Renewable Heat Incentive to Create Local Opportunities

14.03.11

The Department of Energy and Climate Change (DECC) has published details of its long-awaited Renewable Heat Incentive (RHI) scheme which will pay businesses and householders for the amount of usable heat they produce from renewable sources.

The UK has a number of targets for reducing its contribution to global warming – including a commitment to reduce carbon emissions by 80% by 2050. Burning fossil fuels to provide heat and hot water in buildings accounts for a large slice of current emissions. The RHI is the government's attempt to kick-start a move towards heating systems that use renewable energy sources and produce fewer emissions.

Like many other countries, the UK has a feed-in tariff to provide financial payments to people and organisations for each unit of electricity they produce using small-scale renewable technologies such as solar photovoltaic panels and wind turbines. The RHI provides a similar set of incentives for heating, and is the first policy of its type anywhere in the world.

The £860 million fund will provide tariff payments for domestic and business-related heating installations such as solar thermal heating systems (typically roof-mounted), wood and other bio-mass burning heaters, air-source heat pumps, anaerobic digesters (producing biogas for heating), combined heat and power systems, etc

Sonya Bedford, head of renewables at Stephens Scown, told Business Cornwall: “This scheme is all about scaling up the use of renewable heat technology in an effort to reduce carbon emissions and create a competitive market that eventually brings down the cost of technology to make it affordable for all.

“In the south west there are more than 100 companies working in the heat pump sector alone so the availability additional funds to effectively reward people for generating renewable heat is a great opportunity for suppliers, installers and technicians, and will have a positive knock-on effect in the supply chain.”

If it takes off, as the Government predicts, the impact of the RHI would be the equivalent of taking 20 gas-fired power stations off the National Grid.

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