Households installing green heating systems could receive hundreds of pounds a year in government incentive payments.
The Department of Energy and Climate Change (DECC) today announced the details of its long-awaited domestic Renewable Heat Incentive (RHI) scheme, which aims to encourage the public to install environmentally friendly heating systems such as solar thermal panels, biomass boilers and heat pumps.
The department confirmed that tariff levels for air source heat pumps have been set at 7.3p/kWh, biomass boilers will earn 12.2p/kWh, ground source heat pumps will be eligible for 18.8p/kWh, and solar thermal systems will receive 19.2p/kWh.
Minister for Energy Greg Barker said in a written ministerial statement: "This marks a major milestone in achieving our renewable heat goals; it builds on the success of the Renewable Heat Premium Payment, which has seen more than £20m spent on the installation of 16,000-plus domestic renewable heat systems over the last two years."
The scheme has been up and running for the non-domestic sector since November 2011, but now homeowners, landlords and third party owners of heating systems can benefit, with anyone who has installed renewable heat technology since 15 July 2009 and who meets the scheme eligibility criteria able to join as well.
Technology covered by the RHI domestic scheme include air to water heat pumps; biomass-only boilers and biomass pellet stoves with back boilers; ground and water source heat pumps and flat plate and evacuated tube solar thermal panels.
Those interested in the scheme can get help with the upfront costs of installation through the Renewable Heat Premium Payment scheme, launched in 2011, with the government recently increasing the value of money off vouchers available for those purchasing domestic renewable heating systems.
Barker said: “Investing for the long-term in new renewable heat technologies will mean cleaner energy and cheaper bills. So this package of measures is a big step forward in our drive to get innovative renewable heating kit in our homes.
“Householders can now invest in a range of exciting heating technologies knowing how much the tariff will be for different renewable heat technologies and benefit from the clean green heat produced. We are also sending a clear signal to industry that the Coalition is 110 per cent committed to boosting and sustaining growth in this sector.”
Tariff levels have been set to compensate for the difference between the cost of installing and running renewable heat systems versus the cost of non-renewable systems over a 20-year period.
The RHI for householders will be administered by Ofgem and with more details on how to apply to be published soon.