Delay to RHI (27/03/12)

The government announces further details of RHI implementation plans.

Today Greg Barker announced further plans for the delivery of the Renewable Heat Incentive (RHI) including a time table setting out what we intend to do and when for both the domestic and non-domestic sectors.

Government remains committed to the deployment of renewable heat and we committed to clarify timing on support for the domestic sector in November 2011. We will consult on how we can support renewable heating for households in the longer term in September 2012 and we will set out a firmer timetable for delivering this support at that point and anticipate that this will be from Summer 2013.

The Renewable Heat Premium Payment (RHPP) has provided support to the domestic sector since August 2011 due to the later than anticipated household scheme under RHI. A second phase of this scheme, worth £25m (£10m more than the first phase), to provide support for the installation of renewable heat technologies in the household sector was also announced. The support will consist of a new voucher scheme for domestic households and a new social landlords’ competition building on the experiences of Phase 1 of the RHPP. Some small but important changes to the voucher scheme to ensure that we learn as much as we can from the installations it supports are also being made. The second phase also includes a new £8m Communities Competition which will help to bring renewable heat to a wider pool of householders. Potential applicants for the voucher scheme will be able to pre-register with the Energy Saving Trust[External link] from Monday 2 April. Further details on eligibility criteria and the competitions will be announced in due course.

To ensure the success of the non-domestic scheme (that launched in November 2011), we will prioritise the delivery of a cost control regime that incorporates lessons from other schemes and meets previous commitments. To do this, we are developing a package of policy options that include modified pre-accreditation, degression and reviews. We will consult on proposals in July 2012, with a view to laying Regulations in November and for the policy to be implemented by the end of the current financial year. This consultation will also include amendments to the existing scheme covering air quality and biomass sustainability issues as outlined in the original RHI Policy document. Cost control measures can only apply going forward, i.e. to new entrants, so installations already receiving the RHI will continue to receive their current tariff (adjusted for RPI) for the full 20 year duration.

In the meantime, we are consulting on arrangements for interim measures to be in place to keep us within the budgetary limits set by the Comprehensive Spending Review (CSR) and we intend for this to be in place by the summer subject to Parliamentary approval. The consultation closes on 23 April 2012. Full details are available on the The Renewable Heat Incentive: consultation on interim cost controlweb page.

We will also consider extending support to new technologies and we will consult on proposals to do this in September 2012, with a view to ensuring new support will be available from Summer 2013.

(Information courtesy of the DECC)

Further information is available from the Department of Energy and Climate Change:  http://www.decc.gov.uk/en/content/cms/meeting_energy/Renewable_ener/incentive/incentive.aspx