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Renewable Heat Incentive: A reformed and refocused scheme

The Renewable Heat Incentive (RHI) was introduced to support households, businesses, public bodies and charities in transitioning from conventional forms of heating to renewable alternatives. In November 2015, the Government renewed its commitment to the transition to a low carbon economy by confirming a continued budget for the RHI. 

Objectives of the consultation

The Government wishes to reform the existing Renewable Heat Incentive scheme to ensure it meets its objectives in a manner which: is affordable; offers value for money; promotes deployment of those technologies which are likely to be strategically important in the long-term; contributes to the development of sustainable markets; promotes widespread access, and; incorporates robust scheme design. The consultation set out and sought views on the Government’s package of proposals to achieve these aims. The consultation closed on 27 April 2016.

Supporting papers

To download documents that supported this consultation, please follow the links below.

CIBSE response

CIBSE agrees that achieving a subsidy-free existence for renewable and low carbon heating technologies in the UK is a sensible long term market objective. The key challenge is enabling a smooth transition from the current situation to the desired subsidy free scenario, providing adequate but diminishing support to enable businesses to plan their operations, training and skills development, and business financing appropriately.

Some of the current proposals for the Renewable Heat Incentive risk undermining growth in the sector and eroding value from already committed taxpayer support. This includes the removal of solar thermal systems from both domestic and non-domestic RHI schemes, and the de-prioritisation of biomass heating.

An area which requires more attention is that of quality, regulation and standards. Setting minimum (and perhaps best practice) standards for renewable and low carbon heating will provide greater confidence for specifiers and clients. This would drive up the quality of installations, increase efficiencies and reliability for consumers, reduce emissions, and deliver better value for Government.

To read the full CIBSE response, please follow the link below.

Results of the consultation and next steps

The Government published its response to the consultation on reforms to the Renewable Heat Incentive Scheme on 7 December 2016. Overall, the reforms will improve the scheme to ensure it:

  • focuses on long-term decarbonisation: promoting the deployment of the right technologies for the right uses, while ensuring the RHI contributes to both our decarbonisation targets and to the UK’s renewable energy target
  • offers better value for money and protects consumers: improving how costs are controlled, giving consumers more confidence in the performance of particular technologies and addressing potential loopholes in the scheme
  • supports supply chain growth and challenges the market to deliver: driving cost reductions and innovation to help build growing markets that provide quality to consumers and are sustainable without Government support in future.

To read the Government response to the consultation, the impact assessment and accompanying reports, please follow the links below.

The RHI Scheme regulations were published on the legislation website in February 2018. To view the regulations, please follow the links below.