Domestic RHI – A scheme worth waiting for?

Waiting game: Despite the delay to the RHI, Simon Allan, Plumb Center, highlights the positives to be gained once the scheme is up and running
Waiting game: Despite the delay to the RHI, Simon Allan, Plumb Center, highlights the positives to be gained once the scheme is up and running
Reaction to the announcement by DECC of a delay in the timetable for the introduction of domestic Renewable Heat Incentive (RHI) has been greeted with widespread resignation, and even hostility by the industry. But, says Simon Allan, Plumb Center’s renewables director, the picture is not entirely bleak

I won’t pretend that the delay of the launch of domestic RHI until the spring of 2014 isn’t a great disappointment. We, like many others in the industry, had been looking forward to the boost that we hope the scheme will give heat-generating technologies, in the same way that Feed-in Tariffs (FiTs) helped establish solar PV as a viable option in the UK market. It’s also a key element in the government’s strategy to supply 15 per cent of the UK’s energy demand from renewable sources by 2020. This may sound distant, but it’s only six years from the planned launch of RHI.

Let’s not forget that this is a scheme that was announced in 2009. Following last year’s consultation, an announcement on the detail of how it would work was expected around now. The launch itself was planned for the summer of 2013, enabling households to benefit from their home-generated heat next winter.

Despite this setback we do, however, welcome the news that government has set aside £250,000 for a voucher scheme to boost renewable training. The scheme will focus on SMEs, which is great for Plumb Center’s core customer group, the local heating installer business. Training vouchers will be worth up to £500, or a maximum of 75 per cent of the cost of the training course, per person. This is a positive move from the government, and should encourage many installers who have not yet engaged with renewable heating technologies to add these complementary products and services to their customer portfolio.

While not compensating fully for the absence of an exciting RHI offer to householders, the extension of the Renewable Heat Premium Payment (RHPP) will continue to provide some support for the market in renewable technologies such as biomass, solar thermal and heat pumps, which will be especially useful for our off-grid customers. However, to date RHPP has not had a significant impact on the take-up of these technologies, and despite its extension, renewables will continue to be unaffordable or uneconomic for many people. It should also be remembered that RHPP monies have to be repaid from RHI income, when this arrives eventually.

Details of the RHI scheme – including whether it will cover social housing – are now expected to be unveiled this summer. The delay means there’s still time for installers to add the skills they may lack in these technologies, equipping them to capitalise on the opportunities generated when the scheme is launched next year.

It is also to be hoped that good use is made by DECC of the added time before launch to tighten consumer protection, especially in such areas as mis-selling and installer qualifications. Intelligent promotion of RHI and the availability of in-depth, objective consumer advice are also needed to make sure consumers get a fair deal – and feel that they have done the right thing.

While any delay is frustrating, we hope the government learns the lessons from both the introduction of FITs and the Green Deal. A negative initial consumer reaction would be far more damaging to the industry in the long run than a few months’ delay before launch.

Some may question the government’s commitment to domestic renewables, but the £250,000 investment in training for 100 apprentices working in the renewables industry is a welcome boost for the future of the sector. With or without government incentives, renewables offer a vital option to many homeowners facing spiralling energy bills. And their contribution to meeting households’ power and heating needs can only increase in years to come.