Introduction

The Government has also introduced an incentive to encourage us to product our own heat – for hot water and heating. This is the Renewable Heat Incentive (RHI). This will pay us for every unit of heat produced from renewable sources – Solar Thermal Hot Water, Ground Source, Air Source or Biomass.

This incentive will be particularly attractive to those customers who are off the gas ‘grid’ or are limited in to the type of fuel that can be used for heating.

The incentive has already been launched for commercial applications and the full domestic scheme will be available from summer 2013.

The incentive will provide an INDEX LINKED TAX FREE INCOME and is guaranteed by the Government.

WHAT IS THE RENEWABLE HEAT INCENTIVE (RHI)

The Renewable Heat Incentive (RHI) is the Government’s principal financial incentive to encourage the installation of renewable technology for the production of heat and hot water in domestic and commercial buildings. 

A key aim is to reduce dependence on increasingly expensive and declining fossil fuels such as coal, gas and oil.

The Non Domestic RHI was launched in November 2011 and is applicable to renewable heat installations in business, industry and the public sector as well as district heating schemes.

The scheme currently supports technologies that produce hot water that us used directly or used to heat systems such as radiators and under-floor heating.  These technologies include:

• Biomass [link to commercial heat technology page]
• Heat Pumps (air source and ground source) [link to commercial heat technology page]
• All Solar-Thermal Systems [link to commercial heat technology page]

The Domestic sector RHI scheduled to launch in June 2013 and is applicable to any heat produced by a renewable technology.  The heat production will be calculated when the system is commissioned to predict how often?) to calculate the amount payable to the owner of the system.

WHAT ARE THE FINANCIAL BENEFITS OF THE RHI?

There are three financial benefits from RHI:

1. Heat Production Payment – the potential heat produced by the renewable technology will be predicted (in units called Kilowatt Therms) and you will receive regular payments based on this calculation.
2. Energy Bill Savings – you won't have to use as much energy from your existing boiler, which will provide an immediate reduction in your electricity, gas or heating oil bill.
3. Reduced Maintenance Costs – your existing boiler will not need to work as hard which will extend its lifespan and reduce wear and tear which can be expensive to repair.

HOW MUCH WILL BE PAID?

There are two separate RHI payment tables – one for non-domestic systems and one for domestic systems.

Non Domestic Systems

Domestic Systems (due to commence in June 2013)

The proposed payment levels would be made quarterly over a seven year period. However this is still under consultation and therefore may be subject to change - for details of the Government consultation on RHI, please visit the DECC website: [http://www.decc.gov.uk/en/content/cms/meeting_energy/renewable_ener/incentive/incentive.aspx].

What next?

Find out how renewable energy looks on:

• My Home
• My Business
• My Farm