DECC announces details of new domestic RHI

Householders could be paid hundreds of pounds a year for generating heat by solar thermal panels, biomass boilers and heat pumps under the new domestic phase of the Renewable Heat Incentive (RHI)
DECC announces details of new domestic RHI

UK Energy Minister Greg Barker has confirmed that the long-awaited domestic phase of the Renewable Heat Incentive (RHI) will be launched shortly. Mr Barker confirmed that householders signing up to the incentive scheme could receive hundreds of pounds per year for heat generated by renewable technology such as solar thermal panels, biomass boilers and heat pumps. The government’s announcement followed extensive consultation on how a financial incentive would work best for householders and takes into account lessons learned from the Renewable Heat Premium Payment grant scheme (RHPP) and the RHI non domestic scheme.

Tariff levels for the domestic RHI have been set at 7.3p per kilowatt hour (kWh) for air source heat pumps; 12.2p per kWh for biomass boilers, 18.8p per kWh for ground source heat pumps and 19.2 p per kWh for solar thermal. The scheme is designed to drive forward uptake of renewable heat technologies in homes across Great Britain to cut carbon, help meet renewables targets and save money on bills. The commercial phase of the scheme has been up and running since November 2011.

The Department of Energy and Climate Change (DECC) is currently finalising the details of the expansion of the non-domestic RHI scheme and will confirm the way forward in the autumn alongside the outcome of the tariff review. DECC’s aim is to introduce these changes from Spring 2014.

“The Coalition is committed to helping hardworking families with the cost of living” said Mr Barker. “Investing for the long term in new renewable heat technologies will mean cleaner energy and cheaper bills. So this package of measures is a big step forward in our drive to get innovative renewable heating kit in our homes. Householders can now invest in a range of exciting heating technologies knowing how much the tariff will be for different renewable heat technologies and benefit from the clean green heat produced. We are also sending a clear signal to industry that the Coalition is 110 percent committed to boosting and sustaining growth in this sector.”

The domestic RHI will be available to homeowners, private and social landlords, third-party owners of heating systems and people who build their own homes. Anyone who has installed a renewable heat technology since 15 July 2009 and meets the scheme eligibility criteria will be able to apply. Eligible technology includes air to water heat pumps, biomass only boilers and biomass pellet stoves with back boilers, ground and water source heat pumps and flat plate and evacuated tube solar thermal panels.

Payments under the scheme will be made on a quarterly basis for seven years with tariffs set at a level that reflects the expected cost of renewable heat generation over 20 years. In most cases, payments will be made based on estimated heat demand of the property but DECC will also offer an extra set payment of £230 per year where consumers take out metering and monitoring support packages for heat pumps and £200 for biomass boilers.

Applicants will need to complete a Green Deal Assessment before submitting their application and must ensure they have met minimum loft (250mm) and cavity wall insulation requirements, where appropriate. All installations and installers must be MCS certified (or certified by an equivalent scheme). MCS certified installers are currently required to be members of the Renewable Energy Consumer Code, which is backed by the Trading Standards Institute. Householders may be able to get help with the upfront costs of the renewable heating kit under the Government’s Green Deal which enables people to pay for energy efficiency improvements including renewable heating systems through savings on their energy bills. Householders will be able to take up Green Deal finance and claim the RHI payments and Money off vouchers are also available under the RHPP scheme. Householders who receive money under RHPP will have this amount deducted from any future RHI payments to avoid a double subsidy.

The scheme as a whole will be administered by Ofgem with more details on how to apply to be published in due course. Pre-application enquiries should be directed to the Energy Saving Advice Service on 0300 123 1234.

Further information:

Department of Energy and Climate Change (DECC)

Relevant informative documents concerning the RHI

Details on how to apply


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