Generous financial incentives announced for domestic households to switch to renewable heating
The details of the long awaited domestic Renewable Heat Incentive (RHI) were announced by the UK Government on 12 July 2013 (subject to state aid and parliamentary approval).
What is the Domestic Renewable Heat Incentive?
- The domestic RHI is a UK Government financial support scheme for renewable heat, targeted at, but not limited to, off gas grid households.
- The domestic RHI scheme covers England, Wales and Scotland only
When will it start?
- The Department for Energy & Climate Change (DECC) intend that the scheme will open to applications in Spring 2014 and will be administered by The Office for Gas and Electricity Markets (Ofgem)
- Ofgem guidance will be available before the launch of the scheme on how to apply and the information that will need to be provided
- In the meantime, the current one off payment scheme called the Renewable Heat Premium Payment (RHPP) will still be paid up until March 2014.
Who is eligible?
Payments will apply to single domestic dwellings and will be open to:
- Private landlords
- Registered Providers of Social Housing
- Third party owners of heating systems
It will not be open to new build properties other than self-build.
- It will be open to anyone in these groups who installed an eligible technology since 15th July 2009, provided they met the scheme criteria
- For those who have installed a renewable heating system before the launch of the scheme in Spring 2014 and since 15 July 2009 (legacy applications).
What renewable heating technologies will the payments cover?
The scheme will support:
- air source heat pumps (ASHP)
- biomass systems
- ground source heat pumps (GSHP)
- solar thermal technologies.
How much will I get?
- The financial support will be paid at a set rate per unit of renewable heat produced (kilowatt hour or kWh), for seven years, to the owner of the heating system.
- The support payments vary depending on the technology installed:
|Tariff (pence per kWh)||
- For biomass, the renewable heat generated will be based on an estimated figure of heat demand from an Energy Performance Certificate (EPC).
- For heat pumps, the renewable heat generated will be based on an estimate of the heat demand from an EPC combined with an estimate of the heat pump’s efficiency.
- For solar thermal systems, the renewable heat generated will be based on the estimate of system performance completed as part of an Microgeneration Certification Scheme (MCS) installation.
- To help improve performance of renewable heating systems, there will be an extra incentive for applicants who install metering and monitoring service packages, of £230 per year for heat pumps and £200 per year for biomass boilers.
Other things to consider:
- To be eligible the system must be certified under the Microgeneration Certification Scheme (MCS) scheme and meet relevant standards for each technology, including limits on harmful emissions for biomass systems
- Legacy biomass installations, installed between 15th July 2009 and the launch of the scheme in Spring 2014, will not need to meet the emissions limits requirement.
- All applicants are required to complete a Green Deal Assessment (GDA) before applying and to ensure they meet minimum energy efficiency requirements of loft and cavity insulation where required by the GDA
- Any public grants previously received, including RHPP, will be deducted to avoid a double subsidy
- Tariffs will change annually in line with the Retail Price Index (RPI)
- DECC intend to introduce a system of degression to control the costs of the scheme. This is where tariffs are reduced over time for new applications to the scheme.Those who have already secured their tariff will not have their tariff reduced due to cost control. DECC will announce further details on the cost control policy in Autumn 2013.
To find out more about how the RHI could benefit you, or for expert advice on renewable energy solutions for your home, school or business can help to reduce your energy costs, call us on 0845 371 3181 or find your nearest branch.