Wondering how the domestic Renewable Heat Incentive (RHI) works? This article is designed to give homeowners an overview of the main things they need to know – if you want to read about the RHI in all its glory, visit the Ofgem website.
What is the domestic Renewable Heat Incentive (RHI)?
The domestic RHI scheme is a government-led, long-term environmental programme designed to encourage homeowners to generate heat from renewable sources, by providing a generous tax-free financial incentive for every kilowatt of ‘green’ heat generated, every year for 7 years. The scheme will help the UK meet EU targets to reduce carbon emissions and secure the future of Britain’s energy supply.
What are the current payment levels?
There are two schemes – one for homeowners, and one for businesses – and they each receive different financial incentives.The current domestic tariffs for the technologies we install are as follows:
Biomass boiler installations = 12.2p per kilowatt.
Solar thermal installations = 19.2p per kilowatt.
Once you’ve joined the RHI, you’ll stay on the same tariff rate for the whole 7 years, even if the rate for new installations is reduced at one of Ofgem’s quarterly tariff reviews.
The payments really add up – a 45kw biomass boiler heating a 3-bedroom home will typically earn you £4,671 a year in RHI payments, which adds up to a guaranteed income of £32,697 over the 7 year term of the scheme. And this is before the typical £2,000 a year savings you’ll make on your fuel bills are factored in – see our Save with biomass page for more information and examples.
Is my home eligible for the domestic Renewable Heat Incentive (RHI)?
Homes both on and off the mains gas grid are eligible to apply for the scheme, although homes that are off gas will save more. The main criteria for joining the scheme is that the renewable heating system you’re installing must only heat a single domestic property – to prove that your home is a domestic dwelling, you’ll need to provide Ofgem with a copy of your home’s Energy Performance Certificate (EPC) as part of your RHI application. AN EPC is required every time you buy, sell or rent property, and is produced as part of a Green Deal Assessment – if your home doesn’t already have one, we can help.
There are a number of other criteria that also need to be met – here’s an overview:
Biomass boiler installations
- The boiler must be specifically designed to generate heat using only solid biomass
- It must use a liquid to heat a home – via radiators, for example. It can – and 9 times out of 10, will – also be used to provide the home with hot water, though this isn’t essential to meet RHI criteria
- It must meet emissions and air quality requirements.
Solar thermal installations
- The collector type must be flat plate or evacuated tube
- The installation must only be used to produce hot water for domestic purposes – installations to provide space heating or heat a swimming pool are not eligible for the RHI scheme.
- Equipment must be new and have Microgeneration Certification Scheme (MCS) certification at the time of installation (or equivalent for boilers under 45kw)
- It must be fitted by an MCS-accredited installer ( we are…)
- It must only provide heat to a single domestic dwelling
- It must have the right sort of meter, calibrated correctly and located in the right place according to the type of installation.
We’re delighted to say that, thanks to our MCS-accreditation and our experience, all Lime-Circle biomass boiler and solar thermal installations have met Ofgem’s requirements and received RHI accreditation.
How are payments made?
If your biomass or heat pump installation is accredited and approved for RHI payments, you will receive payments by BACS on a quarterly basis for the lifespan of your boiler or 7 years, whichever is the shorter. The amount of money you will receive depends on:
- The type of installation – biomass or solar thermal
- The size of the installation
- The heat output of the installation
You’ll receive your first payment 3 months from the date you submitted your completed application form to Ofgem.
How do I apply for the RHI?
The government is investing a significant amount of public money in incentivising homeowners to produce heat from renewable sources, so, as you can probably imagine, the application process involves answering a number of questions and submitting a volume of documentary evidence to prove that your installation is legit. That said, it is only a 2-page form, and we – and indeed any decent installer – will support you fully throughout the application process, helping you complete the application form and gather the evidence you need. We can even do the whole lot for you, if you prefer.
How long will it take for my installation to be accredited?
It depends on how accurately and completely you fill in the application form and how complicated the installation is – the more questions Ofgem have to ask, the longer the whole thing takes. Your application could sail through in as little as 10 days or take a couple of months, but we’ll help you get things moving as fast as we can. You can find out more about the RHI application process here.
Any more questions?
We’re here to help – give us a call on 0115 952 0263 or 07890 022002 and we’ll go over things in more detail.