DECC Announcement Brings RHI Confidence
Farmers and estate owners looking to invest in renewable heat projects have received a boost as DECC outline measures that will enable the sustainable management of the Renewable Heat Incentive (RHI).
A newly installed biomass boiler
The announcement creates certainty for people who are looking to invest in renewable heat projects but are unsure how the RHI tariffs are to be managed in the future.
Under the proposed plans, a flexible degression based system will be implemented to stop an oversubscription of the RHI.
As the scheme goes forwards, tariffs will be reduced for new applicants when uptake reaches predetermined trigger points.
Rebecca Seaman, a renewable heat expert at Fisher German, believes that this strategy is essential in order to gain the confidence of those looking to invest in renewable heat.
“The government had to show that there would not be a repeat of what happened to the Feed-in-Tariff for solar PV, where a higher than anticipated uptake in installations used up a large proportion of funds earmarked for other technologies under the FIT.
“The proposed flexible degression system for the RHI intends to manage the scheme sustainably.
The system is based on quarterly reviews to evaluate whether a degression trigger has been hit.
If uptake has reached the predetermined trigger point, a one month notice period will be given before tariff reductions are made.”
DECC has confirmed that grandfathering will apply and only applications which are accredited after the reduction comes into force will be affected.
Rebecca comments “The consultation demonstrates the government’s intentions regarding degression and the review mechanisms, creating a sustainable programme for investment.
It provides confidence for farmers and landowners who want to invest in renewable heat technologies.”
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