operation, and its heading was for convenience only.
3. Clause 2.3 made the RPPAs of no force and effect, apart from specified clauses, when the relevant conditions were not fulfilled within the agreed period. Clause 3.5 therefore ceased to have effect. It could not be impliedly continued as part of clause 2.4’s separate obligation to procure commissioning. The surviving provisions did not provide for the building of a generating station, so the exclusions did not apply.
4. The statutory background, including section 32 of the Electricity Act 1989, sections 62 and 67 of the Utilities Act 2000, article 4 of the Electricity (Non-Fossil Fuel Sources) (England and Wales) Order 1998 and article 4 of the Electricity from Non-Fossil Fuel Sources Saving Arrangements Order 2000, informed but did not alter that construction. Article 4(1) concerned the period before the Contract Term while conditions precedent remained capable of satisfaction. Article 4(2) did not apply because the RPPAs had not been terminated under clause 15. The statutory scheme imposed no obligation to secure replacement capacity merely because secured capacity later became unavailable; it imposed an obligation not to frustrate the arrangements.
5. The Authority’s concession before the judge was correct. Infinis’s statutory right to accreditation was a pecuniary benefit and a legitimate expectation founded on a legal provision. Under Kopecky v Slovakia (2005) 41 EHRR 43, a legal provision alone was sufficient; a judicial decision confirming the entitlement was unnecessary. Applying Anufrijeva v Southwark LBC [2004] QB 1124, restitutio in integrum was appropriate because the loss was significant and readily calculable. The award of £94,393.62 was upheld.

1. Court of Appeal (Civil Division) dismissed the Authority’s appeal and upheld the substantive relief and just-satisfaction award.
2. Administrative Court, Lindblom J, in [2011] EWHC 1873 (Admin) , quashed the Authority’s refusal of accreditation, ordered accreditation and the issue of Renewables Obligation Certificates, and awarded £94,393.62 under Article 1 of the First Protocol.