What is the Renewable Heat Incentive (RHI)?
The RHI is the government financial incentive for renewable heat technologies, covering air and ground-source heat pumps, biomass boilers and solar thermal panels. Administrated by Ofgem, the scheme was set up to encourage the take-up of renewable heating installations to reduce carbon emissions and contribute to the UK’s renewable energy targets.
For domestic installations, the RHI is payable quarterly for seven years, and is subject to degression. This means that the tariff rates will decrease over time based on the amount of installations commissioned and registered on the RHI, to monitor the amount of funding allocated. Ofgem release new tariff tables at least once per year. Once you’ve applied and been accepted however, your rates are set at whatever they were at the time of your acceptance.
Domestic RHI tariff
As of July 2018, the domestic RHI tariffs are:
Biomass boilers: 6.74p/kWh
Air source heat pumps: 10.49p/kWh
Ground source heat pumps: 20.46p/kWh
Solar thermal panels: 20.66p/kWh
The way the RHI is calculated for your heat pumps and biomass is based on your Energy Performance Certificate (N.B. Some installations require the system to be metered if the installation is not supplying 100% of the heat demand). The EPC will give an annual heat demand in kWh for your property (i.e. how much power your home requires) for both heating and hot water. Heat pump systems are also subject to the Seasonal Performance Factor (SPF), which takes into account the amount of electricity required to power the systems.
It is worth noting that RHI is eligible for solar thermal systems that are providing hot water only, and is calculated from the Design Calculations (the estimate of energy output, so that the customer would see the amount they would get prior to the installation). The RHI is not calculated from the EPC.
The RHI payments made on heat pumps and biomass will be limited to the renewable proportion of heat demand. If the figure on your Energy Performance Certificate is higher than this amount, you can still apply, but the contributions will be capped at these limits:
Capped annual energy demands (kWh)
Ground-source heat pumps: 30,000kWh
Air-source heat pumps: 20,000kWh