RHI tariff regression mechanism

March has been a super busy bumper month, seeing us all run around like ‘mad hatters’! The reason for this is that DECC (the Department of Energy and Climate Change) announced, on 27th February 2015, that the degression super trigger for domestic biomass had been passed. This means that the current domestic biomass tariff of 10.98p per kilowatt hour will be reduced, by 20%, to 8.93p per kilowatt hour for all new applications made under the domestic RHI from 1st April 2015. Consequently and understandably, our clients were eager to instal before the 1st April, making March a very busy and hectic month indeed. Tariff rates are subject to review quarterly, so another review is expected to take place in June. We urge you please, if you are considering biomass, not to delay, because time really is of the essence in securing the best possible tariff rate for your RHI term. Here’s what all the jargon means:

David Stirling and his Windhager Biowin 2

The RHI (Renewable Heat Incentive) is a limited budget pot, which the Government reduces as more and more biomass boilers are installed, via a financial control mechanism called degression. This reduces the tariff, meaning that it really is a case of the early adopters reaping the greatest financial benefits.

What are tariffs?

These are the set rate for your RHI payments. The good news is that once your application is complete and agreed, your tariff rate is fixed for the entirety of your term. People who join the scheme and abide by its rules receive quarterly payments over 7 years (under the domestic RHI) and 20 years (under the commercial RHI) for using clean, green renewable heat.

Scheme budget management (degression)

The original RHI tariff rates were set by DECC. In order to keep the RHI within budget, DECC carefully monitor its uptake. If the uptake of the scheme is higher than the approved budget, they lower the tariff rates and this control mechanism is called degression. Tariff rates are subject to review quarterly but the rate will only reduce if the total amount of RHI payments made is higher than the degression trigger or (as in the case recently, with this year’s first quarter’s domestic RHI, which caused our extremely manic March) super trigger. Legacy applications (for installations commissioned before the scheme launched) are not affected by degression and the tariff rate at the time of submission will apply for the full term, meaning that any further reviews and degressions will not affect it.

The commercial RHI and the domestic RHI are separate “budget pots” but both are subject to tariff reviews once a quarter.

If you have any queries, on any of the above, please do not hesitate to contact us – we are always happy to talk biomass!

Exciting instal with record-breaking domestic RHI return

The domestic RHI can be very lucrative – ask us about a FREE site visit to assess the suitability of biomass for your home

We are very excited about one of our current projects, up in Malvern in Worcestershire. 2 x 35kw Biowin Excels running in cascade, with full weather conmpensation Windhager Specialist MES controls (which alone will save the client 13% per annum on fuel), a 7 tonne pellet store and 6 metres of pipework from the boiler room to the house. The most exciting thing about this project is not the beautiful rolling Malvern hills, not the two shiny Biowin Excels (the workhorses of the Windhager family) but the whopping £110,000 that our clients will receive from the Government, under the Domestic Renewable Heat Incentive (RHI), over a 7 year period. We were blown away by this figure and it tops the charts as being one of the highest that we have personally seen, under the Domestic RHI,  to date!

 

 

Biomass Wood Gasification Boilers

We have installed several biomass wood gasification boilers recently; always an exciting project for our installers as they (that’s the boilers) feel very “manly” and “neanderthal”  - apparently! Always exciting projects for us as a business because, when fitted correctly and in the right context, they represent great value for money and probably the most cost effective form of fuel . For clients who work in the timber industry or who can lay their hands on a plentiful supply of suitable wood, they are a no-brainer and, of course, under the RHI scheme, the Government pays you to use them – joy!

Biomass Wood Gasification boiler

Windhager Biomass Wood Gasification boilers – the science is simple; the effects are extraordinary

Biomass Wood Gasification Boiler installed recently for a client in Chippenham