The Domestic Renewable Heat Incentive is a Government initiative which provides funding to promote the installation of renewable energy heating systems.
These include biomass boilers, air source heat pumps, ground source heat pumps and solar thermal water heating systems.
Domestic Renewable Heat Incentive scheme is a UK Government initiative offering financial incentives to encourage home owners to use renewable energy systems instead of fossil fuel.
If you participate in the Domestic Renewable Heat Incentive scheme and install a renewable heating system such as an air source heat pump or biomass boiler, the Domestic Renewable Heat Incentive tariff payments will be paid to you quarterly for 7 years.
Most Renewable Heat Incentive payments are based on the heat required to heat your home and provide hot water. This information can be found on your Energy Performance Certificate (EPC).
The Domestic Renewable Heat Incentive is available in England, Scotland and Wales.
The basis of the Domestic Renewable Heat Incentive scheme is that the UK Government has set out its intention of achieving a target of 12% of heating being sourced from renewables such as biomass energy by 2020.
This is part of its overall plan to reduce carbon emissions from homes and businesses and to minimise the effects of climate change.
The Domestic Renewable Heat Incentive scheme is considered so important by the Government that the Department of Energy and Climate Change described it as ‘the first step in transforming the way we heat our homes’.
In May 2019 the Committee on Climate Change released a report entitled ‘Net Zero The UK’s contribution to stopping global warming’. This set a target of net zero carbon emissions from the UK by 2050. You can download a full copy of the report HERE.
We have processed over 30,000 applications for Government Heating and Insulation Grants
Learn more about the Domestic Renewable Heat Incentive from the Government HERE
Domestic Renewable Heat Incentive started on 9th April 2014. It applies to:
Domestic Renewable Heat Incentive tariffs are paid to eligible applicants every three months for seven years. The Domestic Renewable Heat Incentive scheme is available to homeowners and those who self-build new homes in England, Wales and Scotland.
Whilst the Domestic Renewable Heat Incentive scheme is available to all households, those off mains gas will have more to gain by reducing both their fuel bills and carbon emissions. This is because of the relative inefficiencies (compared to mains gas) of LPG, heating oil, coal or electricity in providing cost-effective heat and hot water for your home.
All of these renewable energy heating systems provide space heating or space heating and hot water, except solar thermal which must provide hot water only, to be eligible. Where a renewable energy technology system provides space heating, it must do so through a ‘wet’ central heating system such as radiators to be eligible for the Domestic Renewable Heat Incentive scheme.
Current estimates are that there are approximately four million households in the UK which don’t have access to mains gas and the Domestic Renewable Heat Incentive scheme is available to:
Domestic Renewable Heat Incentive financial incentives are paid quarterly for seven years, to the owner of the renewable heating system.
Tariffs are at a set rate of ‘pence per kilowatt hour’ of renewable heat energy generated.
To be eligible for the Domestic Renewable Heat Incentive, solar thermal panels must ONLY supply hot water for your home, whereas all of the other eligible renewable heating systems can provide space heating, with or without hot water.
Domestic RHI scheme rules only apply to these renewable energy technologies if they use a ‘wet’ central heating system such as central heating radiators. Domestic RHI tariffs will not be paid for hot water intended for use in a swimming pool or hot tub.
Example of RHI Tariffs by Switching to an Air Source Heat Pump
Based on a typical three bedroom house using 15,000 kilowatt hours of heat energy per year, installing an Air Source Heat Pump, the total annual Domestic Renewable Heat Incentive tariff will be:
kWh of renewable heat x tariff = Total annual Domestic Renewable Heat Incentive payment
15,000 kWh x 10.71 pence per kWh = £1,606.50 per year
This equates to tariff receipts of £11,245 over seven years however, this is adjusted by the Seasonal Performance Factor of the particular air source heat pump you install. Please see the relevant FAQ below.
When assessing the financial impact of switching to renewable energy you should take into account:
Renewable Heat Incentive tariffs will change annually in line with the Retail Price Index (RPI).
Also, the Department of Energy and Climate Change (DECC) has announced that in order to control costs and encourage early take up, Domestic Renewable Heat Incentive tariffs may be reduced over time for new applicants to the scheme, this is referred to as degression. However, once an applicant has secured their tariff it will not be reduced due to cost control or degression; it will only be affected by changes in the RPI each year.
Any changes to tariff rates in the Renewable Heat Incentive scheme will be notified by the Department of Energy and Climate Change but we cannot guarantee that any published tariff rates on this web site represent the very latest situation.
If you are considering installing a renewable energy heating system such as a air source heat pump you should check with Ofgem first for current Domestic Renewable Heat Incentive tariffs, before making a decision.
When the Renewable Heat Incentive scheme was first launched, the then Chancellor of the Exchequer, Alistair Darling, announced that Domestic Renewable Heat Incentive tariffs would not be taxable.
As far as we are aware, that remains the case as long as the renewable energy produced by your eligible heating system is for your own private use in the property within which it is installed.
You will need metering if:
Simply complete the form on this page and we will introduce you to up to three renewable energy technology installation companies for you to request quotations from.
We do not charge you anything for this service and you are under no obligation to place an order with any of the installers that we introduce you to.
Your proposed renewable heating system must be installed in a property capable of having a domestic Energy Performance Certificate (EPC). Without an EPC you will not be able to apply for the scheme.
Additionally, for biomass boilers , ground source heat pumps and air source heat pumps, the Domestic Renewable Heat Incentive tariff payable to householders is calculated with reference to the estimated heat demand for the property as shown in the EPC.
In other words, without an EPC the tariff payments due cannot be calculated, so it is very much in the applicant’s interest to ensure that an EPC is prepared.
The Domestic Renewable Heat Incentive scheme rules include:
To apply for Domestic Renewable Heat Incentive scheme you will need:
All of these can be provided by or organised by your installer.
Any public grants previously received which have subsidised the cost of installing renewable heating systems such as biomass boilers, including the Renewable Heat Premium Payment (RHPP), may be deducted from the Domestic Renewable Heat Incentive tariff, to avoid a double subsidy.
The Renewable Heat Incentive is administered by Ofgem.
If you sell your property whilst you are still receiving tariffs under the Renewable Heat Incentive scheme, you must inform Ofgem so that future payments can be made to the new owner.
Electricity is required to run heat pumps and to avoid being rewarded for using this electricity, the RHI tariff payable is adjusted for the Seasonal Performance Factor (SPF) of the particular heat pump you have installed.
The SPF is calculated the following way:
This is to say, a heat pump with an SPF of 3 will on average deliver 3.0kWh of heat for every 1kWh of electricity it uses.
The adjusted annual RHI tariff payable is calculated as follows:
If the annual heat demand from your EPC is 15,000 kWh as in the example above this equates to an annual tariff of £1,071.00 not £1,606.50 as shown above, before the adjustment for your air source heat pump’s SPF.
The main changes to the Domestic Renewable Heat Incentive since it was introduced are:
Other minor changes have been introduced and a ‘Factsheet – Important Changes to the Domestic Renewable Heat Incentive Scheme’ produced by OFGEM can be seen HERE.
Typical costs per unit of fuel energy for a Biomass wood pellet boiler compared to other domestic fuels:
Typical Carbon Dioxide emissions for a Biomass wood pellet boiler compared to other domestic fuels:
Speech by Greg Barker MP, Minister of State for Energy and Climate Change when the Domestic Renewable Heat Incentive Scheme was introduced
Affordable Warmth Scheme
Another Government scheme to help with heating systems in domestic households is the Affordable Warmth Scheme. This provides grants to help to install central heating systems, replace broken heating systems and to install insulation in homes where one of the occupants receives a qualifying State Benefit, Tax Credits or other allowance.
More information about the Affordable Warmth Scheme can be found HERE.
You can apply for ‘First Time Central Heating’ to be installed HERE or if you live in Liverpool, apply HERE.