Businesses and communities across Britain will from Monday be able to apply for a heat tariff payment, ushering in a new era of clean green heat technology, Greg Barker said today.
The world’s first Renewable Heat Incentive (RHI) will be open to applicants from Monday 28 November, providing payments for heat generated from renewable technologies including biomass boilers, solar thermal equipment and heat pumps installed since 15 July 2009.
Recipients will be paid up to 7.9p per kWh for biomass boilers, 8.5p per kWh for solar thermal and up to 4.5p per kWh for heat pumps.
Energy and Climate Change Minister Greg Barker said:
“The RHI will usher in a new era in clean green heat technology. It’s a world first and has the potential to put the UK at the forefront of a vibrant new green technology sector.
“Renewable heat will be a big win for our economy - it will support thousands of green jobs, reduce our dependency on imported fossil fuels, reduce our carbon emissions and help us meet our renewable target.”
The RHI has a key role to play in meeting the UK’s 2020 renewables target, will help reduce the UK’s dependence on expensive imported fossil fuels and will cut emissions by 43 million tonnes of carbon by 2020 - equivalent to the annual carbon emitted by 19 typical new gas power stations. Up to 500,000 jobs are expected to be created in the renewables industry as a whole by the end of the decade.
The start of the scheme follows a short delay while DECC resolved the scheme’s compatibility with EU state aid rules. Organisations will be able to apply to Ofgem for support under the scheme from Monday 28 November and will receive payments on a quarterly basis for heat generated over 20 years.
The Renewable Heat Premium Payment scheme is already up and running, providing money off renewable heat technologies for householders. Vouchers are still available - householders have until 31st March next year to apply. There will also be support for householders under the second phase of the RHI, the timing of which will be confirmed early in the new year. The Government remains absolutely committed to driving the renewable heat agenda not just in the industrial, business and public sector, but in the domestic sector as well.
Notes for Editors
- The Coalition has made £860 million available to support renewable heat. The RHI will provide financial support to commercial, industrial, public and not-for-profit and community generators of renewable heat for a 20 year period, resulting in 14,000 industrial installations by 2020,and 112,000 installations in the commercial and public sector.
- The tariff levels are as follows
Levels of support - 2011 prices
Tariff rate (pence/
Tariff duration (Years)
Small commercial biomass
Solid biomass including solid biomass contained in Municipal Solid Waste and CHP
Less than 200 kWth
Tier 1: 7.9
Tier 1 applies annually up to the Tier Break, Tier 2 above the Tier Break. The Tier Break is: installed capacity x 1,314 peak load hours, i.e.:
kWth x 1,314
Tier 2: 2.0
Medium commercial biomass
200 kWth and above; less than 1000 kWth
Tier 1: 4.9
Tier 2: 2.0
Large commercial biomass
1000 kWth and above
Small commercial heat pumps
Ground-source heat pumps; Water-source heat pumps; deep geothermal
Less than 100 kWth
Large commercial heat pumps
100 kWth and above
Less than 200 kWth
Biomethane and biogas combustion
Biomethane injection and biogas combustion
Biomethane all scales, biogas combustion less than 200 kWth
- Payments will be based on the metered amount of heat generated (except for biomethane producers who get a payment based on the metered amount of biomethane injected to the grid) and will be paid for 20 years for eligible technologies that have been installed since 15 July 2009, with payments for each kWh of heat produced.
- Once in the scheme, the level of support an installation will receive is fixed although it will be adjusted annually with inflation.
- Details of how to apply for RHI can be found on Ofgem’s website.
- Ofgem also have a helpline number for queries on the RHI. The team can be contacted on 0845 200 2122 or by email to RHI.Enquiry@ofgem.gov.uk.
- More information about the Renewable Heat Premium Payment scheme can be found on the Energy Saving Trust website or by calling 0800 512 012.