The Renewable Heat Incentive provides a financial carrot to encourage the switch into renewable heat technologies, such as wood pellets. Following the installation of these new energy sources the owner will receive a set tariff over a guaranteed period for the level of useful heat produced.
Eligible uses of heat
The Government have made it clear that the RHI only applies to useful heat applications. This means that the production of heat for electricity generation is not covered under the terms of this scheme.
The RHI supports:
- The utilisation of useful heat
- Heat load produced should be an existing or new heating requirements
- Acceptable heat uses are space, water and process heating where the heat is used in fully enclosed structures
The governing body Ofgem are responsible for what constitutes useful heat. For those using heat for cooling, this is eligible for the RHI except for when produced by heat pumps. This is a common practice in commercial and industrial buildings and, as such, cooling delivered in this way will be supported by the RHI.
For domestic users whose heat requirement has been calculated based on the property's Energy Performance Certificate, the RHI payment is fixed regardless of the amount of heat actually used. This discourages users from generating excess heat.