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What is the Renewable Heat Incentive?

Renewable heat incentive

This guide is intended to provide general guidance only. It is not intended to give you advice on your personal financial circumstances. You should seek independent professional advice if you’re unsure about anything mentioned in this guide or what choices to make.

The Renewable Heat Incentive, or RHI, is a scheme set up by the UK government to encourage homeowners in England, Scotland and Wales to install renewable heating technology and reduce their carbon emissions.

It was launched in April 2014 and updated in July 2015 to fine-tune the eligibility criteria for heat pumps and biomass systems.

If you install an eligible system and then keep to the rules of the scheme, the government will pay you renewable energy incentives as a cash sum each quarter. The amount will be based on the amount of clean, green renewable heat produced by your system.

What kind of renewable heating technology does the RHI cover?

The grant covers heat pumps (ground to water or air to water), solar thermal panels, and boilers powered by wood or biomass. Some cooker stoves or high temperature heat pumps might also qualify. We’ve included full (and rather technical) details in a table further on in this article.

The RHI doesn’t cover log stoves, air to air heat pumps, pellet stoves (unless they include an integrated boiler providing space heating) or hybrid photovoltaic (PV) solar panels.



How much are the quarterly cash payments?

The payments will change each year in line with the Retail Price Index, and will depend on a range of factors, including:

  • What kind of heating system you install.
  • The latest tariffs being offered by the government (see the table below).
  • Whether you’ve already had a grant from the government or another public body.
  • Metering – some kinds of heating system will need to be metered to see how much heat they’re producing.

You can find out roughly what you might earn by using the RHI calculator on the website of the Department of Energy and Climate Change (DECC).

What are the tariffs?

Here are the latest renewable energy incentives for each kind of heating, as shown on the Energy Saving Trust’s website:

  

    Air source heat pump Biomass Ground source heat pump Solar thermal
Tariff (pence per kilowatt hour of renewable heat) Applications submitted between 1 July 2015 and 30 September 2015 inclusive 7.42p 7.14p 19.10p 19.51p
Tariff (pence per kilowatt hour of renewable heat) Applications submitted between 1 October 2015 and 31 December 2015 inclusive 7.42p 6.43p 19.10p 19.51p

 

Tariff rates updated – 1 September 2015

Would my home qualify for the Renewable Heat Incentive?

You could qualify if:

  • You live in England, Wales or Scotland.
  • You are an owner-occupier, self builder, private landlord or registered provider of social housing.
  • You’ve installed a heating system that meets the scheme’s criteria.
  • The system heats just one home that isn’t a new-build (unless it’s also a self-build).
  • The property is a domestic dwelling – not a business or commercial building – and is capable of getting a domestic Energy Performance Certificate (EPC).

Does my home need to be on the national gas grid?

No – the scheme applies to homes both off and on the gas grid. In fact, if you can’t get mains gas, yours is one of the homes with most potential for savings on your fuel bill and CO2 emissions.

How do I apply?

You must apply within a year after you’ve installed and started using your heating system. That means you can apply for a system that’s already working, as long as it’s been going for less than a year.

To apply, just visit Ofgem’s website. They recommend you use a laptop rather than a tablet or smartphone.

If you can’t apply online, you can call Ofgem on 0300 003 0744; their lines are open 9am - 5pm Monday - Friday. You can also email them on DomesticRHI@ofgem.gov.uk.

You’ll need to have all this information ready before you start your application:

A Microgeneration Certification Scheme (MCS) certificate number for the heating system.

An Energy Performance Certificate (EPC) number.

Your bank details.

Details of whether or not your heating system might need to be metered – find out more.

Invoices or records showing what it cost to install your system (if it’s already up and running) or what you think it will cost to install (including labour) – it can just be a rough guestimate at this stage.

Ofgem might well be able to give you an immediate decision, unless there are aspects of your application that they need to review.

Can I apply for heating my workplace?

If your workplace is simply a home office in your house, or an annexe to it, then you should still be eligible for a Domestic RHI. However, if it’s in a separate self-contained building, it wouldn’t qualify.

There is a separate Renewable Heat Incentive for business or commercial properties, known as the Non-Domestic RHI. This is also suitable for hospitals, schools and district heating schemes.

Both RHIs are administered by Ofgem, but they have different tariffs, conditions, rules and application processes.

More details of the kind of heating systems that could qualify for renewable energy incentives

Not every heating system that seems to be renewable is suitable for the RHI scheme, so make sure you do your research before you invest your cash in a heater that isn’t on the approved list.

Heat pumps

YES As long as: No
Ground to water Air to water Water source Some high-temperature heat pumps
  • They meet a minimum performance standard.
  • They have an EU energy label with an efficiency rating.
  • They are on the Domestic Renewable Heat Incentive Product Eligibility List.
Air to air heat pumps

 

Biomass stoves and boilers

YES As long as: No
Biomass (wood-fuelled) boilers Biomass pellet stoves with integrated boilers that provide space heating
  • The fuel is sustainable, and sourced from a supplier on the RHI Biomass Suppliers List.
  • The stove or boiler is on the Domestic Renewable Heat Incentive Product Eligibility List.
Log stoves Pellet stoves without back boilers

Solar panels

 
YES As long as: No
Solar thermal panels (flat plate or evacuated tube) that provide hot water for your home
  • They are on the Domestic Renewable Heat Incentive Product Eligibility List.
Photovoltaic (PV) solar panels, including hybrid PV


 

 

OVO Energy rated 4.5/5 based on 1000+ customer reviews.

*Source and notes for graphs and table

Sources:

https://www.ofgem.gov.uk/environmental-programmes/domestic-renewable-heat-incentive

http://www.energysavingtrust.org.uk/renewable-heat-incentive

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