UK Government Domestic RHI (Renewable Heat Incentive) How It Works

December 24, 2017

The Renewable Heat Incentive (RHI) is UK Government scheme mooted to encourage individuals and companies to generate their power through renewable technologies. The RHI is a pioneering scheme globally as the UK government strives to accomplish its goal of having over 15 % of its heating power coming from green sources instead of fossil fuel.

The domestic chapter of the RHI scheme, which rolled out in April 2014, offers financial incentives in the form of tariffs to households using either of five eligible technologies. The tariffs are calculated based on the technology in use. It’s easy to calculate the amount you could earn online, although there are rules and regulations to be followed for you to qualify.

At the same time, tariffs are calculated on based on the amount of renewable output that a household generates and the current tariff rates announced by UK government.

Renewable Heat Incentives Options
The Renewable Heat Incentives can be summed up in two ways: there is the scheme for the non-domestic sector that covers industries, commercial public and community-based establishments. This scheme has been operational since 2011.

The domestic RHI scheme operates almost in a similar way compared to the Feed-in-tariff in the domestic renewable electricity sector. This scheme is available in England, Scotland and Wales.
Regarding RHI policymaking prerogatives, the UK Government’s Department for Business, Energy & Industrial Strategy takes charge while the leading energy firm; Ofgem E-Serve plays the role of administrator. To qualify for payments, there are particular aspects that a household needs to meet.


Technologies That Qualify Households For RHI Payments Include:
• Solar thermal.
• Ground source heat pumps.
• Air source heat pumps.
• Biomass.

Who Is Eligible?
Upon meeting eligibility criterion, a variety of individuals can apply for these payments they include:
• Single domestic units.
• Owner-occupiers.
• Private landlords.
• Self-builders.
• Certified social housing provider, who have installed recommended technologies.

Applicants are required to apply within 12 months after the commissioning of their systems.

Additionally, applicants looking to qualify for Domestic RHI payments need:
• An Energy Performance Certificate that is less than 24 months old. This certificate should detail the current condition of the home.
• If you have remodelled or renovated your home, you might need a new EPC with updated info.
• Also you will need Microgeneration Certification Scheme (MCS) Certificate.

For those who received government grants or public funding for the installation, you need to provide details regarding the amount you received, relevant dates and a tabulation of installation costs.

Additionally, households applying for RHI tariffs for heat pumps need to provide the Seasonal Performance Factor while those with systems that require metering need the Installer Metering Questions form.

Factors Affecting RHI Payments
When you start receiving domestic RHI payments, the rates are likely to vary annually. Before the Spring Regulatory amendments of March 2016, rates changed in line with the Retail Price Index. For applications that were verified after the beginning of April 2016 will be adjusted by the Consumer Prices Index.

RHI payments are calculated on a ‘degression’ system to better manage the resources available for the RHI pay-outs. Intermittently, the tariff for a given technology will dip especially for new applicants, but this applies when the total amount being claimed reaches a given level. As such, applicants who are already on the paylist will not have their tariffs reduced via digression.

For those who are beneficiaries of government grants or public funds, the amount extended is factored in when calculating their domestic RHI payments.

What’s New?
As of September 2017, changes were made resulting in increased RHI subsidies for heat pumps and biomass boilers. There are no tariff adjustments for the solar panels option although they remain part of the scheme. The government introduced caps on heat demand limits for biomass boilers and heat pumps. This means households will receive payments for a stipulated amount of heat output. Heat pumps installed during the 2017 summer and winter need to have electricity meters to consolidate efficiency.

How to Apply For the Domestic RHI?
Applying for eligibility for the domestic RHI payments is relatively easy. You need to have the relevant documentation in place including, EPC installation certificates, photo evidence when applying.
The scheme is funded from taxpayers’ money and thus the strict level of bureaucracy required. You can make an application through the My RHI or the OFGEM website.

Get in Touch
HP energy can provide invaluable advice. You can call us any day for help with your application.


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