What is the Renewable Heat Incentive?

The Renewable Heat Incentive (RHI) was a scheme that provided quarterly payments to those who owned or installed specific types of renewable heating systems. Eligible homeowners and businesses received cash payouts every three months.

The UK government had set targets to reduce the country’s carbon footprint, and one effective way of achieving this was by decreasing energy consumption in homes, small businesses, and larger companies. Encouraging the use of renewable energy sources instead of fossil fuels was another way to achieve this goal. The RHI was a straightforward approach to accomplishing this.

There were two versions of the RHI scheme: a domestic version that was launched in 2014 and targeted homeowners in England, Scotland, and Wales, and a non-domestic version. The regulations were updated, so it was important for those interested in participating in the scheme to confirm their eligibility and the current status before investing in a renewable heating system. Complete details about the schemes could be found on the Ofgem website.

Key Takeaways

• The Renewable Heat Incentive (RHI) was a UK government scheme that provided quarterly payments to individuals and businesses who used or installed certain renewable heating systems, aiming to reduce the country’s carbon footprint.
• There were two versions of the RHI: the Domestic RHI for homeowners and the Non-Domestic RHI for commercial properties, each had its own set of eligibility criteria and regulations.
• Payouts under the RHI were based on the performance or estimated performance of the renewable heating system, and the scheme served as an incentive for more sustainable energy practices in the UK.

About The Domestic Renewable Heat Incentive

The Domestic RHI was a scheme that the government had launched in order to encourage homeowners to use renewable heat sources. The idea behind the system was that homeowners would help to reduce the total carbon emissions of the UK, and support the UK in reaching its renewable energy targets.

To qualify for the scheme, homeowners had to have a green, renewable heat source, and stick to the rules of the scheme long-term. If they did this, then they would be given payouts based on the estimated output of their renewable heating system. There were already thousands of homeowners taking part in the scheme.

If you wanted to join the Domestic RHI then you needed to sign up online, providing a copy of your home’s EPC, as well as the Microgeneration Certification Scheme number. You also needed to provide information on the cost of the installation. This information was requested for statistics only, and did not affect your eligibility for payouts. The payments were based on the output of the system, not how much you spent to have it fitted.

About The Non-Domestic Renewable Heat Incentive

The Non-Domestic RHI was similar to the domestic version but was aimed at commercial properties. Any business, public sector organisation, or nonprofit could apply, as long as their equipment had been installed on, or later than, 15 July 2009.

There were strict requirements for the type of renewable heat system, and for how it was monitored. The non-domestic RHI was for both large and small businesses, and also applied to a business with a district heating system which served more than one home.

In cases where a renewable heating system served only one property, and that property was eligible for the domestic EPC, then one would apply for the domestic version of the RHI scheme. The domestic EPC was treated as proof that the property was a domestic dwelling. A property that did not have a domestic EPC would not be eligible for the domestic RHI and would need to apply for the non-domestic version of the scheme.

Technologies Applicable for Claiming RHI support

• Biomass (wood fuelled) boilers
• Biomass pellet stoves with integrated boilers providing space heating
• Ground to water heat pumps
• Air to water heat pumps
• Solar thermal panels (flat plate or evacuated tube only) providing hot water for your home
• Air to air heat pumps, all log stoves, pellet stoves without back boilers and hybrid PVT are not supported by RHI.
• Water source heat pumps can potentially be eligible for the Domestic RHI.
• Certain cooker stoves and certain high temperature heat pumps may also be eligible.

How Payouts are Sent

Depending on the type of system you had, and whether or not you needed to be metered, you would be paid based on the performance (or estimated performance) of your heating system. You were asked for bank details when you applied, and the payment was sent off to those bank details. Once your renewable heat system had been approved, you should have found that the process of getting payouts was hassle-free, as long as you continued to comply with the regulations. This was a nice ongoing bonus that could help renewable heating systems to ‘pay for themselves’.

Businesses in Northern Ireland

The Non-Domestic RHI was aimed at people who ran businesses in England, Scotland, and Wales. If you were based in Northern Ireland then you needed to look at their version of the scheme. At the time of writing, the Department of Enterprise, Trade, and Investment had put the RHI for businesses in Northern Ireland on hold. Anyone who had already joined the scheme would continue to get payments for the duration of their eligibility, but new applications were not currently being accepted.

The RHI was just one ‘green’ incentive scheme. There were other tariff and payment options for other green improvements, so it was worth asking your local authority for information about incentives that you may have been eligible for.

Note that you could apply only for the Domestic or the Non-Domestic RHI. A property could not be signed up to both at the same time. Seek advice if you were not sure which scheme you were eligible for.

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Conclusion

The Renewable Heat Incentive (RHI) was a testament to the UK government’s commitment to promoting sustainable energy practices and reducing the nation’s carbon footprint. By offering both homeowners and businesses financial incentives, the RHI encouraged the adoption of renewable heating systems. With distinct guidelines for domestic and non-domestic participants, the scheme ensured a tailored approach to cater to different needs. As the world grappled with the challenges of climate change, initiatives like the RHI played a pivotal role in steering communities toward a greener future.