The Renewable Heat Incentive (RHI)
The RHI is a government incentive designed to reward homes that are heated using renewable energy. The scheme will guarantee regular ‘tariff’ payments for 20 years based on the amount of renewable energy you generate.
The RHI is administered by the official regulator Ofgem who pay the tariffs with money from the Treasury. First of all you will save money by eliminating or reducing your need for gas or oil, both of which are becoming increasingly expensive. Secondly, you will be paid up to 8.5p/kWhr for the hot water and heat you generate and use yourself. It depends on exactly what systems you use and how large they are as to what the exact tariff level is. Only new equipment is eligible for the RHI and must be installed after 15th July 2009. Converted installations are not covered by the scheme. However new systems replacing existing renewable installations do qualify. There are some restrictions on the equipment and suppliers you can use.
Each eligible installation has to be registered by the energy regulator Ofgem.
There are some specific requirements. For example, systems below 45kW capacity must comply with the Microgeneration Certification Scheme. Rest assured Total energy Installations comply with this legislation.
How is the RHI being funded?
£860million has been made available from central Government funding to support the RHI over the period 2011-2014. The Government has decided not to take forward previous administration proposals for an RHI levy.
There are three steps to the RHI:
Step One: you install in your property renewable heat systems such as solar thermal panels, heat pumps or a biomass boiler
Step Two: you measure how much heat your renewable energy systems produce
Step Three: you get paid a fixed amount based on that output, the type of technology and the size of the system
The Renewable Heat Incentive is similar to the Feed-In Tariff system but with some important differences:
It will be paid for by the Treasury not by energy users and there is no ‘National Grid for Heat’ and so importing and exporting heat is not relevant. Also it will be introduced in phases, with residential schemes not eligible until Phase 2.