Non-domestic RHI boost for CHP, air and ground source heat pumps


DECC has published a response document ‘Non-Domestic Renewable Heat Incentive: Improving support, increasing uptake’, which sets out a range of improvements and increased support under the non-domestic Renewable Heat Incentive (RHI).

This responds to the consultations “Expanding the non-domestic scheme”, “Air to Water Heat Pumps and Energy from Waste” and “Non Domestic Scheme Early Tariff Review” as well as addressing the outcome of four calls for evidence related to bio-propane; large biomass, ground source heat pumps and landfill gas.

The non-domestic RHI scheme has been open to commercial, industrial, public sector, not for profit and community generators of renewable heat since November 2011. The scheme is designed to bridge the gap between the cost of fossil fuel heat sources and renewable heat alternatives through financial support for owners of participating installations.

Given low levels of uptake for some technologies in the scheme and additional evidence from stakeholders, it was decided to re-examine the evidence on the assumptions and cost data used to set the level of tariffs.

Subject to State Aid approval, DECC intends to increase the support available for renewable Combined Heat and Power (CHP) plants, large biomass boilers (over 1MW), deep geothermal, ground source heat pumps, solar thermal and biogas combustion >200kWth. DECC is also introducing new support for air-water heat pumps and commercial and industrial energy from waste.

GI Energy Chairman Mike Fellowes commented: “We are delighted that Energy and Climate Change Minister Greg Barker has listened to our concerns and created this fantastic boost for large scale Ground Source Heat Pump systems.  We look forward to playing our part in continuing to grow this market for this extremely efficient method of heating and cooling buildings that will contribute significantly to the UKs carbon reductions and providing a more sustainable and economic solution.”

Phil Hurley, NIBE managing director, comments: “The decision to include air source heat pumps (ASHPs) in the non-domestic scheme represents long-awaited recognition of the benefits of this technology, and marks a much-needed step forward in the movement to cut emissions in the commercial sector.

“We are also pleased to see an increase in the non-domestic tariff for ground source heat pumps (GSHPs). While these have not reached the level suggested in the original consultation, increasing tier 1 payments to 8.7p/kWh will undoubtedly provide an important market boost.”

REA Chief Executive Dr Nina Skorupska said: “Although the scheme has under-performed in its first two years, the Government deserves credit for listening to industry’s concerns and implementing many of the necessary changes.”


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