When can I apply to the domestic RHI?
Posted by Cathy Debenham on 9 December 2013 at 10:30 am
People with renewable heating systems installed since 15 July 2009 may have to wait to apply for the domestic renewable heat incentive (RHI). Last week the government announced its plans to phase the process.
Phasing will enable those who installed without support from the renewable heat premium payments (RHPP) to apply as soon as the scheme launches. Three months later those who applied for their RHPP voucher before 20 May 2013 can apply. Six months after the scheme starts, those who got the higher rates of RHPP can apply. All legacy applications must be completed in the first year of the scheme. New applicants can apply as soon as their system is commissioned, and must appy within a year of the commissioning date.
|Phase||Who can apply|
New applications (from launch date)
Legacy that have not received RHPP
Legacy installations that have not received RHPP
Legacy part-funded by RHPP (applied for voucher pre 20/5/13)
All legacy applications
|Year 2 onwards||
New applications only
The reason given for phasing is to manage the potentially large volume of applications and prevent a backlog. Given the tortuous backlog that dogged the introduction of the feed-in tariff, and caused much consternation to applicants, it makes sense.
Tariff reduction in the RHI
The government also announced its plans to manage the renewable heat incentive budget. Unlike the feed-in tariff, the RHI is funded out of general taxation, and budgets are assigned as part of the spending review. This means that "budgets are set for each year and are not flexible".
Like the feed-in tariff, the budget will be managed by degression - the tariff paid to new entrants will be lowered (degressed) as the amount spent on the scheme reaches triggers set out in advance.
Government will check every quarter to see whether a trigger level of spending has been hit. If it has, the tariff will go down for new applicants. If not, it will remain the same. There will be one month's notice of any tariff reduction. The government says: "We consider that one month is long enough to allow the majority of those with complete or almost complete installations to submit the application to Ofgem." When a trigger is hit, the tariff will reduce by 10 per cent (or 20 per cent if it hits a super trigger).
It will work like this:
|Deployment to 31 July provided to DECC by Ofgem|
|Analysis of data - have triggers been met?|
|By 1 September tariff change notice of 1 month issued|
|1 October - new tariffs come into effect|
If there are any tariff reductions in the first year, all legacy applicants will be protected from them, and will receive the tariff rate at launch.
The degression will be based on applications to the domestic RHI for each specific technology, rather than for the scheme overall. The aim is to support a mix of technologies and not to allow one to dominate the budget. The first assessment date is 31 July 2014, and quarterly thereafter. The budget is around £45m in 2014-15 and £80m in 2015-16 (these include the legacy applications and the metering and monitoring service). This would be around 35,000 installations in the first year and 57,000 the year after.
Other funding and eligibility
An installation must be at least part paid for by the owner to be eligible for the domestic RHI. Any public funding (including Lottery funding and RHPP) will be deducted from RHI payments.
Biomass sustainability requirements
It is a requirement of the scheme that domestic RHI recipients using biomass source their fuel from an approved suppliers list. However, as the industry isn't ready yet, this requirement will not start until Autumn 2014. However, you will still be encouraged to use a registered supplier.
Photo: John MoriartyBy Cathy Debenham
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