Renewable Heat Incentive (RHI) Scheme

21 January 2013: Renewable Heat Incentive Non-domestic scheme

Following the launch of the non domestic Renewable Heat Incentive (RHI) scheme in November 2011, DECC consulted on improvements and extensions to its scope in July 2012 and September 2012. These included proposals for long term budget management,  environmental sustainability and the introduction of additional technologies, alongside proposals for an RHI for householders. DECC will confirm the way forward on these as soon as possible to provide certainty to the market and encourage further uptake of a host of other exciting renewable heating technologies.
The non-domestic RHI has been available for just over one year, and DECC is now looking at the evidence on the assumptions and cost data used to set the level of tariffs when the scheme was launched, alongside the level of uptake so far under the scheme. DECC will assess whether new input assumptions should now be adopted and if so, their likely impact on the tariff levels. For example, particular concerns have been raised about the very low uptake of RHI for ground source heat pumps and some of the assumptions underpinning the current tariffs.

Emerging evidence suggests there may be differences between actual costs and load factors of installations and the original assumptions used to calculate the current tariffs. After the work has finished a summary of the findings will be published.

Following the outcome of this work, if the evidence demonstrates that the initial assumptions and cost data need to be updated, subject to value for money considerations and the necessary approvals, DECC will consider proposing tariff changes for new installations in the Spring. It is DECC’s intention that where tariffs increase as a result of this work, installations accredited from today (21st January)  would benefit from that increase once the new tariffs come into force.

DECC is particularly keen to ensure that where technologies, such as ground source heat pumps, have had low take up to date that any updated tariff is set to provide the right incentive, balancing the need for value for money with the need for an ambitious level of deployment, and the work to complete this is prioritised.

DECC will also continue to consider how the new RHI cost control measures will fit with any new tariffs.

Government remains fully committed to delivering a cost effective incentive to encourage the uptake of renewable heat, helping cut carbon, save money on bills and meet the UK’s legally binding renewables target. 



20 September 2012: DECC has published three consultations on the Renewable Heat Incentive

  • The consultation on proposals for a domestic scheme sets out our proposals for longer term support to householders who install renewable heating kit such as biomass boilers, heat pumps and solar thermal into homes. The RHI for householders is aimed at any householder looking to replace their current heating with renewable heating kit or householders who have installed any such technology since 15 July 2009. It is intended that householders will get paid for each kWh of heat they would be expected produce under the current proposals. More information on this consultation and how to respond to it can be found on the Renewable Heat Incentive: proposals for a domestic scheme page. Deadline for responses is 7 December 2012.
  • The consultation on Renewable Heat Incentive: expanding the non-domestic scheme sets out our broad proposals to expand the existing scheme. More information on this consultation and how to respond to it can be found on the Renewable Heat Incentive: expanding the non-domestic scheme page. Deadline for responses is 7 December 2012.
  • The consultation on air to water heat pumps and energy from waste sets out our proposals for air to water heat pumps and energy from waste. More information on this consultation and how to respond to it can be found on the Renewable Heat Incentive: air to water heat pumps & energy from waste page. Deadline for responses is 18 October 2012.

Consultation support aids

To accompany our consultation document, we have prepared two factsheets that give outline explanations of the RHI proposals and the background to them:

Addendum to the Domestic RHI Consultation

The following addendum provides updated information about our policy proposals for the application of the cap on tariffs as set out in the domestic RHI consultation document ‘RHI : consultation on proposals for a domestic RHI’.  In particular, it sets out in greater detail the implications of the definition of what constitutes renewable heat under the Renewable Energy Directive and hence the way in which we determine the heat for which a tariff should be paid. If we decide to impose a value for money cap following consultation this could affect the tariffs offered.   The renewable energy projections set out in the impact assessment are unaffected.


The Renewable Heat Incentive (RHI) is the Government’s principal mechanism for driving forward the transition to deployment of renewable and low carbon heat over the coming decades. The RHI is a key contributor in achieving the UK’s share of the EU’s renewable energy targets and the Carbon Plan, which provides the two key objectives of the scheme:

  • To increase the deployment of renewable heat technologies in order to keep the UK on track to meet the 2020 target in the most cost effective way. The Renewable Energy Strategy 2009 outlined that heat could contribute 12 % (72 TWh) towards meeting this target.
  • To contribute to the UK’s carbon targets of achieving an 80% reduction by 2050

The RHI is also currently the primary tool for delivering our Heat Strategy, which sets out a vision for achieving practically zero carbon heating in buildings by 2050. The Heat Strategy is aligned with the Government’s priorities of delivering secure energy on the way to a low carbon energy future and driving ambitious action on climate change at home and abroad. DECC’s Business Plan (2.2.iii) and the UK renewable energy roadmap set out the steps we will take to develop and implement this scheme.

The Non-domestic RHI Scheme was launched in November 2011 and we will be consulting on proposals to extend the scheme to additional technologies later in Septemebr. We will also be consulting on proposals for a Domestic RHI Scheme around the same time with a view to opening a domestic RHI in summer 2013.

Frequently asked questions

Further information on the Renewable Heat Incentive Scheme can be found in the FAQs:

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