Friday, 6 July 2012

RHI Update: New guidance for Applicants

Ofgem's latest update on  the RHI reports the scheme has received over 600 applications and has resulted in  payments for over 13,000 MWh of heat.  Of interest is the extremely high application acceptance rate (95%) with only three schemes having been rejected due to the receipt of capital grants (which are not compatible with the RHI).

Based on these figures it appears that only around 57 applications have been successfully processed and are receiving payments (which hints at a huge backlog of around 543 applications, the majority of which are for biomass).

Ofgem acknowledge the popularity of the scheme and the fact that it is taking longer to process applications than anticipated.  Most importantly Ofgem have highlighted the issues they  have found with heat metering under the scheme.  In response a range of new guidance materials have been made available (see below).

Heat metering issues

Ofgem has conducted a series of early site audits of RHI installations which have revealed significant problems with most installations having errors in their metering arrangements (which need to be rectified before installations can be accredited to the scheme.  Common issues identified include:
  • Meters are not installed according to manufacturers’ guidance (e.g. the meter orientation is incorrect; the meter is installed too close to a bend; or the meter is installed in the flow pipe when it should have been installed in the return pipe etc).
  • More installations qualify as ‘complex’ than as ‘simple’ for the purposes of RHI (meaning often more meters are required than applicants and their advisers might have anticipated).
  • Schematics provided for systems to date often lack clarity or fail to adequately reflect the situation on site. This means that it can be difficult for Ofgem to decide whether the heat metering strategy is appropriate for the installation. This results in a need for further clarifications and work for both applicants and Ofgem.
  • There are errors and omissions in Independent Reports on Metering Arrangements as well as inconsistencies with other documentation.

In addition to the new guides below Ofgem offers the following key advice:

  • Be clear about the triggers which make an installation ‘complex’ for the purposes of the RHI before making an application.
  • Ensure that meters can be and are actually installed in accordance with their manufacturers’ instructions.
  • Ensure that appropriate documentation is obtained from manufacturers or suppliers and retained by the owner of the installation.
  • Provide a schematic which accurately reflects the situation on site, to allow Ofgem to rely upon the meter readings it receives.
  • Ensure that Independent Reports on Metering Arrangements are proof-read and checked against other documentation by their authors before submission to Ofgem.
  • Ensure that the application is well made, by providing sufficient detail against answers and including all supporting documentation at the outset.
New guidance

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