RHI's severe delay and new action plan

Published:  28 March, 2013

The Government this week announced a delay of the domestic Renewable Heat Incentive (RHI) until April 2014.

The Micropower Council said the blow of this recent delay was slightly softened by the Government confirming it would continue with the current Renewable Heat Premium Payments system, with similar funding levels in 2013/14 to provide grants for householders who install renewable heating systems. However, the industry still wishes to see the final scheme implemented as quickly as possible.

In addition, the Government confirmed it does not intend to fast-track the integration of air to water heat pump technologies, despite a shorter fast-track consultation on their inclusion in September 2012. This will also not now happen until April 2014.

Despite being disappointed with this week's announcements, the Micropower Council said it remains fully committed to making this scheme a success. Dave Sowden, the Micropower Council’s chief executive, said: "The early feedback is that the market is bitterly disappointed with this delay. Taken with the delay in confirming the next steps of the "zero carbon homes" policy, the announcement is forcing industry to question whether the Coalition is serious about promoting domestic Renewable Heat during this Parliament.

"Despite there being some snippets of good news buried in the detail, this is a further setback for investor confidence. It is becoming increasingly difficult to give positive messages about whether the Coalition as a whole remains committed to domestic renewable heat, despite the seemingly good intentions of those within the Department of Energy and Climate Change (DECC).

"Following on from an absence of any mention in last week's Budget, a Cabinet-level unequivocal cross-government commitment to an ambitious renewable heat policy is urgently needed to restore investor confidence."

Energy & Climate Change Minister Greg Barker said: “The Renewable Heat Incentive, which has been available for non domestic investors for over a year, is a key part of our approach to cutting carbon and driving forward the move to more sustainable low carbon heating alternatives.

“So far over 1,000 groups have got on board, and today [26 March] we have outlined details of our tariff review to help encourage even more organisations to invest. We remain committed to introducing an incentive scheme for householders too, and have today set out an updated timetable for its launch alongside plans to extend our renewable heat voucher scheme in the meantime.”

Energy Secretary Edward Davey said: “If we can increase the use of low carbon heating in our homes, businesses and across our economy, we can help reduce our dependence on costly carbon-intense fossil fuels.

“Last year we launched the UK’s first ever heat strategy, to get us on the right pathway to decarbonisation and today we have published an update on the progress we have made so far, alongside a new set of actions specifically targeted at industrial heat, urban heat networks and heat in buildings.

“Many homes and businesses across the UK have already switched away from fossil fuels and are using kit like biomass boilers, heat pumps and solar thermal panels to provide heat, thanks to government support, and I want to ensure even more householders and organisations get on board.”

This week’s plan focused on a number of key actions to spur on green growth and the move to low carbon heating alternatives, including:

  • A £9m package to help local authorities get heat network schemes up and running in towns and cities across the country, with a new Heat Networks Delivery Unit to sit within DECC providing expert advice
  • £1m for the cities of Manchester, Leeds, Newcastle, Sheffield and Nottingham to help them develop heat networks
  • 100 green apprenticeships to be funded primarily for young people in small-scale renewable technologies
  • Up to £250,000 for a new ‘first come first served’ voucher scheme for heating installers to get money off the cost of renewable heating kit installation training, with up to £500 or 75 percent of the cost of the training course per person
  • Working with individual industrial sectors to design long-term pathways to cut carbon across UK industry.

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