All you need to know about…the Renewable Heat Incentive.

We give you the lowdown on the £860m Renewable Heat Incentive scheme – what’s included and what’s not.

Why has the RHI been introduced?

The government has set a legally-binding target of reducing greenhouse gas emissions by 34% by 2020 and 80% by 2050 (from base 1990 levels). So the coalition will have to speed up change by toughening legislation such as Part L of the Building Regulations and introducing green initiatives to change behaviours.

One area where it is doing just that is in the take-up of renewable energy. The Feed-In Tariff (FIT) scheme rewards generation of electricity through renewable means. There have been more than 28 500 registrations for solar PV projects since the introduction of the FIT scheme in April 2010.

Now the coalition is looking to do the same for renewable heat. The £860 million RHI scheme is expected to increase green capital investment by £4.5 billion.

The UK target is to source 15% of its energy from renewable sources by 2020. The figure currently stands at around 7%. Heat generated from renewables currently only meets 1% of the UK’s total heat demand. To reach the 2020 renewable energy target, around 12% of the UK’s heat needs to be generated from renewable sources.

How does it work?

The RHI will encourage installation of equipment such as solar thermal panels, biomass boilers and ground- and water-source heat pumps to reduce the UK’s carbon emissions. This will be done by giving out a tariff for generation of heat (in terms of pence/kWh) by renewable fuels. So far, RHI tariff levels have only been announced for the commercial and industrial sectors.

RHI tariff payments for the domestic sector will start alongside the Green Deal financial incentive in October 2012. However, in the meantime, the government is providing a RHI premium payment to homeowners for up to 25,000 installations from July this year.

Have any technologies been excluded in the RHI scheme?

Yes. Air source heat pumps. The government has decided this particular type of heat pump needs more work to better understand the costs associated with it before it can be included in the RHI.

The Department of Energy and Climate Change said: “For air source heat pumps, work is ongoing to develop a robust methodology for measuring heat delivered in the form of hot air. Subject to successful conclusion of this work and other factors (such as the role of cooling as opposed to heating in such systems) we intend to extend eligibility to this technology from 2012.”

Do contractors need any particular training?

For installations up to and including 45 kWh, installers and equipment must be certified under the Microgeneration Certification Scheme or equivalent standard. Contractors may therefore need appropriate training before applying for certification.

Is it worth investing in the training?

This will be a big market. By 2020 the government estimates that the renewable heat sector will have grown to include around:

  • 110,000 installations in the commercial and public sector, supplying 25 per cent of the heat demand in these sectors
  • 13,000 installations in industry.

What’s in the fine print?

Key aspects of the RHI scheme:

  • payments will be made quarterly over a 20-year period
  • biomass installations of 1MWh capacity and above will be required to report quarterly on the sustainability of their biomass feedstock
  • eligible installations completed after 15 July 2009, but before the start of the RHI, will be eligible for support
  • the RHI will be administered by Ofgem.

Where can I go for more information?

For details on the scheme: www.decc.gov.uk/en/content/cms/meeting_energy/Renewable_ener/incentive/incentive.aspx

For details on MCS accreditation: www.microgenerationcertification.org/

For details on training: www.nsaet.org.uk/

Related Industry News