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Minister implements Renewable Heat Incentive tariff changes

Changes to tariffs under the Renewable Heat Incentive (RHI) have been applauded by the energy-from-waste sector, with industry experts saying ministers have listened to their concerns.

The RHI scheme, the first of its kind in the world, supports commercial and industrial companies and is due to be extended to households in spring.

The changes from the Department of Energy and Climate Change (DECC) include:

  • the addition of air source heat pumps, biogas combustion over 200kW, biomass combined heat and power, and the full range of waste feedstocks
  • increased tariffs for large biomass
  • modification of tariff reduction triggers to boost biomass deployment because of an overall underspend so far

The review followed low levels of uptake for some technologies in the scheme and complaints from the sector, such as the Renewable Energy Association (REA), on how it was performing.

Climate change minister Greg Barker, left, said: “It is vital that we get the level of support right so that the market can invest with confidence, cost reductions can be achieved and the market can grow sustainably.”

The policy announcement followed consultation on expanding the non-domestic scheme; air to water heat pumps and energy from waste; and a review of the non-domestic scheme early tariff. There have also been calls for evidence relating to bio-propane, large biomass, ground source heat pumps and landfill gas.

REA chief executive Dr Nina Skorupska praised ministers: “Although the scheme has under-performed in its first two years, the Government deserves credit for listening to industry’s concerns and implementing many of the necessary changes.

“Mixed messages from Government have unnerved many in the renewables sector lately, so the RHI announcement gives a timely boost to the green economy.”

Skorupska urged DECC not to make further changes to the RHI so the market could mature.

Charlotte Morton, chief executive of the Anaerobic Digestion and Biogas Association Charlottte Morton specifically welcomed support through the RHI for heat use from biogas projects over 200 kWth.

“This is something we have long called for. Biogas is an extremely low-carbon energy source, and this support will help meet the infrastructure costs to make good use of heat. Although we are disappointed that support will not be available to existing plants which only use some of the heat they currently generate, it is good that those which do not make use of heat at all should now be supported.”

Ministers have also confirmed strike prices for renewable energy Contracts for Difference.

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