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Quick Guide to the Renewable Heat Incentive

Posted by Christos Panayiotou on 15th July 2011

The acronym FIT’s (Feed in Tariff’s) is slowly but surely becoming common knowledge amongst the public as they realise that these three letters actually mean we can not only save money but earn money from Solar PV. However there is a new acronym on the block known as the RHI (Renewable Heat Incentive).

Just like it’s electrical cousin the RHI is intended to incentivise businesses and homeowners to implement renewable heating sources along side traditional fossil fuel heating.

Unlike Solar PV where the electricity pumped back into the national grid can be measured accurately RHI intends to reward people for the heat they produce by metering heat generated in commercial settings. It is also suggested that for domestic settings “deeming” could be used to suggest how much heat the installation should produce if the property were well insulated. This is still be confirmed.

Initially the RHI is being rolled out to the non-domestic sector and we are awaiting its launch any day now. However home owners and domestic installations are not due to benefit until October next year. The government believes that the initial non-domestic phase will provide enough momentum to get a number of renewable technologies off the ground including:

Solar Thermal


Geothermal and Ground Source Heat

Biogas Heat and Gas Injection.

However they are still weighing up the inclusion of Air Source Heat Pumps.

For the technologies included above tariff’s will be payable for 20 years (5 less than FIT’s) and the exact levels are likely to be much lower than Solar PV. However the cost of installation is also likely to be much lower. We have laid out some quick reference points below:

Commences in July 2011 (date still to be confirmed) for solar thermal, biomass and Ground Source Heat Pumps. Energy to be metered and tariff lasts for 20 years.

Rates are 8.5p for solar thermal up to 200kW and ground source is 4.3p up to 100kW and 3p above 100kW. Air source is not supported for commercial initially – but may be supported from 2012

Domestic RHI in October 2012 to coincide with Green Deal (but RHI Premium payment available from July 2011 – details still to be announced.)

To claim the Renewable Heat Incentive you must have installed an operating renewable heat system on your property after July 15, 2009.

As of July 2011, up to 25,000 installations will be supported by a new ‘RHI Premium Payment’ to help people cover the purchase price of green heating systems. The RHI Premium Payment will cover technologies across all of Great Britain. The amount for solar thermal for example is £300/unit.

Those taking up the premium will be eligible for a RHI tariff from October 2012, as will anyone else who has had eligible equipment installed from July 15, 2009.

The exact amounts available to consumers have yet to be confirmed. However the Department of Energy and Climate Change (DECC) have announced that the following amounts may be available:

Solar Thermal - £300/unit

Air Source Heat Pumps - £850/unit

Biomass boilers - £950/unit

Ground Source Heat Pumps - £1,250/unit.

These are one off payments; so not annual. DECC plan to publish details of the “RHI Premium Payment” and how this will apply in May this year (nothing has been announced so far as of the 15th July 2011)


Categories: renewable heat incentive