How does the RHI work?

The RHI, or Renewable Heat Incentive, is the Government's Pay As You Generate scheme for domestic renewable heat installations. The RHI will be administered by Ofgem E-Serve and is open for applications from Spring 2014, although the enquiries line is already open (0300 123 1234). More information on the administration of the RHI can be found on the Ofgem E-Serve: Renewable Heat Incentive web pages. The RHPP grant scheme is administered by the Energy Saving Trust. Applications for the RHPP can be processed on line - see the RHPP page for more information.

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How the RHI works

The way the Renewable Heat Incentive works is fairly simple. First, the user pays for and installs an eligible renewable heat technology – the scheme covers biomass pellet stoves with a back plate boiler, biomass only boilers, water source heat pumps, ground source heat pumps, air to water heat pumps and evacuated and flat plate solar thermal installations. If the technology and the customer’s circumstances meet the requirements of the RHI scheme (below), they can then register the system with Ofgem who administer the RHI scheme.

They are then eligible to receive the Renewable Heat Incentive payment quarterly for the next 7 years. The amount paid is adjusted upwards for inflation over the payment period and is also dependent on a number of factors including:

  • Amount of heat generated
  • Technology type

The payment is designed to cover the difference between the installation cost for the renewable heat technology and the installation cost for a conventional system, the running costs of the system and any interest charged by finance providers.

At the end of the 7 years these costs should have been fully reimbursed to the customer. The lifetime of the technology is 20 years, so the customer will get a further 13 years’ worth of energy bill savings with that installation.

Customers applying to the RHI scheme can also apply to the RHPP grant scheme. which gives one-off grants for renewable heat installations.  Applying for both has the effect of giving you more of the payable money upfront, as the RHPP grant amount will be deducted from your RHI payments to avoid a double subsidy.

Tariff rates

  • Solar thermal: At least 19.2p/kWh (Increases to this rate may be confirmed in Autumn)
  • Biomass boiler: 12.2p/kWh
  • Air to Water Heat Pump: 7.3p/kWh
  • Ground Source Heat Pump: 18.8p/kWh
At the moment, the total amount to be paid is determined by assessing your house’s heat demand – this is because your installation won’t necessarily have the capability to measure exactly how much heat is being generated. Households that take out support for this extra function will receive an extra £230 for heat pumps and £200 a year for biomass boilers. 

You Qualify for the RHI scheme if:

You installed an eligible technology after the 15th July 2009. Currently the qualifying technologies for domestic installations are:

  • Solar Thermal water heating
  • biomass boiler
  • air source heat pump
  • ground source
  • water source heat pump
You need to have a Green Deal Assessment carried out on your house preferably before the installation – more information on this can be found on our Green Deal Assessment page. 

Your installer and installation will also have to be MCS certified – check that your installer is MCS compliant before going ahead with the work.

How to Apply to the RHI

DECC have said that information on how to apply to the RHI scheme will be released shortly – in the meantime, you can direct any questions about the scheme to the Energy Saving Advice Line on 0300 123 1234.

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FAQs

Is there any guarantee should my technology not work to expectations?
If you use an MCS installer and product (or equivalent) for your installation you should receive a warranty for both the equipment and workmanship of your installation. Ask your installer about this; it is always a good idea to seek more than one quotation and you may wish to consider the type of warranty on offer alongside other considerations such as price. We will introduce you to 3 installers to ensure you get a good range of quotes.
Can I still receive a grant if a non-certified installer performs the installation?
Only if an MCS certificated installer commissions the system after the non-certified installer has finished the installation. In this case, the certificated installer must fill out the completion certificate, and you must provide a suitable chain of invoices showing all of the costs of the installation.
Are biomass hot air systems or wood burning stoves eligible?
No, only biomass systems which heat water to provide space heating are eligible. However, if your wood burning stove provides the main heating source through a back boiler, it will be eligible. Please be aware that Government is currently considering whether biomass stoves, even where they are the main heating source through a back boiler, will be supported under the long-term Renewable Heat Incentive (RHI). At this stage, there is no guarantee that they will be. DECC will be consulting on support for domestic participants in due course.
What information will you gather for the monitoring and what will you do with all the information you collect?
It is important to make sure you are comfortable with the idea that you may have to complete a survey on aspects of your heating system such as its performance. It is possible that this information may become public (but not your name, your full address, your date of birth or any other information which would allow the comments to be attributed to you). In addition, the Government will pay for a percentage of houses to have additional meters put in them, to monitor energy use from the new equipment. These meters are likely to send information about energy use automatically back to the Energy Saving Trust, who are administering the system, so this will not require any additional work from the householder.
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