Heat Incentive Delayed Again

The renewable heat incentive (RHI) for domestic projects is set for yet more delays following a government announcement.

The RHI is intended to encourage homeowners and self-builders to invest in renewable heating products, such as solar thermal panels, heat pumps and biomass boilers.

The scheme would work in a similar way to the Feed-In Tariff (FIT) regime, whereby homeowners are paid a pre-defined rate for generating electricity.

RHI payments will be available for an ‘eligible’ or ‘deemed’ heat output according to the house’s size and specification. This should help to avoid situations where installations are over-specified and payments are consequently made for ‘wasted’ heat.

The RHI was introduced for commercial installations in November 2011. The domestic version was originally slated for release shortly after.

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However, the exact details of how the RHI scheme will operate and what the tariff levels will be has been subject to huge debate at government and industry level, leading to dramatic delays.

The Department of Energy and Climate Change (DECC website) now plans to release tariff levels this summer (click here for information on the DECC’s overarching heating policy), with a view to launching the domestic renewable heat incentive in spring 2014.

To plug the gap, the DECC intends to extend the Renewable Heat Premium Payment scheme, which offers a cashback-style grant on eligible installations.

But the uncertainty is sure to have implications for the heating industry as it struggles to plan for the RHI. Homeowners, too, will continue to find it difficult to gauge the long-term value of renewable heating technology to their projects.