7 Dec 2012

My RHI response (don't get too excited)

The Renewable Heat Incentive Consultation closes today. Thanks to Kate de Selincourt who alerted me to this. I spent 40 minutes replying to some of the many questions and thought I would share my responses with blog readers. If you want to put your five pence worth in, be quick. It's here: RHI Consultation

1. What are your views about the proposed approach of a universally available tariff scheme? Is a tariff scheme the most efficient way to drive down technology costs, increase innovation and value for money, together with developing a homegrown supply chain? Please include reasoning for your response.

No, I think a tariff scheme, especially a deemed tariff scheme is not the way to go here. It seems to be modelled on FITs which have themselves been copied from Germany. FITs have been successful because they have been generous, but an installation-based subsidy has the potential to be just as successful and would be easier to comprehend from the consumer's standpoint and to administer for government agencies.

2. Do you think that there would be advantages in phasing or piloting roll out of the scheme? On what basis do you think it might make sense to phase or pilot the scheme?

Not really. FITS have been around long enough for us to know what is likely to happen. RHI has already been delayed. "Phasing" sounds like a polite way of adding further delay.

3. Do you think that there may be alternative or additional approaches to incentivising renewable heat deployment that we should pursue? What approaches do you think might add most value?

Yes. If there is to be any subsidy, it should be towards the installation costs. As with almost all non-fossil fuelled power sources, the running costs are generally much lower. It's the capital costs which are the barrier to uptake. Consequently, it makes little sense to incentivise the running costs, which is what the RHI is planning to do. The entry barriers remain just as large as ever, and only the rich or well connected will be able to take advantage of the RHI. This makes it regressive.

10. Do you agree with the proposed eligible technologies set out above? Are there others that should be considered for inclusion?

No, I don't. I am critical of the inclusion of biomass for reasons already made known to DECC. It is quite wrong-headed of us to be subsidising the burning of carbon-intensive fuels, and biomass is carbon-intensive. The inclusion of biomass in the RHI seems to be all about meeting 2020 EU targets for renewable usage, but that doesn't stop it being bad science.

If we must subsidise here, let's encourage the use of timber and other biomass materials in construction, where the carbon will be locked up for the critical years ahead when we have to reduce CO2 emissions.

11. Do you agree that an approved suppliers scheme is the best option for domestic biomass heat installations to demonstrate their use of sustainable fuel? Please provide reasoning with your response.

Hard to answer as I don't agree that biomass is a sustainable fuel. I guess some sort of auditing on the supply side is preferable to none at all, but I fear if biomass really takes off as a fuel source, that it will be sourced from further and further afield and that the auditing is likely to be compromised.

12. Do you agree that as part of the approved biomass supplier list we should assume a level of boiler efficiency?

Yes, if biomass is to be burnt, then at least control the boiler efficiencies. Insist on condensing biomass boilers at the very least.

23. What is the risk of switchback after the period over which tariff payments are made? Do you think this applies solely to biomass?

If you provide a mechanism for people to harvest a subsidy for their fuel bills, then of course there is a risk they will find another way of providing heating after the subsidy is withdrawn. That is yet another reason why capital cost subsidy is preferable.

39. Do you agree that deeming, as opposed to metering, is the most appropriate approach on which to base the calculation of RHI payments? If not, why not?

I can see why deeming is the preferred method, but I don't like it. It seems to highlight yet another problem with subsidising running costs, and not installation costs.


  1. Kate de SelincourtDecember 07, 2012

    Spot on Mark - very helpful!

    If anyone is interested, I have posted some of my thoughts here
    (prompted by the non-dom) - I will make liberal use of your replies when I do the domestic one today!

    I really struggle with the logic of incentivising people to use more energy, however "renewable".

    DECC's laborious efforts to tie the RHI in with the green deal, in an attempt to raise the status of efficiency, highlight how fragmented the whole system is - as it is, because the Green Deal is all decided by "the market" they can't even compel ppl in huge detached rural properties to get their SWI done before they splash out on a massive over-sized heat pump which we will then be bankrolling. What a mess!

  2. Linn has left a new comment on your post "My RHI response (don't get too excited)":

    two points from me..

    Deeming - the current proposal suggests this should be done according to a calculation carried out by the installer. Why? the orginal proposal for domestic deeming relied on a calculation carried out by an impartial DEA. http://www.yougen.co.uk/blog-entry/1487/Renewable+Heat+Incentive%273A+%2727deeming%2727+explained/
    Now we have green deal, and are told that all GreenDealable measures must be installed prior to claiming RHI. This makes it even more obvious that the calculation should be done by the impartial, highly regulated, and monitored GDA.

    Fabric first, as mentioned by Kate - SWI is a green deal measure. OK, so Green Deal is a market driven scheme, and it would be wrong to prevent consumers from installing heating improvements without SWI. I do not think this should extend to the RHI, where it is perfectly reasonable to require SWI to be installed before the RHI may be claimed. This could be done within the requirement to install all Greendealable measures first.

    Posted by Linn to Mark Brinkley (aka House 2.0) at December 07, 2012