RHI tariff triggers to avoid FITs debacle

27th February 2013

Related Topics

Related tags

  • Mitigation ,
  • Renewable ,
  • Air



Payments under the Renewable Heat Incentive (RHI) will be linked to deployment levels and an overall spending cap to prevent sudden changes like those imposed on the feed-in tariff

Decc has outlined its plans to gradually lower payments under the non-domestic RHI scheme, to prevent the initiative exceeding its budget and to provide greater certainty in future subsidy levels.

Under the proposals, which will come into force on 1 June if approved by parliament, the Decc will set tariff levels for each eligible renewable technology up to March 2015. However, these tariffs will be reduced for new applicants by 5–20% each quarter if uptake exceeds trigger levels set by the energy department.

Decc will monitor the deployment of technologies each quarter and if uptake of an individual technology, for example biomass boilers, exceeds the department’s forecasts by 50% or more, the tariff for new installations of that technology will be reduced by 5%.

If deployment levels do not fall back to below the trigger level, tariffs will be reduced by up to 10% the following quarter and then 20%.

There will also be an overall trigger specified in the implementing legislation, which, if exceeded by more than 50%, will impose the same reductions across all the RHI tariffs, in addition to any cuts in individual tariffs.

If uptake of the RHI is consistently above Decc predictions, subsidies could by cut by 57% in 12 months.

Energy minister Greg Barker acknowledged the difficulties firms face in securing investment when subsidy levels for renewable technologies are subject to change.

“We recognise the potential for the prospect of tariff changes to hinder investment decisions. However this needs to be balanced against the need to act when there is persuasive evidence on the case for change,” he said.

Decc also confirmed that it will be introducing new air quality and sustainability requirements for biomass installations applying for RHI payments.

Under the planned changes, from April 2014 both new biomass installations and those already registered on the scheme will have to demonstrate they are meeting sustainability criteria related to the life-cycle greenhouse-gas emissions of fuel and land use to receive RHI payments.

RHI recipients will either have to submit reports demonstrating their fuel meets the requirements or source fuel from an “approved supplier” list.

The revised air quality controls will be implemented by the end of 2013 and will apply on to new installations. RHI applicants burning solid biomass will have to demonstrate that their installation emits no more than 30 grams of particulate matter per gigajoule of energy generated and no more than 150g/GJ of nitrogen oxides.

The air quality limits will also apply to combined heat and power installations burning biomass, and which have a thermal capacity below 20 megawatts.

Transform articles

National climate plans could see fossil fuel demand peak by 2025

Demand for fossil fuels will peak by 2025 if all national net-zero pledges are implemented in full and on time, the International Energy Agency (IEA) has forecast.

15th October 2021

Read more

The Green Homes Grant is set to deliver only a fraction of the jobs and improvements intended, leading to calls for more involvement from local authorities in future schemes.

23rd September 2021

Read more

COVID-19 recovery packages have largely focused on protecting, rather than transforming, existing industries, and have been a “lost opportunity” for speeding up the global energy transition.

23rd September 2021

Read more

Half of the world's 40 largest listed oil and gas companies will have to slash their production by at least 50% by the 2030s to align with the goals of the Paris Agreement, new analysis has found.

9th September 2021

Read more

None of England’s water and sewerage companies achieved all environmental expectations for the period 2015 to 2020, the Environment Agency has revealed. These targets included the reduction of total pollution incidents by at least one-third compared with 2012, and for incident self-reporting to be at least 75%.

30th July 2021

Read more

The UK’s pipeline for renewable energy projects could mitigate 90% of job losses caused by COVID-19 and help deliver the government’s ‘levelling up’ agenda. That is according to a recent report from consultancy EY-Parthenon, which outlines how the UK’s £108bn “visible pipeline” of investible renewable energy projects could create 625,000 jobs.

30th July 2021

Read more

Billions of people worldwide have been unable to access safe drinking water and sanitation in their homes during the COVID-19 pandemic, according to a progress report from the World Health Organisation focusing on the UN’s sixth Sustainable Development Goal (SDG 6) – to “ensure availability and sustainable management of water and sanitation for all by 2030”.

30th July 2021

Read more

The oil and gas industry is set to burn through its allocated carbon budget 13 years early unless decisive action is taken immediately, new analysis has found.

22nd July 2021

Read more

The UK will no longer use unabated coal to generate electricity from October 2024, one year earlier than originally planned, the Department for Business, Energy & Industrial Strategy has announced.

2nd July 2021

Read more

Media enquires

Looking for an expert to speak at an event or comment on an item in the news?

Find an expert