After months of delays, the Renewable Heat Incentive (RHI) has been launched by Energy Secretary Chris Huhne today.
The 860m Incentive guarantees tariffs will be paid for 20 years to eligible technologies that have been installed since 15th July 2009 with payments being made for each kWh of renewable heat which is produced.
Anything from a pub to a public library, a school to a power plant will be eligible under the RHI to install technologies like biomass boilers, heat pumps and solar thermal. Community projects will also be eligible, provided a single installation is providing heat to more than one house.
The Government estimates that by2020 the renewable heat sector will have grown to include around 13,000 installations in industry, 110,000 installations in the commercial and public sector, supplying 25% of the heat demand in these sectors - seven times the number of anticipated installations in 2014.
The RHI will reduce emissions by 44 million tonnes of carbon to 2020, equivalent to the annual carbon emitted by 20 typical new gas power stations and encourage installation of equipment like renewable heat pumps, biomass boilers and solar thermal panels to reduce emissions and support the existing 150,000 jobs in the heating industry.
Chris Huhne said:
“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.”
RHI tariff payments will start for homes alongside the Green Deal from 2012 to allow a more whole-house approach to heat production and energy saving. In the meantime, up to 25,000 installations from July will be supported by a “RHI Premium Payment” (collectively worth around £15m) to help people cover the purchase price of green heating systems. Those taking up the Premium will then be eligible for a RHI tariff from October next year when the Green Deal begins, as will anyone else who has had eligible equipment installed from July 2009.
Eligibility criteria for the scheme includes a well-insulated home and co-operation to give feedback on equipment performance.
Details of the “RHI Premium Payment” and how this will apply will be published in May this year and the Government will consult on the RHI tariffs that will apply from October 2012 later in the year.
Download the full document here.