New RHI rates announced by government

Changes to the UK RHI scheme, the government’s innovative financial incentive programme to encourage investment into renewable heating technologies, have finally been presented for Parliamentary approval.

Submitted on Friday 1 September, they will come in to force on 20 September, which may take the industry by surprise.

The changes to the scheme, which has been active for five years, were originally released in December 2016. However the finer details, including the deadline date was delayed, due to other external pressures facing the government.

Adam Baxendine of Savills Energy said: “In order to benefit from the current rates, a renewable heat installation will need to be commissioned and application submitted to Ofgem by 19 September 2017, otherwise the new rates will apply which will be higher in a number of cases. This may catch some developers and landowners by surprise if they are in the middle of installing renewable heating technologies”. The new regulations are available here.

The changes implemented now are as follows:

  • Alignment of non-domestic biomass tariff (tier 1: 2.96p/kWth, tier 2: 2.08p/kWth) and changes of load factor from 15% to 35%
  • New degression triggers until July 2018
  • Domestic demand limits for domestic biomass, ASHP, and GSHP
  • New tariffs for domestic RHI: Biomass plants: 6.54p/kWh; Air source heat pumps: 10.18p/kWh; Ground source heat pumps: 19.86p/kWh; Solar thermal plants: 20.06p/kWh
  • Provisions to receive higher tariffs for plants whose tariff start date is on or after 14 December 2016 but before 1 April 2017 to be able to receive the higher tariffs.

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