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Last updated: 05 June 2018

The Ultimate Guide to RHI and Heat Pumps

How to Save Money with Domestic Renewable Heat Incentive Schemes

The renewable heat incentives, in the following blog referred as RHI, is a financial support program from the UK government which promotes the use of renewable energy to heat your home. That qualifies you to get paid by RHI. The long-term goal of the RHI scheme is to reduce the greenhouse emission, and, further, to take climate change seriously. Only certain types of renewable heat solutions are accepted by the RHI scheme, mainly heat pumps.

These following solutions can apply for the RHI scheme:

The basic idea of a heat pump is that a small amount of energy is used to move heat from one place to another, from cool to warm or reverse. Heat is moved and not generated, and, therefore, it is a more cost-efficient energy solution than conventional heating or cooling systems. Heat pumps can be divided into 3 types: geothermal, water source and air to air. In each system heat is collected from the ground, in front of your home, water and air are concentrated and used inside your home.   

If you are interested in finding out more about heat pumps and the installations costs, just fill in the contact form at the top of this page and we'll provide you with up to 4 quotes from our trusted suppliers. This will save you time researching and you'll be able to make a better decision for your home. Greenmatch's services are free and there are no further obligations involved.

Heat Pumps and RHI

The Difference Between Domestic and Non-Domestic RHI

We will have a deeper look into the benefits for domestic RHI which focus on for private users, whereas the non-domestic focus lies on industrial users. The domestic RHI scheme was founded on April 9th, 2014. The RHI (renewable heat incentive) was created to promote the use of renewable heating systems to those who own a private home, landlords of private buildings, landlords of social buildings and self-builders.

The RHI scheme offers the most value for non-gas-households to create the highest savings on fuel charges and also lower the carbon footprint. New build properties are excluded from the scheme, but not self-build properties. Following the tariffs, the RHI will pay per amount of heat created, for up to seven years.

RHI delivers huge incentives to investors in solar thermal renewable heat solutions and ground source heat pumps. The calculated cost of generation of renewable heat over a time span of 20 years was used as a base to calculate the tariffs. It has never been easier to save money and save energy with your heat pump since the RHI scheme was introduced from the UK government.  

The graph shows the tariffs for the different heat pump energy saving solutions for a green energy UK RHI scheme.

The Benefits Using Ground Source Heat Pumps are: 

  • Environmental friendly and effective.
  • 50% saving compared to conventional heating.
  • Reduction of carbon emission, depending on the replaced fuel.
  • No more fuel transportation.
  • Low maintenance required system.
  • £790 to £1425 savings per year.
  • 25-year usage of indoor parts
  • Ground loops have a 50-to100-year lifespan.
  • Heat is distributed equally.

How Many are Aware of the Domestic Renewable Heat Incentive?

Only 35% from the survey by Daikin UK, knew about it; 14% from those knew the term but that's all only 8% have enough information about the scheme but have not applied. Only 4 % applied.  

 

Amount of Households with RHI

Which Heat Pumps are Certified for RHI?

All Ground water heat pumps listed on the Domestic Renewable Heat Incentive Product Eligibility List are eligible for RHI. Changes regarding the heat pump eligibility were introduced by the EU directives ‘The Ecodesign of Energy-related Products Directive’ and ‘The Energy Labelling Directive.’ Important changes from the are collected here: A standard of minimum performance for heat pumps EU energy labels which provide information on the efficiency rating of the heat pump Since March 25th, 2016 all heat pumps have to meet the requirements of the directives.The Seasonal Performance Factor (SPF) applies when applying for RHI for heat pumps. The Installer Metering Questions form applies when applying for RHI for systems which require metering

Below we listed green energy solutions which are eligible for the RHI scheme  

Supported Not supported
Ground source heat pumps Air to air
Water source heat pumps Hybrid Pvt
Air source heat pumps Pellets stoves without back boilers

How to Apply for the RHI to Start Saving Money

In order to receive the benefits from the RHI scheme, you need to apply for it. Therefore, you need to live in either England, Scotland or Wales. Further, you must be the owner of a home or be an either a social or private landlord. Newly built properties are only eligible if you build it yourself. In order to apply you need to meet also these requirements: 

  • MSC installation certificate number
  • EPC Energy performance certificate number
  • GDAR Green Deal advice report number, not necessary in case of self-builders and social landlords
  • Bank details
  • Additionally, you need to have this information ready:
  1. Already received payment
  2. When you were paid
  3. How much you paid for the installation

Save Money with the RHI Scheme

RHI payments are done by Ofgem, for maximum 7 years and once a quarter. The estimated required heating usage will be estimated, payments are based on this estimation. Heat pumps - the amount of generated renewable heat from the heat pumps is based on and a combined estimation of the requirement for an energy performance certificate and the estimation of the efficiency of the heat pump. Solar panels - the amount of generated renewable heat from the solar panels is based on a combined estimation of the completed system performance which is a part of the installation of Microgeneration Certification Scheme.

To be prepared perfectly before applying for the domestic RHI Ofgem has created an application help-sheet formApplications have to be made also through the website of Ofgem. In case you cannot apply online, you have the possibility to contact the domestic RHi Applicant Support Centre of Ofgem on 0300 003 0744 from Monday to Friday from 09:00 to 17:00 or by emailing DomesticRHI@ofgem.gov.uk    

Calculate Your Savings with the RHI Scheme 

The Department of Business, Energy & Industrial Strategy UK created an online tool to calculate how much you can save with the RHI scheme. This tool is very easy and simple to use. Step-by-step you will be guided through the calculator and asked for details. The tool will then create an estimation, based on the technology you chose. In this way, you can compare different technologies. The cash amount received from the RHI scheme over seven years quarterly, depending on different factors, for example, the technology you choose, the current tariff for the chosen technology, and, maybe also, metering link to metering part of the article. There is a limit on your heat demands, exceeding this demand, the domestic RHI scheme won't apply anymore and payments will not be conducted.

Overview, maximum payout through the Renewable Heat Incentive

Product 1st Year 7 Years
Ground Source Heat Pump £ 4.026 £ 29.442
Air Source Heat Pump £ 1.357 £ 9.498
Biomass boilers £ 1.620 £ 11.3407

 

The graph shows how much the RHI incentive will pay for each technology.

Can my Heat Pump Solution Claim for RHI Support?

The rates for each solution will change annually in regards to the Retail Price Index. The RHI digression model was created to manage the available domestic RHI budget. Periodically, tariffs are changed, only for new applicants, in case the applicants exceeds a level of demand of claimed amount. There will be no digression on your tariff if you are already receiving domestic RHI. In case you received other public funds or grants from the Government such as the RHPP, Renewable Heat Premium Payment, it will take into consideration and the domestic RHI payment will be lower. Metering will be necessary in some cases to determine the heat output by the chosen technology, whereas the majority of solutions payment will be based on heat output estimation.

There is the option to choose a metering and monitoring service package to make it possible for the installer to check continuously if the system is working as expected. Occurring problems can be found and solved immediately by the installer then. A benefit of using this package: for the first 2,500 applicants in the first year of this scheme, a bonus will be paid of £200 per year for biomass systems and £230 per year for heat pump systems.

If you are interested in finding out more about heat pumps and the installations costs, just fill in the contact form at the top of this page and we'll provide you with up to 4 quotes from our trusted suppliers. This will save you time researching and you'll be able to make a better decision for your home. Greenmatch's services are free and there are no further obligations involved.

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