Renewable Heat Incentive- Government Review

During the Autumn, the Government renewed its commitment to a low carbon economy by confirming a continued budget for the Renewable Heat Incentive (RHI) scheme.  As part of the commitment, a review has been taking place to ensure the scheme meets its objectives.

A consultation has been undertaken and a DECC consultation document has now been published.  This confirms that RHI is central to the Government’s plans to help develop secure, affordable and clean energy.  In order to meet decarbonisation targets, mass take up of low carbon heating technology will be required from 2020 onwards.  Spending on RHI is therefore expected to rise to £1.15bn in 2020/21.

The document recognises the Government’s wish to meet the following objectives:

  • Widespread access
  • Affordability
  • Value for money
  • Deployment of technologies which are likely to be strategically important in the longer term.
  • Innovation in technologies should contribute to development of sustainable markets
  • Ensure a robust scheme design

Deployment is expected to be focussed on areas off the gas grid, including rural areas.  Among other measures, consideration is being given to larger-scale biomass fired heat in energy intensive industries and more widespread use of heat pumps in providing heat to both homes and commercial buildings.  Aims include higher take up amongst those living in fuel poverty.

The consultation seeks views on proposals.  It is proposed the changes will be introduced in two stages with the first stage implemented from 1st April 2016.  It is planned that the first stage will include a budget cap and acts to reduce tariffs available to new applicants at pre-determined trigger points.  Plans are in place to simplify and clarify the domestic scheme, including removal of the need for a Green Deal assessment for applicants.

From Spring 2017 the second stage proposes to improve access for those less able to pay via various measures, including development of new third party financing models and driving up the performance of heat pumps installed under RHI, including schemes with shared ground loops.

Elmhurst will be making a response to the consultation document, and to read more click here

 

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