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RHI Costs and Earnings

Within this article, we provide you with an overview of the domestic Renewable Heat Incentive (RHI) scheme, the options available to you, and the potential benefits of switching to renewable energy technologies. 

First introduced in England, Scotland and Wales in April 2014, the RHI scheme aims to reduce CO2 emissions, helping the UK to achieve its 2020 target of producing 12% of its heat from renewable sources. The scheme has 2 strands - one for residential homes, and the other for non-domestic properties (which includes industrial, commercial, public sector and community organisations) – and helps property owners to cover the cost of installing and maintaining a renewable heating system. The scheme is open to owner-occupiers, social/private landlords, self-builders, third-party owners of heating systems, and individuals who have installed renewable heat technologies (subject to conditions).

The cost of installing a renewable heating system is dependent on the type and size of the system you choose. For instance, renewable heating source can range from as little as £3,000 for solar thermal panels, to £20,000+ for state-of-the-art technologies - a significant investment, but the savings resulting from renewable heating technology can also be significant. After just a few years, the majority of participants will see a substantial decrease in their heating bills. (Significant savings can be made for homes that are off the gas grid.) Furthermore, following installation, the participant will receive quarterly RHI payments, for every kilowatt hour (kWh) of renewable heat produced, for seven years for the domestic RHI and 20 years for the commercial scheme. 

The amount you can earn from a renewable heating system is dependent on the property type, and the renewable heat technology that has been installed. As an example, a 2 bed semi-detached property with solar thermal panels installed can result in an annual RHI payment of £266. Furthermore, homeowners can install more than one technology, and receive annual RHI payments for each system utilised. If you have two of the same technology installed, the payment will be calculated according to the combined output.

To assist you in choosing the right energy technology, a Green Deal assessment will be conducted, which provides you with a guideline regarding the appropriate technologies for your property, as well as an approximate cost for installation, based on your current annual heating bills. You will be required to undertake the minimum insulation recommendations detailed on your Green deal advice report. If you require further information or assistance, please contact a Green Deal Advisor – we’re happy to help.