Renewable Heat Incentive for Home

Could the Domestic Renewable Heat Incentive pay for your heating?

With funding for the Domestic Renewable Heat Incentive set to rise from £430m to £1.5bn by 2020, you could earn money from a renewable heating system for 7 years, as well as saving on your heating bill.

You can read the latest announcement from Ofgem, about the reformed RHI by clicking here.

The government have stated that they anticipate the installation of nearly 140,000 heat pumps by 2021 and have increased the RHI to make these green technologies even more attractive.

From the beginning of April, the tariffs will change as follows,

  • for an Air Source Heat Pump the tariff will go up from 7.51p/kWh to 10.02p/kWh, meaning you could earn £10,570.00 for the installation of a 10kW heat pump to heat your property.
  • for a Ground Source Heat Pump the tariff will go up from 19.33p/kWh to 19.55p/kWh, meaning you could earn £28,500.00 for the installation of a 12kW heat pump to heat your property.
  • for Biomass the tariff will go up from 4.68p/kWh to 6.44p/kWh, meaning you could earn £11,270.00 for the installation of a biomass boiler to heat your property.

The Domestic Renewable Heat Incentive is open to applicants who wish to upgrade to a renewable heating technology in a domestic property that they own. It is available to home owners who;

  • Wish to replace a current heating system (oil, solid fuel, LPG, natural gas or electricity) in an existing property.
  • Wish to install a new renewable heating system in a “Self-Build”, or Custom Build” property you are building, or are having built for yourself; (if you are building a property to sell immediately, you will not be eligible).
  • Are converting a barn or renovating a property.

In order to be eligible, your chosen heating technology must be;

  • New; it cannot have been previously installed in another property.
  • Connected to a wet heating system, such as conventional water filled radiators or underfloor heating.
  • Approved by the Microgeneration Certification Scheme (MCS) and listed on the MCS product database.
  • Must be installed by an MCS accredited installer
  • The installation must be registered on the Microgeneration Certification Scheme Installation Database (MIB) by the installer.
  • If it is a biomass system you must use fuel from a certified sustainable supplier, (you are required to keep records of where you source your fuel and declare that it is from a supplier on the Biomass Suppliers List) – biomass-suppliers-list.service.gov.uk

The Domestic Renewable Heat Incentive is calculated by multiplying your property’s deemed heat requirement (both space heating and domestic hot water) by the current tariff for the chosen technology and is paid only on the renewable heat your chosen technology generates. Once you are accepted on to the scheme your payments will be fixed and will only change in line with inflation. You will receive payments on a quarterly basis for 7 years.

Your heat requirement is calculated by having an independent assessor produce an Energy Performance Certificate (EPC) for your property. This will show how much energy is required to heat your property and produce your domestic hot water.

Applications submitted Biomass boilers and stoves Air source heat pumps Ground source heat pumps Solar thermal
01/01/2018 - 31/03/2018* 6.54p 10.18p 19.86p 20.06p
01/01/2018 - 31/03/2018** If any new tariff changes are to be made due to degression, the announcement by BEIS would be made by 1 March 2018. If any new tariff changes are to be made due to degression, the next announcement by DECC would be by 1 June 2016. If any new tariff changes are to be made due to degression, the next announcement by DECC would be by 1 June 2016. If any new tariff changes are to be made due to degression, the next announcement by DECC would be by 1 June 2016.
Historical tariffs
09/04/14 - 31/12/14*** 12.20p 7.30p 18.80p 19.20p
01/01/15 - 31/03/15 10.98p 7.30p 18.80p 19.20p
01/04/15 - 30/06/15* 8.93p 7.42p 19.10p 19.51p
01/07/15 - 30/09/15 7.14p 7.42p 19.10p 19.51p
01/10/15 - 31/12/15 6.43p 7.42p 19.10p 19.51p
01/01/16 - 31/03/16 5.14p 7.42p 19.10p 19.51p
01/09/16 - 31/12/16* 4.68p 7.51p 19.33p 19.74p
01/01/2017-31/03/2017* 4.21p 7.51p 19.33p 19.74p
01/04/2017-30/06/2017* 4.28p 7.63p 19.64p 20.06p
01/07/2017 - 19/09/2017* 3.85p 7.63p 19.64p 20.06p
20/09/20 - 31/12/2017* 6.54p 10.18p 19.86p 20.06p

*these tariffs have been adjusted in line with RPI.
**these tariffs will be adjusted in line with CPI.
***including legacy applications made between 09/04/14 – 09/04/15. The window for legacy applicants to apply has now closed.