The Renewable Heat Incentive (RHI) scheme has finally been launched after Whitehall was forced to amend the tariff for larger biomass plants.
Businesses and communities can now apply for payments for heat generated using biomass boilers after the RHI came into force on 28 November.
It provides quarterly payments for heat generated from renewable technologies installed since 15 July 2009. Recipients will be paid up to 7.9p per kWh for biomass boilers, 8.5p per kWh for solar thermal and 4.5p per kWh for heat pumps.
The Department for Energy and Climate Change (DECC) failed to meet an original launch deadline of 30 September because the European Commission said the large biomass tariff had been set too high.
Wood recyclers hailed biomass as a critical market. Waste wood is a key source of biomass, and the Wood Recyclers Association said the fuel represented its fastest growing market.
Rick Wilcox, deputy secretary at the WRA, said: “Biomass is expected to overtake boards as the biggest market for recycled wood in the next few years.
“It is an important market. In properly licensed facilities, Grade B and C wood is burnt, for which there is little other use.”
But board manufacturers were relaxed about the start of the scheme.
Alastair Kerr, director-general at the Wood Panel Industries Federation, said: “The level of subsidy has been reduced by the EU so I don’t know how much of an incentive it will provide.
“We are not really concerned. I do not think it will have a significant impact on the recycled wood market.”