Grants & Funding
Renewable Heat Incentive (RHI)
The Renewable Heat Incentive (RHI) announced in March 2011, is aimed at encouraging people to install renewable heating technologies and is the first financial support scheme for renewable heat in the world.
The scheme is being introduced in two phases:
In the first phase long term tariff support is focussed on the non-domestic sector (industrial, business and public sector) as it accounts for 38% of the UK's emissions. But for the domestic sector a one off incentive has been put in place, the Renewable Heat Premium Payment (RHPP) to provide householders with financial support to install renewable heating technology.
The second phase is likely to see the scheme expanded to include additional technologies as well as long term support for house holders. DECC announced in July 2013 that the Doemstic strand of the scheme will be up and running by Spring 2014, which represents another slippage so an extension has been applied to the second phase of RHPP , effective until March 31 2014.
Phase 1 - Non-Domestic
This phase of the scheme opened for applications on November 28, 2011 and currently only supports technologies listed within the EU Renewable Energy Directive, as listed below:
- solid biomass and solid biomass contained in municipal waste (including CHP),
- ground and water source heat pumps,
- geothermal (including CHP),
- solar thermal (at capacities of less than 200 kWth),
- biogas combustion (except from landfill gas but including CHP; at capacities of less than 200 kWth) biomethane injection.
Note: Air source heat pumps are not currently supported.
Participants also need to meet several other eligibility requirements which are explained in the Guidance document. These include demonstrating that the heat is used for an eligible purpose, that metering arrangements are appropriate, and that grants have not been received for certain purposes.
The tariffs will be paid for 20 years to eligible technologies that have been installed since 15th July 2009 with payments being made for each kWh of renewable heat which is produced. Once in the scheme the level of support an installation will receive is fixed and adjusted annually with inflation - click here to see the latest announcement from ofgem . However, as with the feed-in tariffs, it is expected that the levels of support available for new entrants to the RHI scheme will decrease over time as the costs of the equipment and installation reduce through economies of scale. £860m of funding has been allocated for the first 4 yearsof the scheme.
Tariff rates for Dimplex eligible technologies - applicable from 1 April 2012:
Ground Source Heat Pumps
- 4.7p/kWh for systems up to 100kW
- 3.4p/kWh for systems over 100kW
Solar Thermal Systems
Phase 2 Domestic
Households installing renewable heat technologies will from 2014 be eligible for hundreds of pounds a year in incentive payments, after the government announced some details of its long-awaited domestic Renewable Heat Incentive (RHI) scheme.
The scheme is now expected to launch next Spring with a final date to be confirmed once the plan has gained Parliamentary and state aid approval. But, significantly, any eligible renewable heat technology installed since 15 July 2009, when the scheme was first announced, will be able to access the incentives, meaning there is no reason for interested households to delay installing the technology.
Under the scheme, payments will be made on a quarterly basis for seven years with most payments being calculated using estimates of heat output. However, an extra set payment of £230 a year is available for households with heat pumps that also install a metering system.
The government has also moved to ensure it is not incentivising heat generation in inefficient homes, with the introduction of rules requiring those applying for the RHI to have completed a Green Deal assessment to ensure that they meet minimum insulation standards. All installations and installers also have to be compliant with the MSC certification scheme.
The domestic RHI will replace the existing Renewable Heat Premium Payment (RHPP) scheme, which offers grants to help cover some of the cost of renewable heat technologies. Those households that have already taken advantage of the RHPP grants can apply for the RHI support, but the value of the grant will be deducted from RHI payments to avoid the risk of a double subsidy.
Scheme at a glance:
- Tariff rates:
- ASHP - 7.3p/kWh
- GSHP - 18.8p/kWh
- Solar Thermal at least 19.2p/kWh
- Tariffs payable over 7 years
- Extra £230 per year for heat pump systems with monitoring
- Deemed SPF for heat pumps to be based on the efficiency in the Heat Emitter Guide
- Installations carried out after July 2009 are eligible, but a default SPF will be used
- Scheme due to commence Spring 2014
- Scheme to be administered by OFGEM
For more information regarding the RHI visit the DECC website or download the leaflet from DECC by clicking on the image below
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