INCENTIVES

What is the RHI?

The RHI is a Government incentive that is currently open to all Commercial establishments that replace their fossil fuel burning heating with appliances that run on renewable fuels. This incentive runs for 20 years.

Note: there is a separate domestic tariff which will pay grants towards similar systems over a period of 7 years.

How do I know if I can claim?

All the details of qualifying criteria are available on the OFGEM website - www.ofgem.gov.uk.

What is involved with the application process?

OFGEM print details of the necessary requirements, but in general terms, the boiler must have been approved to be RHI qualifying, in terms of efficiency. If the boiler is below 45KWth, then it must be approved under the MCS scheme to qualify. Metering and submissions to OFGEM are required in order to prove the savings in the carbon footprint have been made.

How much is it worth?

The RHI is structured in a banding system that is periodically adjusted by OFGEM. The categories are below 200KW, below 1MW and 1 MW and above. Each category has two tiers for the year. A higher rate is paid for the first 1314 hrs at peak output, with the remaining running time at a lower rate. Payments are made quarterly.

For the latest rate see the OFGEM web site for information.

How long are the payments for?

The RHI is paid to all qualifying installations for a guaranteed period of 20 years

I have a boiler that is already installed, can I claim?

You may be able to claim on your boiler if it was installed after 2009. You would need to contact OFGEM to check

The Financial Incentive

The scheme is intended to appeal to those with money to invest as the schemes are more expensive than simply replacing an equivalent gas or oil boiler with a more up to date equivalent one, but is sufficiently generous to cover the all the cost of the fuel (at current prices) and provide an additional inflation proof return over 20 years.

Obviously there is an outgoing of cash at the start but the payback is significantly in excess of what can be achieved in a savings account. The returns are so secure that there are finance companies seeking to offer financial loan products to people who take up the scheme which can reduce the initial outlay.

The more heat being used, the more the grant pays, so there should be no more worrying about turning the heating off, and in fact the reverse is true, it is better  financially to burn as much fuel as possible with the current price of wood pellets.

The RHI grant is claimed quarterly online, based upon heat meter readings .

* The government will reduce these tariffs April 1 2015