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What you need to know about the Renewable Heat Incentive

This blog gives details on the new government scheme, The Renewable Heat Incentive, due to launch in 2014. It covers the specific details of the scheme from eligibility to funding. This blog aims to give readers an easy-to-read perspective on the scheme and how it could benefit your property.

The Renewable Heat Incentive is a government scheme set to begin in 2014 that aims to have 12% of heat generated renewably by 2020. The final details of the scheme were announced by The Department of Energy and Climate Change in July and are now up for Parliamentary and EU state aid approval. Below you will find information on the incentive and how it might be beneficial to you and your home. You could be eligible for renewable technologies such as air source heat pumps, biomass boilers and solar thermal resources. Read on to find out the finer details of the scheme.

The Renewable Heat Incentive (RHI)

The Renewable Heat Incentive is the world’s first long-term financial support programme for renewable heat. The RHI pays rewards the members of the scheme that use renewable energy to heat their buildings or homes. The scheme helps the UK reduce greenhouse gas emissions by using renewable energy sources instead of fossil fuels. This scheme will help the UK reduce the effects the country has on climate change.

In English…

Those who become members of the Renewable Heat Incentive will earn money back on renewable technologies that they install in their home. For example, if you install a biomass boiler in your home you will earn a tariff for the next 7 years as an incentive for choosing a renewable energy source to heat your building. You will be paid annually and the amount is based on the per kWh of renewable heat generated.

The Maths

To break this down even further, if you purchased solar thermal technologies for your home that are on a Renewable Heat Incentive tariff rate of 19.2p/kWh and you used 15,000kWh then you would earn £2,880.

How did they come up with the rates?

When the government decided on the rates they based it on the technology and installation costs. With the technology they considered the efficiency and lifetime of the technology, the cost of financing and the cost of off-grid fuels such as electricity & oil. They also considered a 7.5% compensation for the cost of purchasing and installing the new systems.

Who is eligible for the RHI scheme?

  • Owner occupiers
  • Private/Social landlords
  • Self-builders
  • Legacy – people who have installed eligible technologies since July 15, 2009.
  • Third party owners of a heating system.

RHI Eligible Technologies and Requirements.

  • Biomass boilers and wood pellet stoves with a back boiler.
  • Air source heat pumps (ASHP)
  • Ground and water source heat pumps (GSHP)
  • Solar thermal.

There are certain regulations and requirement within each of the above categories. They must meet the Microgeneration Certification Scheme (MCS) certification and the company that installs the technology must be a member of the renewable energy consumer code (RECC). Everyone, with the exception of self-builders, will need to undergo a Green Deal Assessment that records the energy performance of your building. The Green Deal Assessment gives guidance on which measures to install to increase energy efficiency, cost and savings. You must also be able to prove that you heating system is working correctly as part of the application process and you must do this annually through the course of the scheme.


If you install your new technologies before March 2014 you will be eligible to claim the renewable heat premium payments (RHPP):

  • ASHP: £1,300
  • Biomass boiler: £2,000
  • GSHP: £2,300
  • Solar: £600

The Application

Applications begin in Spring 2014 at the online Ofgem website. Depending on the finalized details of the scheme, those who have not received funding from the RHPP will be dealt with first. The recipients of the RHPP and Legacy applicants should expect a staggered application process.

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