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Renewable Heat Incentive is welcomed by industry

Posted by Cathy Debenham on 17 March 2010 at 10:42 am

Ambitious and far-reaching were just some of the words delegates used to welcome the Renewable Heat Incentive proposals at yesterday's consultation event organised by RegenSW. However, they said that more education about renewable heat is needed if the Renewable Heat Incentive is going to succeed in boosting take up.

"In urban areas it is very difficult to sell a house without gas," said Kim Slowe, managing director of ZeroCHoldings and Ecofirst, speaking about biomass district heating he had installed in new housing developments. "Established perceptions are often a stronger sentiment than common sense. We need to educate the buying public. A lot of effort is needed. ... District heating is more attractive to developers, but purchasers still want individual fossil fuel back up systems."

Chris Miles, managing director of Econergy added to this call. "Heat and the renewable heat initiative is badly understood," he said. "How do we sell this to politicians and the media with simple messages ... Substantial education is needed. We need to do a sales job." He also pointed to the short timescale until the introduction of the scheme, and advised focusing on what we really want, and getting that right, and putting aside the "nice to have's". "We need to make it simple and get it 70% right and moving".

The scheme, which aims to incentivise the take up of renewable heat at all levels, from a one bedroom flat to district housing to industrial buildings and large scale heat from waste schemes, is the first of its kind anywhere in the world. Heat has, until now, been a poor relation compared with electricity generation, yet it makes up 60% of average domestic energy use and 47% of the UK's carbon dioxide emissions. One per cent of the UK's heat use is currently generated from renewable sources. The plans proposed by the Department of Energy and Climate Change (DECC) have a goal of 12% by 2020, (this compares with Sweden's 40% renewable heat). This is a huge undertaking given that there are currently only 500 accredited MCS installers (Microgeneration Certification Scheme) in the UK. This contrasts with 120,000 Gas Safe installers.

This is why DECC is offering an attractive 12% rate of return to encourage the take up of renewable heat. DECC official Erich Scherer said that the scheme will cover the differential costs in installing renewable heat, and any additional fuel costs, as well as giving a return on top. The aim is to offer a rate that will incentivise commercial investors as well as domestic ones. The rate of return on solar thermal is a lower 6%. When questioned about this he said it was because uptake and awareness is already higher for solar thermal than for other technologies. "The question we've asked is how much does it need to get going? Under the Low Carbon Building Programme  solar thermal got significant take up with a small grant of £400. What we are proposing is enormously more generous that what we have done so far." (The proposal is around £400 a year for 20 years for an average home).

Chris Miles also focused on the MCS scheme. While acknowledging its importance, he said it needs to change. "Having a certified installer is a good thing, but we have to think of individuals. It's not good for individuals, but it's ok for companies." On product certification he observed that the MCS scheme needs streamlining with other schemes, such as the Clean Air Act and emissions regulations - and that needs to happen quickly. 

Several installers pointed to the iniquity of ommitting existing microgenerators from the scheme, saying that they had received enquiries from people wanting to rip out existing equipment and replace it so as to get the renewable heat incentive. "Why are we penalising the people who lead the way?" asked Kim Slowe. Asked about this Erich Scherer pointed out that for DECC it was a "no win situation - we have to make one or other side of the argument angry". However, he did ask people to respond to the consultation on this issue: "Now this is only a proposal. We have a fairly open question on this. We need more than anecdotal evidence.

Jo Greasley, head of the Renewable Heat Incentive team at DECC, closed the day with a plea for responses to the consultation. "There are a number of very difficult questions that need answering". The consultation document can be downloaded from the DECC website. The closing date for responses is 26 April 2010. We will be publishing much more on the renewable heat incentive proposals, and the implications for our homes on YouGen between now and then, so please keep coming back and let us know what you think.

Photo by Wili Hybrid

More information about the Renewable Heat Incentive (RHI) on YouGen.

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Comments

5 comments - read them below or add one

Jayhawk International Ltd

Jayhawk International LtdComment left on: 3 May 2010 at 2:51 pm

As an innovator and pioneer of keep it simple solar thermal installations since I first introduced the Sunda brand of vacuum tube heating pipe collectors into the UK in 1999 after 5 years educating myself in Cyprus in every aspect of solar thermal collectors to the simple to complicated systems being bombarded with today from the BIG German manufactures and others, I am reverting back to the many proven system designs I developed then and are still 10 years on, working today, with no need to call out service engineers to replace the failed Gylcol due to the over heating of the collector caused in the main by installing pressure systems

On heat pumps, a couple from Cambridge who visited my home in Wimborne where for 10 years I have gained day time heating in winter from my collectors, told me about their Daikin split system heat pump coupled together with a 100 litre water storage tank.

They lived in a housing assoiation home and were told they needed 2 weeks to install this kit after explaining to them how it will save them money.

If anybody wants a copy with pictures on what has gone wrong and still not working right after 9 months, email me at jayhawkint@btconnect.com as you will find their story one of dispair and also that of the installer who keeps coming back.

Eric Hawkins (Solar thermal system designer/manufacture)

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Jayhawk International Ltd

Jayhawk International LtdComment left on: 19 March 2010 at 6:17 pm

Haveing just signed up to this great web site, my company, established in 1998 has been developing the ultimate in solar thermal heating and hot water, ready for the day such a scheme as is being consultant on today, the RHI scheme will reward those who have pinoneered the take up of solar thermal heat while the big money has gone into solar PV. Ever since the year 2000 when Tony Blair anounced in  the Labour manifesto that the Environment would be at the top of New Labours Agenda??

The small business sector haveing survived all these years as I have done, become a loyal member of the STA, has a new fight on its hands, that of the expanding gas boiler manufacturing industry with its deep pockets and links to EU mainland partners already well established in Germany.

What will separate the small companies with the corparate gas boiler sector is the innovations in system design which Jayhawk has established itself in.

The Up and coming RHI scheme will pay out much more money compared to covering your roof in solar PV panels if you heat your house with mains gas, oil and LPG.

Our new business model is to promote solar/gasboiler space heating and hot water system in order to gain 3 times the income from Ofgem as against the solar hot water system only that is being shown as a pay out a year of £400.00

Interesting times ahead

 

 

 

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Cathy Debenham

Cathy DebenhamComment left on: 19 March 2010 at 4:43 pm

I totally agree about the ambassador role, and there's such a need for education about renewable heat that there's definitely a case to make. The more people that respond to the consultation the better - but I'm not holding my breath.

The difference between the RHI and the feed-in tariff is that existing microgenerators of electricity were already receiving the renewable obligation certificates (ROCs), and the 9p rate of FiT is the equivalent of the ROC - although less than many were getting from their electricity supplier.

Under the current proposals a pellet stove boiler doesn't qualify - but that's something well worth challenging in the consultation. However, if you invest in a new heat generation system, such as a biomass boiler, you will be entitled to payments.

I'll be posting a more detailed Q&A on the RHI soon.

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Glenfender

GlenfenderComment left on: 19 March 2010 at 10:17 am

Monica makes a good point - having a body of folk who will get the RHI payments from day one would be a great advertisement for the scheme.  I also wonder how fair it is not to reward these early adopters, when as I understand it the Feed In Tarrifs are going to be paid to those who installed PV earlier - albeit at a lower rate.  As someone who installed a pellet stove boiler four years ago because it was all I could afford - I would perhaps be interested in replacing this with the more expensive but better big boiler with large pellet store - but without RHI I won't be doing that.   

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Monica B

Monica BComment left on: 18 March 2010 at 8:23 pm

I commented on another blog this evening about the anomalies that will occur if the RHI is not extended to early installers. For example, it will be cost effective for any one who is able to remove their renewable heating system to do so, and then re-install it later. I am aware from talking to non-green neighbours and friends that there is a lot of opposition or just apathy to renewable heating. I know of one friend who was unable to sell his house with a solar thermal system in place. In the end he had to remove the system as well as drop the price of his house, he then installed it on the house he moved to. If early installers are not receiving the RHI they will be hit by a double whammy if they sell - the house will be harder to sell and of less value than if they were receiving the RHI. So the pioneers are again penalised.

Finally, as I said on the other blog, if early installers are included in the RHI, this rapidly creates a body of people able to talk about how much money they are receiving in the payments and who are knowledgeable about their installations. This would be the best and most cost effective publicity for the scheme and is much more likely to convince the general public that the scheme is both real, and worth taking seriously. It would also continue to motivate the pioneers, in spreading the green message.

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