Support rates for small biomass will be cut by a further 10% next month. The department of energy and climate change (Decc) said that forecast commitments under the renewable heat incentive (RHI) had breached its budget cap for the financial year.
Small biomass is classified as installations up to 200kW thermal (kWth). The digression comes after total forecasts for the RHI subsidy scheme (standing at £517.4m) breached the trigger for tariff cuts by £75.3m. For small biomass specifically, the category is now overcommitted by £15.6m (12% above its £129.5m digression trigger).
Decc said the 10% digression was appropriate because the overall RHI cap had been exceeded (resulting in a 5% cut) and that the small biomass cap had been exceeded (another -5%). As such, small biomass tariffs will be reduced by 10% from 1 July.
The figures come as Decc mulls responses to its plans to make significant changes to the RHI. It has proposed to set one support rate for biomass generation in a bid to curtail smaller biomass schemes and encourage larger projects, which it says will deliver better value for money. Critics have warned that cutting support levels will kill off smaller scale biomass, with fewer businesses benefitting as a result.
Meanwhile, biomethane and biogas support commitments were also well above the trigger threshold, said Decc, and so both will be subject to a 15% tariff cut from 1 July.
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