What is the RHI?

Launched by Energy Secretary Chris Huhne, the Renewable Heat Incentive Scheme (RHI) is an innovative Government-backed measure to provide financial incentives to organisations who install heating systems to generate renewable heat. Renewable heat is any heat which is produced by renewable sources, such as solar heating or producing biomass from organic waste.

Benefits of the Scheme  

With global commitment to carbon reduction and concerns over our reliance on finite fossil fuels, the generation of renewal heat has never been more welcomed. The scheme hopes to encourage communities, the public sector, not-for-profit organisations, business and industry to make the 'commercially sound' decision to install and use renewable heat technology. It is expected that those using renewable heat will not be as badly affected by the fluctuation in fuel prices as others. Furthermore, it is anticipated that there is potential for organisations to make a profit. Crucially, those implementing renewable heat technologies will be making a difference to the Environment.

Key principles  

For every kilowatt hour of renewable heat generated, the organisation will earn a fixed sum set by Government. Initially, only non-domestic sectors will be supported by the scheme i.e businesses; public sector; charities and not-for-profit organisations; and industry. A tariff will be set for 20 years and income will be provided quarterly throughout this period.

The scheme will provide support for domestic installations in private residential dwellings in 2011-12. A one-year payment will help to cover installation costs, followed by regular payments from 2012.

Applications for support should be made to The Gas and Electricity Market Authority (Ofgem) who will be responsible for the administration of the scheme.

For full details of RHI, please click here.