Reduce Energy Costs - Renewable Heat Incentive (RHI)

Econic_RHI_fact_sheet.pdf

The Renewabble Heat Incentive (RHI) for non-Dommestic
Heat Pump Installations

From 28th November 2011, applications for the Renewable Heat Incentive  (RHI) can now be submitted for industrial, commercial, public sector and not–for-profit and community installations.  This scheme is designed to increase the uptake of renewable energy heating systems like ground source heat pumps and biomass boilers. The RHI takes the form of regular payments to the owner of the heating system (based on the amount of heat produced) over a period of 20 years.

Who can get the subsidy?
The payments will be made to the owner of the heating system directly by Ofgem who will be administering the scheme.

What types of organizations qualify?
To begin with, the RHI will only applyy to heating systems owned by the commercial, pubblic and not-for-profit sectors. A domestic versiion of the scheme is planned for late 2012.

What types of heating system qualify?
The RHI will apply to ground source heat pumps (not air source), biomass boilers and solar thermal systems as well as some more exotic technologies like biogas injection. The heat must be being produced for a legitimate heating like space heating or hot water production. It can be for new build or retro-fitt applications. Pre-commissioning accreditation is possible for deep geothermal if the installation iss 1MW or larger.

How much subsidy can I get?
The subsidy payments are tiered based on the system output and are paid per kWh of heat generated (see table below). This has to be measured by an approved heat meter. Meter readings need to be supplied quarterly to Ofgem who will make the payments.
The tariff levels are indexed linked to the retail price index and last for 20 years. The Scheme began on the 28th November 2011.

What does this mean for pay back?
Depending on the system capacity and the amount of heat produced capital payback could be under 5 years when compared with a heatiing system using oil. The RHI is designed to give a 12% ROI on the difference in cost between a renewable and conventional heating system. Contact us for a financial analysis on your proposed system.

I’ve already got a renewable heating system, can I get the RHI?
If your system was commissioned after July 15th 2009, your system may qualify. If a grant was receeived then it will not.
Some changes may need to be made to your installation to ensure it qualifies (metering scheme for instance). We can advise on this aspect.

Can I use any installer or equipment?
For installations under 45kW both installer and equipment have to be MCS certified. Above that limit it is at the discretion of Ofgem who are administering the scheme. They will want to see proof that the system is well designed and installed and has a qualifying use. We can help to ensure that your system meets the requirements of the scheme.

Can I claim RHI and reduce my CRC bill?
Yes, carbon savings produced by renewable heating systems will qualify under the CRC even if you are receiving RHI payments. This is in contrast to the Feed-in-Tariff scheme where carbon savings from PV or wind systems can’t be claimed against CRC targets.

Can I use my system for cooling?
You can use your ground source heat pump for cooling but you will not be able to claim any RHI payments for this application. Ofgem will need to be satisfied that the metering and hydraulic design of the system guarantees that only heating is metered. You can, however, use heat generated by a renewable system to produce cooling via an absorption chiller. Although this may appear illogical it meets with EU rules.

What about home owners?
The initial RHI scheme will only be for commercial, public and not for profit sectors. A domestic version will be introduced in late 2012. There will be £15M made available before that date to support home owners by way of one off grant payments. For details
of this scheme please see the Energy Saving Trust website

http://www.energysavingtrust.org.uk/Generate-your-own-energy/Financialincentives/
Renewable-Heat-Premium-Payment

Will there be finance available to help with capital costs?
Although this isn’t a formal part of the RHI scheme we expect a number of bodies to offer finance, of various sorts, to support the up-front capital costs of heating system installations. Contact us for further information on this.

I’m an RSL, can I claim RHI payments if I upgrade my housing stock with renewable heating systems?
If the new renewable heating system is a communal or district scheme, then the RHI payments can be applied for. If the upgrade involves fitting individual heating systems in each house then the RHI does not apply at this stage. This would be a domestic installation and qualify under the scheme to be introduced in late 2012.

What about air source heat pumps?
Currently the Government is not satisfied that the performance of air source heat pumps offers value for money under this scheme. Further work is being done and this technology (and others) may be added later.

Where can I find out more?
Full guidance is available from Ofgem. Please click.
http://www.ofgem.gov.uk/e-serve/RHI/Pages/RHI.aspx Alternatively, please contact us for an up to date assessment of the situation and for advice on your particular project.

Contact us today on -01603 277040