The Cinderella of energy policy gets a boost with the launch of the Renewable Heat Incentive

Heat accounts for just under half of UK energy demand and for 46% of UK carbon emissions, but has long been the Cinderella of energy policy. When Green Alliance started working on heat five years ago, the amount of energy used for heating space and water wasn’t even reliably measured.

Since Green Alliance launched its manifesto for sustainable heat in 2007, interest in heat has grown; the last government produced eleven reports and consultations which confirmed the sector’s potential, but produced little in the way of action.

Now, after some delays, a financial incentive for green heat has finally been launched. From this week, non-domestic users including industry, public sector, small businesses and schools can claim the Renewable Heat Incentive (RHI) if they install technologies such as solar water heating, ground source heat pumps and biomass boilers. Small biomass systems – the most highly subsidised systems for the non-domestic sector – can earn up to 7.9p per KWH.

Householders will have to wait next year to be eligible for the scheme, but a test programme is already underway. A £15m short term grant scheme called the Renewable Heat Premium Payment was launched in August this year to offer vouchers towards the cost of renewable heat technology and to test the waters for the RHI.

However, DECC figures suggest that take-up has not been as high as government hoped. According to DECC, 4,094 vouchers have been issued so far, equivalent to £2.45m worth of grants. A further £4.2m is earmarked for social housing completion and £1.5m for additional metering. That leaves £6.85m in the pot still to be spent before the scheme closes at the end of the financial year

The launch of the RHI is great news, but government and others need to make sure that its delivered and communicated in a way that encourages take-up. For more on Green Alliance’s work on the RHI, see our past papers on how to maximise uptake for the scheme, how to make it more efficient and why renewable heat matters.

3 comments

  • The seminar Green Alliance held on the RHI excluded community groups, the very organisations that can build trust and deliver demand.

    Further, there seems to be a mindset within the ‘green’ establishment that it is down to central Government and councils to deliver awareness which is illogical given public spending cutbacks and Green Alliance’s own research that shows 75% of councils are reducing their work on climate change mitigation.

    The Green Deal stakeholder forums, for example, exclude community group representation and until Government, industry and organisations like GA realise the importance of community initiatives like Energise Barnet, the RHI and Green Deal etc, will not live up to expectations.

  • Hi Nigel,

    Thanks for your comment. We recognise the importance of community groups – our localism theme is designed to understand how community groups can help to tackle climate change, and we’ve just run three seminars on the Green Deal in Hexham, Bristol North West and Redcar which explicitly sought out participation from community groups. Particularly for heat and insulation, both of which involve changes to people’s homes, groups with on-the-ground experience are needed. But central and local government must also have a role in changing the frameworks which govern the energy system, and in raising awareness.

  • The real problem is in big cities where there are hardly any community energy initiatives. As a result, for example, in London:

    · By the end of October, only 14,612 homes out of a target 200,000 homes have been improved by RE:NEW. In Barnet, less than 4,000 out of 140,000 homes are to be targeted.

    · Only 3,021 renewable energy installations have been fitted in London since April 2010, making it the second worst region in the UK.

    · Only 34 out of 3386 vouchers under the Renewable Heat Premium Payment (RHPP) scheme were requested in London making it the worst region in the UK.

    Something clearly needs to be done and that is our intention.

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