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RHI Consultation published

Posted: 7 March, 2016. Written by Mark

The Renewable Heat Incentive (RHI) Consultation has now been published and can be found here. Most notable is the news that Government is proposing to withdraw support for new solar thermal systems from 2017 on the basis that it represents poor value for money for taxpayers.

In the consultation, DECC is proposing changes to be implemented now (in April, for the financial year 2016/17), and changes to be implemented in 2017. Most of the April 2016 proposals are not subject to change. The Spring 2017 proposals could be subject to change.

Proposals to take effect from April 2016:

  • Implementation of a budget cap with a backstop based on the annual budgets assigned to the RHI;
  • Degression triggers to be extended from the final trigger points currently set out in regulations across all technologies;
  • Future installations (those with a tariff start date on or after 1 April 2016) will switch future annual tariff inflation adjustments (beginning on 1 April 2017) from the RPI to the CPI index;
  • Removal of the requirement for a Green Deal Assessment;
  • Exemption of new self-build properties from the 183 days occupancy declaration;
  • Powers for Ofgem to request a new EPC and amend RHI payments accordingly should they discover an error in the EPC originally submitted;
  • Changes to the wording of the requirements for equivalent schemes to the Microgeneration Certification Scheme (MCS).

Proposals for the Domestic RHI to take effect from Spring 2017:

  • Introduction of heat demand limits. Homes with annual heat demand above the limit (whether deemed or metered) would be eligible for the RHI, but their payments would be capped;
  • An assignment of rights to allow householders to assign their right to RHI payments to a company that has financed their renewable heating technology. Householders would still own the system. This is intended to help householders overcome the barrier of the initial capital cost of a renewable heating system;
  • Increase of heat pump tariffs. DECC propose to review the tariffs for both AWHP and GSHP. The AWHP tariff will be set in the range of 7.42-10.0p/kWh and GSHP could be adjusted, with the maximum possible tariff of 19.51p/kWh;
  • Removal of support for further solar thermal deployment;
  • Possible changes to support for GSHP systems with shared ground loops.
  • Making it easier for less able to pay households to benefit from the Domestic RHI

You can find REA's analysis of the proposals, including non-domestic, here.

RECC will be responding to the consultation and we urge members to also respond directly with evidence of the way in which the proposals are likely to affect your business.