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What is the RHI?
The domestic Renewable Heat Incentive (RHI) is a government-backed financial incentive scheme designed to encourage UK homes to swap to renewable heating systems. Under the RHI, heat pump, biomass or solar thermal system owners are rewarded for the renewable heat they generate over a seven-year period.
What are the benefits?
As well as cutting your home’s carbon footprint, installing an RHI-eligible technology will bring you all the usual economic benefits of a renewable heating system – and more. Not only will it reduce your reliance on costly on- or off-grid fossil fuels, it will also provide you with quarterly payments for the next seven years (tariffs will adjust in line with inflation).
How much could I earn?
How much you could earn depends on the technology you choose and the tariffs set out by the government (measured in pence per kilowatt-hour for the renewable heat produced).
Payment calculations are based on an estimate of how much heat your home will require from a renewable heating system and how it will perform once installed. As well as the technology itself, performance will also depend on other factors, such as insulation levels and the heat emitters your system uses (for example, low-temperature underfloor heating is likely to be more efficient than traditional radiators). If you received a grant towards the cost of your system under the Renewable Heat Premium Payment (RHPP), this will be deducted from your RHI payments.
Before applying for the RHI you will need an up-to-date Energy Performance Certificate (EPC), which shows how efficient your property is. If applying for a retrofit project, you will need to arrange a Green Deal Assessment (GDA) which will identify measures to improve your home’s efficiency (including minimum insulation levels). These improvements need to be carried out and a new EPC obtained before going ahead with the RHI application. For most self-build projects the EPC will be produced at the end of the build.
You can find a Green Deal Assessor in your local area here.
A NIBE ground source heat pump fitted in a typical four-bedroom house could generate annual payments of around £3,400 (or £24,000 over the seven-year scheme):
Total annual energy demand (from EPC): 25,000kWh
Ground source heat pump seasonal efficiency*: 3.7
RHI tariff (ground source heat pumps): 18.8p/kWh
System eligible heat demand: 25,000kWh x (1-1/3.7)
Annual RHI payment: 18,243kWh x 18.8p
Estimated RHI payments over x7 years: £24,007.76
A NIBE air source heat pump fitted in a typical three-bedroom home could generate RHI payments of more than £680per year (which works out at around £4,800 over the seven-year scheme):
Total annual energy demand (from EPC): 15,000kWh
Air source heat pump seasonal efficiency*: 2.7
RHI tariff (air source heat pumps): 7.3p/kWh
System eligible heat demand: 15,000kWh x (1-1/2.7)
Annual RHI payment: 9,444kWh x 7.3p
Estimated RHI payments over x7 years: £4,823
For an estimate of much your system could earn please visit the NIBE RHI calculator here.
There may also be an opportunity to earn an extra annual payment by signing up to the RHI Metering and Monitoring Service Package. This is where users opt to have a meter fitted to record the performance of their system, and are rewarded with a payment of £230/year for heat pumps and £200/year for biomass.
Who is eligible?
Anyone who retrofits an air source or ground source heat pump, biomass boiler or solar thermal system in a single domestic property is eligible for RHI payments (whether they are an owner-occupier or private/social landlord). Self-build properties are the only new-build installations that are eligible.
To qualify for RHI payments, your system needs to have been fitted by an installer who has the right training and accreditation under the Microgeneration Certification Scheme (MCS). Opting for a NIBE VIP Installer gives you complete peace of mind, as not only are all NIBE VIPs fully MCS-accredited, they can also offer an extended warranty on certain products – so it pays to make sure you deal with the experts.
Find a local NIBE VIP Installer here.
If your NIBE system was installed on or after 15th July 2009, you may be eligible for a legacy application. Legacy applications must be made within the first year of the RHI scheme.
How can I apply?
NIBE’s RHI application checklist:
*System seasonal efficiency (SPF) based on 3* rating in the Heat Emitter Guide