Renewable Heat Incentive (RHI)
The Renewable Heat Incentive (RHI) is a government scheme set up to encourage the uptake a renewable sources of heat in both commercial and domestic properties. The aim of the scheme is to help reduce the carbon emissions associated with burning fossil fuels, used in traditional heating appliances such as gas, oil and LPG boilers.
If you have an eligible renewable heating appliance installed by an approved installer and meet other eligibility criteria, you can apply to receive regular payments from the Renewable Heat Incentive via your energy supplier.
What appliances are eligible?
Biomass boilers, ground- and air-source heat pumps and solar thermal systems are classed as renewable heat appliances and therefore are included in the RHI scheme. However, only specific manufacturers' models that have been tested to meet the government's efficiency and emissions criteria are eligible. We can advise you on suitable eligible products during a site visit.
Are you an approved installer?
Michael Magson Ltd is an MCS-accredited installer, as well as Benchmark certified and REAL Assurance scheme members. We are a VIP installer of NIBE heat pump and solar thermal products and an experienced installer of Windhager biomass boilers. We therefore meet the criteria for installers of renewable heating under the RHI.
What else do I need to be eligible for RHI payments?
This depends on whether you are installing a heating system for domestic or non-domestic (commercial) use. The rules can be complex so we would recommend checking the latest eligibility criteria with Ofgem either for domestic customers or commercial installations.
For domestic customers, the main criteria is that your property is insulated to a suitable standard, so that heat isn't lost unnecessarily. This generally means you have to have adequate loft and cavity wall insulation installed before applying for the RHI. To ensure your property meets these requirements, you are obliged to undertake a Green Deal Assessment before installing a renewable heating system, part of which will involve an assessor creating an Energy Performance Certificate (EPC) for your property. It is important that the EPC is produced as part of a Green Deal Assessment for it to be recognised by the RHI scheme.
The EPC will confirm whether there are any improvements you need to make to your property before you are eligible for the domestic RHI. If improvements are required, you will not be able to apply for the RHI until those improvements have been made and you have had another EPC issued.
How much will the RHI scheme pay for my installation?
The RHI payments depend on whether you have a domestic or commercial installation and the type of renewable technology you have installed.
For domestic customers, the RHI payments are made quarterly over a seven year period whereas commercial applicants receive payments over a 20 year period.
Domestic customers receive payments based on the "deemed heat use" of the property. This is the amount of heat your house is expected to need to produce each year and is calculated during the EPC assessment and shown on the EPC. Domestic RHI applicants will receive an amount based on this figure, regardless of whether more or less heat is actually required or produced by the renewable heating system when in use. See some example RHI calculations provided by Ofgem.
If you have a domestic biomass or solar thermal system installed, all the heat produced by these systems counts as being renewable. The current RHI payment for domestic biomass is 6.54p per kWh of heat (20.06p per kWh for solar thermal) so the annual amount is this figure multiplied by the annual deemed heat demand. For example, if your EPC states you have a heat demand of 32,000kWh per year, you would receive £2092.80 per year for seven years for a domestic biomass system.
Payments for domestic heat pumps are similar, although as heat pumps are run on electricity, not all of the heat output is counted as renewable. Consequently the efficiency of the heat pump has an effect on the actual figure you receive. The RHI scheme deducts an amount of heat output based on the Seasonal Performance Factor (SPF) of your heat pump so it is important to know the SPF of the model of heat pump you are planning to install (we can advise you of this during a site visit). Ground-source heat pumps currently receive 19.86p per kWh of renewable heat and air-source heat pumps 10.18p per kWh of renewable heat.
All RHI tariffs are subject to change, so please refer to Ofgem's list of current domestic RHI tariffs for the renewable system you plan to install.
Payments for commercial installations are calculated based on actual heat use rather than a calculated deemed heat demand. To measure the amount of heat produced by a commercial system, a heat meter is required for these types of installation. See Ofgem's list of current commercial RHI tariffs for the latest figures.