Domestic RHI

What is the Domestic RHI?

rhi-780x350The Domestic Renewable Heat Incentive (Domestic RHI) is a government financial incentive to promote the use of renewable heat. Switching to heating systems that use naturally replenished energy can help the UK reduce its carbon emissions.

People who join the scheme and stick to its rules, receive quarterly payments for seven years for the amount of clean, green renewable heat their system produces.

 

What could I expect to earn in RHI payments?

Use the link below to calculate how much you could earn with the domestic Renewable Heat Incentive (RHI) when you install a heat pump or biomass boiler.

RHI Calculator

Current Tariffs

Tariffs for the domestic scheme can be found using the link below:

Domestic RHI

All tariffs are paid for a period of seven years from the date of accreditation.

The support levels are higher than those in the non-domestic RHI scheme as they attempt to squash 20 years’ worth of support into 7 years. This is because a 20 year tariff at lower values is unlikely to suit many homeowners.

All installations must be certified under the Microgeneration Certification Scheme (MCS) and meet relevant standards for each technology, including the proposed limits on harmful emissions for biomass systems. This effectively limits the domestic RHI scheme to technologies under 45kW.

Who’s it for?

The scheme’s open to anyone who can meet the joining requirements. It’s for households both off and on the gas grid. People off mains gas have the most potential to save on fuel bills and reduce carbon emissions.

Two Schemes: Domestic and Non-Domestic

The Renewable Heat Incentive has two schemes – Domestic and Non-Domestic. They have separate tariffs, joining conditions, rules and application processes.

Each application can only be to one of the schemes.

The Domestic RHI

Key to joining is that the renewable heating system heats only a single property which is capable of getting a domestic Energy Performance Certificate (EPC). The EPC is the proof we need that your property is assessed as a domestic ‘dwelling’. Without one, you won’t be able to apply and can’t join the scheme.

An EPC gives information about a property’s energy use, plus recommendations on how to reduce energy and save money. The EPC is required every time you buy, sell or rent a property.

Ofgem have imposed ‘heat demand limits’ on all domestic installations. This means that there will be a limit to the financial support that scheme participants can receive for their heat use annually. These limits are:

  • Air Source Heat Pumps 20,000kWh
  • Ground Source Heat Pumps 30,000kWh
  • Biomass 25,000 kWh

You are still able to apply for RHI if your annual heat demand on your Energy Performance Certificate (EPC) is higher than the heat demand limit, however your RHI payments will be capped in line with these limits.

Key features of the Domestic RHI:

  • All installations must be MCS (or equivalent) e.g. under 45kW
  • Tariffs are RPI linked and last for 7 years
  • Only single domestic dwellings qualify
  • Any eligible installation installed after 15 July 2009 can qualify
  • Applicants that have also received Renewable Heat Premium Payment (RHPP) support will have their support reduced by the value of the RHPP voucher
  • Most installations will have their heat generation ‘deemed’ (estimated through the Energy Performance Certificate)
  • All installations (other than self-build) must have minimum loft and cavity work completed where appropriate
  • There will be a degression system put in place, similar to non-domestic RHI

 

Who can Apply?

The scheme covers single domestic dwellings: owner occupiers, private landlords, Registered Social Landlords (RSLs) and third-party owners of heating systems and self builders. New properties other than self-build will be ineligible.

We recommend you read the Essential Guide for Applicants which can be found below:

Applicant Guide

Legacy Applications

Anyone who has installed an eligible technology, in accordance with the scheme criteria, since 15 July 2009 will be able to apply for support. Installations will need to meet the MCS standards that applied at the time of installation, rather than the current standards. However installations installed prior to the scheme launch will not need to meet the air quality requirements that will apply once the scheme opens.

MCS Standard Installations

MCS is the primary way of demonstrating that the installation has been installed competently. However DECC have indicated they will recognise other certification schemes that meet standards such as EN45011 or ISO/IEC 17065 and have suitable consumer protection measures in place. Ofgem and MCS are currently working on an online list of products that will be eligible for domestic RHI support.

Do second homes count?

Second homes can access domestic RHI support, but must be metered. They will only receive support up to the level of heat ‘deemed’ by the EPC of the property.

How Income from the Tariff will be Assessed

The renewable heat generated by an RHI installation will be estimated (or ‘deemed’) in most cases, from the buildings’ Energy Performance Certificate. This avoids the consumer having to pay the additional costs of installing meters.

The exception to this will be those who have a backup heating system (such as an oil boiler) or who are applying for a second home. In these cases, meters will need to be installed to measure the actual heat generated.

Payments will be received quarterly and will be RPI index linked.

Interaction with Renewable Heat Premium Payments

If the applicant has already received support under the RHPP, this will need to be declared during the application process. This will then be deducted from the RHI payments. Initially, this will be a deduction of one twenty-eighth of the value of the public funding per quarter.

Heat Pumps

Not all of the heat produced by a heat pump is renewable, so only a proportion of the heat pump output will receive RHI support. The Seasonal Performance Factor (SPF) of a heat pump will be used to calculate how much subsidy the installation will receive. For example, a heat pump with an SPF of 3, will only receive RHI support for two-thirds of its output. Heat pumps installed before the launch of the scheme will be given a default SPF of 2.5, or can be assessed by an MCS installer to demonstrate a higher rating. 2.5 is the minimum efficiency for a heat pump to be supported under domestic RHI.

Biomass

Biomass only boilers and biomass pellet-stoves with back boilers are eligible for support. Condensing biomass boilers are currently included in the domestic RHI.

New installations from the start of the scheme need to adhere to the minimum air quality standards: maximum permitted emissions of 30 grams per gigajoule (g/GJ) net thermal input for particulate matter and 150 g/Gj for NOx. In addition, biomass boilers supported under the scheme will need to have their fuel sourced sustainably.

Applicants that source their own woodfuel from their own estate will automatically be considered as sustainable as long as they do not supply other biomass heat installations.

Reviews

Formal reviews of the scheme are planned for later in 2018, but DECC reserve the right to hold a review of the scheme at any time.

General Guidance

If you applied for RHPP funding before 20th May 2013 you will have been eligible to apply for the RHI from 9th July 2014.

If you applied for the Renewable Heat Premium Payment funding after 20th May 2013 you will have been eligible to apply for the RHI from 9th October 2014.

Every single customer needs an EPC before they apply for RHI, regardless of installation date

 

SPF – SEASONAL PERFORMANCE FACTOR

 

SPF – Seasonal Performance Factor is a new calculation which all GSHP & ASHP customers will have to supply with their RHI application

 

SPF Example Calculation using SPF score of 4.1 on a Ground Source Heat Pump:
(Total Heat Demand = 31,350 kWh RHI Tariff = 19.86 pence – SPF calculated at = 4.1)
1 ÷ 4.1= 0.243
1 – 0.243 = 0.76 (SPF Calculation)
31,350 x 0.76 = 23,826 (Total Heat kWh allowance)

23,846 x 20.46p = £4,878.89 (Annual RHI figure)

 

SPF Example Calculation using Ofgem score of 2.5 on a Ground Source Heat Pump:
(Total Heat Demand = 31,350 kWh RHI Tariff = 19.86 pence – SPF calculated at = 2.5)
1 ÷ 2.5 = 0.4
1 – 0.4 = 0.6 (SPF Calculation)

31,350 x 0.6 = 18,810 (Total Heat kWh allowance)

18,810 x 20.46p = £3,848.53 (Annual RHI figure)

 

 Heat Metering and Backup Systems

  • Any installation ASHP, GSHP or Biomass which has a backup system in place (i.e. the original heating system) must have a meter fitted prior to RHI Application
  • Once the Heat meter is installed and RHI has been granted, the customer will only get paid for the reading taken from the meter regardless of the EPC calculation
  • It may be advisable to think about removing the backup system which then alleviates the need for the heat meter and means that the customer can claim the full allowance as indicated on the EPC

 

 

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