Happy Birthday RHI

Happy Birthday RHI

Happy Birthday RHI 150 150 Greengage Environmental

This is a blog by planning expert Mitch Cooke. Mitch is Founder of environmental planning consultancy Greengage Environmental LLP. He previously led the environmental planning teams for WSP and WYG.

The Renewable Heat Incentive opened to applications on 28 November 2011. It pays businesses and public sector bodies a subsidy for each unit of heat generated using renewables such as biomass boilers and heat pumps.

The incentive was introduced to ensure the UK gets 12 per cent of its heat from renewables by 2020, up from 2.2 per cent in 2011 (This level is needed to meet EU targets). However, the renewable heat generated in the scheme’s first year amounts to less than one thousandth of a per cent of UK annual heat demand.

It seems that the take-up is far lower than expected. Almost 1,500 additional installations will now be needed per month to reach the government’s target for 123,000 businesses and public sector bodies to be using renewable heat by 2020.

Ofgem data shows just a disappointing 586 installations are now claiming the RHI and these total just 143 megawatts peak capacity. Unsurprisingly 524 of these are biomass boilers, which produced 99 per cent of heat under the scheme. Only £2million in subsidy has so far been paid out.

Although still far below expectations, the figures do improve when you look at applications rather than claimants. Ofgem had received 1,107 applications for accreditation including those approved, by the end of October.

However, in my view, the difficult first year can be attributed to confusion over metering requirements and the government introducing cost-control measures that made some investors wary of committing to projects.

I believe the main barriers to growth are business and public sector fears that the government will cut the subsidies available with little notice – a consequence of the highly publicised government slashing of Feed-in Tariffs for solar power over the past year.

I think that similar cuts are unlikely in the case of the RHI, as the Department of Energy and Climate Change (DECC) has established a cost control system under which subsidies will gradually fall as uptake increases.

A domestic version of the RHI is due to launch next year.

Privacy Preferences

When you visit our website, it may store information through your browser from specific services, usually in the form of cookies. Here you can change your Privacy preferences. It is worth noting that blocking some types of cookies may impact your experience on our website and the services we are able to offer.

Click to enable/disable Google Analytics tracking code.
Click to enable/disable Google Fonts.
Click to enable/disable Google Maps.
Click to enable/disable video embeds.
Our website uses cookies, mainly from 3rd party services. Define your Privacy Preferences and/or agree to our use of cookies.