The Renewable Heat Incentive (RHI)

The non-domestic Renewable Heat Incentive(RHI) is a Government-funded tariff scheme with a 20 year lifespan (there is a Domestic tariff for 7 years).

The non-domestic Renewable Heat Incentive(RHI) is a Government-funded tariff scheme with a 20 year lifespan (there is a Domestic tariff for 7 years). This is subject to multiple heating systems, two or more properties or buildings. Currently there are two tiers which cover small, medium and large scale biomass:

Tier 1 – currently 2.98p for 35% of the year up to 3066 hours.

Tier 2 – currently 2.08p for the remaining 8760 hours per year, minus down times for servicing and maintenance.

This cost is much lower than standard electricity costs for companies and provides an annual return for customers on their initial investment. A range of grants and incentives exist in the UK to encourage the use of Biomass Heating including financial help with the purchase and installation of equipment. To find out how you can start making savings on your energy costs today, get in touch with us. Size of the system ie 500mw x number of hours worked x tariff so:

Tier 1 = 500 x 3066 x .0298 = £45,683.34 8760 hours – 3066 hours = 5694 hours Minus servicing and maintenance = 5500 hours.

Tier 2 = 500 x 5500 x.0208 = £57,200 + £45,683.34 = £102,883.34 Fuel costs are on average an extra 20% to be deducted but this is roughly the return on RHI payments making the initial outlay of £3-450,000 repayable in 3 years.

A CHP unit increases this further and brings the repayment time down by half.