RHI update

We were very shocked this morning, when we looked at the date of our last blog – May 2016 arrrggghhh!!

We have been so busy that we have not had time to think, more later on what we have been up to but, more importantly for now, up to date news on the Domestic RHI.

Ofgem published a factsheet in December 2016 entitled “Important Changes to the RHI”. The factsheet floated the potential idea of an uplift in the tariff and also a cap in the kWh to come in to force in Spring of this year. The current tariff is 4.21p per kWh – this is the figure that you would receive if you installed a domestic biomass plant today. What the government are proposing is an uplift to 6.44p per kWh in Spring but also a cap at 25,000 kWh.

We have just come off the phone with Ofgem and, what is interesting, is that the uplift will be automatic, so, if you were to instal today (for example) you would automatically receive the uplifted amount if it comes into force in Spring BUT you would not receive the cap, unless you had installed after the date when any potential cap was announced.

It would seem to us that now would be a good time to instal a biomass system, if you are thinking of it, because there is a short time frame in which you can potentially reap the benefits of a sizeable uplift in tariff, without having to bear the burden of any potential caps its a – win/win scenario but hurry, it won’t be around for long!

Energy Efficiency and Retrofit Awards 2016

We are so chuffed and proud to announce that we won silver at the Energy Efficiency and Retrofit Awards yesterday, in the category of RHI Installer of the Year! I’d just like to say a huge thank you to our lovely clients who provided testimonials, you really are the best and continue to be our greatest advert!!

 

RHI changes Spring 2016

From 24th March new applicants to the RHI Scheme will not require a Green Deal Assessment and Self Build Properties will be exempt from the 183 declaration (this is where home owners are required  to declare occupation of a property for 6 months of the year).

The Future of the RHI

The Chancellor of the Exchequer delivered his spending review on Wednesday, which was much awaited in the industry, as it contained information about the future of the Renewable Heat Incentive. Here is what it said :

“The Government will increase funding for the Renewable Heat Incentive to £1.5  billion in 2021, to ensure that the UK continues to make progress towards its climate goals, while reforming the scheme to improve value for money, delivering savings of almost £700 million by 2020-21.”

Below is a table of how the year on year budget will look moving forward. As soon as we have any information on the scheme reforms, we will of course let you know.

Recent project in Abergavenny

We’ve just completed an installation for some lovely clients in Abergavenny, who are extremely happy with their brand new and shiny Windhager Biowin 2. They are set to receive just over £23,000 from the domestic RHI, over a 7 year period and emailed me today to say “…we thought you might want this photo. Aaron really has done a super job with everything!”

Windhager Biowin 2 installed in beautiful Abergavenny

Happy Birthday to the Domestic RHI

The Domestic RHI celebrated its first birthday last month, here are some key facts regarding its impact so far:

Over 30,000 Domestic RHI accreditations have been made since its launch, helping to create cleener, greener and cheaper heating for many homes across the UK.

DECC estimates that these accreditations will save approximately 1.4MT CO2 – in the 7 year membership period of the Domestic RHI this is equivalent to … 150,000,000 gallons of petrol, to the moon and back 7,000 times or, enough electricity to power 180,000 homes for a year!

Of these 30,000 accreditations 30% are new applicants and 70% are legacy applicants

The make up of the statistics for each technology is:

42% for Air Source Heat Pumps, 26% for Biomass, 19% for Solar Thermal & 14% for Ground Source Heat Pumps

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!