Domestic RHI proposals announced

In keeping with the cautious nature of UK energy policy-making DECC has launched three new RHI consultations - a domestic RHI, expansion of the non-domestic RHI and introduction of renewable heat tariffs for air-to-water and energy-from-waste.

Of these the long awaited domestic RHI is of considerable interest to the biomass heating sector. It provides some clarity on the final scheme that should emerge during summer 2013 and is essential reading for consumers and installers alike.

Proposed domestic RHI timeline

This article aims to highlight the main points of the domestic RHI proposals in relation to biomass heating technologies.  It also provides links the consultation documents and summaries from other commentators which may help to provide a more rounded picture.

Lets start with the DECC introduction which provides a succinct summary of the 116 page document:

The consultation on proposals for a domestic scheme sets out  proposals for longer term support to householders who install renewable heating kit such as biomass boilers, air (to water) and ground source heat pumps and solar thermal into homes.

The RHI for householders is aimed at any householder looking to replace their current heating with renewable heating kit or householders who have installed any such technology since 15 July 2009 (n.b. whether or not these installations will be eligible for  support will be decided decided upon as a result of this consultation).

The more detailed introduction to the consultation goes a bit further:

• The scheme is aimed at helping households replace their existing fossil fuel-based heating systems with renewable-based ones (<45 kWh/thermal).
• Support is proposed for the installation of Microgeneration Certification Scheme (or equivalent) certified ground and air source heat pumps, biomass boilers and solar thermal panels.
• The subsidy would be provided through tariff based payments over a seven year period.
• Payments would be made on the basis of deemed amount of renewable heat generated with the rate paid varying according to the type of renewable technology installed.
• The tariffs take into account the additional costs of installation and running the renewable system and non-financial barriers (such as disruption in the home). They also build in compensation on the additional upfront installation costs of 7.5% to cover the cost of financing.
• The scheme will be for individual domestic properties and is open to all.
• Provided that properties meet certain energy efficiency criteria (meaning a key interaction with the Green Deal), owner-occupiers and private landlords would be eligible, together with householders who have installed renewable heating systems since 15 July 2009, including those who received the Renewable Heat Premium Payment (RHPP).
• There is consideration of bespoke tariffs for the registered social landlord and new build sectors, recognising their potential contribution to the roll-out of renewable heat, but taking into account the possible lower installation-related and other costs they might benefit from.

The devil, as they say, is in the detail and a more thorough read through is required to reveal the finer points. The main items of interest, as far as we are concerned and again relating primarily to biomass, are below. Don't forget that these are only proposals at this stage and the final result will depend on the feedback to the consultation:

• The basic idea behind for a domestic RHI is that it is a boiler replacement scheme: It is designed to encourage those who would be looking to change their current fossil fuel boiler due to age and/or loss of efficiency.
• The tariff could be paid over a timescale shorter than 20 years (e.g. 7 years) to appeal to consumers who plan and budget in a shorter time frame.
• Tariff levels are set to be more financially advantageous to those homes off the gas grid, although the scheme will be open to any home in the UK.  However, the policy could be restricted to just those off the gas grid or focused at particular geographic areas.

Proposed domestic RHI tariff

• Second homes are excluded from the scheme.
• It is proposed that installations in rented properties be eligible for the RHI with the landlord as the recipient (providing the landlord is the owner of the heating system).
• Consumers who installed renewable heat installations since 15 July 2009 will be eligible to apply for the domestic RHI provided they:

• Have installed an eligible technology.

• Meet the eligibility criteria on energy efficiency.

• Declare any government funding or support already received for the installation of renewable heat.

• Do not have a back up fossil fuel heating system, or if they do, are prepared or have installed a heat usage meter on which the RHI payments can be based.

• Meet all current MCS standards.

• Where these legacy applicants meet the eligibility criteria, any government funding already received will be subtracted from the amount of RHI payable to the householder and will be reflected in the payments received. A phased application process for legacy installations may be used to help manage applications.
• Biomass-only boilers and biomass pellet stoves with back boilers will be eligible for the RHI provided they meet 99% of the peak space heating load of the property using the calculation methodologies in MCS.
• Fuel sustainability criteria used for the non-domestic RHI will also apply to the domestic scheme.  This would entail consumers purchasing fuel from an approved supplier list.
• As with biomass sustainability, the domestic RHI scheme takes the same approach regarding emissions limits and the tests to assess compliance as that set out in the recent consultation on the non-domestic scheme.
• It is proposed that only biomass appliances that are on the HETAS approved list will be eligible for the RHI.
• Stoves with back boilers (log or chip), room heater stoves and condensing biomass boilers and stoves are excluded from the scheme.
• Individual homes would be eligible to apply only once during the lifetime of the scheme. In line with this, domestic RHI payments would be calculated on the assumption of one eligible technology meeting the deemed total space heating (not hot water) demand of the property.
• The installation of multiple eligible renewable technologies under the domestic RHI be restricted to solar thermal in combination only (e.g. solar thermal and biomass).
• In order to receive the domestic RHI, consumers would be required to have completed all 'green ticks' on their Green Deal assessment that relate to the thermal efficiency of the house.

Example of Green Deal 'green ticks'

• The domestic RHI will be paid on the basis of ‘deemed’ heat with metering being only required for certain situations.  Deemed heat is the estimated annual heat load which would be obtained via an existing accepted measurement process (most likely SAP).
• In the majority of cases consumers would be required to remove their existing fossil fuel heating systems in order to be eligible for the RHI.
• For biomass boilers bivalent systems (i.e. biomass plus fossil fuel system) would not be allowed, except for electric immersion heaters for hot water and solar thermal, due to the risks involved around the consumer switching back after 7 years.
• For legacy applicants we are proposing to allow bivalent systems if they have been installed and the heat load will be calculated based on metered readings.

• Where pre-existing fossil fuel Rayburn range cookers are in place, we propose that these need not be removed but that the range cooker should be disconnected from the heating pipes and boiler, allowing the householder to continue to use the cooking facilities. These systems would not be taken into account in ensuring that the renewable system covers 100% of the heat load.

• Where pre-existing Aga range cookers are in place, for safety reasons we propose that these could remain connected to the boiler but they should be disconnected from the radiators.

The consultation document can be found on the DECC website.  The deadline for responses is December 12th.

Links

Here is a selection of early commentary on the consultation that may be of use in forming an overall opinion of what is being proposed:

Business Green
Greenwise Business
Guardian