Renewable Heat Incentive (RHI)

It is estimated that just under half the energy used in the UK is used for heating, and about 55% of this is used on domestic space heating, hot water and cooking.  Most of this energy is currently supplied by gas (69%), oil (10%) and electricity (14%) and only 1% is known to come from renewable energy sources. So, although it is known that the most efficient way to reduce our energy use in buildings is through insulation and other energy efficiency measures, in order to create a shift change in the type of energy we use the government is introducing the RHI.

The RHI for solar thermal and other heating technologies will be introduced in 2 phases.

Phase I
From July 2011 only the non-domestic sector will be eligible for the RHI tariff.
However domestic installations post-July 2011, will be eligible for a one-off payment known as the RENEWABLE HEAT PREMIUM PAYMENT (RHPP).  This has a value of £300.00 and is an inducement to install a solar thermal system.  It also comes with a condition that participants will have to provide feedback as to how the system works.  The RHPP can be claimed via the Energy Savings Trust -www.energysavingtrust.org.uk/RHPP. The RHPP scheme has been extended for the time being.

Phase II
This has been delayed (possibly to mid-2013) and will coincide with the introduction of the Green Deal for Homes. People in receipt of the RHPP, and those who have installed and commissioned solar thermal technology on or after 15 July 2009, will also be eligible for RHI tariff for a further 20 years.

Who can claim the RHI?

RHI payments can only be made to the owner of the installation.  That is usually the person who has paid for the installation.  The application must also meet all the eligibility criteria required under the scheme. These include;

  • The equipment must be used and maintained.
  • MCS accredited products and installers must be used.
  • Only solar thermal installations below 200KWth are currently eligible.
  • Solar thermal installations below 45KWth will have to be MCS accredited and above this they will be certified by OFGEM.
  • The property must have up to 250mm of loft insulation and cavity insulation where possible.

What is the current value of the RHI?

The tariff level for solar thermal installations below 200KWth will be 8.5p for 20 years.  These prices are based on 2010 prices and will be updated to reflect 2011 prices before the start of the RHI. Each year this figure will be adjusted automatically in line with the RPI. This will be paid quarterly.