The Renewable Heat Incentive (RHI)

As part of the drive to reach their target of 12% of heating coming from renewable energy sources the UK government is introducing the Renewable Heat Incentive (RHI). The scheme operates by offering significant financial incentives to businesses, households and communities who adopt renewable heating technology.

The Renewable Heat Incentive scheme is in two phases.

Phase 1 is the introduction of the Renewable Heat Premium (RHPP) scheme to domestic households and payments under the RHI to non-domestic users. Phase 1 has already been introduced. Payment of the RHI to businesses is being measured by installing heat meters. The rates paid are dependent on the technology used, the capacity of the system and the total amount of energy used. A summary of the RHI rates is displayed in the table below:

Technology Max Tarrif rate (pence/kWh) Tarif duration (Years)
Biomass (< 200kWth) 7.6 20
Biomass (> 200kWth & < 1000kWth) 4.7 20
Biomass (> 1000kWth) 2.6 20
Ground & Water Source Heat Pump (< 100kWth) 4.3 20
Ground & Water Source Heat Pump (>; 100kWth) 3.0 20
Solar Thermal (< 200 kWth) 8.5 20
Biomethane (not landfill gas) 6.5 20


The Renewable Heat Premium Payment (RHPP) is a one off payment to assist with installation costs of certain technologies. The scheme has been extended to allow claims to made up to 31st March 2013 (subject to available funding).

Technology Voucher Value
Solar thermal hot water £300
Air-to-water heat pump £850
Ground-source or water-source heat pump £1250
Biomass boiler £1250


Phase 2: The Domestic RHI was originally due to be introduced in October 2012 but is subject to further consultation (due to end in September 2012), was scheduled for the Spring of 2013 and looks like it may be further delayed until Summer 2013.

No tariffs have actually been published as yet. Expected tariff levels are forecast to follow a similar pattern to the commercial structure in place under phase 1. The original consultation document indicated rates of around 9p/kWh for Biomass for a small installation.

Warning: Although information published on this website is believed to be accurate no guarantees are made and it should not be used to make any commercial or financial decisions without full consultation with M.H.Scargill and Son Ltd. You can contact us on 01263 741353 or by email.