Renewable heat incentive plans unveiled

With expensive energy bills one of the main worries for many homeowners in the UK, renewables offer a way to escape costly gas and electricity prices. But if you’re put off by the cost of installation, the Government have announced a scheme that’ll help you see a lucrative payback.

The Renewable Heat Incentive (RHI) has been set up by the Government to offer a financial return for those who invest in renewables which produce environmentally friendly heat. This would include the likes of solar thermal panels, heat pumps and biomass boilers.

With strict EU targets set to reduce carbon emissions in the UK by 2020 and an ambition to have 12% of heat coming from renewable sources by the same year, the RHI is expected to go a long way in helping to achieve both.

The scheme is aimed at both domestic and commercial installations, although the domestic side will come into force in spring 2014.

The RHI works in a similar way to the successful feed-in tariff scheme, most associated with solar panels. It pays out a set rate for the renewable heat you generate and early predictions say you can earn as much as £650 a year through this incentive alone. Then you have the annual savings on bills to add on too.

For domestic renewables, the following rates will apply:

  • Solar thermal panels: 19.2p/kWh
  • Ground source heat pumps: 18.8p/kWh
  • Biomass boilers: 12.2p/kWh
  • Air source heat pumps: 7.3p/kWh

Payments will be made quarterly for seven years, ensuring you see a fantastic return of investment over the system’s lifetime, which in many cases is at least two decades.

Remember, as well as this scheme there is also the Renewable Heat Premium Payment (RHPP) which is a grant for the installation of renewables. Grants have recently doubled too, so if you’re interested in lowering your energy bills now is the time to act.

RHPP grants are currently as follows:

  • Ground source heat pumps: £2,300
  • Biomass boilers: £2,000
  • Air source heat pumps: £1,300
  • Solar thermal panels: £600

The grant could well be cut when the RHI comes into play in spring 2014, so make sure you’re up and running before then.


Tom Crosswell

I have been managing online projects since 1999 and I'm a experienced marketeer, who is well versed in international brand management, online business strategy and developing long term relationships. Through my academic and professional background I am a specialist in generating online loyalty towards brands. My experience has taught me that ultimately business is about relationships and people. For more information see my Google+ page.

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