UK government sets out case for renewable heat incentive

The UK government yesterday unveiled the details of its long-awaited plans for a renewable heat incentive (RHI).

The £860 million scheme will seek to drive the adoption of alternative technologies such as biomass, ground source and water source heat pumps, solar thermal and biomethane to reduce the 46% of the UK’s emissions that come from heating.

According to the government, the RHI could increase capital investment in renewable heat technologies by £4.5 billion between now and 2020, with the scheme supporting up to 150,000 projects in the non-domestic sector and an initial 25,000 households.

In a written statement from Energy Secretary Chris Huhne, he outlined how the scheme will be introduced in two phases.

Initially, the focus will be on long-term support for large users in the non-domestic sector – industry, businesses and the public sector that currently account for around 38% of the UK’s emissions.

Organisations using renewable heat will receive quarterly payments – for both new installations and those installed since 15 July 2009 – for a 20 year period.

But the first phase will also include around £15 million to help households under the Renewable Heat Premium Payment.

The second phase of the RHI, which is designed to coincide with the start of the Green Deal in October 2012, will move households with renewable heat installations on a similar long-term tariff scheme as the non-domestic sector.

“This incentive is the first of its kind in the world. It’ll help the UK shift away from fossil fuel, reducing carbon emissions and encouraging innovation, jobs and growth in new advanced technologies,” commented Huhne.

The two-phase introduction will allow the government, manufacturers, installers and individuals to understand and assess how renewable heat incentives perform under ‘real-life’ conditions.

Huhne adds that the government will consider at this stage the introduction of support for other renewable heat technologies not on the original list.

The plans are open to comments about their implementation and the government plans to gain approval from Parliament in July this year.

For further information:
www.decc.gov.uk/
www.decc.gov.uk/en/content/cms/what_we_do/uk_supply/energy_mix/renewable/policy/incentive/incentive.aspx

Related stories:
CBI turns up the heat on UK Government (15-Sept 2010)
Badly installed heat pumps not performing, says Energy Saving Trust (8-Sept 2010)
UK Government cuts turn off renewable heat investment (26-May 2010)
Funding gap could put UK renewable heat sector into disarray (19-Mar 2010)

11 March 2011

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